Montana Regulatory Program

Issuing agencies

Abstract

We, the Office of Surface Mining Reclamation and Enforcement (OSM), are denying 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 (Senate Bill (SB) 392). The proposed amendment would have added a provision requiring equal application of court costs to the prevailing party in contested case proceedings by a court or administrative agency that issues a decision. The proposal would have also amended the Montana Code Annotated (MCA) to refer to the proposed equal application of court costs rule. Finally, SB 392 includes contingencies that apply to the proposed amendment but are not codified into the MCA: codification instructions, a severability clause, an effective date clause, and an applicability statement.

Full Text

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<title>Federal Register, Volume 91 Issue 163 (Tuesday, August 25, 2026)</title>
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<body><pre>
[Federal Register Volume 91, Number 163 (Tuesday, August 25, 2026)]
[Rules and Regulations]
[Pages 54803-54810]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17333]


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DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation and Enforcement

30 CFR Part 926

[SATS No. MT-043-FOR; Docket No. OSM-2023-0008; S1D1S SS08011000 
SX064A000 256S180110; S2D2S SS08011000 SX064A000 25XS501520]


Montana Regulatory Program

AGENCY: Office of Surface Mining Reclamation and Enforcement, Interior.

ACTION: Final rule; denying.

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SUMMARY: We, the Office of Surface Mining Reclamation and Enforcement 
(OSM), are denying 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 (Senate Bill 
(SB) 392). The proposed amendment would have added a provision 
requiring equal application of court costs to the prevailing party in 
contested case proceedings by a court or administrative agency that 
issues a decision. The proposal would have also amended the Montana 
Code Annotated (MCA) to refer to the proposed equal application of 
court costs rule. Finally, SB 392 includes contingencies that apply to 
the proposed amendment but are not codified into the MCA: codification 
instructions, a severability clause, an effective date clause, and an 
applicability statement.

DATES: The effective date is September 24, 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#d0bab6bcb5b9a3b3b8bdb1be90bfa3bda2b5feb7bfa6"><span class="__cf_email__" data-cfemail="177d717b727e64747f7a76795778647a657239707861">[email&#160;protected]</span></a>.

SUPPLEMENTARY INFORMATION:

I. Background on the Montana Program
II. Submission of the Amendment
III. OSM's Findings

[[Page 54804]]

    A. Changes to Sec. Sec.  82-4-251, 252, and 255 of the MCA
    B. Contingencies to SB 392
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 June 22, 2023 (Administrative Record No. MT-043-
01), Montana sent us a proposed amendment to its program under SMCRA 
(30 U.S.C. 1201 et seq.). We found Montana's proposed amendment to be 
administratively complete on June 27, 2023. Montana submitted the 
proposed amendment to us, on its own volition, after the Montana 
legislature passed SB 392 during the 2023 legislative session. SB 392 
amends the Montana Strip and Underground Mine Reclamation Act (MSUMRA) 
as well as sections 82-4-251, 252, and 255 of the MCA.
    Specifically, Montana proposes a new section to MCA at Sec.  82-4-
255, which requires the equal application of court costs in contested 
case proceedings by a court or administrative agency that issues a 
decision pursuant to Sec.  82-4-2. This proposed section states that a 
court or administrative agency may award the prevailing party 
reasonable costs of litigation, including filing fees, attorney fees, 
and witness costs, but the court or administrative agency may not 
consider the identities of the parties involved when determining the 
award. The parties that may be awarded attorney fees include the 
permittee, permit applicant, agency, public interest litigant, or any 
other party to the action. The proposal applies equally to all parties 
in an action and places the burden of proof and persuasion for awarding 
court costs on the requesting party.
    At Sec.  82-4-251(7) of the MCA, Montana proposes that new Sec.  
82-4-255 applies to an order issued or administrative proceedings under 
82-4-251. And at Sec.  82-4-252(5) of the MCA, Montana proposes any 
court issuing a final order may award court costs in line with new 
Sec.  82-4-255.
    Finally, SB 392 adds four contingencies to the proposed changes of 
Sec. Sec.  82-4-251, 82-4-252, and 82-4-255 that are not codified into 
the MCA but apply to the sections amended by the legislation. Section 4 
of SB 392 states its newly proposed section for equal application of 
court costs will be codified within Title 82, chapter 4, part 2. 
Montana later changed this to Sec.  82-4-255 of the MCA. Section 5 of 
SB 392 states that if any part of SB 392 is invalid, all valid parts 
are severable and may remain in effect. Section 6 of SB 392 states that 
the bill is effective upon passage and approval in the Montana 
legislature. Section 7 of SB 392 states that the bill applies to court 
actions filed on or after the effective date of SB 392.
    We announced receipt of the proposed amendment in the August 7, 
2023, Federal Register (88 FR 52086). In the same document, we opened 
the public comment period and provided an opportunity for a public 
hearing or meeting on the adequacy of the amendment. After a request 
from several public interest groups, we announced a 60-day extension of 
the comment period until November 6, 2024. See 88 FR 64855 (Sept. 20, 
2023). We held a public hearing on November 1, 2023, in Billings, MT, 
where we received testimony from 23 individuals. (Administrative Record 
No. MT-043-19). We also received 219 written comments on the proposed 
rule. On April 30, 2025, OSM sent a letter to the Montana Department of 
Environmental Quality (MDEQ) detailing concerns that OSM had with the 
proposed amendment (Administrative Record No. MT-043-28). The letter 
offered two options for MDEQ: suspend the amendment to allow MDEQ to 
make necessary changes or proceed to the final rule stage with no 
changes. MDEQ responded on May 8, 2025, that, because the proposed 
amendments were the result of legislative action, MDEQ is unable to 
submit further modifications to address OSM's concerns. (Administrative 
Record No. MT-043-29).

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 disapproving Montana's submittal.

A. Changes to Sec. Sec.  82-4-251, 252, and 255 of the MCA

    Montana's proposed changes under Sec. Sec.  82-4-251, 82-4-252, and 
82-4-255 of the MCA are not in accordance with SMCRA and are 
inconsistent with the Federal regulations. Through SB 392, Montana 
proposes to amend MCA Sec. Sec.  82-4-251, 252, and 255 to require an 
equal application of court costs when a court or administrative agency 
issues a final order in an action pursuant to Title 82, chapter 4, part 
2 of the MCA. Proposed Sec.  82-4-255 of the MCA states that: (1) a 
court or administrative agency may award the prevailing party 
reasonable costs of litigation; (2) the court or administrative agency 
may not consider the identity of any party, including but not limited 
to a permittee, permit applicant, agency, public interest litigant, or 
other party to an action; (3) this section supersedes prior rulings 
pursuant to private attorney general doctrine; and (4) the provisions 
apply equally to all parties in an action. Proposed amendments to MCA 
Sec. Sec.  82-4-251 and 82-4-252 would require those sections to adhere 
to MCA Sec.  82-4-255. While we are generally supportive of Montana's 
attempts to rein in frivolous lawsuits that slow down energy 
production, following our review, OSM has determined that there are 
several issues with the proposed amendment when compared to SMCRA and 
the Federal regulations.
    First, proposed Sec.  82-4-255 MCA is inconsistent with SMCRA and 
the Federal regulations. Because Sec.  82-4-255 covers proceedings by a 
court or administrative agency that issues a decision pursuant to the 
Montana coal program, both citizen suits and applications for review of 
an order or notice, investigation, or hearing are covered under Sec.  
82-4-255. Under SMCRA, the fees shifting provision for citizen suits, 
including attorneys fees and court costs, are within section 520(d), 
and the fee shifting provision for applications for review of an order 
are contained within section 525(e). Proposed Sec.  82-4-255 MCA limits 
who can receive awards of court costs to ``prevailing parties,'' 
prohibits a judge from considering the identity of any party in its 
decision, supersedes prior rulings pursuant to private attorney

[[Page 54805]]

general doctrine, and must be applied equally to all parties in an 
action.
    In contrast to Montana's proposed changes to its fee shifting 
provision, sections 520(d) and 525(e) of SMCRA do not use the 
``prevailing parties'' standard; instead, they provide for attorney 
fees whenever the tribunal deems that fees are proper, which is often 
referred to as the ``whenever appropriate'' standard. 30 U.S.C. 1276. 
The House Committee Report that first contained the provision that 
ultimately became section 525(e) stated the ``intention that this 
subsection not be interpreted or applied in a manner that would 
discourage good faith actions on the part of interested citizens.'' 
H.R. Rep. No. 218, at 131 (1977). Likewise, the Senate Committee on 
Energy and Natural Resources further explained: ``In many, if not most, 
cases in both the administrative and judicial forum, the citizen who 
sues to enforce the law, or participates in administrative proceedings 
to enforce the law, will have little or no money with which to hire a 
lawyer. . . . Attorneys' fees may be awarded to the permittee or 
government when the suit or participation is brought in bad faith.'' S. 
Rep. No. 95-128, at 59 (1977) (emphasis added).
    To implement this statutory direction, after Ruckelshaus v. Sierra 
Club, 463 U.S. 680 (1983), the Federal regulations at 43 CFR 4.1294 do 
not treat all parties as equal; instead, the Federal regulations 
separate the types of parties that can receive and award into three 
groups: ``any person,'' ``permittee,'' and ``OSM,'' and details how a 
court should award court costs in multiple situations depending on the 
types of parties involved. For example, for a person other than a 
permittee to receive fees from OSM, that person must ``acheiv[e] at 
least some degree of success on the merits, assuming that they made a 
substantial contribution to the determination of the issues.'' 43 CFR 
4.1294(b). In contrast, OSM or a permittee can recover fees only from a 
person in instances of bad faith or harassment. 43 CFR 4.1294(d) and 
(e); see also M.L. Johnson Family Props. v. Bernhardt, 2020 U.S. Dist. 
Lexis 192103, *15 (E.D. Ky. 2020) (citing the House Committee report 
and holding that it was not proper to allow the permittee to recover 
fees against a landowner).
    Montana's proposed rule, which would award costs only to prevailing 
parties, directly conflicts with SMCRA, which uses the ``whenever 
appropriate'' rather than the ``prevailing party'' standard and the 
Federal regulations, which do not treat all parties equally when it 
comes to recovery of attorney fees. Under Montana's proposed amendment, 
a party that has a reasonable, good-faith claim may choose not to bring 
forward their claim because they could potentially lose and be 
responsible for both their legal fees as well as the legal fees accrued 
by the permittee or MDEQ. SMCRA was written to encourage public 
participation, so the court costs provisions cannot be written or 
enforced to stifle that participation, unless the party was determined 
to have acted in bad faith. Montana's proposed regulation expands who 
must pay court costs beyond ``bad faith,'' as it would make any party 
who loses eligible to pay court costs regardless of the circumstances. 
Thus, Montana's proposed requirement that any prevailing party may 
receive court costs is inconsistent with SMCRA and the Federal 
regulations.
    Next, proposed changes to Sec. Sec.  82-4-251 and 82-4-252 MCA are 
not in accordance with SMCRA and are inconsistent with the Federal 
regulations. Both proposed changes to Sec. Sec.  82-4-251(7) and 82-4-
252(5) MCA require those sections of the MCA to adhere to section 1 of 
SB 392. As discussed above, section 1 of SB 392 is inconsistent with 
the Federal regulations. Therefore, Montana's proposed changes to 
Sec. Sec.  82-4-251(7) and 82-4-252(5) MCA must be denied.
    Lastly, we note that this proposed amendment has only been 
interpreted in terms of whether it is in accordance with SMCRA and 
consistent with the Federal regulations. There has been no official 
determination as to conflicts with other Federal laws.

B. Contingencies to SB 392

    SB 392 also added contingencies that are not codified into the MCA 
but that affect the amended parts of the MCA.
1. Section 4. Codification Instruction
    Section 4 of SB 392 states what is now new Sec.  82-4-255 is 
intended to be codified as an integral part of Title 82, chapter 4, 
part 2 of the MCA, and the provisions of Sec.  s 82-4-2 will apply to 
the new section. Codification is a matter left to the states and OSM 
has no comment on this section.
2. Section 5. Severability
    Section 5 of SB 392 states that if any part of SB 392 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, 
the Federal regulations at 30 CFR 732.17(h)(7) require 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. Here, notwithstanding 
section 5 of SB 392, OSM has disapproved the entire amendment.
3. Section 6: Effective Date
    Section 6 of SB 392 states that its provisions are effective on 
passage and approval of the bill. This provision is contrary to SMCRA 
and the Federal regulations that 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).
4. Section 7: Applicability
    Section 7 of SB 392 states that its provisions apply to court 
action filed on or after the effective date of SB 392. This provision 
is contrary to SMCRA and the Federal regulations as it forces the 
changes to be effective before OSM reviews and approves the amendment, 
as required by 30 CFR 732.17(g), and section 723.17(i)(12) states that 
all decisions of the Secretary to approve or disapprove a program 
amendments must be published in the Federal Register. The 
Administrative Procedure Act generally requires a 30-day delay before a 
rule becomes effective. 5 U.S.C. 553(d).

IV. Summary and Disposition of Comments

    We asked for initial public comments on the amendment during a 
public comment period that ended on November 6, 2023. We received 219 
written comments during our initial comment period, and we received 
testimony from 23 individuals at a public hearing held in Billings, MT 
on November 1, 2023. (Administrative Record No. MT-043-19).
    Due to the large number of comments, we have consolidated 
substantially similar comments to avoid redundancy. Over 200 commenters 
were opposed to the approval of this amendment and raised similar 
concerns, which are discussed below. 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 the need for the United 
States to transition to renewable energy, general statements about the 
public's opposition to SB 392 and prior legislative efforts, comments 
about HB 576 and the

[[Page 54806]]

definition of ``material damage to the hydrologic balance'' and 
hydrologic information requirements (which was discussed in a separate 
final rule (MT-042-FOR, published at 90 FR 3673 (Jan. 15, 2025))), 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>.
    Public Comment 1: There was consensus among a group of over 190 
commenters in opposition to the proposed amendment that the ``loser 
pays'' provision of SB 392 would create a major financial burden for 
communities and landowners if their land or water is harmed by mining 
activity because it would limit court access to only wealthy 
individuals who can assume the financial risk of covering the legal 
fees of a coal company or regulatory agency.
    OSM Response: OSM is disapproving Montana's proposed amendment. 
Please see OSM's discussion of the proposed changes to Sec.  82-4-255 
MCA in Section III(A).
    Public Comment 2: This large group of commenters also stated that 
SB 392 is in direct violation of 43 CFR 4.1294 because this Federal 
regulation requires a judge to consider a party's identity and can only 
obligate a plaintiff to pay the defendants' attorney's fees if the 
plaintiff acted in bad faith.
    OSM Response: OSM is disapproving Montana's proposed amendment and 
agrees that SB 392 is not in accordance with SMCRA and is inconsistent 
with the Federal regulations at 43 CFR 4.1294. Please see OSM's 
discussion of the proposed changes to Sec. Sec.  82-4-251, 82-4-252, 
and 82-4-255 MCA in Section III(A).
    Public Comment 3: These commenters also opined that OSM has 
previously denied program amendments similar to Montana's proposed 
amendment; these commenters specifically referenced similar attempts in 
Alaska and Utah.
    OSM Response: For the reasons described above, OSM is disapproving 
Montana's proposed amendment. As for the mentioned Alaska rule, on 
April 21, 2014, OSM sent a letter to Alaska under 30 CFR 732.17(e)(2) 
finding that Alaska House Bill 145 (2003) resulted in significant 
changes to how state courts authorize award fees under the Alaska 
program in civil actions brought to compel compliance with the program. 
We found that the changes were not in accordance with section 520(d) of 
SMCRA (30 U.S.C. 1270(d)), and requested that Alaska file a program 
amendment to correct the issue. In response, Alaska did not file an 
amendment to its program, but Alaska assured OSM that it ``would not 
seek to or obtain or object to attorney's fees awards in citizen suits 
under [Alaska House Bill 145] in a manner that is not in accordance 
with the federal SMCRA statute.'' And that the Alaska Supreme Court had 
previously found the Alaska program ``should be construed to be 
consistent with SMCRA.'' In Utah, a State Board reiterated that only 
the ``bad faith'' standard that had been approved by OSM as part of the 
Utah State Program could be used regardless of any inadvertent omission 
from the State compilation of regulations.
    Public Comment 4: Multiple commenters opposed to the proposed 
amendment raised concerns that SB 392 would silence public 
participation because most landowners and communities would not risk 
going to court and potentially paying for a mining corporation's legal 
fees.
    OSM Response: OSM is disapproving Montana's proposed amendment and 
agrees that SB 392 is contrary to public participation principles of 
SMCRA and the Federal regulations. Please see OSM's discussion of the 
proposed changes to Sec. Sec.  82-4-251, 82-4-252, and 82-4-255 MCA in 
Section III(A).
    Public Comment 5: Another set of commenters opposed the proposed 
amendment, arguing that SB 392 seeks to supplant the decision of the 
judge by restricting the judge's ability to consider a party's identity 
when awarding court costs. These commenters noted that 30 U.S.C. 
1270(d) and 1275(e) shows SMCRA's intentions that the judicial branch 
is the most appropriate entity to determine attorney fees, as the judge 
of the case is in the best position to determine whether a plaintiff 
should be liable for all legal fees and the judge is bound to follow 
the law at 43 CFR 4.1294.
    OSM Response: OSM is disapproving Montana's proposed amendment and 
agrees that the judge must award court costs when deemed proper in line 
with SMCRA and 43 CFR 4.1294 or OSM-approved state counterpart laws and 
regulations. Please see OSM's discussion of the proposed changes to 
Sec. Sec.  82-4-251, 82-4-252, and 82-4-255 MCA in Section III(A).
    Public Comment 6: Another set of commenters opposed the proposed 
amendment; they claimed that SB 392 could potentially put them and 
other irrigators, farmers, and ranchers out of business because coal 
pollution may damage the land and water that they depend on to make a 
living, and they will not be able to take the financial risk of 
bringing a coal company to court to rectify the issue.
    OSM Response: OSM is disapproving Montana's proposed amendment. 
Please see OSM's discussion of the proposed changes to Sec. Sec.  82-4-
251, 82-4-252, and 82-4-255 MCA in Section III(A).
    Public Comment 7: Another set of commenters disagreed with the 
proponents of SB 392's argument that the proposed amendment would stop 
frivolous lawsuits; instead, these commenters argued that people with 
limited financial resources use litigation only as a last resort when 
other paths to justice have failed.
    OSM Response: OSM is disapproving Montana's proposed amendment. 
Please see OSM's discussion of the proposed changes to Sec. Sec.  82-4-
251, 82-4-252, and 82-4-255 MCA in Section III(A).
    Public Comment 8: Another commenter opposed to the proposed 
amendment alleged that SB 392 would negatively affect a local 
government's ability to seek justice. Under proposed SB 392, a local 
government entity is very unlikely to pursue any civil action for harms 
caused by mining because it would potentially lose substantial taxpayer 
money if they were made to pay the regulatory authority or mining 
companies' attorney fees. This prevents local governments from pursuing 
good faith civil actions to protect their constituents from damage to 
land and water caused by mining.
    OSM Response: OSM is disapproving Montana's proposed amendment. 
Please see OSM's discussion of the proposed changes to Sec. Sec.  82-4-
251, 82-4-252, and 82-4-255 MCA in Section III(A).
    Public Comment 9: Another commenter stated that SB 392 is directly 
contrary to section 520(d) of SMCRA (30 U.S.C. 1270(d)), which intended 
for the public to be protected from adverse fee awards unless their 
claims were deemed frivolous and made in bad faith.
    OSM Response: Please note that sections 520(d) and 525(e) of SMCRA 
have the same fee shifting standards, but section 520(d) covers awards 
for citizen suits and section 525(e) covers awards for applications for 
review of an order or notice, investigation, or hearing. Montana's 
proposed changes at Sec. Sec.  82-4-255 covers both types of actions. 
As stated above in OSM's discussion of the proposed changes to 
Sec. Sec.  82-4-251, 82-4-252, and 82-4-255 MCA in Section III(A), OSM 
is disapproving Montana's proposed amendment because it is not in 
accordance with SMCRA and is inconsistent with the Federal regulations.
    Public Comment 10: Another commenter opposed the proposed amendment 
and stated that SB 392 discourages citizens access to court to such a 
degree that it violates the equal

[[Page 54807]]

protection clause of the U.S. Constitution. U.S. Const. amend. XIV 
Sec.  1.
    OSM Response: Because OSM is disapproving Montana's proposed 
amendment on the basis of SMCRA and the Federal regulations (see OSM's 
discussion of the proposed changes to Sec. Sec.  82-4-251, 82-4-252, 
and 82-4-255 MCA in Section III(A)), it is unnecessary for us to 
respond to the alleged constitutional issue raised by this commenter.
    Public Comment 11: Other commenters opposed to the bill stated that 
citizen participation was intentionally built into SMCRA, and the 
legislative history confirms that SMCRA was intended to provide ongoing 
protection to coalfield citizens through SMCRA. Furthermore, they 
claimed that Congress intended citizens to be a key enforcement and 
accountability tool for coal operations; therefore, SB 392 is in 
conflict with these intentions.
    OSM Response: OSM notes the legislative history of SMCRA recognizes 
the importance of public participation in SMCRA proceedings. As stated 
in OSM's discussion of the proposed changes to Sec. Sec.  82-4-251, 82-
4-252, and 82-4-255 MCA in Section III(A), OSM is disapproving 
Montana's proposed amendment, and we agree that citizen participation 
is a fundamental aspect of SMCRA.
    Public Comment 12: Several commenters stated that the immediate 
effective date and applicability of SB 392 are inconsistent with the 
Federal regulations, citing 30 CFR 732.17(g), which requires that no 
State coal regulations go into effect until approved by OSM, and 30 
U.S.C. 1202(i), which requires that all appropriate procedures are 
followed for public participation in the revision of a State's program.
    OSM Response: We agree with these commenters on the proposed 
immediate effective date and applicability provisions; please see OSM's 
full discussion in Section III(B).
    Public Comment 13: Multiple commenters stated that SMCRA and the 
Federal regulations require an asymmetrical fee regime. They noted that 
this is further evidenced by how, in the 1980s, OSM only conditionally 
approved Montana's program in part because the Montana program did not 
establish an asymmetrical fee regime in line with 30 U.S.C. 1270 and 
1275 of SMCRA. See 47 FR 6266, 6266 (Feb. 11, 1982).
    OSM Response: OSM conditionally approved Montana's program February 
11, 1982, and required Montana to establish a fee award system in line 
with SMCRA and the Federal regulations before the State could achieve 
full approval of its coal regulatory program. 47 FR 6266, 6266 (Feb. 
11, 1982). OSM is now disapproving Montana's proposed amendment related 
to fee recovery because, as proposed, it is inconsistent with the 
Federal regulations at 43 CFR 4.1294.
    Industry Comment 1: A couple of commenters in favor of the proposed 
amendment claimed that SB 392 evens the playing field for all parties 
involved in litigation and that it will deter costly and meritless 
administrative and judicial litigation.
    OSM Response: While we support the general proposition that 
meritless administrative and judicial litigation should be deterred, 
OSM is disapproving Montana's proposed amendment because it is plainly 
inconsistent with the Federal regulations. The Federal regulations and 
Montana's existing program already deter meritless lawsuits by allowing 
judges to award attorney fees to a permittee if the lawsuit is found to 
have been brought in bad faith. Please see OSM's discussion of the 
proposed changes to Sec. Sec.  82-4-251, 82-4-252, and 82-4-255 MCA in 
Section III(A).
    Industry Comment 2: A commenter in favor of the proposed amendment 
stated that SB 392 adheres to 30 U.S.C. 1270(d) and 1275(e) of SMCRA. 
The commenter stated that those sections of SMCRA deem the 
appropriateness of an attorney fees award on the merits and nature or 
the proceedings, not the identity of the parties; thus, SB 392 is in 
line with these sections of SMCRA by not allowing a judge to consider 
the identities of the parties involved when awarding attorney fees.
    OSM Response: In order to approve program amendment, OSM must 
determine that the proposal is both in accordance with SMCRA and 
consistent with the Federal regulations. 30 CFR 730.5, 732.15(a), and 
732.17(h)(10). While we understand that this commenter argues that the 
program amendment is in accordance with SMCRA, even if that were true, 
the Montana program is plainly not consistent with 43 CFR 4.1294. On 
that basis alone, we must deny the program amendment. Please see OSM's 
discussion of the proposed changes to Sec. Sec.  82-4-251, 82-4-252, 
and 82-4-255 MCA in Section III(A).
    Industry Comment 3: A couple of commenters in favor of the proposed 
amendments stated that for citizen suits in particular, 30 U.S.C. 
1270(d), requirements for granting attorney fees do not purport to 
govern a state court's award of attorney fees; thus, for citizen suits, 
these comments allege that SB 392 is consistent with SMCRA and Federal 
law and should be approved.
    OSM Response: OSM disagrees with the commenters. SMCRA at 30 U.S.C. 
1253(a) requires that each State that wishes to assume exclusive 
jurisdiction over the regulation of surface coal mining and reclamation 
operation must submit a program demonstrating that such State has the 
capability of carrying out the provisions of SMCRA. This includes the 
provisions of 30 U.S.C. 1270, SMCRA's citizen suit provision. Montana 
must have provisions carrying out 30 U.S.C. 1270 at the State level, 
which would include requiring a State court to award attorney's fees 
for citizen suits in accordance with 30 U.S.C. 1270(d) and 43 CFR 
4.1294.
    Industry Comment 4: A commenter in favor of the proposed amendment 
stated that 43 CFR 4.1294 is inconsistent with SMCRA. They stated that 
30 U.S.C. 1275(e) allows a judge to grant awards to either party 
whenever proper, but the counterpart Federal regulations at 43 CFR 
4.1294 has an asymmetrical structure where upon a third party can 
receive an award in any situation where it can prove it made 
substantial contribution to the full and fair determination of the 
issues, but a permittee can only be awarded by a third-party if the 
third-party is found to have acted in ``bad-faith.'' Thus, according to 
the commenter, 43 CFR 4.1294 is invalid, and SB 392 should only need to 
be consistent with 30 U.S.C. 1275(e).
    OSM Response: To the extent the commenter considered 43 CFR 4.1294 
unlawful, any challenge to that Federal regulation needed to be brought 
within 60 days of the promulgation of the regulation. See 30 U.S.C. 
1276(a). OSM first enacted this provision in 1978, and, at that time, 
OSM thoroughly considered comments that disagreed with this approach. 
43 FR 34376 (Aug. 3, 1978). At that time, OSM found that the public 
participation aspect of SMCRA, when read as a whole and in conjunction 
with the legislative history, is key to the interpretation of the 
provision. 43 FR 34376, 34386 (Aug. 3, 1978). The provision was later 
revised in 1985 in response to the Ruckelshaus decision. 50 FR 47222 
(Nov. 15, 1985). Because 43 CFR 4.1294 is still a current Federal 
regulation that is in effect, we cannot approve this program amendment, 
which is inconsistent with that Federal regulation. The State program 
amendment process is not the vehicle to collaterally challenge a duly 
promulgated Federal regulation. To the extent that the commenter 
continues to think that 43 CFR 4.1294 should be amended or repealed, 
SMCRA provides

[[Page 54808]]

a process for persons to petition OSM to initiate a rulemaking. See 30 
U.S.C. 1211(g) and 30 CFR 700.12.
    Industry Comment 5: A commenter stated that the immediate effective 
date in SB 392 was a valid exercise of the State's sovereignty. The 
commenter stated that OSM's regulations at 30 CFR 732.17(g) are 
contrary to the principle of federalism and violate SMCRA. They also 
maintain that 30 U.S.C. 1255(a), which states that ``no State law or 
regulation . . . shall be superseded by any provisions of SMCRA or its 
implementing regulations . . . except insofar as such State law or 
regulation is inconsistent with the provisions of this act[,]'' 
supports their position. The commenter alleged that under SMCRA, a 
State's regulation may remain in place until it is found to be 
inconsistent with SMCRA. In support of this comment, the commenter 
cited to Bragg v. W.VA. Coal Ass'n, 248 F.3d 275, 295 (4th Cir. 2001), 
the ``major questions doctrine,'' and the Tenth Amendment to the U.S. 
Constitution.
    OSM Response: Please see Section III(B) for our discussion on the 
issue of the effective date. In addition, the U.S. District Court for 
the District of Montana recently held that ``the `immediately 
effective' provisions of [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).
    We do not agree with the commenter that the Federal regulation at 
30 CFR 732.17(g) violates SMCRA or that 30 CFR 732.17(g) violates the 
principles of cooperative federalism as set forth in SMCRA. The Supreme 
Court of the United States found that SMCRA does not violate the Tenth 
Amendment. See Hodel v. VA. Surface Mining and Reclamation Ass'n, 452 
U.S. 264 (1981). SMCRA clearly does not allow proposed changes to an 
approved State program to go into effect before OSM reviews those 
changes to determine whether a State law or regulation is consistent 
with the provisions of SMCRA. 30 U.S.C. 1255(a) (``No State law or 
regulation . . . which may become effective thereafter, shall be 
superseded by any provision of this Act or any regulation issued 
pursuant thereto, except insofar as such State law or regulation is 
inconsistent with the provisions of this act.'' (emphasis added)). 
Despite this plain language, as noted in the previous comment response, 
to the extent the comment considers a Federal regulation to be 
unlawful, 30 CFR 732.17(g) in this case, the commenter must follow the 
procedures to either challenge the Federal regulation (30 U.S.C. 
1276(a)) or seek to have us amend or repeal the regulation via a 
petition for a rulemaking (30 U.S.C. 1211(g) and 30 CFR 700.12). The 
State program amendment process is not the vehicle to collaterally 
challenge a valid Federal regulation.
    Industry Comment 6: The same commenter also stated that, even if 
``immediately effective'' provision is not allowed, OSM must complete 
and publish its review of SB 392 within seven months of receipt 
pursuant to 30 CFR 732.17(h)(13). For SB 392, the seventh-month date 
was January 22, 2024. Otherwise, OSM is indefinitely delaying SB 392's 
effectiveness by failing to act.
    OSM Response: OSM strives to meet the deadlines it established in 
its regulations; however, when OSM promulgated 30 CFR 732.17(h)(13), it 
acknowledged that ``[f]or processing times specified in the 
regulations, the general rule is that a statutory or regulatory time 
period is not mandatory unless it both expressly requires an agency to 
act within a particular time period and also specifies a consequence 
for failure to comply. . . . Where no such consequence is specified, 
the time period is regarded as directory only, intended to guide the 
agency procedures but not to set inflexible requirements.'' 70 FR 
61194, 61204 (Oct. 20, 2005). Given the nature of the legal issues 
raised by this proposed program amendment and our attempt to work with 
the State to resolve our concerns, this program amendment has taken 
longer to process.
    Industry Comment 7: A commenter in favor of the proposed amendment 
stated that administrative and judicial litigation is a significant 
cost to agencies and, thus, to taxpayers. The commenter opined that SB 
392 will deter frivolous litigation, which will give agencies more time 
and money to effectively protect the environment.
    OSM Response: We agree that frivolous litigation is a drain on 
taxpayer resources and should be discouraged. However, we are charged 
with reviewing program amendments to determine if they are in 
accordance with SMCRA and consistent with the Federal regulations. As 
discussed above, this proposed program amendment is not consistent with 
the Federal regulations and is disapproved. To the extent that 
litigation has no sound basis (i.e., frivolous), it is likely that a 
permittee or regulatory authority can still recover legal fees even 
under the bad faith standard.
    Industry Comment 8: A commenter in favor of the proposed amendment 
stated that OSM has approved provisions similar to SB 392 in other 
State programs and, thus, SB 392 should be approved to be consistent 
with these decisions. These include amendments in Wyoming where the 
commenter stated that OSM approved an amendment that allows fees to be 
assessed against any party to litigation before Wyoming's Environmental 
Quality Council. 59 FR 53094 (Oct. 21, 1994); in Ohio where the 
commenter states OSM approved an amendment giving the Ohio Reclamation 
Board of Review or Chief the authority to award attorney fees for that 
party's participation in the enforcement proceedings. 62 FR 1668 (Jan. 
13, 1997); and in New Mexico where the commenter stated OSM approved a 
rule allowing a permittee to be awarded by any party if the permittee 
initiated the proceedings, prevailed in whole or part, and achieves 
some degree of success in the case. 71 FR 69192 (Nov. 30, 2006).
    OSM Response: For the 1994 Wyoming amendment, OSM disagrees that 
the Wyoming amendment allows fees to be assessed against any party in 
litigation before the Wyoming Environmental Quality Council. In the 
preamble to the 1994 amendment, a commenter stated they were concerned 
that the language in W.S. 35-11-437(f) was too broad by allowing an 
award to ``be assessed against either party as the court or council 
deems proper,'' and instead Wyoming should add language stating ``and 
shall include all classes of actions in which participants would be 
eligible for an award of costs and expenses under 43 CFR 4.1290 through 
4.1295.'' OSM disagreed that such language needed to be added because, 
in 59 FR 3513 (Jan. 24, 1994), OSM had approved Wyoming regulations 
that are counterparts to 43 CFR 4.1290 through 4.1295. 59 FR 53094, 
53096 (Oct. 21, 1994). These other provisions had not been amended, 
and, thus, Wyoming still has the necessary party classifications in its 
rules as required by 43 CFR 4.1294.
    For the 1997 Ohio amendment, OSM agrees with the commenters 
assertion that the Ohio amendment allows the Ohio Reclamation Board of 
Review to award attorney fees for a party's participation, but OSM 
disagrees that a party's participation allows any party under any 
circumstance to be awarded attorney fees. The Ohio amendment and 
regulations, in line with 43 CFR 4.1294,

[[Page 54809]]

categorizes acceptable awards by party type and circumstance. The State 
regulations at ORC 1513.13(E)(1)(b), for example, only allows a 
permittee to receive an award if the other party who initiated or 
participated in the appeal did so in bad faith. OSM discussed these 
findings in our acceptance of this amendment. 62 FR 1668, 1670 (Jan. 
13, 1997).
    For the 2006 New Mexico amendment, OSM disagrees with the 
commenters assertion that New Mexico's approved amendment allows a 
permittee to be awarded by any party if the permittee initiated the 
proceedings, prevailed in whole or part, and achieves some degree of 
success in the case. New Mexico Administrative Code 19.8.12.1204(E)(4) 
only allows a permittee to be awarded attorney costs when the 
regulatory authority or person acted in bad faith.

Federal Agency Comments

    On June 27, 2023, under 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-043-05). On August 28, 2023, 
following the extension of the comment period for a further 60 days, we 
sent an additional request for comments on the amendment 
(Administrative Record No. MT-043-11). We did not receive any comments.

U.S. Environmental Protection Agency (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 Clean Water Act (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 June 27, 2023, under 30 CFR 732.17(h)(11)(i), 
we sent a letter requesting comments from the EPA on the amendment 
(Administrative Record No. MT-043-05). On August 28, 2023, following 
the extension of the comment period for a further 60 days, we sent 
another request for comments on the Amendment (Administrative Record 
No. MT-043-11). 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 June 27, 2023, we requested comments on the amendment 
(Administrative Record No. MT-043-03, and MT-043-04). On August 28, 
2023, following the extension of the comment period for a further 60 
days, we sent another request for comments on the amendment 
(Administrative Record No. MT-043-09, and MT-043-10). Montana SHPO and 
ACHP did not provide a comment.

V. OSM's Decision

    Based on the above findings, we are disapproving Montana's proposed 
amendment (MT-043-FOR) sent to us on June 22, 2023 (Administrative 
Record No. MT-043-01).
    To implement this decision, we are amending the Federal 
regulations, at 30 CFR part 926, that codify disapproval decisions 
concerning the Montana program. In accordance with the Administrative 
Procedure Act, 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 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 are exempted from 
OMB review under Executive Order 12866. Executive Order 13563, which 
reaffirms and supplements Executive Order 12866, retains this 
exemption.

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 disapproves an amendment to 
the Montana program submitted and drafted by the State to ensure that 
the State program is ``in accordance with'' the requirements of SMCRA 
and ``consistent with'' the regulations issued by the Secretary 
pursuant to SMCRA.

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 in

[[Page 54810]]

Executive Order 13175 and have determined that it has no substantial 
direct effects on Federally recognized Tribes or on the distribution of 
power and responsibilities between the Federal government and Tribes. 
Therefore, consultation under the Department's tribal consultation 
policy is not required. The basis for this determination is that our 
decision is on the Montana State program that does not include the 
regulation of Indian lands or regulation of activities on Indian lands 
as that term is defined in 30 U.S.C. 1291(9). Indian lands are 
regulated independently under the applicable, approved Federal Indian 
lands program, with the exception of the Crow Tribe's ``Ceded Strip'' 
in Montana, which represents a unique and special situation because 
under the terms of the memorandum of understanding, the Department of 
the Interior and Montana agreed to coordinate the administration of 
applicable surface mining requirements in the Crow Ceded Strip. 
However, as we are disapproving the majority of the substantive changes 
made by this proposed amendment, our action will not have any 
significant effects on the regulation of surface coal mining operations 
within the Crow Ceded Strip. The Department's consultation policy also 
acknowledges that our rules may have Tribal implications where the 
State proposing the amendment encompasses ancestral lands in areas with 
mineable coal. We are currently working to identify and engage 
appropriate Tribal stakeholders to devise a constructive approach for 
consulting on these amendments.

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 not a 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 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 upon 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.  926.12 by adding paragraph (b) to read as follows:


Sec.  926.12  State program provisions and amendments not approved.

* * * * *
    (b) The following amendment submitted by letter dated June 22, 
2023, Administrative Record No. MT-043-01, which proposed changes to 
the Montana approved program at sections 82-4-251, 82-4-252, and 82-4-
255 MCA, as a result of the Montana Legislature's 2023 passage of a 
Senate Bill (SB 392) relating to the awarding of attorney's fees, is 
not approved.
* * * * *
[FR Doc. 2026-17333 Filed 8-24-26; 8:45 am]
BILLING CODE 4310-05-P


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