CASPER – Executives of a bankrupt coal firm in the Powder River Basin received over half a million dollars in bonus payments in the year leading up to the company’s bankruptcy filing, court documents reveal.
Lighthouse Resources paid 11 “insiders” within the company and its subsidiaries a total of $3.3 million, including at least $702,500 in bonuses, in the 12 months before filing for bankruptcy.
These insiders included a president, chief operating officer, treasurer, general manager, two secretaries and four directors.
The company also reported $2.5 million in “payments related to bankruptcy” made during that same period, according to the company’s financial statements.
This comes as the insolvent company asked a federal bankruptcy court last month to reject a $2.7 million pension plan for coal miners, asserting the company needs to cut costs to be able to afford cleanup at its mining site in Montana. Maintaining the pension program would require the company to make annual contributions of about $85,000, according to the company.
The coal firm forecasts cleanup costs at the Decker mine to total as much as $95 million. Exiting the union contract would also save the firm about $200,000 each year by allowing the employer to limit overtime, reduce paid holidays, increase employee contributions to health care plans and contract work out, according to company attorneys.
Lighthouse Resources asked the U.S. Bankruptcy Court for the District of Delaware on Jan. 20 for approval to reject the collective bargaining agreement struck with the union in 2012. The company maintained that eliminating the $2.7 million in pension liabilities is the only way to save enough money to complete reclamation, or cleanup, at the mine site.
The United Mine Workers of America requested that the court block the coal company’s request to exit its union contract.
Lighthouse Resources submitted a tentative collective bargaining agreement to the court on Monday, but it had yet to be approved as of Friday.
Clark Williams-Derry, an energy analyst at the Institute for Energy Economics and Financial Analysis, called the bankrupt company’s claim it needed to reject workers’ benefit to save money for future cleanup bills “disingenuous.”
“When Lighthouse says we can’t pay for miners’ retirement because we have to pay for cleanup, it really sets up a false dynamic of the environment versus workers,” Williams-Derry said. “It hides the fact that company executives and insiders have given themselves golden parachutes and paid themselves generous salaries, bonuses and retirement contributions, when they don’t give those same financial benefits to their workers.”