Thu August 16, 2012
Lawmaker’s Potential Gain From Kentucky-India Coal Deal Raises Concern
The involvement of a state representative in a major coal deal in Kentucky is raising some eyebrows. Under the terms of a new $7 billion contract, Kentucky coal producers will ship nine million tons of coal a year to India for the next twenty-five years. Representative Keith Hall was instrumental in brokering the deal—and he represents both the people of Kentucky and his own private coal interests.
Hall's district covers part of coal-rich Pike County. He’s the chair of a special energy subcommittee, and the vice chair on the House Natural Resources and Environment Committee.
“I’m not just a friend of coal,” Hall said. “I’m coal’s best friend.”
And the Indian companies know that, too. Hall says he was approached by Faisal Sayed, the chairman of the FJS board, to help make the deal.
“Him being a friend of mine through a common acquaintance, Larry Chimerine, he came to Kentucky and said ‘You’re chairman of energy, you’re in the coal business, Representative Hall. We need coal. Can you help me?’”
When asked about his involvement, and whether it was as a business owner or a state representative, Hall is candid.
“I’m very proud to say I wear both hats. This didn’t put one dime in Keith Hall’s pocket but maybe in the future, they’ll maybe take more of my coal, mine more of my coal and put my people back to work.”
Hall has mixed his legislative role and business interests before—and he got in trouble for it. In October, the Legislative Ethics Commission fined the representative $2,000 for a vote he cast in 2005. The vote appropriated coal severance taxes for a sewer project, and one of Hall’s companies was involved in the project.
Richard Beliles is the chair of Common Cause Kentucky, a government watchdog group. He says Hall’s involvement in the India deal may not have crossed any lines yet, but it’s definitely questionable.
“We might be talking about a future problem, really,” he said.
Beliles says this is an issue with citizen legislatures: that it’s hard to distinguish between a legislator’s private business activities and his official capacity. But the India contract lasts for 25 years, and it’s likely some related legislation will come before the General Assembly in that time.
“I’ll bet anything it will,” Beliles said. “And then we’ll see who votes and who doesn’t and who recuses themselves from voting.”
Hall the lawmaker says he looks out for the miners in his district, and this deal will help them. But...that's not to say it won't help Hall the businessman as well.
“It does not directly help me because my coal is currently going to United Coal, being mined by Apex. They didn’t have a market. But now we’ve got a whole new market for this coal. It will be good for me, it will be good for Apex, it will be good for Booth Energy, because now you’ve got an order for nine million tons a year.”