Appalachia Today: Part 3 – Ownership of the Land and Minerals in the Region

Photo: Presence of large-scale industrial coal mining on Appalachian lands

Prior to the rise of the coal industry in Appalachia in the 1870s, the Appalachian population was sparse and primarily engaged in subsistence farming.[i] The arrival of railroads in the 1870s dramatically changed Appalachia for with the railroads came the coal companies and land agents who over time created a single-resource economy on which the region remains largely dependent today.[ii]

Unfortunately for the people and environment of Appalachia, the coal industry proved disastrously unstable. The large-scale industrial coal mining which had come to dominate the region by the early twentieth century was, from the outset, controlled primarily by outside capital and speculators who purchased large swathes of coal-bearing land and/or the minerals and then invested the capital necessary to exploit the massive coal resources of the region.[iii] In Central Appalachia, they largely retain that ownership to this day.

Absentee ownership of the surface (including the minerals) or only the minerals remains extensive. As the chart below illustrates, in 11 of the key coal counties in central Appalachia absentee entities still own more than 50 % of the surface land in each of the counties.

The first comprehensive study of land and mineral ownership of West Virginia done in 1974 found that two thirds of the private land in the state was owned or controlled by absentee landlords – 40% of the land and 70% of the mineral were owned by corporations. Of the land owned by individuals, half of that was owned by out of the state interests. A 1980 study financed by the Appalachian Regional Commission reached similar conclusion for central Appalachia as a whole.

Appalachian Coal Counties with Greater than 50 Percent Absentee Ownership of Surface Acres (1980)

County Percentage of County Surface Absentee-Owned Acres Absentee-Owned
McDowell, WV 79.3 270,647
Mingo, WV 67.9 183,717
Logan, WV 63.0 149,891
Dickenson, VA 60.6 128,845
Campbell, TN 58.3 168,299
Knott, KY 57.6 131,195
Harlan, KY 57.6 172,757
Martin, KY 57.2 84,590
Morgan, TN 55.9 192,926
Wise, VA 54.6 143,723
Scott, TN 52.6 181,217

      Appalachian Land Ownership Study, 1980

In addition to the fee simple ownership of both the surface and the mineral, in many cases the absentee corporate entities owned only the mineral and not the surface of the land. However, the courts for many years interpreted these “mineral only” deeds to allow any and all actions necessary to extract coal by whatever method they chose, whatever the resulting damage might be, making the owner’s title to the surface of the land almost worthless once the mining began.[iv] This practice continued in Kentucky as late as the 1980s.

Absentee mineral ownership was even more extensive than fee simple ownership of both the surface and the mineral (and cheaper as well). One study of the region of seven million acres of mineral rights surveyed concluded that 79% of the minerals in the region were absentee-owned.[v]

The chart below illustrates the degree of mineral ownership of the key coal producing counties in that study-

Mineral Ownership in Coal Producing Counties

County Corporate Mineral Acres as % of County Surface Corporate-Owned Mineral Acres
Lincoln, WV 120.4[vi] 337,385
McDowell, WV 104.9 357,935
Mingo, WV 97.5 264,046
Raleigh, WV 87.1 337,272
Logan, WV 84.8 247,595
Dickenson, VA 71.7 152,422
Buchanan, VA 65.5 213,165
Martin, KY 59.6 88,070

     Appalachian Land Ownership Study, 1980[vii]

Another study by a University of Virginia professor in 1995 examined the social and economic implications of absentee ownership of the region’s land and mineral and concluded that the large corporate and out of state land holdings restricted access to the land by the people who lived there, increased the political influence of corporate and out of state interests, and decreased civic engagement in Appalachian communities. The land ownership pattern also severely limited the tax base for the counties , as well as the options for alternative land use.


Photo: Environmental devastation on Appalachian lands after coal companies strip mine

For centuries the wealth created by natural resources has flowed out of the mineral-producing regions as corporate profit without bringing sufficient tax income to the region while local residents have been exploited as cheap labor. Corporate-owned lands tend to have artificially low market values, because land transfers between corporations were rarely made public or registered at the county courthouses, which allow companies to pay property taxes at a lower rate. This practice also disguised who owned what land.[viii] Moreover, while owning large portions of the land surface, corporations pay little property taxes. A study in 1981 found that in central Appalachian counties, the major mining companies owned more than 50 percent of the land but only paid about 4% of property taxes. In contrast, small property holders who owned about 30% of the land accounted for 96% of tax property incomes.[ix] Corporations also managed to maintain their control and silence the local residents by donating to the local, state, and federal level politicians. Corporations that controlled the land forced local residents to build on lands with frequent flooding. In April 1977, heavy rainfall in Appalachia caused disastrous flooding across Kentucky, West Virginia, Virginia and Tennessee, killing 32 people and causing over $700 million worth of damages.[x]

The most recent study in 2013 by the West Virginia Center on Budget and Policy found a shift in land ownership on timber management companies (it did not study mineral only holdings). However, in the coal counties of West Virginia, the picture remained much the same. In Wyoming County, two companies still owned over 50% of the county’s private lands.

 

[i] Harry M. Caudill, Night Comes to the Cumberlands: A Biography of a Depressed Area (Ashland: Jesse Stuart Foundation, 2001), at 1-30.

[ii] Id., at 62-69.

[iii] One impact was on subsistence farming, the mainstay of the region before mining. As Professor Corbin has noted, by the 1920s less than 15 % of Boone and Logan counties and 7.3 % of McDowell County, all three major coal producing counties, were used for farm land. (David Corbin, Life, Work and Rebellion in the Coal Fields: The Southern West Virginia Miners, 1880-1922 (University of Illinois Press, 1989), at 7.)

[iv] Id., at 70-74.

[v] Who Owns Appalachia?: Landownership and Its Impact, Appalachian Land Ownership Task Force (The University Press of Kentucky, 2014), at 21.

[vi] Mineral ownership can exceed 100% because of the existence of more than one coal seam beneath the surface.

[vii] Id., at 65.

[viii] http://www.empyreanresearch.org/blog/landownership

[ix] http://www.empyreanresearch.org/blog/landownership

[x] https://www.weather.gov/jkl/1977flood