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Kentucky, Coal Company Settle Water Pollution Violations Case

Years of litigation against an Eastern Kentucky coal company for thousands of Clean Water Act violations were resolved late Monday. Environmental groups hailed the $6 million settlement agreement with Frasure Creek Mining and the Kentucky Energy and Environment Cabinet as “historic.”

The Frasure Creek story is a long and complicated one. In 2010, environmental groups found inconsistencies in the water quality reports the company is required to submit to the state. They found missing reports and identical water quality measurements reported from one quarter to another, even though it’s virtually impossible for the numbers to remain the same.

The groups, including Kentuckians for the Commonwealth, Appalachian Voices, the Waterkeeper Alliance and others, announced their intention to sue the company for the violations. But before they could, the state cabinet stepped in and initiated a lawsuit. In total, there were four lawsuits filed against Frasure Creek over the past five years for similar violations.

An attempt to reach a settlement in one of the cases last year was rejected by Franklin County Circuit Judge Phillip Shepherd. In his order, Shepherd said the proposed penalty of $310,000 was insufficient.

Now, under the terms of the Agreed Order, Frasure Creek admits liability for the thousands of pollution violations.

The agreement includes a $6 million fine, which according to environmental groups is the highest ever entered by Kentucky against a coal company for environmental violations. But Frasure Creek will only have to pay $500,000 of that fine immediately. If the company defaults on that initial amount, the state can demand the entire $6 million penalty.

The agreement also bans Frasure Creek and parent company Trinity Coal from getting any new coal mining permits in Kentucky unless they pay $2.75 million. Neither company currently mines coal in Kentucky, and Trinity Coal is undergoing bankruptcy proceedings.

The settlement was agreed to in the final hours of Gov. Steve Beshear’s administration, and is legally binding.

State offices were closed Tuesday for Gov. Matt Bevin’s inauguration, and a spokesman for the Energy and Environment Cabinet couldn’t be reached for comment. Calls to the lawyers representing Frasure Creek were not returned Tuesday morning.

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