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The Inspector General’s Report

The Report on MSHA, Not the Report on Russia, the President or the Election.

Inspector General Reports are in fashion in Washington, D.C. If you pick up a newspaper (or, more likely, read the news on your phone) or listen to or watch the news on TV or the radio, you’ve likely read or heard all about the latest “IG” report on the Russians, the last election, the FBI, dossiers, FISA, etc. Granted, none of these reports have anything to do with mining (although I readily admit that I, like nearly every other reasonably sane person on the planet, haven’t actually read any of the reports). However, that does not mean that there aren’t any IG reports on mining-related issues.

No, the mining industry hasn’t been left out of all the fun. Never fear, the Department of Labor’s Office of Inspector General (OIG) is on the job, investigating and producing OIG reports on mining-related (and other) issues. Most recently, the OIG conducted an investigation to answer a very specific question: “To what extent has MSHA’s [Civil Monetary Penalty Program] deterred unsafe mine operations?” That seems like a fair question, given that MSHA has assessed more than $1 billion and collected more than $800,000,000 in civil monetary penalties from mine operators since 2000.

The title of its Aug. 16 report on that investigation provides the (partial) answer to that question: “MSHA Did Not Evaluate Whether Civil Monetary Penalties Effectively Deterred Unsafe Mine Operations.” In other words, MSHA doesn’t know the answer because it never asked the question. MSHA does not know whether penalties assessed to mine operators affect mine safety and health. That should be a bit embarrassing given that the stated purpose of MSHA’s Civil Monetary Penalty (CMP) program “is to protect miners by financially penalizing mine operators for safety hazards found during inspections.”


The reason MSHA offered to explain itself certainly doesn’t suggest embarrassment. As the OIG put it, “MSHA has not measured the impact of the program on mine safety, as agency officials believe it is too difficult to distinguish the effect of the program from other MSHA safety and enforcement initiatives. Without metrics, MSHA has not been able to ensure [the CMP program] was achieving its intended purpose.” That’s right, MSHA’s excuse for its failure to evaluate the effectiveness of a program that has collected well over $50 million a year since 2000 from the mining industry is that it’s just too hard.

Of course, “MSHA believed its safety programs collectively improved mine safety, and the annual number of fatalities from mining accidents has been in decline historically.” I do not doubt MSHA’s sincerity. I am sure MSHA truly believes that whatever it has done and is doing “collectively improves mine safety.” The trouble with this approach is that it’s blind. It tells us nothing about what works and what doesn’t, what is effective and efficient and what’s not. Are MSHA penalties too high? Too low? Just right? MSHA can’t say, but it is happy to assume that whatever it is doing is working “collectively.”

So, MSHA told the OIG that it was too hard to determine whether the CMP program was effective. The OIG agreed that MSHA didn’t have the data or “metrics” it would need to evaluate the program. Thus, the OIG recommended the development of “metrics for the CMP program that will allow review and measurement of its effect on changing operator behavior to deter unsafe mine operations.” MSHA responded and said it would “work with the OIG to explore various options for developing metric to measure the CMP program.” That’s where this ends, right?

Nope. The OIG looked at some of MSHA’s data. In so doing, it found that:

The average number of severe accidents over the period examined, CY 2000 – CY 2017, showed no significant difference between those who paid less than 50% and those who paid 100% of their penalties. Contrary to our expectations, those [mine operators] who paid almost all of their penalties – greater than 99%, but less than 100% – had the highest average number of severe accidents.

Put differently, the OIG expected to find that the mines with the worst accident history would be the same mines that were operated by mine operators who didn’t pay their penalties, and it was surprised to find that wasn’t the case. Overall, the OIG determined that “mines with the highest number of severe accidents generally paid the majority of their violation penalties.” It also found that “operators who paid violation penalties and those who did not pay continued to have severe violations year-after-year at about the same frequency.”


That’s all quite interesting, but what does it tell us about the effectiveness of MSHA’s penalty program? According to the OIG, it tells us that MSHA’s CMP program “did not have a distinguishable effect on reducing mine hazards and protecting those who work in mines.”

Doesn’t that mean MSHA’s penalties are too low to have an impact on behavior? If MSHA increases the penalties, that’ll surely “have an effect on reducing mine hazards,” right? Wrong. First, the OIG’s is impossible to square with its finding that MSHA doesn’t have the data it needs to evaluate the effectiveness of the program. MSHA doesn’t know, and neither does OIG. Second, the OIG’s conclusion is a great example of a couple of two different statistical fallacies. Space here is limited (and writing about statistics is great way to discourage readers).

Suffice to say, the OIG’s conclusion isn’t well supported (and that’s putting it kindly). For example, take two plots of corn. At the end of the season, I tell you that the plots produced roughly the same amount of corn, but I applied a lot more fertilizer to one of the two. Based on that information, would it be safe to assume that the extra fertilizer applied to one of the plots was a waste? Ineffective? Nope. It’s good information to have, but you’d obviously need to know more about those plots in order to evaluate the effectiveness of the fertilizer. Here, the OIG would need a lot more information or data to properly evaluate the effectiveness of MSHA’s penalty program.

Finally, I will note that the OIG did discover that MSHA is doing one thing quite well. In the OIG’s words:

MSHA effectively managed the collection of penalties under the CMP program. Specifically, our analysis of MSHA’s data confirmed MSHA was collecting a majority of its penalty assessments. Further, MSHA utilized the U.S. Department of Treasury’s debt collection capabilities to facilitate this process, as intended.

So, MSHA is great at debt collection, but it doesn’t know the extent to which those debts – the penalties MSHA has assessed to mine operators for violations – impacts the safety and health of our miners.

Brian Hendrix, a member of Husch Blackwell’s Energy & Natural Resources group, advises clients on environmental, health and safety law, with a focus on litigation, incident investigations, enforcement defense and regulatory compliance counseling. He has extensive experience with federal and state agencies and has represented numerous clients in manufacturing, natural resource production and service-related industries. This email address is being protected from spambots. You need JavaScript enabled to view it., 202-378-2417.