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Why Should Communities Benefit?

Communities across the the state have, for years, experienced the cycle of “boom and bust” associated with coal mining. Expecting the “boom” to last, the economies of these small towns have had little diversification. When companies pull out, or changes in production cause substantial job loss, communities experience spikes in unemployment, and loss of business and trade. The most recent example of this “bust” economy in downstate Illinois comes with the scheduled 2016 closing of the New Era Mine in Galatia, a town of 933 people.  Originally a tobacco-farming hub, Galatia’s economy has ebbed and flowed with the “boom and bust” cycles of coal mining for over a century.

These same communities also are left with legacy costs after coal companies leave, such as: abandoned mined lands; leaking coal slurry; damaged roads and farmland; and depopulated communities as quality of life in rural areas is impacted from blasting associated with strip mines; light pollution from 24-7 operations; increased truck traffic on roads not intended to carry such heavy loads; fugitive dust from mining; and more.

Frank's Mine

Strip mine in Saline County, Illinois. Photo by Pam Richart, Eco-Justice Collaborative

Corporations Should Pay Their Fair Share

Illinois is just one of three of 25 coal-producing states in the country that does not collect a severance tax.  Studies show that a small excise fee placed on the value or amount of coal extracted does not cost jobs, but does bring substantial revenues bak to state and local governments.

An October 23, 2015 study by the Center for Tax and Budget Accountability and Downstream Strategies estimates that a coal severance tax could generate new revenue for Illinois communities, potentially generating $141.5 million in annual revenue in 2015 for state and local governments – and as much as $258 million each year by 2040.  Bringing the majority of those funds back to active coal-producing communities could help them begin to diversify their economies now impacted by the “boom and bust” cycle of coal. 

What Will Illinois Consumers Pay?

Illinois exports nearly 80% of the coal mined to other states and markets overseas.  Therefore, the impact on Illinois consumers would be minimal. In fact, residents already are paying severance taxes on coal imported from Wyoming, who supplies most of our coal.

Illinois coal is exported

A coal barge is ready for Mississippi transport to markets. Photo courtesy of the Illinois Department of Commerce and Economic Opportunity