Battered Coal Companies Courted State AGs to Fight Climate Rules

  • Republican attorneys general lead challenge to Obama plan
  • Top prosecutors are prime targets for corporate lobbying

Murray Energy Corp. made a $250,000 donation to the Republican Attorneys General Association last year and, in return, the coal mining company’s chief executive got a closed-door meeting with state prosecutors to discuss the Obama administration’s regulation of power plants.

Eleven days later, the attorneys general went to federal court to fight the rules that Murray Energy says could put the coal industry out of business.

The meeting among the crystal chandeliers, plush chaises and carpeted staircases of West Virginia’s Greenbrier resort came during the association’s August 2015 summit attended by more than a dozen energy company representatives. A Murray attorney and the head of a coal advocacy group spoke on a panel about “the dangerous consequences of the Clean Power Plan" and other U.S. Environmental Protection Agency rules, according to an agenda and other conference materials.

The documents, obtained under state public records requests by a watchdog group, along with tax filings and political campaign disclosures reviewed by Bloomberg News, show how energy companies, Republican attorneys general and the association dedicated to re-electing them are aligned in a legal attack on President Barack Obama’s signature plan to combat carbon pollution from power plants.

‘No Coincidence’

"It’s no coincidence that GOP attorneys general have mounted an aggressive fight alongside the fossil fuel industry to block the Clean Power Plan," said Nick Surgey, research director for the Madison, Wisconsin-based Center for Media and Democracy, which obtained the documents. "That appears to be exactly what the industry paid for."

The help from state officials comes at a particularly useful time for the energy companies, which are facing low crude prices and a diminished demand for coal that’s limited their financial ability to wage policy fights in court. Some coal companies have filed for bankruptcy protection or -- as in the case of Murray -- laid off workers.

Murray Energy spokesman Gary Broadbent said the company’s meeting with the Republican attorneys general was a useful strategy session for the litigation against the Obama administration’s Clean Power Plan. The state prosecutors, he said "drew their own conclusions" that the initiative is illegal "and acted on their own."

Scott Will, the Republican Attorneys General Association’s executive director, said there is no link between contributors and litigation -- only "between executive overreach and litigation." Republican attorneys general are on the front lines of the fight against Obama’s actions on a range of issues, including Obamacare, executive amnesty and a clean water rule, Will said by e-mail. 

‘Kill Jobs’

"Republican attorneys general are challenging the Clean Power Plan in court because it would kill jobs, raise energy prices on hard-working families, and provide no environmental benefit,” Will said. “Most importantly, the Clean Power Plan is blatantly unconstitutional, and the elected officials involved in this case are doing their job by fighting it all the way to the Supreme Court."

Coal production in the U.S. has fallen as cheap natural gas and environmental regulations have taken their toll.
Coal production in the U.S. has fallen as cheap natural gas and environmental regulations have taken their toll.
U.S. Energy Information Administration

The episode shines a light on how individual companies and industry groups can work hand-in-hand with like-minded politicians. In most cases, attorneys general are elected by popular vote and run as partisans, making them not merely the top prosecutors in their respective states but politicians who must win popular support for re-election.

$15,000 Membership

The Republican group laid down an explicit menu of options for its biggest donors, with an annual contribution of $15,000 conferring membership in the organization.

RAGA donors contributing at least $50,000 annually get four passes to group meetings, according to a membership packet, a chance to be a panelist during those summits and an "opportunity to lead issue briefings with Republican attorneys general" such as the one Murray attended.

Similarly, membership in a Democratic counterpart unlocks such benefits as participating in policy roundtables and attending issue conferences.

And promise of access in return for political contributions isn’t limited to attorneys general associations: Both the Republican and Democratic governors associations hold exclusive gatherings for donors, with bigger contributions yielding bigger perks.

Court Stay

The fight against the Clean Power Plan has been effective so far. The regulation, which would slash carbon dioxide emissions 32 percent below 2005 levels by 2030, has been stayed and the U.S. Court of Appeals in Washington is set to hear arguments on its constitutionality Sept. 27. Murray is one of nearly a dozen coal companies and interest groups also challenging it in cases that have been consolidated with West Virginia’s suit.

The Center for Democracy and Media didn’t seek copies of Democratic Attorneys General Association meeting agendas because it focused on the Republican-led legal fight against the regulation. Bloomberg News filed records requests on the Democratic group’s activities with several states but has yet to receive any documents.

‘Partisan Forums’

Both the Republican and Democratic groups accept money from a wide array of interests and industries. The attorneys general associations are registered as tax-exempt 527 organizations -- named after a section of the tax code -- which allows them to accept unlimited corporate contributions. Among companies that gave to both last year: Monsanto Co., Google Inc. and Pfizer Inc.

The 16-year-old Republican Attorneys General Association and its Democratic counterpart have become conduits for campaign cash and influence. The Republican association raised $19.3 million in the past year and a half, while the Democratic Attorneys General Association reported taking in $6.7 million, an increase from the previous year, according to Internal Revenue Service filings.

"There really is a lot going on in terms of connections between corporations and ideological groups and the AGs in these obviously explicit partisan forums where there is discussion of strategy and potential lawsuits," said Paul Nolette, a Marquette University political science professor who has documented the growing prominence of state attorneys general on policy matters.

Attorneys general are influential on policy as they dictate much of a state’s legal strategy, including whether to investigate and prosecute suspected misdeeds, Nolette said.

Donor Lists

The Republican Attorneys General Association’s membership list is thick with the names of energy companies and trade groups that have given money, such as Koch Industries Inc. ($225,000 last year), Exxon Mobil Corp. ($50,000) and Cloud Peak Energy Inc. ($15,000).

By contrast, only a handful of energy companies and trade groups donated to the Democratic association.

Both attorneys general associations spend to keep their members in office. For instance, the Republican group bought $3.1 million worth of advertising and funneled at least $180,000 to state and local candidates in 2015 and the first quarter of this year. The Democratic group reported $883,800 in donations to state candidates, according to data disclosed to the IRS and analyzed by the not-for-profit Center for Responsive Politics.

A spokesman for the Democratic group didn’t respond to a request for comment on or details of its activities.

‘Continuous Growth’

The Republican attorneys general, meanwhile, are encouraged to give their time and attention to donor-members. In a memo sent to Idaho Attorney General Lawrence Wasden before the summer conference last year, RAGA says he should "be prepared to attend all of the meetings and activities" on the agenda. "In order to support the continuous growth of RAGA, it will be critical to spend as much time as possible with as many different members as possible."

Murray Energy took advantage of the membership perks springing from the miner’s May 2015 contribution of $250,000 during last year’s conference.

In addition to a 45-minute private meeting with attorneys general, a conference agenda shows Murray counsel Geoffrey Barnes appearing on an hour-long panel discussion Clean Power Plan consequences, along with West Virginia Attorney General Patrick Morrisey and the top prosecutors from Texas and Oklahoma, who are part of the now 27-state coalition challenging the initiative. The president of the American Coalition for Clean Coal Electricity, which gave $223,400 to the Republican association last year, also had a seat on the panel.

Coal Baron

And one of the regulation’s most ardent opponents -- coal baron Robert E. Murray -- attended the 2015 conference at the Greenbrier hotel and joined other representatives of the company he founded in the closed-door meeting with attorneys general, according to Broadbent, the Murray spokesman.

"Murray Energy Corporation has no choice but to support those politicians who have vowed to protect and defend the United States coal industry -- and the jobs and family livelihoods that depend on it -- and low-cost electricity for all Americans," Broadbent said by e-mail. The company "is proud to support the Republican Attorneys General Association in working to combat the numerous illegal and destructive actions of the Obama administration."

The openly political nature of the associations cloud these issues, Marquette’s Nolette said. It’s difficult to discern "whether the line has been crossed from donating and getting access, which is -- whatever you think about it -- very common, and whether there are actual policy changes in the AG’s office that are a result of the money coming in."

Home-State Issue

Clean Power Plan foes, including Morrisey, the attorney general leading the legal battle against it, say the Environmental Protection Agency overstepped its legal and constitutional authority to limit carbon dioxide emissions from power plants.

Morrisey probably didn’t need much encouragement to challenge the Clean Power Plan, a critical issue in his home state of West Virginia, where coal’s decline has put thousands of miners out of work.

“Attorney General Morrisey always has stood firm and resilient in his willingness to challenge President Obama’s repeated unlawful use of executive power and will continue to oppose federal overreach that impacts West Virginia," Morrisey spokesman Curtis Johnson said when asked about coal boosters’ involvement in the Republican group. "The EPA’s power plan is a particularly egregious example of federal overreach that would have a devastating effect on West Virginia’s economy and the countless jobs that depend upon coal’s success."

Shooting Tournament

On the sidelines of the Republicans’ 2015 summit, there was plenty of time for mingling over golf, a clay shooting tournament and kayaking. Some of the executives, lobbyists and lawyers schooling state attorneys general in their policy preferences by day also paid an extra $500 to $5,000 in contributions to prosecutors’ campaigns to sip cocktails and coffee with the prosecutors under crystal-bedecked chandeliers in oft-overlapping 45-minute fundraisers at the Greenbrier.

Attorneys general are "a captive audience" at the conferences, Surgey said. "The corporations are paying a premium to RAGA for the benefit of being able to hold the AGs in a room and tell them what they want, tell them about their expectations, and at the same time -- literally the same day -- those AGs are asking the corporate representatives for money."

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