Interior Secretary James G. Watt, in a bruising day-long session with some of his harshest critics, denied yesterday that he has leased government coal reserves at "fire sale" prices, and vowed to press ahead with plans to lease several billion more tons of coal by 1985.
Watt acknowledged to a House Appropriations subcommittee that his strategy of leasing large amounts of coal in an energy glut does not bring maximum dollar returns. But he said he considers the program essential to national security and the economy and has no plans to change its course.
"I have made a judgment I will not seek to optimize the dollar return at the expense of consumers and jobs in the future," Watt said, contending that he has nonetheless received a fair return for resources, as required by law. "Am I guilty of being consumer-oriented versus getting a higher dollar bid today? Yes, I am guilty of that."
Watt was responding to a recent General Accounting Office investigation that concluded that he leased government coal reserves last year for $100 million less than their market value. Watt said he takes "serious exception" to the GAO report, and to another House inquiry that put the figure at $60 million.
Subcommittee Chairman Sidney R. Yates (D-Ill.) called Watt's defense of his accelerated leasing program "the most euphemistic way of justifying a low purchase price for a federal property, almost to the point of a giveaway."
Watt responded: "It's a difference in philosophy."
Such standoffs were repeated throughout the day, as members of the Democratic-controlled panel assailed Watt on policies ranging from accelerated coal leasing to his use of political loyalty checks on nominees to Interior Department advisory panels. Watt responded to many of the attacks by saying his critics are motivated by philosophical, rather than substantive, differences with him.
In one of the most bitter exchanges, Rep. Les AuCoin (D-Ore.), a critic of Watt's park and offshore oil drilling policies, denounced him for checking the party affiliation of Interior science advisers with the Republican National Committee. When Watt responded that he also consults members of Congress in picking advisers, AuCoin said he had never been called.
"It could be you may not share our enthusiasm for success," Watt said.
"That could be one of your problems," AuCoin fired back. "Anyone who differs with you on policy" is dismissed as a philosophical adversary.
Democrats brandished one internal Interior memo after another to bolster their attacks. Rep. William R. Ratchford (D-Conn.) read from a National Park Service memo warning that coal development plans could lead to sulfur dioxide pollution in Theodore Roosevelt National Park.
AuCoin read a memo instructing Interior officials to appear frequently before civic groups throughout the country to present a slide show on successes under Watt.
Watt appeared composed during much of the grilling. But during a recess, after the questioning shifted from his embattled coal program to wildlife refuges, he turned to an aide and said: "The pain is gone. The irritation continues."
The Appropriations subcommittee voted across party lines last week to bar Watt from leasing coal for the rest of this year, but yesterday's harsh attacks came only from Democrats.
Watt called the proposed leasing ban "very poor public policy," and said he hopes Congress does not pass it. He said there were some problems in the auction of more than 1 billion tons of coal leased by Interior last year along the Montana-Wyoming border. But he said Interior still received a fair market value for the coal, contrary to the GAO findings.
Watt said Interior has since changed its bidding system to promote higher bids, and that as a result, he sees no need to follow GAO's recommendation and suspend further leasing until the agency makes major reforms in its coal program. The GAO also recommended that Watt cancel most of the leases from the 1982 auction, but Watt said this also is unnecessary.
"Could it have been done better? We think so," Watt said of the 1982 auction, the largest in U.S. history. "Was it done detrimentally? No. And that's the struggle we're in now."
Watt also released an investigation by Interior inspector general Richard Mulberry, saying there is no proof that confidential data was leaked to the coal industry before the auction. Interior officials had earlier said they believed there was a leak, but denied it compromised the auction.
Mulberry's report said, however, that information obtained by industry sources before the auction came from a public notice posted in Interior field offices. Officials who reported a "leak" last year are quoted in the report as saying they now realize the information came from that notice, not from an unauthorized disclosure.
"I blew it," the report quotes Douglas Hileman of the agency's Wyoming office as saying.