Introduction

Electricity generation is a major source of demand for coal in the United States. The U.S. Energy Information Administration (EIA) has noted that since 1961, "the electric power sector has accounted for the majority of U.S. coal consumption," and that "the electric power sector accounted for about 91.7% of the total U.S. coal consumed in 2022."¹ In addition to electricity generation, coal is used to a lesser degree for other purposes in the United States (e.g., steel manufacturing, other industries).²

In recent years, coal's market share in overall electricity generation has declined, and EIA energy analysts expect this trend to continue.³ Changes in electricity generation are generally the result of both market forces and federal, state, and local policies which have influenced the use of different energy sources. According to some analysts, the net effect for coal has been a general loss of competitiveness compared to natural gas, wind energy, and solar energy.⁴

Results of energy sector restructuring have affected certain communities due to declining levels of coal production, employment, and state and local revenues—particularly since 2011 in areas with high rates of coal dependence.⁵ The term "coal communities" lacks a standard definition but generally refers to communities with a concentration of coal-related industries, particularly industries that extract coal or communities that have a coal-fired electric plant (see "Identifying Coal Communities" for definitions). In certain coal communities, the regional economy is not diversified, job losses are highly concentrated, and impacted workers face barriers to relocation or new employment.⁶ Economic and workforce development initiatives in these areas face challenges related to environmental, community, and individual health impacts associated with past and current coal industry activity. To address the localized nature of economic, employment, and environmental concerns, Congress has approved primarily place-based programs that support the revitalization of economically distressed coal communities.⁷

While some note that changes in the energy markets have provided certain benefits to some workers and communities, this report focuses primarily on broader, community-level economic development challenges.⁸ This report provides an overview of trends in the U.S. coal industry and the factors that have contributed to economic distress in certain coal communities. This report also summarizes existing federal policies that provide place-based assistance for economic diversification and development in coal communities. The final part of this report outlines various policy tools Congress may consider if it seeks to adjust or expand assistance for coal communities, including options for program integration and areas for additional research and evaluation. A full cost-benefit analysis of the economic, environmental, and health impacts of coal activity and related policies is not within the scope of the report.

While this report focuses on economic, community, and workforce development policies, Congress has notably provided federal financial assistance for certain health care and pension programs for eligible coal workers.⁹ Programs that provide assistance directly to individuals are generally not discussed in this report.

Economic revitalization challenges may be similar across different types of energy communities. Several programs described in this report, in the context of coal-impacted communities, may broadly provide assistance to those other types of energy communities. This report does not attempt to examine specific policy considerations for oil, natural gas, nuclear, or other types of energy communities.

Identifying Coal Communities

The term "coal communities" is not uniformly defined in statute and certain federal agencies and outside groups use the term in various ways. When defining "coal communities" for the purpose of federal assistance and national analyses, federal agencies and other groups have typically used a range of criteria associated with the levels and types of coal industry activity. To identify conditions of regional economic distress associated with coal regions, definitions of "coal communities" often combine measures of coal industry activity with indicators of socioeconomic distress.¹⁰ The various definitions generally identify communities that have power plants with coal-fired electric generators or a concentration of coal-related industries, particularly those that extract coal.¹¹ Researchers often demonstrate a relationship or "dependence" of a region on coal sector activity through measures of sector employment levels, sector employment as a share of total employment,¹² the current or past level of sector production,¹³ and/or the presence or number of coal mines or power plants with coal-fired electric generators that may be active, retired, or scheduled for retirement.¹⁴ Certain definitions may also include areas with supply chain, distribution, or transportation connections to coal activity. These definitions may cover communities that do not have coal supplies or generating facilities, but nonetheless may be impacted by shifts in the coal industry.¹⁵

Congress, federal agencies, and the Biden Administration have used differing methodologies to define and identify coal communities, which are explored below.

Interagency Working Group (IWG) on Coal and Power Plant Communities and Economic Revitalization

In January 2021, the Biden Administration established the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization (IWG) to facilitate economic revitalization in coal, oil and gas, and power plant communities.¹⁶ In an April 2021 report, the IWG identified the 25 "most impacted regions for coal-related declines" (see Figure 1). To define those regions, the IWG analyzed "workers directly employed in coal mining and power generation, and also the workers in related jobs in logistics and services ... as well as fenceline communities and other communities impacted by environmental and health effects of fossil fuel generation."¹⁷ Seven of the IWG's 10 most-impacted coal regions were in Appalachia or Wyoming. Twelve of the 25 regions were in the seven highest coal-producing states.¹⁸

Figure 1. IWG-Identified 25 Priority Communities for Coal-Related Employees

Source: Map created by CRS using data provided by the IWG and listed in IWG, Initial Report to the President on Empowering Workers Through Revitalizing Energy Communities, Appendix B (Counties within Priority Communities). Notes: The IWG identified the 25 Priority Communities based on the "number of direct coal-related jobs as a percentage of the total number of jobs in each area." According to the IWG, the Western Pennsylvania non-metropolitan area (*) was added for geographic diversity, and the "shading highlights BLS metro and non-metro areas that are communities vulnerable to impacts from coal-specific job losses." There may be minor mapping discrepancies between the CRS map and the areas shown in Figure 2 of the IWG report. Congressional offices may contact the author for more information. Figure 2 of the IWG report includes the location of the top 1-25 and 26-70 metropolitan and nonmetropolitan areas with a high number of coal-related employees. The CRS map (above) shows the top 1-25 communities identified by the IWG. The IWG report also included a map that identified the location of the top 75 metropolitan and nonmetropolitan areas with a high number of fossil energy activities and jobs; see IWG, Figure 1.

U.S. Department of Commerce Economic Development Administration (EDA)

The EDA, a bureau of the U.S. Department of Commerce (DOC), is the only federal agency with economic development as its sole mission. The agency was established pursuant to the enactment of the Public Works and Economic Development Act (PWEDA) of 1965 (42 U.S.C. §3121 et seq.) to assist state and local stakeholders with developing the conditions and amenities to grow businesses, create jobs, and expand investment in economically distressed areas.

The Economic Adjustment Assistance (EAA) program (42 U.S.C. §3149) is one of EDA's core programs for economically distressed areas. EDA administers the Assistance to Coal Communities (ACC) grant initiative primarily through the EAA program. EDA does not provide a list of eligible coal communities; however, agency guidance notes that potential applicants should use third-party data to document the extent to which contractions in the coal economy have negatively impacted (or will negatively impact) the community or region.¹⁹ EDA has defined "coal economy" as a term that reflects the complete supply chain of coal-reliant industries, including coal mining, coal-fired power plants, and related transportation, logistics, and supply chain manufacturing.²⁰

Appalachian Regional Commission (ARC)

The ARC is one of eight federal regional commissions and authorities that Congress has authorized to address instances of major economic distress in certain defined geographic regions of the country.²¹ The ARC was established in 1965 to address economic distress in the Appalachian region,²² which spans 423 counties in Alabama, Georgia, Kentucky, Maryland, Mississippi, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Virginia, and West Virginia.²³

The ARC does not provide a list of eligible coal communities for its main grant program for coal communities within its jurisdiction. Instead, for its Partnerships for Opportunity and Workforce and Economic Revitalization (POWER) Initiative, the ARC's request for funding proposals indicates that

Eligible POWER projects must be located within and targeted to communities or regions that have been recently impacted (or can reasonably demonstrate that they will be impacted in the near future) by coal-mining or coal-power-plant employment loss, or employment loss in the supply-chain or logistics industries of either sector.²⁴

U.S. Department of Health and Human Services, Community Economic Development—Focus on Energy Communities

Certain discretionary grant funds provided under the Community Economic Development (CED) initiative²⁶ are also set aside for "energy communities."²⁷ The CED is administered by the U.S. Department of Health and Human Services, Administration for Children and Families, Office of Community Services. CED grants are made available through a competitive process to qualifying private, nonprofit community development corporations with 501(c)(3) status.²⁸ Under the CED Initiative, "energy communities" are defined by the agency as "communities that have experienced employment loss and/or economic dislocation events because of declines in the fossil fuel industry and/or are disproportionately reliant on fossil fuel energy production or distribution, including coal, oil, gas, and power plant."²⁹ The goal of the CED's Focus on Energy Communities initiative are to create jobs, spur economic revitalization, remediate environmental degradation, and support energy workers.³⁰ In fiscal year (FY) 2021, OCS provided bonus points to CED applications for projects located in and serving coal, oil, and gas, and/or power plant communities, and indicated that it would provide funding through separate funding opportunities for projects serving these communities starting in FY2022.³¹

Coal Communities Impacted by Coal Closures 2000/2010 or Later

In 2021, the Infrastructure Investment and Jobs Act (IIJA, P.L. 117-58) established the Advanced Energy Manufacturing and Recycling Grant Program³² (see Table 2), which provides grants for qualified businesses in coal communities impacted by certain coal closures. In the context of this program, coal communities include areas located in census tracts containing coal-fired generating units that have retired since December 21, 2009, coal mines that have closed since December 31, 1999, or adjacent census tracts. Figure 2 shows an example from the DOE mapping tool that may be used to help identify these census tracts.

Figure 2. Coal Communities Directly Impacted by Coal Closures 2000/2010 or Later According to DOE's IIJA Mapping Tool for the Advanced Energy Manufacturing and Recycling Grant Program, as of July 2023

Source: Figure created by CRS based on U.S. DOE, "BIL [Bipartisan Infrastructure Law] Section 40209: Coal Communities Directly Impacted by Coal Closures 2000/2010 or Later," accessed July 25, 2023, https://arcgis.netl.doe.gov/portal/apps/experiencebuilder/experience/?id=09457c326145417595287951ed376a29. (DOE and other entities use the term "BIL" to refer to P.L. 117-58. P.L. 117-58 is commonly referred to as the BIL and/or the IIJA.) Notes: PR is Puerto Rico, and USVI refers to the U.S. Virgin Islands. Figure does not display other U.S. Territories. The online version of the map is interactive and includes additional data visualization options. DOE further notes that—as in statute, proposed projects under the program funding announcement for the Advanced Energy Manufacturing and Recycling Grant Program must be located in (a) a census tract in which a coal mine closed after December 31, 1999, (b) a census tract in which a coal-fired electricity generating power plant unit closed after December 31, 2009, or (c) a census tract immediately adjacent to (a) or (b).

Coal Communities as a Subset of "Energy Communities"

Depending on the type of coal industry activity and other factors present, coal communities may be considered a type of "energy community." The Inflation Reduction Act (IRA, P.L. 117-169) provided enhanced tax credits for certain energy projects, facilities, and technologies, if the investments are located in "energy communities." (See Table 3 for additional examples from the IRA.) In the context of the IRA's climate and energy incentives, energy communities are defined as

• A brownfield site as defined in subparagraphs (A), (B), and (D)(ii)(III) of Section 101(39) of the Comprehensive Environmental Response, Compensation, and Liability Act of 1980;
• A metropolitan statistical area or non-metropolitan statistical area with an above-average unemployment rate and either greater than 0.17% direct employment or greater than 25% local tax revenues related to the extraction, processing, transport, or storage of coal, oil, or natural gas (as determined by the Secretary);
• A census tract (or directly adjoining tract)
• In which a mine closed after December 31, 1999, or
• In which a coal-fired generating unit was retired after December 31, 2009.³³

See Table 3 for additional information about selected energy community tax credit policies.³⁴

Figure 3 shows an example from the DOE's mapping tool for energy community tax credit policies that provides up to 10% (for production tax credits) or 10 percentage points (for investment tax credits) to taxpayers and applicable entities³⁵ for certain investments in energy communities. The increased rates or amounts pertain to certain energy community requirements under Section 45, 48, 45Y, or 48E of the Internal Revenue Code. Figure 3 does not include brownfields locations. The energy community bonus tax credits are for areas associated with fossil fuels, including coal as well as oil and natural gas. This contrasts with Figure 2, which shows areas associated with coal activity.³⁶

Figure 3. Areas Meeting Fossil Fuel-Related Criteria for the IRA's Energy Community Tax Credit Bonus for 2023 Brownfields not shown

Source: Figure created by CRS based on U.S. DOE, "IRA Energy Community Tax Credit Bonus Mapping Tool," accessed July 24, 2023, https://arcgis.netl.doe.gov/portal/apps/experiencebuilder/experience/?id=a2ce47d4721a477a8701bd0e08495e1d. Notes: MSAs are metropolitan statistical areas. PR is Puerto Rico and USVI refers to the U.S. Virgin Islands. Figure does not display other U.S. Territories. The online version of the map is interactive and includes additional data visualization options. The IWG provides a link (https://energycommunities.gov/energy-community-tax-credit-bonus) to the U.S. DOE's mapping tool with the following description of the mapping tool: The mapping tool [above] reflects currently available data on two types of energy communities. First, the map shows energy communities that are census tracts and that have had coal mine closures after December 31, 1999 or coal-fired electric generating unit retirements after December 31, 2009, and tracts that are directly adjoining. Second, the map shows the metropolitan statistical areas (MSAs) and non-metropolitan statistical areas (non-MSAs) that are energy communities for 2023. These MSAs and non-MSAs have had for at least one year since 2009, 0.17% or greater direct employment related to extraction, processing, transport, or storage of coal, oil, or natural gas (the fossil fuel employment (FFE) threshold) and have an unemployment rate for 2022 that is equal to or greater than the national average unemployment rate for 2022. These MSAs and non-MSAs that meet the 2022 unemployment rate requirement are energy communities as of January 1, 2023, and will maintain that status until the unemployment rates for 2023 become available and a new list of energy communities is provided. The guidance that determines the MSAs and non-MSAs that are energy communities based on 2023 unemployment rates will likely be released in May 2024. Note that brownfields are not shown on this map. The IWG also provides the following disclaimer associated with the mapping tool: The mapping tool may not be relied upon by taxpayers to substantiate a tax return position or for determining whether certain penalties apply and will not be used by the IRS for examination purposes. The mapping tool does not reflect the application of the law to a specific taxpayer's situation, and the applicable Internal Revenue Code provisions ultimately control.

Trends in U.S. Coal Production and Employment³⁷

Since the 1920s, coal communities have generally experienced long-term declines in employment which may be exacerbated by more recent declines in coal production. Experts expect these declines to continue with current technologic, economic, and policy trends. Key changes include³⁸

• The mix of U.S. energy production has shifted among fuels and technologies (Figure 4). For electricity generation, market shares have generally shifted from coal to natural gas and, more recently, to wind and solar energy. Since the mid-2000s, coal production has declined by almost one-half.
• Fossil fuel production, especially coal production, has shifted from the eastern to the western United States. The largest reduction has occurred in the central Appalachian basin (Figure A-1). On average, western mines require fewer miners to produce a ton of coal than eastern mines.³⁹
• Employment in coal production has experienced a century-long decline (Figure 6). This has occurred heterogeneously across U.S. regions (Figure 6).⁴⁰ A 2022 report by researchers at West Virginia University noted that

37.3 thousand workers were employed in the coal mining industry in 2021. This reflects a significant decline of around 37.8 thousand jobs, or more than 50 percent, from 2001. Notice that jobs in the coal industry continued to decline in 2021, even as the U.S. economy was recovering from the COVID pandemic. Jobs in the other industries in the U.S., on the other hand, increased by more than 12 percent during the same period. Overall, this reflects a gradual shift in the national economy away from coal over time.⁴¹

The Appalachian region,⁴² in particular, experienced concentrated job losses between 2005 and 2015.⁴³

• The long-term decline in coal employment has been attributed primarily to technological changes (e.g., substitution of capital for labor inputs) and economic changes (e.g., the shifting competitiveness of production across types and locations of mines) that reduced, in most decades, the average labor necessary to produce a ton of coal.⁴⁴ Throughout the century, these shifts led to declining employment even in places where coal production increased (Figure 6). The decrease in coal production since 2008 has further reduced coal-related employment.

Figure 4. U.S. Energy Production by Source, 1949-2021 In quadrillion British thermal units

Source: CRS, using data from the U.S. Energy Information Administration, "Monthly Energy Review," December 2022, https://www.eia.gov/totalenergy/data/monthly.

Figure 5. Annual Average Coal Mine Employees in Selected Regions

Source: CRS, using data from the U.S. Energy Information Administration, "Coal Data Browser," https://www.eia.gov/coal/data/browser/#/topic/36? agg=.

Figure 6. U.S. Coal Production and Employment 1900-2021

Source: CRS, using the following data: Coal Production: National Mining Association, "Growth of the Bituminous Coal Mining Industry in the United States, 1900-1971," accessed January 24, 2023, https://nma.org/wp-content/uploads/2016/08/Historic-Bituminous-Coal-Production.pdf; and Energy Information Administration, Coal Data Browser, "Aggregate Coal Mine Production, Total Annual," accessed January 24, 2023; Coal Employment: Mine Safety and Health Administration, "Coal Fatalities for 1900 through 2022," U.S. Department of Labor, accessed June 29, 2023, https://arlweb.msha.gov/stats/centurystats/coalstats.asp. Notes: BOM is the U.S. Bureau of Mines; EIA is the U.S. Energy Information Administration; DOL is the U.S. Department of Labor. Employment data include office workers beginning in 1973.

Analysts have identified a number of factors that have influenced the growth and decline in coal production in the United States. Since 2008, demand for coal for electricity has fallen with the decreasing cost-competitiveness of coal as a fuel for electricity generation.⁴⁵ Factors affecting the loss of cost-competitiveness include

• changing federal policy incentives;⁴⁶
• technological advances that reduced the cost of natural gas production;⁴⁷
• increasing costs of environmental regulation;⁴⁸ and
• increasing costs of production in Appalachia.⁴⁹

Figure A-1 illustrates the differences in coal production across regions and individual states from 2001 to 2021. Nearly all states have witnessed declines in coal production from their recent peaks, though some much more than others. See "Economic Diversification and Employment in Coal Communities" for a discussion of community impacts associated with changes in coal production.

EIA projections indicate that U.S. coal production is likely to continue to decrease under current policies and anticipated technological advances, as well as a wide range of alternative economic assumptions. The EIA's outlook for coal production to 2050 includes a reference case as well as a range of "side cases" that reflect alternative economic and technological assumptions. In all of EIA's side cases, coal production continues its long-term decline, even in cases with more favorable assumptions, such as high economic growth combined with high zero-carbon technology costs, and omission of the IRA (P.L. 117-169) and its incentives for renewable energy development.⁵⁰ Despite these changes, coal is generally expected to continue as a component of the U.S. energy supply.⁵¹

Economic Diversification and Employment in Coal Communities

In recent years, coal communities across the United States have faced a combination of inter-related economic diversification and employment challenges, including the following:⁵²

• declining coal-related tax revenues for state and local governments;⁵³
• sustained, long-term job losses—both direct and indirect—in coal and coal-related industries;⁵⁴
• local workforces skilled in coal-related jobs, but less prepared for positions in other industries, and barriers to labor mobility for new employment seekers;⁵⁵
• health, education, and other concerns that accompany the concentrated job losses;⁵⁶ and
• environmental impacts tied to coal mining and production.⁵⁷

Regional economies that are less diversified—including certain coal communities—are more vulnerable to multiple challenges following the decline of major industries and other economic shocks or events. For instance, decreased tax revenues from lower coal production levels may lead to fewer resources for public services. Although state and local tax structures and rates vary,⁵⁸ a 2020 analysis of three of the nation's most coal mining-dependent counties found that "coal-related revenue may fund a third or more of their budgets."⁵⁹ The decline in tax revenues and public services in coal communities may compound economic and workforce development challenges,⁶⁰ since limited resources for the planning and implementation of diversification strategies may impede efforts to attract new investment, industries, and jobs.⁶¹

Declining state and local revenues may pose a particular challenge for rural areas. Researchers observe that geographically isolated, rural areas may be more vulnerable to declining production and employment changes at coal mining facilities because these areas generally have fewer industries, longer commuting distances for dislocated workers, and a greater reliance on taxes for public services and infrastructure.⁶²

Less diversified regional economies may have fewer employment opportunities, and this challenge may be exacerbated in certain areas by concentrated, ongoing job losses associated with shifts in the coal industry.⁶³ As noted above, the number of coal mining jobs has declined since a peak in the 1920s, and the rate of decline has intensified in the most recent decades (see Figure 6). Following employment shifts, a spatial mismatch may occur when available jobs are not located near dislocated coal workers and alternative employment is not available to absorb dislocated workers within the affected region. Dislocated workers in economically distressed areas may also face barriers to moving to other areas to pursue employment, training, or other economic opportunities.⁶⁴ Furthermore, a mismatch of skills may occur when private sector (non-coal firms) workforce demands do not align with workers' skills. Non-coal jobs may require different training, certification, or skillsets than those of coal workers.⁶⁵ The spatial mismatch and workforce gaps may further intensify economic development and training challenges for coal-impacted communities.

Additional issues may complicate efforts to redevelop coal communities.⁶⁶ For example, some have identified particular challenges related to land ownership and use as impediments to development in some locations: inaccurate land ownership records; land ownership by "absentee" landholding corporations; separation of surface and mineral rights; and legacy environmental degradation, among others.⁶⁷ Others note that certain communities may have economic systemic and capacity challenges related to broadband, infrastructure, and health care.⁶⁸ Researchers have observed low levels of entrepreneurship in certain coal communities.⁶⁹ Some researchers have noted that certain coal communities have declining population levels due to outmigration, but note that outmigration may involve a range of complex push and pull factors, particularly for rural areas, and trends vary by region and time period.⁷⁰

Selected Federal Assistance Policies

The rationale for providing federal assistance to coal communities generally reflects one or more policy objectives tied to economic development, economic growth, national economic interests, environmental remediation, or equity. Other policy objectives may include improved fiscal health of local governments, higher per capita earnings, increased educational attainment levels, improved health measures, or other outcomes.

Recent executive branch initiatives and congressional actions indicate continued interest in providing assistance to coal communities to meet a range of policy objectives. In recent years, in response to the challenges noted above, core objectives of these policies have focused on the overall diversification of regional economies and expansion of employment opportunities. Since FY2014, executive actions or legislative actions authorized by Congress that have provided assistance to coal communities include

• targeted, place-based economic adjustment assistance⁷¹ grant funding for economic diversification activities in coal communities (e.g., the EDA's Assistance to Coal Communities (ACC) Initiative, the ARC's POWER Initiative);
• tax credits to incentivize business investments in certain energy communities, including coal communities (e.g., provisions in the IRA);⁷²
• grants for mine land reclamation (e.g., the Department of the Interior's Abandoned Mine Land Economic Revitalization (AMLER) program);
• assistance for dislocated workers, workforce training, education (e.g., aspects of ARC's POWER Initiative); and
• other initiatives and economic adjustment assistance, including interagency working groups and legislation authorizing programs that are broadly available for economic and business development purposes.

The following sections summarize the federal policies designed to assist coal communities with revitalization, regional economic diversification, mine lands, and dislocated workers, as well as other federal activities.⁷³

Programs for Economic Diversification, Community Revitalization, and Jobs

For almost a century, Congress has authorized place-based economic development programs, many of which have been designed to assist economically distressed or socially disadvantaged areas. Place-based policies provide assistance to designated geographic areas rather than focusing assistance on individuals regardless of location.⁷⁴

While many regions may experience economic difficulties, coal communities' unique set of issues may suggest they could benefit from place-based policies tailored to their needs. Since FY2014, in response to the decline in coal sector activity, Congress has enacted place-based programs to address the localized nature of economic and employment concerns in coal communities.⁷⁵ Table 1 summarizes selected economic development grant programs that have criteria specifically for coal-impacted communities.⁷⁶ The programs for community-level support generally include grants and loans for planning, technical assistance, infrastructure, business development and entrepreneurship, workforce development and re-employment opportunities, capacity building, and other activities.⁷⁷

Other federal grant programs are broadly available to coal communities for economic diversification and business development efforts, but may not prioritize or include specific criteria for coal communities. For example, programs administered by the U.S. Department of Agriculture's Rural Development support economic development projects in rural communities, and the Department of Housing and Urban Development (HUD) administers programs that support community development initiatives in both rural and urban areas.⁷⁸ Other programs may be available to broader "energy communities," such as the U.S. Department of Health and Human Services' Community Economic Development Focus on Energy Communities initiative and the Capacity Building for Repurposing Energy Assets initiative, which is administered by the DOE Office of Fossil Energy and Carbon Management.⁷⁹

Selected Business Development, Research and Development, and Energy Infrastructure Programs

Policymakers occasionally authorize or amend programs designed to provide financial assistance (e.g., grants, loan guarantees) for business development activities. These programs may support specific activities such as research and development (R&D), the development of regional entrepreneurial ecosystems, or the commercialization of new technology and innovative processes or products. Some such programs encourage or require federal assistance to be directed to specific geographic areas that may include energy communities.

Several bills enacted during the 117^th Congress included provisions for grant and loan guarantee programs that encouraged participation by coal communities or directed agencies to prioritize activities or projects located in energy communities, including coal communities. Table 2 highlights selected programs authorized by P.L. 117-58 (the Infrastructure Investment and Jobs Act (IIJA)), P.L. 117-167 (commonly known as the CHIPS and Science Act), and P.L. 117-169 (the Inflation Reduction Act (IRA) of 2022) that provide grants and loan guarantees for business development and/or R&D activities in energy communities, including coal communities.

Tax Credit Policies for Businesses in Coal Communities

For decades, Congress has authorized tax credit policies to encourage private business investment in targeted business activities (e.g., R&D), geographic areas (e.g., Opportunity Zones), or to meet specific policy objectives (e.g., trade). Federal tax credit policies may also be designed to incentivize economic development objectives (e.g., policies to encourage investment in distressed regions or to increase firm-level and entrepreneurial activity around the country).

Congress has also authorized tax credit policies to incentivize investment in defined energy communities, some of which may identify as coal communities. P.L. 117-169, the Inflation Reduction Act, for example, provided bonus tax credits for certain projects located in "energy communities" (see "Identifying Coal Communities" for the definition of energy communities in the IRA).⁸⁰ As noted, the IRA also authorized the Advanced Energy Project Credit, which provides a competitively awarded tax credit that includes a set-aside for "projects in areas that have seen the closure of a coal mine or retirement of a coal-fired electric generating unit."⁸¹ Table 3 summarizes selected community tax credit policies established, modified, or amended by the IRA. Table 3 also highlights tax credit policies that include criteria for energy communities, which includes many coal communities.

Federal Assistance for Mine Land Reclamation for Economic and Community Development

Congress has considered whether the reclamation of abandoned coal mining sites could spur economic and community development for communities affected by the decline of coal production and associated tax revenues.

Enacted in 1977, Title IV of the Surface Mining Control and Reclamation Act (SMCRA; P.L. 95-87) established the Abandoned Mine Lands (AML) program to address public health, safety, and environmental hazards at these legacy abandoned coal mining sites.⁸² The Abandoned Mine Reclamation Fund (AMRF), established under Title IV of SMCRA, provides funding to eligible states and tribes for the reclamation of surface mining impacts associated with historical mining of coal.⁸³ The Office of Surface Mining Reclamation and Enforcement (OSMRE), within the Department of the Interior, administers grants from the AMRF to eligible states and tribes to reclaim affected lands and waters resulting from coal mining sites abandoned or otherwise left unreclaimed prior to SMCRA's enactment. Fees collected on coal mining operators in coal-producing states, deposited into the AMRF are the source for grants to eligible states for the reclamation of AML sites.⁸⁴ Under Title IV of SMCRA, the objective of reclamation is to restore lands or waters adversely affected by past coal mining to a condition that would mitigate potential hazards to public health, safety, and the environment.

In more recent years, Congress has established other programs in addition to the AML program under Title IV of SMCRA that are intended to reclaim abandoned coal mining sites to increase economic and community development in certain coal communities or former coal industry workers. Those programs, discussed below, include the Abandoned Mine Land Economic Revitalization (AMLER) program and funding provided under Section 40701 of the IIJA.⁸⁵

Abandoned Mine Land Economic Revitalization (AMLER) Program

Congress provides funding for the AMLER program for the reclamation of abandoned coal mining sites to facilitate economic and community development. Beginning in the 114^th Congress and continuing through the 117^th Congress, versions of the Revitalizing the Economy of Coal Communities by Leveraging Local Activities and Investing More (RECLAIM) Act were introduced in both the House and the Senate but not enacted. These bills would have authorized $1 billion over five years from the existing unappropriated balance of the AMRF to facilitate economic and community development in states and tribes with eligible reclamation programs under Title IV of SMCRA.⁸⁶

In the FY2016 President's budget request, the Obama Administration included a similar legislative proposal to provide $1 billion, in equal amounts over a five-year period, of the unappropriated balance of the AMRF to "use for the reclamation of abandoned coal mine land sites and associated polluted waters in a manner that promotes sustainable redevelopment in economically distressed coal country communities."⁸⁷

Beginning in FY2016, Congress took a more limited approach to provide funding for a pilot project similar in scope and purpose to versions of the RECLAIM Act and the administration's proposal that could inform future policy decisions regarding authorizing additional funds towards these purposes. The Consolidated Appropriations Act, 2016, authorized the AML Pilot Program to provide grants to eligible states and tribes and provided $90 million in annual appropriations from the General Fund for FY2016 for this program.⁸⁸

Congress has directed that funding for the AML pilot program be distributed to the six Appalachian states with the largest unfunded reclamation needs and three eligible tribes under SMCRA.⁸⁹ Congress limited eligibility for these funds to AML projects located in ARC counties, where the project would have the potential to facilitate economic or community development. Congress used the existing framework of Title IV of SMCRA as the requirements for AML sites to be reclaimed under the AML pilot program.

Since FY2016, Congress has continued to provide funding for the AML pilot program, which is now referred to as the AMLER program.⁹⁰ According to OSMRE's FY2024 budget justification, Congress has provided annual appropriations for this program totaling $750 million between FY2016 and FY2022.⁹¹ The Consolidated Appropriations Act, 2023, provided $135 million for the AMLER Program,⁹² and the President's FY2024 budget requested $135 million.⁹³

Whether these funds have achieved the intended purpose of reclaiming abandoned coal sites to facilitate economic and community development presents an oversight consideration for Congress. OSMRE guidance requires AMLER states and tribes to demonstrate the AML project's economic and community development nexus "in different ways depending on whether the proposed project is intended to: (1) incorporate economic and community development related activities as part of the project itself (Category A projects), or (2) primarily involve reclamation activities that create the conditions for future economic and community development that occurs post-reclamation (Category B projects)."⁹⁴ OSMRE guidance urges AMLER-eligible states and tribes to track and report as many economic and environmental performance measures as practical, including examples of⁹⁵

• Jobs created (beyond those jobs necessary to conduct reclamation);
• Businesses created or served;
• Infrastructure created (impact could be measured by the linear feet, acreage, square feet, or other unit of measure for the expected amount of water, sewer, utility, or other form of infrastructure installed, constructed, or repaired);
• Revenues increased (export or domestic sales);
• Patients served;
• Participants served;
• Organizations served;
• Increased, enhanced, or restored infrastructure system capacity (includes energy capacity, broadband accessibility);
• Communities served;
• Households served;
• Reclamation achieved (e.g., acres reclaimed, waters improved, improved revegetation, methane reduced, etc.);
• Housing units constructed or rehabilitated;
• New or existing workers or students served;
• Number of visitors (overnight and daytime); and
• Quantifiable recreational opportunities created.

OSMRE's most recent program implementation and status report for FY2016-FY2019 stated that, as of November 30, 2019, "121 of the 134 reviewed projects are currently active and are moving forward in their use of AML Pilot funds."⁹⁶ Additionally, that report stated "the 13 remaining projects have been tabled by the state or project applicant for various reasons (e.g., to secure additional funds, pending negotiations with partners, or withdrawn application)." To date, OSMRE has not issued similar reports for projects funded in recent years. Those more recent projects may be ongoing and at various stages of the reclamation process.

AML Funding in the Infrastructure Investment and Jobs Act

With the enactment of the IIJA, Congress reauthorized the coal reclamation fee under Section 402 of SMCRA through FY2034 and decreased fee rates from prior law by 20% for underground and surface mining and for lignite coal.⁹⁷ SMCRA authorizes OSMRE to collect these coal fees from coal mining operators, based on coal production, and credit the fees to the AMRF. SMCRA directs these coal fees to be distributed annually as grants to eligible states to support the reclamation of abandoned coal mining sites within their respective jurisdictions.⁹⁸

Additionally, the IIJA provided $11.293 billion in emergency appropriations to the AMRF.⁹⁹ Congress authorized the use of the $11.293 billion to provide grants to eligible states and tribes, in equivalent amounts over a 15-year period, based on relative percent of coal production prior to 1977.¹⁰⁰ Provisions in the IIJA limit the use of grants from the $11.293 billion to eligible states and tribes for the reclamation of abandoned coal mining sites under Section 403(a), Section 403(b), and emergency projects under Section 410 of SMCRA.

In addition to the priorities in Section 403 of SMCRA, the IIJA authorizes states and tribes to consider AML projects that may provide employment to former workers of the coal industry.¹⁰¹ This provision is unique to AML projects authorized by the IIJA, as Congress had directed prioritization of AML projects authorized under SMCRA by public health and safety and natural resources.¹⁰² According to OSMRE's guidance for implementing the AML provisions in the IIJA,

measures to implement these priorities include: (1) requiring contractors to affirm they will give preference to miners in any hiring for BIL-funded AML projects; (2) requiring contractors to report on the extent to which miners have been employed in any AML work the contractors perform; (3) requiring contractors to retain data that can substantiate the reported information; and (4) providing to OSMRE the information reported by the contractors as part of the State or Tribe's regular AML reporting processes.¹⁰³

Additionally, OSMRE guidance encourages states and tribes to engage with labor or workforce development organizations that represent current or former coal industry employees to identify potential candidates.

Workforce Development Programs (Job Training and Education)

Congress has authorized a range of programs to support labor-market relevant human capital development. In some cases, programs support individuals in developing the skills with the express purpose of obtaining employment.¹⁰⁴ In other cases, federal support of higher education may not be primarily considered a direct workforce investment, though the relationship between higher education and positive labor market outcomes is well-documented.¹⁰⁵

Compared to the federal policies noted previously for targeted community assistance—and with few exceptions—most federal workforce development programs are authorized to meet a range of human capital concerns and are not specific to coal communities or coal workers. The primary federal support for skill development is accessed through permanent federal systems with a nationwide footprint. For example

• The Workforce Innovation and Opportunity Act (WIOA) supports state systems and funding streams that state and local workforce development boards can use for career services and training that align with local labor market needs. While these programs are not typically targeted to communities with specific characteristics (e.g., coal communities), some of the characteristics of these communities (e.g., high unemployment) may make some resources more accessible. For example, formula funds under the WIOA Dislocated Worker program are partially allocated to states with higher unemployment or larger shares of long-term unemployed.¹⁰⁶
• The WIOA also authorizes National Dislocated Worker Grants, which is competitive funding to support workers in states and local areas experiencing disasters, emergencies, or "major economic dislocations."¹⁰⁷ In some cases, appropriations language or DOL under its administrative authority has targeted this funding with a broader statutory authorization to specific areas or areas experiencing specific hardships. For example, a portion of FY2016 funding for National Dislocated Worker Grants was targeted to communities adversely affected by coal economy contractions as a component of the multi-agency POWER initiative (see the text box, above, on "POWER Initiative for Coal Communities").¹⁰⁸
• The Higher Education Act (HEA) authorizes a system of federal student aid that makes portable aid available to individual students that can be used at eligible institutions for eligible degree and certificate programs. While most student aid programs are not targeted on the basis of community characteristics, students with fewer financial resources may qualify for larger amounts of need-based aid (e.g., Pell Grants). Eligibility for need-based aid is determined by information provided on the Free Application for Federal Student Aid (FAFSA) and program-specific details.¹⁰⁹
• A number of programs target employment-related assistance to individuals on the basis of individual characteristics. For example, various programs can support employment-related services for individuals with disabilities and veterans.¹¹⁰

In some cases, workforce development is an allowable use of federal resources with broader objectives, often relating to industrial policy or economic development.¹¹¹ Cataloging training efforts associated with these funds can be challenging due to their integration with other activities.¹¹²

Other Federal Activities

In addition to the financial assistance programs noted above, federal involvement in the economic diversification of coal communities may include the coordination of existing resources and partners. In January 2021, the Biden Administration established the Interagency Working Group on Coal and Power Plant Communities and Economic Revitalization to facilitate economic revitalization in coal, oil and gas, and power plant communities and to support workers. The IWG leads workshops, stakeholder engagement, and capacity-building activities to support state and local transition efforts, and carries out resource identification, analysis, and interagency coordination activities.¹¹³ For example, in order to provide direct technical assistance on federal grants, the IWG created Rapid Response Teams (RRTs) in coal and fossil energy communities that connect local stakeholders with federal resources and agency representatives.¹¹⁴

Federal agencies and federal regional commissions also directly provide or facilitate technical assistance to stakeholders in coal communities. Technical assistance may include agency efforts to connect stakeholders from different coal-impacted areas with communities experiencing similar issues. For example

• EDA funding supports nongovernmental partners that provide targeted technical assistance to coal-impacted communities through the Building Resilient Economies in Coal Communities (BRECC) Initiative. BRECC activities include a peer network, education, outreach, and other efforts designed to assist coal communities with economic diversification and revitalization strategies.¹¹⁵
• ARC convenes POWER grantees and other partners for peer learning and provides other technical assistance to coal communities in the Appalachian region.¹¹⁶

Policy Considerations

Since FY2014, Congress has supported policies designed to address economic diversification, environmental challenges, and workforce and business development in coal communities. Should Congress continue to support programs to assist coal communities, policymakers may seek to review the roles of federal, state, and private assistance as well as the type and scale of assistance provided. Congress may also be interested in reviewing if—or how—federal assistance programs align with policy objectives as well as how they are structured, accessed, overseen, evaluated, and financed.

Role of Federal Assistance

Federal assistance for economically distressed coal communities generally reflects policy objectives related to reducing regional economic disparities, expanding tax bases, increasing individual or community wealth, and improving job opportunities and quality of life measures. Federal assistance for coal communities also reflects the belief by some that support for these areas provides a means of shoring up the national economy.¹¹⁷ Some analysts also view economic transitions, and energy transitions in particular, as processes to be managed proactively and with federal support, so as to minimize social division, economic disruption, and overall community resistance to structural and policy changes.¹¹⁸ They note that the geographic concentration of the coal industry, the lack of diversified regional economies, and barriers to worker mobility warrant federal and state policy intervention—in addition to support from the private sector.¹¹⁹ Others view federal assistance as a responsibility—of government and other stakeholders—to address the past contributions of communities and workers towards the growth of the country through energy-related activities. Some of these sentiments reflect an interest in providing support to regions and stakeholders based on their prior contributions to the nation's economic growth.¹²⁰ Analysts observe that Congress has previously provided targeted economic assistance for communities and workers impacted by changes associated with federal policies, such as trade (i.e., trade adjustment assistance programs for workers, firms, and communities¹²¹) and military base closures and realignments¹²² (i.e., place-based, economic adjustment assistance programs administered by the Department of Defense Office of Local Defense Community Cooperation¹²³).¹²⁴

Conversely, for others, federal assistance for local economic development in coal communities—could be limited, in favor of private sector and/or state and local support, or for direct assistance to individuals regardless of where they live. As Congress continues to debate matters related to federal spending, policymakers may opt to limit support for various programs, including economic development assistance overall and economic development assistance to distressed areas and coal communities. In response to proposals that would limit or reduce federal involvement, some researchers note that many coal communities are in persistently economically distressed places that do not have the fiscal resources to implement expanded economic and workforce development programs. They contend that the federal government possesses the capacity to coordinate and deploy redevelopment resources at a scale that is larger than that of states or other authorities.¹²⁵

Structure, Coordination, and Integration Considerations

Congress may consider options to structure federal programs as community-led (i.e., bottom-up), nationally coordinated, or through a combination of these approaches to deploy assistance. With a bottom-up approach, federal programs generally assist with locally developed projects to advance industries or strategies based on a region's particular assets and challenges; the federal agencies' role in planning and implementing state and local projects is limited. The existing federal grant programs for coal communities generally use a community-led approach (e.g., EDA's ACC initiative, ARC's POWER Initiative).¹²⁶

Some observers and agencies note that existing programs are decentralized, and coal communities apply separately to multiple agencies for assistance.¹²⁷ Some outside groups have called for a more centralized approach through a federal office for transition assistance that could oversee a holistic, long-term strategy and serve in a coordination role among agencies and different levels of government.¹²⁸ Some also view a more nationally coordinated approach as a way to provide assistance designed to transition communities towards the development of a specific industry, policy goal, or economic restructuring scenario (e.g., innovation, technology, healthcare, clean energy industries, decarbonized economies).

A combination of these approaches may involve some degree of federal coordination and/or expanded interagency collaboration. A combination approach may also involve assistance that is provided for specific industries, strategies, or policy goals, but continues to be deployed using community-led processes, engagement, and representation from coal community stakeholders.

Congress may consider options to provide assistance through one or more different types of policy vehicles, including tax credits, place-based grant and loan programs, or a combination of these or others. Each type of assistance involves budgetary considerations and limitations.¹²⁹ Each policy tool is also designed to affect different stakeholders and aspects of regional economies. For instance, tax credits may be designed to broadly incentivize certain private sector activities in coal communities. Tax credit policies may be further refined to target even more specific geographic areas, and/or they may include criteria to incentivize capital, labor, trade, R&D, or other activities or outcomes.

Federal place-based grant and loan assistance programs, on the other hand, are based on the premise that public support for strengthening a region's existing assets may create conditions for broad economic development (e.g., support for stable fiscal income, community amenities, research institutions, broadband, workforce, education, and infrastructure).¹³⁰ A potential benefit to providing broad, place-based assistance is that such programs may be designed for multiple stakeholders or a range of beneficiaries, rather than a targeted set of businesses or industries.¹³¹ The deployment of multiple policy instruments simultaneously may offer an approach to assistance that may address the many different phases of economic transition and various types of stakeholders and industry conditions.

Role of Nonfederal Assistance: State and Private Support¹³²

Outside groups have identified state government and private sector entities as sources of additional assistance for economic diversification and worker training activities in coal communities. Selected states, private utilities, and philanthropic organizations, for example, provide grant funds to pay for economic development activities as well as grant writing assistance, technical and feasibility studies, pre-development assistance, and other ways of expanding the capacity of local and regional stakeholders.¹³³ Universities and other institutions of higher education also provide technical assistance, engagement, and planning services to coal communities.¹³⁴

Researchers that track state economic transition policies in selected western states have observed that state policy objectives and approaches vary. They note that some states have enacted policies to support planning and diversification activities, while others have enacted policies for continued coal operations.¹³⁵ Additionally, as noted above, certain federal abandoned mine land reclamation programs are funded by coal excise taxes on private sector firms to support remediation activities. In recent years, legislation at the state and federal levels have proposed taxes on private companies to fund remediation activities and to fund economic development initiatives in anticipation of future energy market fluctuations and potential impacts on local and regional economies.¹³⁶ In light of emerging state energy transition policies, Congress may wish to review how certain states have proposed or implemented strategies to fund economic diversification activities or support continued industry activity.

Whether and How to Target Assistance for Coal Communities

Congress may be interested in reviewing whether to continue providing targeted assistance for coal communities that is separate from—or in addition to—assistance designed for other communities or types of economic shocks. Some researchers and policymakers point to location-specific conditions that may warrant additional assistance for coal communities (see "Economic Diversification and Employment in Coal Communities" for examples of such conditions). Conversely, Congress may provide assistance for coal communities through programs that assist communities impacted by any type of shock or event—regardless of sector or location. For example, the Distressed Area Recompete Pilot Program (Recompete Pilot Program) was recently authorized to provide long-term comprehensive economic development grants to areas with persistent gaps in prime age employment. Certain coal communities may be eligible for the Recompete Pilot Program, but the program is not designed to serve only coal communities.¹³⁷

Congress could also consider how coal communities may qualify for support through more general programs that target individuals and areas on the basis of more general economic disadvantage. If coal communities have larger shares of low-income individuals or higher unemployment, they may receive higher levels of support from programs that target those more general criteria.¹³⁸ One advantage of supporting coal communities through these broader mechanisms is they are based on established systems and eligibility requirements.

If Congress continues to provide targeted assistance to coal communities, it may consider options to direct resources and activities through statutory program definitions of coal communities or through other requirements. In defining coal communities, Congress may expand or narrow the definitions of eligible communities or provide agencies with discretion to develop definitions or designations.¹³⁹ For other approaches to targeted assistance, Congress could consider establishing statutory requirements that a certain number of projects or amounts of funding are provided to coal (or other) communities (see examples in "Selected Business Development, Research and Development, and Energy Infrastructure Programs").

Small, Rural, or Underserved Communities and Capacity Considerations

Across various forms of assistance, experts note that small, rural, or underserved communities may face barriers to planning for economic diversification, supplying required matching funds, and accessing and applying for federal programs.¹⁴⁰ Researchers note that certain communities are challenged by limited local capacity for public engagement and economic development planning following the closure of coal fired generation plants.¹⁴¹ Some note that rural and underserved areas—in facing declining tax revenues—also lack alternative funding streams to "directly address the fiscal challenges facing impacted communities,"¹⁴² and that this challenge is exacerbated in geographically remote, isolated areas.¹⁴³ Others suggest that, in light of these challenges, Congress may seek to consider policies that support local capacity. Some advocate for policies that provide flexibility to applicants in terms of the level of nonfederal matching fund requirements or policies that provide resources to support applicants' readiness to apply for funding. Another approach to addressing capacity limitations may be to provide additional support for technical assistance for coal communities and helping underserved communities learn from other regions.¹⁴⁴ The IWG refers to this as "structural support" and noted that Congress has previously chartered and funded a nonpartisan nonprofit organization (i.e., Neighborworks¹⁴⁵) to support communities with similar revitalization endeavors.¹⁴⁶

Mine Land Reclamation Considerations

Congress could consider oversight options to assess whether funds going towards the AMLER program have achieved the intended purpose of reclaiming abandoned coal sites to facilitate economic and community development. As discussed previously, OSMRE has established numerous metrics for evaluating whether federal funding for AML reclamation has facilitated economic and community development. Congress may pursue oversight options to examine the extent to which funding for these reclamation programs provided intended benefits to economic and community development. Additionally, Congress may choose to provide direction for performance metrics, reporting requirements, and program success.

Congress may also consider the adequacy of past funding levels and future funding necessary to achieve program objectives. Congress has provided a total of $885 million from FY2016 through FY2023 for the AMLER program. Funding for the AMLER program has been provided through annual appropriations since FY2016. As discussed earlier, OSMRE requested $135 million for the AMLER program for FY2024. Congress may consider funding levels, conditions, and criteria for existing federal mine reclamation programs in future appropriations bills or accompanying explanatory statement.

Scale, Timing, and Program Evaluation Considerations

As Congress continues to review economic assistance for coal communities, policymakers may consider aspects of existing policies for future evaluation and oversight. However, attributing outcomes to prior policy interventions may be challenging because economic development investments may take many years or decades to plan and implement and may involve significant private sector investment. There are limitations to the potential impact of federal assistance in light of global markets, unexpected events, state policies, and other factors. Additionally, some view the challenges facing economically distressed coal communities as wide-ranging, complex, and inter-related,¹⁴⁷ and have examined whether there is sufficient funding at scale to support comprehensive transition and diversification.¹⁴⁸ Economic development experts note that following the decline of historically dominant industries, the process of regional economic diversification may involve long-term assistance and multiple rounds of investment from public and private stakeholders.¹⁴⁹ Experts further note that in terms of economic diversification strategies in coal communities, there is limited analysis on the outcomes and processes. Additional study may provide insight on which approaches worked well.¹⁵⁰

Congress may also consider reviewing to what extent the existing programs address current and anticipated community, environmental, and worker needs, including how programs fit with different time periods of the transition process as well as the challenges faced by different types of occupations (e.g., mining, power plants, supply chain, manufacturing, transportation). Some analysts argue that some programs may only be available following a plant or mine closure, which may hinder advance planning and diversification efforts.¹⁵¹ They suggest that existing assistance programs could be more flexible to include providing advance planning assistance before an anticipated sector decline or economic distress occurs.¹⁵²

Researchers and outside groups have further identified barriers to data, human capital, and funding as factors that may limit coal communities' capacity to carry out near-term transition planning as well as holistic, longer-term scenario planning. They also note that federal policies could be expanded to include support for additional asset mapping, feasibility studies, and other place-sensitive, data-informed studies to help communities identify multiple, suitable sectors and opportunities.¹⁵³

Additionally, while many agree that policies should support communities and workers, the indicators of success lack common definitions and measurements. Researchers note that little is known about the strategies that have worked well in coal communities, and in restructuring economies, overall. Researchers note that more cross-disciplinary research is needed on economic diversification and related activities.¹⁵⁴ Considering these limitations, Congress may still seek to gain additional insight on factors and conditions contributing to the success of state, local, and federal strategies, and the role of private sector assistance. Additional research and feedback from domestic and international stakeholders may inform priorities and policy decisions on how other regions and countries have implemented economic transition strategies over longer time periods.¹⁵⁵

Congress may consider expanding policies and associated definitions to include areas with other concentrated industries or fossil resources, such as oil and gas. Regional economies associated with oil production assets have grown in recent years, including businesses directly and indirectly involved in oil extraction (e.g., manufacturing). However, the cyclical nature of the oil and gas industry means that oil and gas communities may experience boom and bust periods as well.¹⁵⁶ The IWG and others note, however, that oil and gas communities face challenges that are similar but distinct from those of coal communities.¹⁵⁷

Conclusion

The geographic concentration of the coal industry, the lack of diversified regional economies, and barriers to worker mobility represent some of the inter-related challenges faced by coal communities in recent years. In response to these and other concerns, Congress has provided support for programs to address economic diversification, business development, workforce development, and environmental challenges. Since 2014, Congress has directed a number of federal agencies to provide flexible, place-based economic adjustment assistance and mine land remediation grants for coal communities. Federal assistance has since expanded to include additional agencies and grant programs, as well as additional types of assistance (e.g., tax credits). Additionally, recent Biden Administration efforts have focused on providing federal technical assistance, convening stakeholders, and coordinating aspects of federal, state, and regional strategies through the IWG. The IWG continues to incorporate activities with and for coal communities within a broader set of "energy community" stakeholders.

Energy transitions have occurred for centuries.¹⁵⁸ The challenges discussed in this report suggest that the regional economic development aspect of energy transitions may be a continuing issue for Congress. In reviewing economic development policy options, Congress may wish to examine the current program roles and authorities. Many of the available programs are place-based and flexible, while others specifically target coal communities (or broader energy communities) through tax credits or appropriations that set aside funding for coal-impacted communities in economic development or other program accounts. Congress may also wish to consider continuing to provide assistance through multiple channels and for different phases of the transition, including grant programs, tax credits, and interagency coordinating activities. Should other industries face similar long-term downturns, Congress may consider providing federal assistance to additional types of impacted communities.

Appendix. Changes in Coal Production by State

The following figure illustrates state-by-state changes in coal production from 2001 to 2021. While the magnitudes and patterns of production reductions vary, the overall trend in the period has been consistent in almost all states.

Figure A-1. Changes in Coal Mine Production by Region, 2001-2021

Source: CRS figure using data from EIA, "Aggregate Coal Mine Production: All Coal: Total," data accessed January 26, 2023.