The Joint Revenue Interim Committee, at their meeting in Buffalo August 25, voted to consider legislation to standardize the Direct Cost Ratio for the state's coal industry, similar to a standard adopted by the trona industry in recent years.
The Direct Cost Ratio (DCR) is essentially the market value of the coal minus the costs involved in getting it to the mouth of the mine. Each mine has a different cost involved in producing coal, and as the mines age, the costs involved in processing the coal go up.
All of the coal mines in Wyoming must submit reports to the state detailing their DCR.
The proposal before the committee was to average the costs of removing the coal from the mines across the board, to make the process easier and to do away with the audits the state conducts every year.
State Representative Mike Madden (R-Buffalo) explains the proposal further.
Mines in Northeast Wyoming, if the proposal is adopted, will have a 79% cost ratio for coal produced there, while mines in Southwest Wyomng will have costs set at 81%.
Governor Matt Mead supports the proposal in theory, according to Sean Reesr with the Governor's office, and the Wyoming Department of Revenue also likes the proposal, according to Ed Schmidt with the Revenue Department.
The revenue committee voted to draft a bill on the issue for discussion at their next meeting in Worland in October.