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ClACTION PLAN ID # UT-2017-001 <br /> If necessary or desired, DOOM shall further revise Tech-007. <br /> ❑ DOOM shall finalize Tech-007 and obtain the necessary internal approvals required to <br /> finalize and implement the revised guidance document. <br /> ❑ DOOM shall subsequently draft and send a letter to coal mine operators and permittees <br /> notifying them of anticipated changes following the formal adoption of the revised Tech- <br /> 007 document. <br /> ❑ DOOM will begin implementing its revised procedures. <br /> SCHEDULE: <br /> ❑ By May 15, 2017, DOOM will delete the "Five Percent Rule" from Tech-007 and submit <br /> the revised guidance document to DFB for review. <br /> Cl By May 30, 2017, DFB will review the revisions to Tech-007 and provide feedback to <br /> DOOM, as appropriate. <br /> U By June 15, 2017, DOOM will make final adjustments to Tech-007. <br /> ❑ By July 17,2017, DOOM will draft and send a letter to coal mine operators and <br /> permittees informing them of changes to its bonding practices. <br /> ❑ By July 18, 2017, DOOM will begin implementing its revised bonding procedures. <br /> ISSUE 3: Tech-007 Guidelines and DOGM's Use of Inflation Factors <br /> PROBLEM DESCRIPTION: OSMRE seeks to ensure that DOOM is consistently applying an <br /> acceptable construction cost index as the basis for calculating inflation rates when evaluating and <br /> escalating performance bond amounts as required under R645-301-830.300 of the Utah rules. <br /> DOOM's TDN response states that it uses a different range of R.S. Means Historical <br /> Construction Cost Index (R.S. Means)values (?revious five years of January values)" than what <br /> is established in Tech-007 (three-year average) '- for calculating escalation factors. OSMRE's <br /> technical findings indicated that the reviewer was unable to re-create DOGM's inflation factors <br /> based upon R.S. Means values from the given time periods. <br /> Neither SMCRA nor the Federal regulations set forth requirements or methodologies for using <br /> inflation factors. However, the Utah rules establish the use of an inflation factor and require that <br /> "an additional inflation factor will be added to the subtotal for the permit term. This inflation <br /> factor will be based upon an acceptable Cost Index."'3 <br /> In addition to escalating the bond amount to account for inflation,sections 509(a) and (e) <br /> SMCRA and 30 C.F.R. § 800.15(a) require the State regulatory authority to adjust the bond <br /> amount where the cost of reclamation changes. This section of the Federal regulations also <br /> allows the regulatory authority to adjust the bond amount to address issues such as inflation of <br /> the reclamation Cost.14 <br /> In its TDN response, DOOM contends that its use of R.S. Means is appropriate because it <br /> includes costs typically associated with reclamation work. OSMRE's technical findings agreed <br /> 11 DOGM's TDN Response at 12. <br /> ''Tech-007 at 10. <br /> 13 UAC R645-301-830.300. <br /> 48 Fed.Reg.32932(July 19, 1983). <br /> 7 <br />