After scaling back production at the Bowie #2 Mine near Paonia in September, Bowie Resource Partners last week announced the mine will be idled "as a result of continued market deterioration."
According to a Feb. 26 press release, the mine will remain idle while the market for Bowie #2 coal is evaluated.
The Bowie #2 mine employs 108 full-time employees and one contractor. "Some of the affected employees will be relocated where possible to fill vacancies in other parts of the business; however, layoffs are unfortunately unavoidable," said Gene DiClaudio, Bowie Resource Partners' chief operating officer. It is anticipated that 68 full-time positions will be eliminated.
Bowie Resource Partners owns and operates three underground coal mines in Utah and one underground coal mine in Colorado and is the leading western bituminous coal producer, with 14 million tons of coal sales in 2015. Bowie's mines produce clean-burning, low-sulfur thermal coal primarily for consumption by domestic power generators in Utah.
"First, we want to say we are deeply saddened for the impact on our families," said Kurt Clay, assistant superintendent of Delta County Joint School District #50.
"The mine and its employees have been huge supporters of our schools and communities, so it's a difficult time for all of us," Clay said.
Delta County administrator Robbie LeValley echoed Clay's thoughts.
"First and foremost, our thoughts are with the families that are directly impacted," she said.
The long-term impact has yet to be realized, but continued declines in student enrollment are definitely a concern, as is the decrease in federal mineral leasing revenue coming to the county.
Since Oct. 1, Clay said, school enrollment is down 28 students districtwide. Fortunately, state equalization funds offset the decrease in per-pupil funding. The county doesn't have that safety net.
"Delta County has been proactive in budgeting in the past two years, anticipating a decrease in revenue based on coal," LeValley said. "We anticipate that we will actually have to cut $500,000 out of the 2017 budget to reflect the decrease not only in coal, but with families that leave the area." The loss of revenue is due to a combination of sales tax, personal property tax, federal mineral leasing and severance taxes.
"That's why Delta County has been partnering with Delta County Economic Development and Region 10 to bring in broadband in partnership with DMEA," LeValley said. "We need to continue to find ways to diversify the economy through broadband, tourism, recreation and manufacturing."
"As a school district and community, we need to figure out ways to be innovative and bring new industry into this community," Clay said. "Broadband is a huge component of that effort."
LeValley said Delta County must also continue to do what it can to showcase the "high quality coal that can fit into a market economy, at the local, state and federal level."
"Colorado's coal is the most compliant coal in the world," said Michael Drake, former president of the Paonia Chamber of Commerce. "One would think there should be a market for our coal.
"My simple thought is the coal market crashed because of the abundance of cheap natural gas, combined with China's reduced use of coal due to their economic slowdown."
Hotchkiss Mayor Wendell Koontz, who works in the coal industry, said of the Bowie announcement, "It's a very sad event to see. We certainly didn't need another mine in the valley closing but between market conditions and environmental regulations imposed on us by the federal government ...
He estimates that in the past five years, Delta County has lost 400 to 450 coal-mining jobs between Bowie #2, Oxbow and West Elk.
The Town of Hotchkiss is estimating a direct financial impact of about $75,000 on town finances the first year, not to mention the social and economic repercussions from families that are now trying to figure out to make a living.
According to the Bowie Resource Partners' website, Bowie began production in 1998 and from 2000 through 2007, was ranked it #1 or #2 nationwide for efficient longwall production.
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