The division hasn't been receiving adequate performance information, says the audit. The coal program devised a Coal Tracking System, but management hasn't fully used this information to monitor the program.

"Management needs better information," Minchey told legislators.

Also, the audit says, inconsistent enforcement by the coal program has led coal operators to obtain permits for a much larger surface area than required by law and the rules. The inconsistencies have forced the division to ignore, not enforce or operate in conflict with rules dealing with the permit area.

In the case of the SUFCO Mine in the southern Wasatch Plateau region of Sevier County, the disturbed area where the regulatory program has authority amounts to around half a square mile, according to a map the auditors supplied. But SUFCO's permit with the program appears to cover more than 40 square miles.

Permitting the larger area is inefficient and ties up more staff time, according to Minchey. "It has created inconsistencies in enforcement. ... This inconsistent enforcement has negatively impacted the coal industry."

He added that management "is entrenched in their old, inconsistent permitting practices."

Auditors recommend the Legislature implement a fee schedule for operators that would replace a one-time charge of $5 now imposed. Some nearby states charge much more. A change in Utah's fee schedule could reduce or eliminate the need for general-fund tax dollars, the audit concludes.

A reasonable fee schedule would generate about $400,000, auditors believe, freeing general-fund money for other purposes.

John Baza, director of the Division of Oil, Gas and Mining, responded, "We actually embrace this audit. It is something that is obviously difficult to listen to. ... " In the end, he said, good will come out of the audit. "I view this audit as a catalyst for positive change in the division."

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E-mail: bau@desnews.com