Rule2026-10722
Montana Regulatory Program
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
May 29, 2026
Effective
June 29, 2026
Issuing agencies
Interior DepartmentSurface Mining Reclamation and Enforcement Office
Abstract
The Office of Surface Mining Reclamation and Enforcement (OSM) is APPROVING an amendment to the Montana regulatory program under the Surface Mining Control and Reclamation Act of 1977 (SMCRA). Montana submitted this proposed amendment to OSM on its own initiative in response to a State law passed by the Montana Legislature House Bill 587 (HB 587). The proposed amendment provides a new definition of "Material damage" with respect to the hydrologic balance, alluvial valley floors, and subsidence. It also creates an option for a permit applicant to provide self-collected information related to its determination of probable hydrologic consequences, if an appropriate Federal or State agency cannot provide such information. Finally, HB 587 includes contingencies that apply to the proposed amendment but are not codified into the Montana Code Annotated (MCA): a severability clause, a contingent voidness clause, an effective date clause, and a retroactive applicability clause.
Full Text
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<title>Federal Register, Volume 91 Issue 103 (Friday, May 29, 2026)</title>
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[Federal Register Volume 91, Number 103 (Friday, May 29, 2026)]
[Rules and Regulations]
[Pages 31898-31909]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-10722]
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DEPARTMENT OF THE INTERIOR
Office of Surface Mining Reclamation and Enforcement
30 CFR Part 926
[SATS No. MT-048-FOR; Docket No. OSM-2025-0008; S1D1S SS08011000
SX064A000 266S180110; S2D2S SS08011000 SX064A000 26XS501520]
Montana Regulatory Program
AGENCY: Office of Surface Mining Reclamation and Enforcement, Interior.
ACTION: Final rule; approval of amendment.
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SUMMARY: The Office of Surface Mining Reclamation and Enforcement (OSM)
is APPROVING an amendment to the Montana regulatory program under the
Surface Mining Control and Reclamation Act of 1977 (SMCRA). Montana
submitted this proposed amendment to OSM on its own initiative in
response to a State law passed by the Montana Legislature House Bill
587 (HB 587). The proposed amendment provides a new definition of
``Material damage'' with respect to the hydrologic balance, alluvial
valley floors, and subsidence. It also creates an option for a permit
applicant to provide self-collected information related to its
determination of probable hydrologic consequences, if an appropriate
Federal or State agency cannot provide such information. Finally, HB
587 includes contingencies that apply to the proposed amendment but are
not codified into the Montana Code Annotated (MCA): a severability
clause, a contingent voidness clause, an effective date clause, and a
retroactive applicability clause.
DATES: The effective date is June 29, 2026.
FOR FURTHER INFORMATION CONTACT:
Attn: Jeffrey Fleischman, Field Office Director, Office of Surface
Mining Reclamation and Enforcement, 100 East B Street, Casper, Wyoming
82602, Telephone: (307) 261-6550, Email: <a href="/cdn-cgi/l/email-protection#ddb7bbb1b8b4aebeb5b0bcb39db2aeb0afb8f3bab2ab"><span class="__cf_email__" data-cfemail="e9838f858c809a8a81848887a9869a849b8cc78e869f">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background on the Montana Program
II. Submission of the Amendment
III. OSM's Findings
A. Montana Code Annotated (MCA) 82-4-203(35)(a)
B. MCA 82-4-203(35)(b)
C. MCA 82-4-203(35)(c)
D. MCA 82-4-222(1)(m)
E. Sections 3, 4, 5, and 6 of HB 587
IV. Summary and Disposition of Comments
V. OSM's Decision
VI. Procedural Determinations
I. Background on the Montana Program
Section 503(a) of SMCRA permits a State to assume primacy for the
regulation of surface coal mining and reclamation operations on non-
Federal and non-Indian lands within its borders by demonstrating that
its program includes, among other things, State laws and regulations
that govern surface coal mining and reclamation operations in
accordance with SMCRA and consistent with the Federal implementing
regulations. See 30 U.S.C. 1253(a)(1) and (7); 30 CFR 730.5 and
732.15(a). On the basis of these criteria, the Secretary of the
Interior conditionally approved the Montana program on April 1, 1980.
You can find background information on the Montana program, including
the Secretary's findings, the disposition of comments, and conditions
of approval of the Montana program in the April 1, 1980, Federal
Register (45 FR 21560). You can also find later actions concerning the
Montana program and program amendments at 30 CFR 926.15.
II. Submission of the Amendment
By letter dated May 15, 2025 (Administrative Record No. MT-048-01),
Montana sent us an amendment to its program under SMCRA (30 U.S.C. 1201
et seq.). We found Montana's proposed amendment to be administratively
complete on May 15, 2025. Montana submitted the proposed amendment to
us, on its own volition, after the Montana legislature passed HB 587
during the 2025 legislative session. HB 587 amends the Montana Strip
and Underground Mine Reclamation Act (MSUMRA) as well as sections 82-4-
203 and 222 of the MCA.
Specifically, Montana proposes changes to its definition of
``Material damage,'' at 82-4-203(35) of the MCA. Montana proposes to
remove the previous definition and create three sub-definitions. The
first, paragraph (a), defines ``Material damage . . . with respect to
the hydrologic balance outside the permit area,'' as a quantifiable
adverse impact from coal mining and reclamation operations on the
quality and quantity of surface or groundwater. The adverse impact must
preclude any existing or reasonably foreseeable use of water outside
the permit area. It further defines a ``quantifiable adverse impact''
as an effect that can be quantified and measured to a significant
degree of confidence. Last, it states that ``existing or reasonably
foreseeable uses of water'' are those beneficial uses recognized in
title 75, chapter 5, part 3 of the MCA.
Next, in paragraph (b), Montana defines ``Material damage . . .
with
[[Page 31899]]
respect to an alluvial valley floor'' as degradation or reduction by
coal mining and reclamation operations to water quality or quantity
supplied to the alluvial valley floor that significantly decreases its
ability to support agricultural activities.
And in paragraph (c), Montana defines ``Material damage . . . with
respect to subsidence caused by underground mining'' as a functional
impairment to surface lands, features, structures, or facilities; a
physical change that has significant adverse impact on an affected
land's ability to support any current or reasonably foreseeable uses or
causes significant loss to production or income; or a significant
change in the condition, appearance, or utility of a structure or
facility.
In addition to the changes to ``Material damage,'' Montana proposes
changes to its permit application requirements in 82-4-222(1)(m) of the
MCA. Currently, an operator can receive necessary hydrologic and
geologic information from an appropriate Federal or State agency to
determine probable hydrologic consequences. Under Montana's proposal,
an operator may use information collected on their own when the
necessary information is not available from a Federal or State agency.
Last, HB 587 adds four contingencies to the proposed changes of
Sec. Sec. 82-4-203 and 222 that are not codified into the MCA but
apply to the sections amended by the legislation. These provisions
cover severability, contingent voidness, effective date, and
retroactive applicability.
We announced receipt of the proposed amendment in the August 4,
2025, Federal Register (90 FR 36407). We received 373 written comments
on the proposed rule.
III. OSM's Findings
OSM reviewed Montana's submittal according to the requirements of
SMCRA and the Federal regulations at 30 CFR 730.5, 732.15, and 732.17.
As described below, we are approving Montana's submittal.
A. Montana Code Annotated (MCA) 82-4-203(35)(a)
For section 82-4-203(35)(a), Montana proposes to replace its
definition of ``Material damage'' as it relates to impacts to the
hydrologic balance from surface and underground coal mining operations.
Current section 82-4-203(35) of the MCA defines ``material damage''
with respect to protection of the hydrologic balance as the
``degradation or reduction by coal mining and reclamation operations of
the quality or quantity of water outside of the permit area in a manner
or to an extent that land uses or beneficial uses of water are
adversely affected, water quality standards are violated, or water
rights are impacted. Violation of a water quality standard, whether or
not an existing water use is affected, is material damage.'' This
definition was previously determined by OSM to be in accordance with
SMCRA and consistent with the Federal implementing regulations when OSM
conditionally approved Montana's Permanent coal program. 45 FR 21560
(Apr. 1, 1980).
Montana's proposed revision would define ``Material damage . . .
with respect to the hydrologic balance outside the permit area'' as:
``a quantifiable adverse impact from surface coal mining and
reclamation operations on the quality or quantity of surface water or
ground water that precludes an existing or reasonably foreseeable use
of surface water or ground water outside the permit area. A
quantifiable adverse impact is an effect that can be quantified and
measured to a significant degree of confidence. Existing or reasonably
foreseeable uses of surface water or ground water are those beneficial
uses recognized in the classification of State waters pursuant to Title
75, chapter 5, part 3.''
The phrase ``material damage to the hydrologic balance outside the
permit area'' appears in SMCRA and within the Federal regulations (30
CFR 816.41), and these references, and other elements of SMCRA and the
Federal regulations, provide parameters for interpreting this phase. As
a threshold matter, SMCRA's performance standards require that all
surface coal mining and reclamation operations ``minimize the
disturbances to the prevailing hydrologic balance at the mine-site and
in associated offsite areas and to the quality and quantity of water in
surface and ground water systems both during and after surface coal
mining operations and during reclamation.'' 30 U.S.C. 1265(b)(10). This
standard is accomplished by avoiding acid forming materials, preventing
``to the extent possible using the best technology currently
available'' contributions of material to streams but under no
circumstances allowing violations of any State or Federal water quality
laws, and other practices designed to protect the existing hydrologic
systems. Id. Similarly, SMCRA requires that underground coal mining
operations ``minimize the disturbances to the prevailing hydrologic
balance at the mine site and in associated offsite areas and to the
quantity of water in surface ground water systems both during and after
surface coal mining operations and during reclamation.'' 30 U.S.C.
1266(b)(9).
Section 510(b)(3) of SMCRA also states that no application for
surface coal mining operations can be approved unless the application
affirmatively demonstrates, and the regulatory authority finds in
writing based on the application and available information, that ``the
assessment of the probable cumulative impact of all anticipated mining
in the area on the hydrologic balance specified in Section 507(b) has
been made by the regulatory authority and the proposed operation
thereof has been designed to prevent material damage to the hydrologic
balance outside the permit area.'' 30 U.S.C. 1260(b)(3). Section
507(b)(11) requires that an applicant submit ``a determination of the
probable hydrologic consequences of the mining and reclamation
operations, both on and off the mine site, with respect to the
hydrologic regime, quantity and quality of water in surface and ground
water systems including the dissolved and suspended solids under
seasonal flow conditions and the collection of sufficient data for the
mine site and surrounding areas so that an assessment can be made by
the regulatory authority of the probable cumulative impacts of all
anticipated mining in the area upon the hydrology of the area and
particularly upon water availability.'' 30 U.S.C. 1257(b)(11).
In addition to the statutory standards, the Federal regulations add
additional contours to the meaning of ``material damage to the
hydrologic balance outside the permit area.'' First, the regulations at
30 CFR 773.15(e) require the regulatory authority to perform an
assessment to determine if ``the proposed operation has been designed
to prevent material damage to the hydrologic balance outside the permit
area.'' Second, the regulations at 30 CFR 780.21(g) and 784.14(f)
require a finding that the Cumulative Hydrologic Impact Assessment
(CHIA) is ``sufficient to determine, for the purposes of permit
approval, whether the proposed operation has been designed to prevent
material damage to the hydrologic balance outside the permit area.''
Third, the regulations at 30 CFR 780.21(h) and 784.14(g) require a
permit applicant to provide a Hydrologic Reclamation Plan. These
sections state, in relevant part, that the plan must ``contain the
steps to be taken during mining and reclamation through bond release to
minimize disturbance to the hydrologic balance within the permit and
adjacent areas; to prevent material damage outside the permit area;
[and] to meet applicable
[[Page 31900]]
Federal and State water quality laws and regulations.'' Id. The fact
that the Hydrologic Reclamation Plan must outline how an operation will
(1) minimize disturbance to the hydrologic balance within the permit
area and the adjacent areas, (2) prevent material damage outside the
permit area, and (3) meet all applicable Federal and State water
quality laws indicates that each element provides a distinct protective
benefit and that merely satisfying one element is not sufficient.
Fourth, the regulations at 30 CFR 816.41(a) and 817.41(a) require that
all surface and underground mining and reclamation activities must be
conducted ``to minimize disturbance to the hydrologic balance within
the permit and adjacent areas [and] . . . prevent material damage to
the hydrologic balance outside the permit area,'' and that the
``regulatory authority may require additional preventative, remedial or
monitoring measures to assure that material damage to the hydrologic
balance outside the permit area is prevented.'' Last, the regulations
at 30 CFR 816.41(c) and (e), as well as section 817.41(c) and (e),
authorize the regulatory authority to modify the monitoring
requirements, including parameters and frequency, if the monitoring
data demonstrate that the operation has ``minimized disturbance to the
hydrologic balance in the permit and adjacent area and prevented
material damage to the hydrologic balance outside the permit area.''
While neither SMCRA nor the current Federal regulations define
``material damage to the hydrologic balance outside a permit area,''
for the Federal and Indian lands programs, OSM has defined the phrase,
as recently as 2024 in various CHIAs as meaning ``any quantifiable
adverse impact from surface coal mining and reclamation operations on
the quality or quantity of surface water or groundwater that would
preclude any existing or reasonably foreseeable use of surface water or
groundwater outside the permit area.'' See Cumulative Hydrologic Impact
Assessment for the Pacific Coast Coal Company John Henry No. 1 Mine, p.
2 (Jan. 2014); Cumulative Hydrologic Impact Assessment of the Navajo
Mine and Pinabete Permit Areas, p. 14 (Mar. 2015); Cumulative
Hydrologic Impact Assessment of the Peabody Western Coal Company
Kayenta Mine Complex, App. A (Sept. 2016); Review and Analysis of
Navajo Aquifer Material Damage Criteria for Peabody Western Coal
Company's Kayenta Mine Complex, p. 14 (Aug. 2024). These documents
recognize that surface coal mining operations will cause hydrologic
impacts but indicate OSM's interpretation that disturbances to the
hydrologic balance within the permit area should be minimized and
material damage outside the permit area should be prevented. Id. The
CHIAs also direct that material damage criteria for both groundwater
and surface water quality should be related to existing standards that
generally are based on the maintenance and protection of specified
water uses such as public and domestic water supply, agriculture,
industry, aquatic life, recreation, and other parameters of local
significance to water use. OSM also provided a definition of material
damage to the hydrologic balance in a 2016 rule (81 FR 93066); however,
that rule was disapproved under the Congressional Review Act in 2017
and is no longer in effect.
Taken all together, SMCRA and the Federal program, thus, require
that: (1) the regulatory authority must make a written finding that the
operation is designed to prevent material damage to the hydrologic
balance outside the permit area before the permit can be issued; (2) a
permit application must include a plan that shows the operation has
been designed to prevent such damage; (3) the operation must be
conducted in a manner to prevent such damage; (4) the water monitoring
requirements can be modified if warranted to determine whether or not
such damage is occurring; and (5) applicable Federal and State water
quality laws and regulations must be followed.
With this background in mind, we have evaluated the proposed
amendment to the Montana program in relation to Federal statutory and
regulatory requirements for preventing ``material damage to the
hydrologic balance outside the permit area'' and determined that
Montana's proposed changes to section 82-4-203(35)(a) are in accordance
with SMCRA and consistent with the Federal regulations.
First, Montana's adoption of OSM's Federal and Indian Lands program
definition in its proposed definition of ``Material damage . . . with
respect to the hydrologic balance outside the permit area,'' is in
accordance with SMCRA and consistent with the Federal regulations.
Montana proposes to define Material damage as ``any quantifiable
adverse impact from surface coal mining and reclamation operations on
the quality or quantity of surface water or groundwater that would
preclude any existing or reasonably foreseeable use of surface water or
groundwater outside the permit area.'' This is the exact definition
that OSM uses for its Federal and Indian lands programs in Cumulative
Hydrologic Impact Assessments (CHIAs). While this is not a definition a
State must adopt, as it only applies within the Federal and Indian Land
Programs, it is a definition that matches SMCRA and Federal regulations
guidelines for ``material damage to the hydrologic balance outside the
permit area.'' Thus, Montana's proposed adoption of OSM's Federal and
Indian Lands program definition of material damage with respect to the
hydrologic balance outside the permit area is in accordance with SMCRA
and consistent with the Federal regulations.
Second, Montana's proposed definition of ``quantifiable adverse
impact'' is in accordance with SMCRA and consistent with the Federal
regulations. Montana defines ``quantifiable adverse impact'' as ``an
effect that can be quantified and measured to a significant degree of
confidence.'' OSM's Federal and Indian Lands program does not further
define ``quantifiable adverse impact,'' but we can assess from the
plain text of the definition that a relevant party must prove with
scientific data, as opposed to anecdotal evidence, that adverse impact
has or has not occurred
As discussed above, Montana's definition of ``Material damage''
must be in accordance with State and Federal water quality standards
(WQS) including those set by the EPA under the Clean Water Act, and
Montana has created a WQS program that is in accordance with and
approved by the EPA. Under this program amendment, any effect that can
be quantified and measured to a significant degree of confidence would
be material damage to the hydrologic balance outside the permit area.
How MDEQ chooses to interpret how the effect is ``measured to a
significant degree of confidence'' is up to that agency. Simply
defining ``quantifiable adverse impact'' as ``an effect that can be
quantified and measured to a significant degree of confidence,'' is in
accordance with SMCRA and consistent with the Federal regulations.
Third, Montana's proposed definition of ``existing and reasonably
foreseeable uses'' is in accordance with SMCRA and consistent with the
Federal regulations. Montana defines ``existing and reasonably
foreseeable uses'' as ``those beneficial uses recognized in the
classification of state waters pursuant to Title 75, chapter 5, part
3'' of the MCA. The definition used by OSM's Federal and Indian Lands
program does not further define ``existing and reasonably foreseeable
uses,'' but State
[[Page 31901]]
Representative Parry explained in his September 3, 2025 letter that the
proposed definition of ``existing or reasonably foreseeable uses''
within the definition of ``Material damage to the hydrologic balance''
was derived from a Montana regulation, 75-5-301(1) MCA, which states:
``Consistent with the provisions of 80-15-201 and this chapter, the
department shall: (1) establish the classification of all state waters
in accordance with their present and future most beneficial uses.'' He
continued and stated that the Montana Department of Environmental
Quality (MDEQ) had already established these classifications in its
Administrative Rules: ARM 17.30.607 and 17.30.616. State Representative
Parry noted that designating the uses of waters is wholly within MDEQ's
authority pursuant to the Federal Clean Water Act, as MDEQ is
responsible for reviewing, establishing, and revising water quality
standards under 40 CFR 131.4(a), and these standards, including uses,
are reviewed and approved by the EPA. Through this definition of
``existing or reasonably foreseeable uses,'' Montana is integrating its
coal program, approved by OSM, with its Clean Water Act program,
approved by the EPA. And as established by OSM in the September 26,
1983 preamble promulgating hydrologic balance rules, OSM intentionally
established basic permitting and performance standards so that State
and Tribal programs have the opportunity to customize their rules to
their particular mining situations. 48 FR 43956 (Sept. 26, 1983).
Montana has met the basic Federal standards, and incorporating its
state water rules into its definition of ``material damage to the
hydrologic balance'' is well within the State's powers as they do not
conflict with the Federal regulations. Thus, Montana's proposed
definition of ``existing and reasonably foreseeable uses'' is in
accordance with SMCRA and consistent with the Federal regulations.
B. MCA 82-4-203(35)(b)
Montana's proposed changes to section 82-4-203(32)(b) of the MCA
are in accordance with SMCRA and consistent with the Federal
regulations. Section 82-4-203(32)(b) proposed to define ``material
damage'' with respect to alluvial valley floors as ``degradation or
reduction by coal mining and reclamation operations of the water
quality or quantity supplied to the alluvial valley floor that
significantly decreases the capability of the alluvial valley floor to
support agricultural activities[.]'' Montana previously proposed these
exact changes in its June 1, 2023, amendment submission. OSM approved
Montana's changes to this section but denied other areas of the
proposed amendment. See 90 FR 3673, 3687 (January 15, 2025). Because
Montana is proposing the same changes that were previously approved
January 15, 2025, we find the changes are in accordance with SMCRA and
consistent with the Federal regulations, and we are approving the
changes again, with the same reasoning as is detailed at 90 FR 3673,
3677 (Jan. 15, 2025).
C. MCA 82-4-203(35)(c)
Montana's proposed changes to section 82-4-203(33)(c) of the MCA
are in accordance with SMCRA and consistent with the Federal
regulations. Montana proposes a definition for what would be considered
material damage with respect to subsidence. This includes ``(i) a
functional impairment of surface lands, features, structures, or
facilities; (ii) a physical change that has a significant adverse
impact on the affected land's capability to support any current or
reasonably foreseeable uses or causes significant loss in production or
income; or (iii) a significant change in the condition, appearance, or
utility of a structure or facility from its presubsidence condition.''
This is nearly identical to the Federal definition of ``material
damage'' for subsidence at 30 CFR 701.5, and it has no substantive
differences from the Federal definitions. Thus, Montana's proposed
changes to MCA section 82-4-203(33)(c) are in accordance with SMCRA and
consistent with the Federal regulations.
D. MCA 82-4-222(1)(m)
Montana's proposed changes to MCA section 82-4-222(1)(m) are in
accordance with SMCRA and consistent with the Federal regulations.
Montana proposes that for hydrologic information needed to determine an
applicant's Probable Hydrologic Consequences (PHC), Montana may use
data collected by the operator to make the PHC determination in the
event the appropriate Federal or State agency does not have that
information available. In its current form, Montana may only use
hydrologic information from an appropriate Federal or State agency to
make its PHC determination for an applicant; there are no exceptions.
By comparison, the Federal regulations at 30 CFR 780.21(c)(2) allows
the regulatory authority to use information submitted by the applicant
in its PHC determination, if that information is not available from an
appropriate State or Federal agency. Because the proposed Montana
regulation is nearly identical with and has no substantive differences
to the Federal regulations at 30 CFR 780.21(c)(2), we find that
proposed changes to section 82-4-222(1)(m) are consistent with SMCRA
and the Federal regulations.
E. Sections 3, 4, 5, and 6 of HB 587
HB 587 also added contingencies that are not codified into the MCA
but that affect the amended parts of the MCA.
1. Section 3. Severability
Section 3 of HB 587 states that if any part of HB 587 is found
invalid, the remainder of the bill that is found valid will be
severable from the invalid part and remain in effect. While this is
legislative language and not part of Montana's surface mining program,
we note that the Federal regulation at 30 CFR 732.17(h)(7) requires the
Director to consider all relevant information, using the criteria set
forth in 30 CFR 732.15, to approve or disapprove the amendment. The
Director may approve all or parts of an amendment that are in
accordance with SMCRA and consistent with the Federal regulations.
2. Section 4. Contingent Voidness
Section 4 of HB 587 states that if the Secretary of the Interior
disapproves of any provision of HB 587 under 30 CFR part 732, then that
portion of the bill is void. Furthermore, MDEQ is required to notify
the code commissioner of a disapproval within 15 days of the effective
date of disapproval. Notwithstanding HB 587, the Federal regulation
gives the Director the authority to approve or disapprove all or part
of a proposed amendment to a State program. 30 CFR 732.17(h)(7). Any
program amendment or part of a program amendment disapproved by the
Director would be void and would not become part of Montana's approved
program.
3. Section 5: Effective Date
Section 5 of HB 587 states that its provisions are ``effective on
passage and approval.'' Section 5 of HB 587 does not specify who is
providing the ``approval'' that triggers the effective date. SMCRA and
the Federal regulations state that no change to law or programs can
take effect for purposes of a State program until the amendment is
approved by the Director. 30 CFR 732.17(g). The Federal regulations
further specify that all decisions approving or not approving a State
program amendment must be published in the Federal Register and will be
effective upon publication unless the notice specifies otherwise. 30
CFR 732.17(h)(12).
By looking at the text of HB 587 preceding Section 5, OSM
interprets the term ``approval'' to mean approval by
[[Page 31902]]
the OSM Director. Section 3 speaks to the need for Secretarial approval
but provides that if a provision is disapproved, that portion of the HB
587 is severed from the approved portions of the bill. In Section 4, HB
587 states that any provision of HB 587 that the Secretary of the
Interior ``disapprov[es]'' shall be void. Taken together, it is
appropriate to read ``approval'' as used in Section 5 of HB 587 as
referring to action taken consistent with the regulatory review and
approval process by the Secretary of the Interior, as delegated to the
OSM Director. This interpretation is also consistent with 30 CFR
732.17(g), which refers to approval by the Director of OSM and states
that ``[n]o such change to [State] laws or regulations shall take
effect for purposes of a State program until approved as an
amendment.'' Thus, OSM interprets Section 5 in a way that is both
supported by the surrounding statutory text of HB 587, and leads to
consistency with SMCRA.
Notwithstanding OSM's interpretation, should the drafters or
implementers of HB 587 interpret Section 5 as becoming effective upon
approval by an entity other than the OSM Director, that interpretation
would conflict with SMCRA and the Federal regulations. No change to
State programs can be implemented or become effective prior to approval
by the Director. 30 CFR 732.17(g). Thus, the effective date of HB 587
is June 29, 2026.
4. Section 6: Retroactive Applicability
Section 6 of HB 587 states that amendments to the MCA apply
retroactively to actions for judicial review, amendment, license,
arbitration, action, certificate, or inspection that are pending but
not yet decided on or after the effective date of HB 587. Section 6 of
HB 587 attempts to make the proposed changes to sections 82-4-203(35)
and 82-4-222(1)(m) apply retroactively to pending issues that have not
been decided on or after the effective date of HB 587. As with the
attempt to make changes to HB 587 effective immediately, this section
is contrary to SMCRA and the Federal regulations. Specifically, the
Federal regulations at 30 CFR 732.17(g), which mandate that no changes
to laws will take effect until OSM approves the amendment, and section
723.17(i)(12), which states that all decisions of the Secretary to
approve or disapprove program amendments must be published in the
Federal Register. The Administrative Procedure Act (APA) generally
requires a 30-day delay before a rule becomes effective. 5 U.S.C.
553(d).
Furthermore, under section 405(a) of SMCRA, ``[n]o State law or
regulation in effect on the date of the enactment of [SMCRA], or which
may become effective thereafter, shall be superseded by any provision
of [SMCRA] or any regulation pursuant thereto, except insofar as such
State law or regulation is inconsistent with the provisions of
[SMCRA].'' 30 U.S.C. 1255(a) (emphasis added). Montana declares that HB
587 applies retroactively within the meaning of 1-2-109 of the MCA,
which states ``[n]o law contained in any of the statutes of Montana is
retroactive unless expressly so declared.'' Despite Montana declaring
that the amendments to 82-4-203(35) and 82-4-222(m)(1) apply
retroactively to select proceedings, as discussed above, retroactive
application is contrary to SMCRA and the Federal regulations. Thus,
SMCRA and the Federal regulation supersede 1-2-109 of the MCA in this
instance, and the amendments to 82-4-203(35) and 83-4-222(m)(1) cannot
be applied retroactively.
IV. Summary and Disposition of Comments
OSM asked for initial public comments on the amendment during a
public comment period that ended on September 3, 2025. OSM received 373
written comments during the comment period. (Administrative Record No.
MT-048-08 through MT-048-20).
Due to the large number of comments, substantially similar comments
and points have been consolidated to avoid redundancy. Comments
expressing generalized support for or opposition to the proposed
amendment, generalized concerns about environmental impacts from mining
operations, concerns about the mining industry, fossil fuel use, and a
transition to renewable energy, general statements about the Montana
Constitution, general statements about OSM's previous denial of HB 576
and prior legislative efforts, general statements about the public's
opposition to HB 587, and other non-responsive comments are beyond the
scope of this amendment and no response is necessary. To view comments
in full, visit <a href="https://www.regulations.gov/">https://www.regulations.gov/</a>.
A. 82-4-203(35)(a) Material Damage to the Hydrologic Balance
1. General Comments on the Definition of ``Material Damage to the
Hydrologic Balance''
Comment: A large group of 300+ commenters opined that the proposed
definition of ``Material damage to the hydrologic balance'' undermines
SMCRA at 30 U.S.C. 1202(b) and its goal to ensure mining, agriculture,
and landowners can coexist, as it would give mining companies more
leeway to damage the hydrologic balance for neighboring property
owners, which would strip property right protections from those
landowners.
OSM Response: OSM disagrees with the commenters; Montana's proposed
definition for ``Material damage to the hydrologic balance'' is in
accordance with SMCRA and consistent with the Federal regulations. 30
U.S.C. 1202(b) states that part of SMCRA's purpose is to ``assure that
the rights of surface landowners and other persons with a legal
interest in the land or appurtenances thereto are fully protected from
such operations[.]'' Montana is required to prevent ``Material damage .
. . with respect to the hydrologic balance outside the permit area.''
The proposed definition recognizes the beneficial water uses of
neighboring water users, including surface landowners and other persons
with a legal interest, and would find material damage if those uses
were precluded by pollution caused by coal mine operations. Please see
our full discussion on this topic in section III(A).
Comment: Multiple commenters stated that Montana's proposed removal
of language that recognizes exceedances of water quality standards as
``Material damage to the hydrologic balance'' violates SMCRA and is
less protective than the Federal regulations. The commenter points to
SMCRA at 30 U.S.C. 1265(b)(10)(B)(i), which prohibits mine drainage in
excess of requirements set by applicable State or Federal law, as well
as OSM's statement in our January 15, 2025, denial of a prior Montana
amendment where OSM states ``[a] violation of a State or Federal WQS as
a result of a surface coal mining and reclamation operation is not
allowed under SMCRA and would constitute material damage to the
hydrologic balance. . . .'' And also ``Because a violation of a WQS is
an established criterion for determining if ``Material damage . . .
with respect to the hydrologic balance outside the permit area'' has
occurred, any regulation proposed by Montana must be in accordance with
and consistent with this Federal standard.'' 90 FR 3673, 3676 (Jan. 15,
2025).
OSM Response: OSM disagrees with the commenters that Montana's
proposed definition removes the requirement that an exceedance of a WQS
be considered ``Material damage
[[Page 31903]]
. . . with respect to the hydrologic balance outside the permit area.''
Under Montana's proposed definition, material damage will be found
where there is a quantifiable adverse impact that precludes an existing
or reasonably foreseeable water use. Montana further defines an
``[e]xisting or reasonably foreseeable uses'' of water as ``those
beneficial uses recognized in the classification of state waters
pursuant to Title 75, chapter 5, part 3 [of the MCA].'' As discussed
further in section III(A), Title 75, Chapter 5 of the MCA contains the
Montana Water Quality Act, and Montana's classification of State waters
in Title 75, chapter 5, part 3 includes WQS that are set in line with
this EPA approved program. If a WQS is exceeded under these rules, a
beneficial use would no longer be available, an existing or reasonably
foreseeable use of State waters would be precluded, and ``Material
damage to the hydrologic damage'' would occur. Thus, Montana's proposed
definition of ``Material damage . . . with respect to the hydrologic
balance outside the permit area'' recognizes that an exceedance of a
WQS is Material damage.
Comment: A commenter stated that the proposed definition of
``Material damage . . . with respect to the hydrologic balance outside
the permit area'' is contrary to SMCRA because it omits any protection
of water rights. They specified that 30 U.S.C. 1258(a)(13)(B) requires
an assessment of water rights in the permitting process, and Montana's
proposed removal of water rights from its definition removes any means
for regulators to ensure protection of water rights at the permitting
stage.
OSM Response: OSM disagrees with the commenter that the proposed
definition's lack of reference to water rights makes the Montana
program inconsistent with SMCRA and the Federal regulations. While
Montana is removing the term ``water rights'' in this definition,
another area of the Montana program fulfills SMCRA's requirement to
consider ``water rights.'' 30 U.S.C. 1258(a)(13)(B) requires that each
reclamation plan submitted as part of a permit application must include
a detailed description of measures to be taken to ``assure the rights
of present users to such water.'' Montana's counterpart regulations for
protecting the ``rights of present user to such water'' are contained
within section 82-4-222 of the MCA. Section 82-4-222(1)(m) of the MCA
requires an applicant to conduct a determination of the PHC that
considers the impact the operation will have on beneficial uses of
water in and adjacent to the permit area, and section 82-4-222(1)(n)
requires an applicant to plan for monitoring groundwater and surface
water for protection of the hydrologic balance. While Montana does not
use the term ``water rights'' in its regulations, ``beneficial uses of
water'' is a reference to water rights. At section 85-2-102(5)(a),
Montana defines ``Beneficials use'' as ``a use of water for the benefit
of the appropriator, other persons, or the public, including but not
limited to agricultural, stock water, domestic, fish and wildlife,
industrial, irrigation, mining, municipal power, and recreational
uses.'' (Emphasis added). At section 85-2-102(2), ``Appropriation
right'' is defined as ``[having] the same meaning as 'water right . . .
.' '' Montana requiring an applicant to plan for an operation's effects
on ``beneficial uses'' is requiring an applicant to consider the
beneficial uses of any potentially affected water rights holder, which
is equivalent to the SMCRA requirement that an applicant consider water
rights. Thus, Montana removing reference to ``water rights'' from its
definition of ``Material damage . . . with respect to the hydrologic
balance outside the permit area'' is in accordance with SMCRA and
consistent with the Federal regulations.
Comment: A couple of commenters stated that the proposed definition
of ``Material damage . . . with respect to the hydrologic balance
outside the permit area'' is in accordance with SMCRA and its allowance
to ``develop a definition based on regional environmental and
regulatory conditions'' (quoting OSM, Cumulative Hydrologic Impact
Assessment of the Pacific Coast Coal Company, John Henry No. 1 Mine, p.
2 (January 2014)). They opined that the proposed definition was created
to address the specific needs of Montana while balancing protection of
the environment and agricultural productivity with the Nation's need
for coal as an essential energy source.
OSM Response: OSM is approving the amendment and agrees with the
commenters that Montana has created a definition that is tailored to
support its local hydrologic needs. Please see OSM's full discussion of
this topic in section III(A).
Comment: A few commenters opined that Montana's definition of
``Material damage . . . with respect to the hydrologic balance outside
the permit area'' should be approved because its nearly identical to
the definition OSM has been using internally since at least 2014.
OSM Response: OSM has approved the amendment and agrees with the
commenters that Montana's proposed a definition of ``Material damage .
. . with respect to the hydrologic balance outside the permit area'' is
substantially similar to the definition used in our CHIAs for Federal
and Indian lands. While there is no codified Federal definition for
``Material damage to the hydrologic balance,'' Montana's proposed
definition is consistent with SMCRA and the Federal regulations. Please
see OSM's full discussion of this topic in section III(A).
2. ``Preclusion''
Comment: A large group of 300+ commenters opposed the requirement
that a beneficial use of water must be precluded to be considered
``Material damage . . . with respect to the hydrologic balance outside
the permit area.'' They stated that the preclusion requirement would
violate SMCRA and the Federal regulations, in particular 30 CFR 816.41.
They opined that Montana's proposed definition would be a loophole that
would allow a mining operation to contaminate water resources without
consequence so long as minimal water use remains, and one of these
commenters was concerned that because all the receiving waters for
Montana's coal mines are already listed as impaired water bodies, a
water use would not be deemed precluded until the stream can no longer
support aquatic life.
OSM Response: OSM disagrees with these commenters that Montana's
proposed definition of ``Material damage . . . with respect to the
hydrologic balance outside the permit area'' is a loophole for water
pollution so long as minimal beneficial use remains. As proposed,
Montana's definition would find material damage where an existing or
reasonably foreseeable use of water is precluded. Montana further
defines ``existing or reasonably foreseeable uses'' as those beneficial
uses recognized under Title 75, chapter 5, part 3 of the MCA. In the
Administrative Rules of Montana (ARM) at Title 17, chapter 30, sub-
chapters 6 and 10, MDEQ lists the water-use classifications and their
standards. Every body of water within Montana's jurisdiction is
assigned a classification based on the water body's characteristics.
There are 16 classifications of surface waters and 4 classifications of
groundwaters, and each classification lists the types of beneficial
uses that must be supported and the water quality standards that must
be followed. Beneficial uses like stock-watering, which would fall
under ``agriculture'' or ``drinking water for livestock and wildlife''
in the rules is
[[Page 31904]]
protected within 14 of the surface water classifications and 3 of the
groundwater classifications. It appears the commenters are concerned
that their ability to use water for stock-watering must be completely
prevented in any way to be considered precluded, but Montana's proposed
definition for ``Material damage . . . with respect to the hydrologic
balance outside the permit area'' in context with the MCA and ARM show
that the use must only be precluded within its classification. For
example, if a neighboring rancher used water for stock watering
classified under Class I groundwater, and coal mining pollution
violated water quality standards for Class I groundwater, then any of
the beneficial uses listed for a Class I groundwater would be
prevented, resulting in material damage. Thus, under Montana's proposed
definition of ``Material damage . . . with respect to the hydrologic
balance outside the permit area,'' a water use would not need to be
precluded to the point of not supporting aquatic life for material
damage to be found.
Comment: The same group of 300+ commenters stated that the
preclusion requirement would put the economic burden on taxpayers and
local governments, including farmers, ranchers, and tourism services
who are highly dependent on clean water for their livelihoods, and who
would bear the brunt of the water degradation. One of these commenters
gave the example that, for ranchers and farmers, while water polluted
by neighboring coal mine operations may still be ``beneficial'' enough
to be used to keep their cattle and crops alive, the degradation in
quality may cause health issues that will in turn impact quality and
profit margins.
OSM Response: OSM disagrees with the commenters that Montana's
proposed definition of material damage to the hydrologic balance
outside the permit area would put an economic burden on taxpayers and
local governments. The requirement for MDEQ and coal operators to
prevent ``Material damage . . . with respect to the hydrologic balance
outside the permit area'' still exists in the Montana Code, and, as
discussed above, degradation of water quality to the point of not
meeting the classification requirements, as contained in Title 17,
chapter 30, sub-chapter 6 of ARM, is considered preclusion of a
beneficial use. Stock-watering would not need to be prevented all
together to be considered preclusion of a beneficial use, which is
included in Montana's definition of material damage to the hydrologic
balance outside the permit area. Instead, in this example the
beneficial use would need only to be precluded within its
classification.
3. ``Quantifiable Adverse Impacts''
Comment: Multiple commenters who were opposed to Montana's proposed
amendment stated that the proposed changes rely on a system with
complex calculations and statistical analysis that would make coal
operators and State regulators less accountable and less transparent.
One of these commenters stated that because Montana's proposed use of a
``quantifiable adverse impacts'' standard does not specify the degree
of confidence needed, it could require the public to demonstrate a
preponderance of evidence standard (50.1%) or it could require a
virtual certainty standard (99%) that material damage had occurred to
enforce the material damage standard. They stated that this gives the
regulators unlimited discretion to decide the level of confidence
required, and if the regulators implemented the 99% confidence
standard, then it would be virtually impossible to prove material
damage.
OSM Response: OSM disagrees with the commenters that the proposed
changes rely on complex statistical analysis that favors coal operators
and State regulators. The bill does not propose, and we are not
approving, any particular method to determine whether an effect that
can be ``quantified and measured to a significant degree of
confidence.'' As noted in a comment by State Representative Parry, the
sponsor of the bill, one way MDEQ may apply this definition is to use
the publicly available EPA guidance for ``statistical significance,''
which is what he stated he intended. (Administrative record no. MT-048-
17, citing ``Basic Principles & Issues: Additional Information on
Interpreting Statistics,'' EPA, <a href="https://www.epa.gov/caddis/basic-principles-issues-2">https://www.epa.gov/caddis/basic-principles-issues-2</a>, last visited May 11, 2026).
However, because this standard was not incorporated into the
statute, it is not controlling, although it is worth noting that the
author of the proposed changes intended for the statistical analysis to
be consistent with EPA guidance for ``Confidence Intervals.''
(Administrative record no. MT-048-17). The EPA guidance for
``Confidence Intervals'' (Administrative record no. MT-048-17)
currently uses a 95% standard where ``(1) There is a 95% chance of the
true value of the parameter falling within the interval; (2) Values
outside the interval can be rejected on the basis of a two-sided
statistical test with alpha 5%.'' In this scenario, a 95% confidence
interval would not be the regulators determining that they are 95%
confident material damage has occurred, instead it would give a range
of numbers that would, if repeated with multiple data samplings, are
95% likely to contain the true value of the desired statistical
parameter, such as a population mean.
Furthermore, it should be noted, if adopted by MDEQ, this standard
would apply equally to operators when they are presenting evidence in
their permit application that their operation will not cause material
damage to the hydrologic balance outside the permit area. MCA section
82-4-227(3)(a).
Comment: One commenter stated that Montana's proposed definition
would remove current language with clear standards for measuring
impacts to the hydrologic balance and replacing them with unreasonable
and unspecified metrics. The commenter opined that the proposed
requirement that ``Material damage . . . with respect to the hydrologic
balance outside the permit area'' must be proven through ``quantifiable
adverse impact. . . . an effect that can be quantified and measured to
a significant degree of confidence'' is inconsistent with SMCRA and the
Federal regulations. The commenter stated that this standard ``provides
excessive subjective discretion and established a standard that would
be onerous to prove.'' The commenter citied to Ohio River Valley Env't
Coal., Inc. v. Norton, No. CIV.A. 3:04-0084, 2005 WL 2428159, at *3
(S.D.W. Va. Sept. 30, 2005), aff'd sub nom. Ohio River Valley Env't
Coal., Inc. v. Kempthorne, 473 F.3d 94 (4th Cir. 2006), a case where a
West Virginia definition of ``Material damage to the hydrologic
balance'' was invalidated by the court for having vague and overly
subjective criteria. The commenter stated that Montana's proposed
definition is also vague and subjective, as ``significant degree of
confidence'' does not have a definition, and the degree of statistical
confidence can be easily manipulated.
OSM Response: OSM disagrees with the commenter that there are not
clear standards for measuring hydrologic balance impacts. As discussed
above, the plain language in Montana's statute indicates that
scientific data is required, as opposed to anecdotal evidence, that an
adverse impact has or has not occurred. Further, State Representative
Parry asserted in this comment that he developed the definition for
``quantifiable adverse impacts'' so that a methodology such as the EPA
guidance for ``Confidence Intervals.'' (Administrative Record No. MT-
048-17) could be used. If MDEQ chooses to adopt them, they would be
clear and
[[Page 31905]]
accessible standards. Furthermore, OSM disagrees that the finding in
Ohio River Valley Env't Coal., Inc. v. Norton applies in this
situation. As is inherent in the name of the term, ``quantifiable
adverse impact'' requires MDEQ to use objective criteria, and the
definition of that term elaborates that the quantified impact must be
able to be measured to a significant degree of confidence. While that
gives MDEQ some appropriate level of discretion to determine if it has
a significant degree of confidence, it is clear that they must have a
higher level of confidence than reasonable probable or another known
standard that is typically applied. Moreover, MDEQ could use the
guidelines for statistical analysis suggested by State Representative
Parry. That EPA guidance offers techniques to prevent data manipulation
in the statistical analysis process. (EPA, <a href="https://www.epa.gov/caddis/basic-principles-issues-2">https://www.epa.gov/caddis/basic-principles-issues-2</a>, last visited December 17, 2025). Thus the
proposed definition of ``quantifiable adverse impact'' is not overly
vague or prone to abuse.
Comment: One commenter stated that the ``quantifiable adverse
impacts'' standard would put the burden of proof on the public,
directly conflicting with 30 U.S.C. 1260(b) of SMCRA which requires the
permittee to affirmatively demonstrate that material damage will not
occur.
OSM Response: OSM disagrees with the commenter; Montana's proposed
definition does not shift the burden of proving no material damage will
occur from the permittee to the public. Per section 82-4-227(3)(a) of
the MCA, operators are required to provide an assessment of probable
cumulative impact and must show that the mining operation has been
designed to prevent material damage to the hydrologic balance outside
the permit area. Montana's proposed rule still puts the burden of proof
on the operator for permit applications, as the operator must be the
one to show that there will be no ``quantifiable adverse impacts.''
Comment: A commenter questioned the ``significant degree of
confidence standard'' and how MDEQ's current sampling practices would
affect material damage findings in Montana. The commenter opined that
MDEQ would need to require significant and repeated sampling to meet
this new standard, and MDEQ's current quarterly sampling is
insufficient to detect to a degree of statistical significance for
large pollution increases. Furthermore, under the proposed standard a
single measurement of extremely high pollution levels could be
statistically erased as an outlier by being deemed ``not statistically
significant.'' The commenter stated that this defeats the purpose of
sampling, which is to ensure compliance. They opined that under the
proposed rule a single sampling or even multiple sampling events
identifying violations of water quality standards might not be deemed
statistically significant, which is contrary to the Federal requirement
that water quality standards serve as material damage criteria.
OSM Response: OSM disagrees with the commenter. MDEQ's sampling
techniques are consistent with the Federal regulations. MDEQ requires
monitoring and sampling of groundwater and surface water (ARM sections
17.24.645 and 17.24.646, respectively) and must sample the water to
such a frequency as is necessary to adequately identify changes in
water quality and quantity from mining operations. If it is
demonstrated that a site needs more frequent water monitoring,
including sampling, MDEQ can adjust accordingly. Furthermore, a WQS
violation is still considered material damage under Montana's rule, as
it under the regulations, but proving WQS violation still requires
procedures and analysis. For example, the EPA sets ``Guidelines
Establishing Test Procedures for the Analysis of Pollutants'' at 40 CFR
part 136 and devised a ``Stressor Identification Guidance Document,''
US EPA, December 2000, (<a href="https://www.epa.gov/sites/default/files/2018-10/documents/stressor-identification-guidance-document.pdf">https://www.epa.gov/sites/default/files/2018-10/documents/stressor-identification-guidance-document.pdf</a>, last
visited May 11, 2026), which gives guidance for properly identifying
WQS violations. The EPA created the ``Casual Analysis/Diagnosis
Decision Information System'' or CADDIS using the framework from this
document. CADDIS is often used by States, Tribes, and others as
guidance for sampling and analysis procedures. In his comment, State
Representative Parry stated that he created the definition for
``quantifiable adverse impact'' in line with CADDIS guidance for
confidence intervals. (Administrative record no. MT-048-17, citing
``Basic Principles & Issues: Additional Information on Interpreting
Statistics,'' EPA, <a href="https://www.epa.gov/caddis/basic-principles-issues-2">https://www.epa.gov/caddis/basic-principles-issues-2</a>, last visited May 11, 2026). Thus, Montana's proposed requirement of
statistical significance to prove a ``quantifiable adverse impact,''
including a WQS violation, is in line with the Federal regulations.
Comment: In a September 3, 2025 letter commenting on this proposed
program amendment, the author of Montana's definition, Montana House
Representative Parry, explained that his intent for including
``quantifiable adverse impact'' within the definition of ``Material
damage to the hydrologic balance'' was to follow EPA guidance that
``Confidence intervals, . . . , can be used to analyze data without
assumptions about the relative burden of proof for different
outcomes.'' State Representative Parry credited the EPA Casual
Analysis/Diagnosis Decision Information System (CADDIS) website for
guiding his creation of the ``quantifiable adverse impacts''
definition. (Administrative record no. MT-048-17, referencing ``Basic
Principles & Issues: Additional Information on Interpreting
Statistics,'' EPA, <a href="https://www.epa.gov/caddis/basic-principles-issues-2">https://www.epa.gov/caddis/basic-principles-issues-2</a>, last visited May 11, 2026). CADDIS was created by the EPA to support
State, Tribal, and other water programs in sampling and analyzing water
quality data.
OSM Response: OSM appreciates State Representative Parry's insights
and background on the program amendment. While we understand the intent
of this State Representative may have been to follow the EPA guidance,
the EPA guidance is not incorporated by reference into the statute and
is not part of the proposed amendment that we are reviewing.
Comment: A few commenters, including U.S. Senator Daines of
Montana, opined that the proposed amendment clarifies the coal mining
permitting and operational process by requiring the material damage
determination to be based on demonstratable, measurable impacts. One of
those commenters specified further that Montana's proposed definition
of ``quantifiable adverse impact'' is appropriate to be defined as ``an
effect that can be quantified and measured to a significant degree of
confidence'' because (1) hydrologic impacts involve numerous and
variable factors and (2) a finding of material damage carries serious
consequences, potentially including denial of a permit or cessation of
mining operations. They stated that by requiring material damage to be
found through demonstratable, tangible, and measurable facts, MDEQ is
able to ensure environmental protection and regulatory certainty when
making its findings.
OSM Response: OSM agrees with the commenters that Montana's
proposed definition requires material damage to be assessed on
demonstratable and measurable impacts. Please see further discussion of
this topic in section III(A).
[[Page 31906]]
4. ``Existing or Reasonably Foreseeable Uses''
Comment: Multiple commenters stated that Montana's proposed
limitation of adverse impacts to ``existing or reasonably foreseeable
use of surface water or ground water'' is inconsistent with SMCRA, and
they claimed that OSM had previously rejected a similar provision to
the Montana program. The commenters cited OSM's discussion at 70 FR
8002, 8004 (Feb. 16, 2005) where OSM found Montana's 2003 proposed
definition of ``hydrologic balance'' would only consider dynamic
hydrologic relationships to the extent they relate to uses of the land
and water, which would result in components of the hydrologic regime
not being identified, protected, or monitored unless those components
relate to postmining uses of land and water. The commenters stated
there is a parallel between the rejected 2003 definition and Montana's
proposed definition here, as Montana's limiting of material damage to
``existing or reasonably foreseeable uses[s]'' fails to protect the
hydrologic balance as a ``natural resource.'' One of these commenters
opined further that Montana's designated beneficial uses are
independent of existing or reasonably foreseeable uses, thus the
inconsistency makes the proposed definition inconsistent with SMCRA.
OSM Response: OSM disagrees with the commenters that our denial of
Montana's 2003 proposed definition of ``hydrologic balance'' requires
us to deny Montana's 2025 proposed definition of ``Material damage . .
. with respect to the hydrologic balance outside the permit area.''
Unlike the 2003 definition of ``hydrologic balance,'' Montana's
proposed definition of ``Material damage . . . with respect to the
hydrologic balance outside the permit area'' is not related to or
reliant on postmining land use. ``[E]xisting or reasonably foreseeable
uses of water'' is related to Montana's classification of beneficial
uses, not how the water will be used for postmining land use.
Furthermore, OSM disagrees with the commenter that the definition
separates Montana's designated beneficial uses from its proposed
definition of ``existing or reasonably foreseeable uses.'' As State
Representative Parry explained in his comment, the definition was
designed to ensure consistency between the Montana Surface and
Underground Mining Reclamation Act and Montana Water Quality Act and
clarified that the classification of State waters mentioned in the
proposed definition reference the water classifications in ARM sections
17.30.607 and 17.30.617. (Administrative Record No. Mt-048-17).
Comment: One commenter opposed the proposed definition because it
did not consider the ``beneficial'' water quality standards that local
landowners valued and enjoyed prior to the life of the coal mine, which
punishes the landowners instead of the polluting coal mine operators.
OSM Response: OSM disagrees with the commenter. As discussed
further in section III(A), Montana is proposing to incorporate
established State water law standards into its definition of ``Material
damage . . . with respect to the hydrologic balance outside the permit
area,'' and these State water law standards use the term ``Beneficial
use.'' At section 85-2-102(5)(a), Montana defines ``Beneficial use'' as
``a use of water for the benefit of the appropriator, other persons, or
the public, including but not limited to agricultural, stock water,
domestic, fish and wildlife, industrial, irrigation, mining, municipal
power, and recreational uses.'' Montana water law, and thus the Montana
coal program through this amendment, recognizes a wide variety of
``beneficial uses'' and does not limit these uses by whether they were
in place before or after the life of coal mines.
Comment: A couple of commenters stated they support the amendment,
and that material damage assessments will consider beneficial uses,
which the commenter opined will protect the farmers, ranchers,
businesses, and families who put Montana's waters to beneficial use.
Furthermore, they stated that the proposed adoption of Montana's
classifications and beneficial uses of water into the definition of
``Material damage . . . with respect to the hydrologic balance outside
the permit area'' will provide regulators, operators, and the public
with a clear and predictable basis for evaluating material damage. And
this would reduce the risk of arbitrary or inconsistent outcomes while
ensuring assessments remain accurate and reliable.
OSM Response: OSM agrees with the commenters that Montana's
proposed adoption of classification and beneficial uses of water into
its definition of ``Material damage . . . with respect to the
hydrologic balance outside the permit area'' will provide a predictable
basis for evaluating material damage, while also protecting the users
of Montana's waters. Please see our full discussion of this topic in
section III(A).
B. 82-4-203(35)(b) Material Damage With Respect to Alluvial Valley
Floors
Comment: One commenter opined that OSM should approve Montana's
proposed definition of ``Material damage . . . with respect to alluvial
valley floors'' because OSM previously approved an identical definition
in 90 FR 3673, 3677 (Jan. 15, 2025).
OSM Response: OSM agrees with the commenter, OSM had previously
approved this section in our January 15, 2025 decision, and as proposed
now, Montana's definition of ``Material damage . . . with respect to
alluvial valley floors'' is consistent with the Federal regulations.
Please see section III(B) for our discussion on this topic.
C. 82-4-203(35)(c) Material Damage With Respect to Subsidence
Comment: One commenter opined that OSM should approve Montana's
proposed definition of ``Material damage . . . with respect to
subsidence'' because Montana incorporated OSM's feedback from our prior
denial of the definition in MT-042-FOR. 90 FR 3673, 3677 (Jan. 15,
2025).
OSM Response: OSM agrees with the commenter, OSM had previously
denied this section in our January 15, 2025 decision, but Montana has
incorporated our feedback and as proposed now Montana's definition of
``Material damage . . . with respect to subsidence'' is consistent with
the Federal regulations. Please see section III(C) for our discussion
on this topic.
D. 82-4-222(1)(m) Hydrologic Information Requirements
Comment: One commenter stated that Montana's proposed rule allowing
operators to submit their own hydrologic and geologic information in
the absence of State or Federal information creates a conflict of
interest and undermines the public's trust in regulatory authorities.
OSM Response: OSM disagrees with the commenter. The Federal
regulations at 30 CFR 780.21 allows an operator to submit their own
hydrologic and geologic information when it cannot be sourced by a
relevant Federal or State agency. Montana's proposed changes are
consistent with the Federal regulations, and, thus, OSM is approving
them. Please see section III(D) for our discussion on this topic.
Comment: One commenter stated that OSM should approve Montana's
proposed changes to requirements for hydrologic information because the
language was drawn directly from the Federal regulations at 30 CFR
780.21(c).
OSM Response: OSM agrees with the commenter as Montana's proposed
changes to its hydrologic information requirements are consistent with
the
[[Page 31907]]
Federal regulations. Please see section III(D) for our discussion on
this topic.
Comment: In a comment, the sponsor of HB 587, State Representative
Parry, stated that the proposed changes to requirements for submitting
hydrologic information were made because the current rule, which only
allows information from a State or Federal agency, is inadequate, and
that in practice this information is best sourced from the operator
themselves. State Representative Parry stated that to correct this, he
changed the language under the proposed rule so that operators may
provide this information if it is not available from the appropriate
Federal and State agencies, and that MDEQ retains sole authority over
determination of compliance.
OSM Response: The Federal regulations prefer that the hydrologic
information is sourced by a relevant Federal or State agency, but when
those agencies cannot provide that information, the regulations allow
the hydrologic information to be sourced by the operator. OSM is
approving Montana's proposed changes to these requirements because they
were consistent with the Federal regulations. Please see section III(D)
for our discussion on this topic.
E. HB 587 Sec. Sec. 5 & 6--Immediate Effectiveness and Retroactive
Application
Comment: Several commenters opined that the immediate effectiveness
and retroactivity provisions of HB 587 violate SMCRA. Multiple
commenters cited OSM's previous denial of identical provisions in HB
576, which found those provisions to violate 30 CFR 732.17(g), and
stated that OSM should similarly deny the similar provisions in HB 587.
OSM Response: As discussed in section III(E), OSM agrees that the
effective date of HB 587 is June 29, 2026. In addition, the U.S.
District Court for the District of Montana recently held that ``the
`immediately effective' provisions of [HB] 576 and [SB] 392 conflict
with the federal review process required by the SMCRA'' and entered a
consent decree, agreed to by MDEQ, that stated that MDEQ would not
``apply, effectuate, or enforce any provision of HB 576 or SB 392
unless and until it is reviewed and approved by the Director of OSM,
pursuant to the provisions of 30 CFR 732.17 and the Montana cooperative
agreement.'' Mont. Env't Ctr. v. Mont. Dep't of Env't Quality, 2025
U.S. Dist. LEXIS 11470, *3-*5 (D. Mont. Jan. 22, 2025). While this case
applies only to HB 576 and SB 392, the precedent from this case would
likely invalidate the ``immediately effective'' provision in HB 587 as
well.
F. Other Comments
Comment: A few commenters stated that OSM must assure that State
programs are in compliance with SMCRA, and OSM must review and deny any
changes to State standards that do not comply with the minimum Federal
standards under SMCRA and the Federal regulations.
OSM Response: OSM agrees with the commenters, as directed by SMCRA
and the Federal regulations at 30 CFR 730.11 and 732.17, OSM is
required to assess whether a State program is in accordance with SMCRA
and consistent with the Federal regulations, and, if there is a
deficiency in a State's proposed amendment to its program, OSM must
deny those defective aspects.
Comment: One commenter stated that OSM should only evaluate whether
the current bill, HB 587, is consistent with SMCRA and the Federal
regulations, and previous versions of MSURMA, other States'
requirements, or other programs and desired outcomes are beyond the
scope of OSM's duties and not authorized by SMCRA.
OSM Response: OSM disagrees with the commenter that SMCRA and the
Federal regulations prevent us from considering information outside of
the amendment when making our decision. OSM assesses State program
amendments as required by SMCRA and the Federal regulations, and 30 CFR
732.17(h)(7) requires that the Director ``considers all relevant
information, including any information obtained from public hearing and
comments . . . .'' While OSM mainly reviews text of the proposed
amendment compared to SMCRA and the Federal regulations, OSM must
consider all relevant information in our assessment as to whether a
proposed amendment is consistent with SMCRA and the Federal
regulations, which can include how OSM has treated similar amendments
in other States.
Comment: A few commenters, including U.S. Senator Daines of
Montana, commented that Montana's amendment is consistent with the
following Federal Executive Orders: Unleashing American Energy (Jan.
20, 2025), Immediate Measures to Increase American Mineral Production
(Mar. 20, 2025), and Reinvigorating America's Beautiful Clean Coal
Industry (Apr. 8, 2025).
OSM Response: OSM agrees that the Montana amendment is consistent
with those Executive Orders. OSM is approving this amendment, though
OSM's approval of any State program amendment is dependent on the
procedures and requirements as dictated by SMCRA and the Federal
regulations at 30 CFR 732.17.
Federal Agency Comments
On September 10, 2025, pursuant to 30 CFR 732.17(h)(11)(i) and
section 503(b) of SMCRA, we requested comments on the amendment from
various Federal agencies that have an actual or potential interest in
the Montana program (Administrative Record No. MT-048-04). These
agencies did not provide comments on this amendment.
EPA Concurrence and Comments
Under 30 CFR 732.17(h)(11)(ii), we are required to get a written
concurrence from EPA for those provisions of the program amendment that
relate to air or water quality standards issued under the authority of
the CWA (33 U.S.C. 1251 et seq.) or the Clean Air Act (43 U.S.C. 7401
et seq.). This amendment does not relate to air or water quality
standards and thus does not require a written concurrence from the EPA.
Even so, on September 10, 2025, under 30 CFR 732.17(h)(11)(i), we sent
a letter requesting comments from the EPA on the amendment
(Administrative Record No. MT-048-04). The EPA did not provide any
comments for this amendment.
State Historical Preservation Officer (SHPO) and the Advisory Council
on Historic Preservation (ACHP)
Under 30 CFR 732.17(h)(4), we are required to request comments from
the SHPO and ACHP on amendments that may have an effect on historic
properties. On September 10, 2025, we requested comments on the
amendment (Administrative Record No. MT-048-04). Montana SHPO and the
ACHP did not provide a comment.
V. OSM's Decision
Based on the above findings, we are approving Montana's proposed
amendment (MT-048-FOR) sent to us on June 22, 2023 (Administrative
Record No. MT-048-01). To implement this decision, we are amending the
Federal regulations, at 30 CFR part 926, that codify decisions
concerning the Montana program. In accordance with the APA, this rule
will take effect 30 days after the date of publication. Section 503(a)
of SMCRA requires that the State's program demonstrate that the State
has the capability of carrying out the provisions of the Act and
meeting its purposes. SMCRA requires that a State program must have
rules and regulations that are in accordance with
[[Page 31908]]
SMCRA and consistent with Federal regulations.
VI. Procedural Determinations
Executive Order 12630--Governmental Actions and Interference With
Constitutionally Protected Property Rights
This rule would not effect a taking of private property or
otherwise have taking implications that would result in public property
being taken for government use without just compensation under the law.
Therefore, a takings implication assessment is not required. This
determination is based on an analysis of the corresponding Federal
regulations.
Executive Orders 12866--Regulatory Planning and Review and 13563--
Improving Regulation and Regulatory Review
Executive Order 12866 provides that the Office of Information and
Regulatory Affairs in the Office of Management and Budget (OMB) will
review all significant rules. Pursuant to OMB guidance, dated October
12, 1993, the approval of State program amendments is exempted from OMB
review under Executive Order 12866.
Executive Order 12988--Civil Justice Reform
The Department of the Interior has reviewed this rule as required
by Section 3 of Executive Order 12988. The Department determined that
this Federal Register document meets the criteria of section 3 of
Executive Order 12988, which is intended to ensure that the agency
review proposed regulations to eliminate drafting errors and ambiguity;
that the agency write its regulations to minimize litigation; and that
the agency's regulations provide a clear legal standard for affected
conduct rather than a general standard, and promote simplification and
burden reduction. Because Section 3 focuses on the quality of Federal
regulations, the Department limited its review under this Executive
Order to the quality of this Federal Register document and to changes
to the Federal regulations. The review under this Executive Order did
not extend to the language of the State regulatory program amendment
that Montana drafted.
Executive Order 13132--Federalism
This rule has potential Federalism implications, as defined under
section 1(a) of Executive Order 13132. Executive Order 13132 directs
agencies to ``grant the States the maximum administrative discretion
possible'' with respect to Federal statutes and regulations
administered by the States. Montana, through its approved regulatory
program, implements and administers SMCRA and its implementing
regulations at the state level. This rule approves an amendment to the
Montana program submitted and drafted by the State, and thus is
consistent with the direction to provide maximum administrative
discretion to States.
Executive Order 13175--Consultation and Coordination With Indian Tribal
Governments
The Department of the Interior strives to strengthen its
government-to government relationship with Tribes through a commitment
to consultation with Tribes and recognition of their right to self-
governance and Tribal sovereignty. We have evaluated this rule under
the Department's consultation policy and under the criteria of
Executive Order 13175 and have determined that, although no Indian
lands, as defined under SMCRA, are implicated by this rule, this State
program amendment may have substantial direct effects on 20 Federally
recognized Tribes because of the potential implications for the Tribe
or Tribal members, Tribal treaty rights, reserved rights, trust
resources, or ancestral lands. Therefore, on August 4, 2025, we sent
invitation letters to consult to these 20 Tribes (Administrative Record
No. MT-048-07).
In response to our invitation, we received a written comment from
the Northern Cheyenne Tribe (NCT) on September 3, 2025. (Administrative
record no. MT-048-13) NCT urged OSM to deny HB 587 because it is
inconsistent with SMCRA and the Federal regulations. The NCT stated
that clean water is spiritually and practically vital to its members
way of life, and that OSM (as well as other Federal agencies) have
fiduciary obligations to consider and protect the Tribe's best
interests and natural resources. The NCT stated that HB 587 removes
protections for water rights and rolls back legal protection of water
resources when the receiving waters for all of Montana's coal mines are
impaired and neighboring tribal members are seeing once reliable water
sources disappear or polluted beyond use. The NCT also stated that HB
587 allows coal operators to violate WQS and reduce water quantity to a
degree that hurts wildlife, stock-watering, irrigation, and domestic
use. And that HB 587 would diminish the public oversight role by
requiring locals affected by water quality and quantity changes to take
on extra burdens to prove their claims, like hiring a statistician to
prove significant water pollution. Lastly, the NCT stated that OSM
should reject the bill because it repeats provisions that OSM have
rejected on multiple occasions.
OSM Response: OSM appreciates the Tribes comments and agrees that
OSM, along with other Federal agencies, has responsibility for Federal
activities that can have Tribal implications. OSM disagrees that
Montana's proposed definition of material damage would allow Montana
coal mines to violate WQS, reduce water quality, or diminish public
oversight. Please see our full discussion of this topic in section
III(A) and in the comment section.
Executive Order 13211--Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
Executive Order 13211 requires agencies to prepare a Statement of
Energy Effects for a rulemaking that is (1) considered significant
under Executive Order 12866, and (2) likely to have a significant
adverse effect on the supply, distribution, or use of energy. Because
this rule is exempt from review under Executive Order 12866 and is not
a significant energy action under the definition in Executive Order
13211, a Statement of Energy Effects is not required.
National Environmental Policy Act
Consistent with sections 501(a) and 702(d) of SMCRA (30 U.S.C.
1251(a) and 1292(d), respectively) and the U.S. Department of the
Interior Departmental Manual, part 516, section 13.5(A), a State
program amendment is a not major Federal action within the meaning of
section 102(2)(C) of the National Environmental Policy Act (43 U.S.C.
4332(2)(C).
Paperwork Reduction Act
This rule does not include requests and requirements of an
individual, partnership, or corporation to obtain information and
report it to a Federal agency. As this rule does not contain
information collection requirements, a submission to OMB under the
Paperwork Reduction Act (44 U.S.C. 3501 et seq.) is not required.
Regulatory Flexibility Act
This rule will not have a significant economic impact on a
substantial number of small entities under the Regulatory Flexibility
Act (5 U.S.C. 601 et seq.). The State submittal, which is the subject
of this rule, is based on corresponding Federal regulations for which
an economic analysis was
[[Page 31909]]
prepared, and certification made that such regulations would not have a
significant economic effect upon a substantial number of small
entities. In making the determination as to whether this rule would
have a significant economic impact, the Department relied on the data
and assumptions for the corresponding Federal regulations.
Congressional Review Act
This rule is not a major rule under 5 U.S.C. 804(2), the Small
Business Regulatory Enforcement Fairness Act. This rule: (a) does not
have an annual effect on the economy of $100 million; (b) will not
cause a major increase in costs or prices for consumers, individual
industries, Federal, State, or local government agencies, or geographic
regions; and (c) does not have significant adverse effects on
competition, employment, investment, productivity, innovation, or the
ability of U.S.-based enterprises to compete with foreign-based
enterprises. This determination is based on an analysis of the
corresponding Federal regulations, which were determined not to
constitute a major rule.
Unfunded Mandates Reform Act
This rule does not impose an unfunded mandate on State, local, or
Tribal governments, or the private sector of more than $100 million per
year. The rule does not have a significant or unique effect on State,
local, or Tribal governments or the private sector. This determination
is based on an analysis of the corresponding Federal regulations, which
were determined not to impose an unfunded mandate. Therefore, a
statement containing the information required by the Unfunded Mandates
Reform Act (2 U.S.C. 1531 et seq.) is not required.
List of Subjects in 30 CFR Part 926
Intergovernmental relations, Surface mining, Underground mining.
Marcelo Calle,
Acting Regional Director, Unified Regions, 5, 7-11.
For the reasons set out in the preamble, 30 CFR part 926 is amended
as set forth below:
PART 926--Montana
0
1. The authority citation for part 926 continues to read as follows:
Authority: 30 U.S.C. 1201 et seq.
0
2. Amend Sec. 926.15 by adding an entry for ``May 15, 2025'' at the
end of the table to read as follows:
Sec. 926.15 Approval of Montana regulatory program amendment.
* * * * *
----------------------------------------------------------------------------------------------------------------
Date of final
Original amendment submission date publication Citation/description
----------------------------------------------------------------------------------------------------------------
* * * * * * *
May 15, 2025.................................. May 29, 2026 Mont. Code. Ann.
82-4-203(35)(a), (b), and (c) Definitions--
Material damage--Approved.
82-4-222(1)(m) Permit Applications--Hydrologic
Information--Approved.
----------------------------------------------------------------------------------------------------------------
[FR Doc. 2026-10722 Filed 5-28-26; 8:45 am]
BILLING CODE 4310-05-P
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