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WEST VIRGINIA LEGISLATURE
2026 REGULAR SESSION
Enrolled
Committee Substitute
for
Committee Substitute
for
Senate Bill 686
BY SENATORS ROSE AND PHILLIPS
[Passed March 14, 2026; in effect 90 days from
passage (June 12, 2026)]
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1 AN ACT to amend and reenact §37-7-2 of the Code of West Virginia, 1931, as amended; and to
2 amend the code by adding two new articles, designated §37B-3-1, §37B-3-2, §37B-3-3,
3 §37B-3-4, §37B-3-5, §37B-3-6, §37B-4-1, §37B-4-2, §37B-4-3, §37B-4-4, §37B-4-5,
4 §37B-4-6, and §37B-4-7, relating to modifying the conditions for lawful mining, extraction,
5 or production of coal in this state regarding co-tenants to a coal estate; providing an
6 exception to waste and trespass for certain coal estates under certain conditions;
7 providing a short title; providing declarations of public policy and legislative findings and
8 intent; providing definitions; providing that, in cases where the owners of at least three
9 fourths of the undivided interest in the coal estate consent to the lawful use or
10 development, the operator’s mining, use, or development of the coal estate is permissible,
11 is not waste, and is not trespass under certain defined conditions; providing that
12 nonconsenting co-tenants are entitled to receive a production royalty and providing a
13 process for obtaining the royalty; requiring certain interests owned by unknown or
14 unlocatable owners be reserved, reported, and deposited in a fund administered by the
15 State Treasurer; creating the Unknown and Unlocatable Coal Interest Owners Fund to be
16 administered by the State Treasurer; providing for certain administrative expenses;
17 providing a mechanism for surface owners to acquire title to certain severed coal interests
18 and moneys held by the Treasurer therefor; providing limitations of liability for certain
19 nonconsenting co-tenants; preserving and affirming certain common law statutory rights
20 concerning the relationship between the surface and the coal estates; requiring certain
21 provisions be read in conjunction and not in conflict with the West Virginia Uniform
22 Unclaimed Property Act; providing certain reporting requirements and administrative
23 duties; permitting investment of moneys in the fund with the West Virginia Board of
24 Treasury Investments; requiring payment of lawful claims of unknown and unlocatable
25 interest owners; providing for certain notice requirements; providing for the crediting of
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26 certain amounts to an owner’s account and payment of certain interest earned; and
27 providing for rule-making authority.
Be it enacted by the Legislature of West Virginia:
CHAPTER 37. REAL PROPERTY.
ARTICLE 7. WASTE.
§37-7-2. Waste by co-tenant.
1 If a tenant in common, joint tenant, or parcener commits waste, he or she is liable to his
2 or her co-tenants, jointly or severally, for damages. The lawful use or development of oil or natural
3 gas and their constituents in compliance with the provisions of §37B-1-1 et seq. of this code is
4 not the commission of waste. The lawful mining, extraction, or production of coal in compliance
5 with the provisions of §37B-3-1 et seq. of this code is not the commission of waste.
CHAPTER 37B. MINERAL DEVELOPMENT.
ARTICLE 3. COAL CO-TENANCY MODERNIZATION AND MINERS PROTECTION ACT.
§37B-3-1. Short title.
1 This article is known and may be cited as the Coal Co-tenancy Modernization and Miners
2 Protection Act.
§37B-3-2. Legislative findings; declaration of public policy.
1 The Legislature finds that it is the public policy of this state and in the public interest to:
2 (1) Promote the safe and efficient mining, extraction, and production of coal in this state;
3 (2) Protect the health and safety of coal miners;
4 (3) Prohibit the waste of coal;
5 (4) Encourage the maximum recovery of coal;
6 (5) Safeguard, protect, and enforce the correlative rights of coal producers and coal
7 owners;
8 (6) Protect the rights of surface owners; and
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9 (7) Promote the execution and performance of contracts lawfully made.
§37B-3-3. Definitions
As used in this article, the following words and phrases have the meanings ascribed to them.
1 "Coal" means a sedimentary deposit composed predominantly of carbon that is readily
2 combustible and includes, but is not limited to, anthracite, bituminous, semi-bituminous,
3 subbituminous, and lignite coal.
4 "Coal land" means the coal estate in land containing coal, for which a present ownership
5 interest has been leased, purchased in fee, or otherwise acquired by an operator.
6 "Consenting co-tenant" means a tenant in common, joint tenant, or parcener having a
7 present ownership interest in coal land who consents in writing to the lawful production of the coal
8 land through a bona fide lease made in an arms-length transaction.
9 "Nonconsenting co-tenant" means a tenant in common, joint tenant, or parcener having a
10 present ownership interest in coal land who, for any reason, does not consent to the lawful use of
11 coal land agreed to by consenting co-tenants owning a present ownership interest in the coal.
12 Nonconsenting co-tenant includes, but is not limited to, an unknown or unlocatable interest owner.
13 "Operator" means any owner of an interest in the right to mine, develop, and produce coal
14 from coal land, and to appropriate the coal produced from the coal land.
15 "Person" means any individual, corporation, partnership, joint venture, limited liability
16 company, association, receiver, trustee, executor, administrator, guardian, fiduciary, or other
17 representative of any kind, and includes any government or any political subdivision or any
18 agency thereof.
19 "Pro rata share" means the proportion that the net acreage of a nonconsenting co-tenant’s
20 ownership interest bears to the total net acreage in a coal estate.
21 "Unknown or unlocatable interest owner" means a person vested with a present ownership
22 interest in coal land whose identity or present location cannot be determined from:
23 (1) An examination of county real property records, grantor-grantee indices, and tax rolls;
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24 (2) A review of probate, estate, and civil records in the county of situs and any reasonably
25 identifiable county of residence; and
26 (3) A review of available online public databases.
§37B-3-4. Lawful use and development by co-tenants; reporting and remitting of interests
of unknown or unlocatable interest owners; establishing terms and provisions for
development; and merging of surface and coal.
1 (a) An operator’s mining, use, or development of the coal estate is permissible, is not
2 waste, and is not trespass if:
3 (1) The operator has made reasonable efforts to negotiate with all known, locatable
4 owners of coal land; and
5 (2) At least three fourths of the undivided interests in the right to mine, develop, lease,
6 operate, and produce coal have consented to the lawful use or development of the coal land.
7 (b) If the criteria in subdivisions (1) and (2), subsection (a) of this section have been
8 satisfied, any consenting co-tenant and his or her lessees, operators, agents, contractors, or
9 assigns:
10 (1) Are not liable for damages for waste or trespass due to the lawful use or development
11 of the coal estate;
12 (2) Shall pay any nonconsenting co-tenant in accordance with subsections (c) and (e) of
13 this section;
14 (3) Shall reserve the amounts specified in subsections (d) and (e) of this section for the
15 benefit of unknown or unlocatable interest owners; and
16 (4) Shall report and remit the reserved interests as provided in subsection (d) of this
17 section.
18 (c) A nonconsenting co-tenant is entitled to receive a pro rata share of production royalty,
19 paid on the gross proceeds received at the first point of sale to an unaffiliated third-party
20 purchaser, equal to the greater of:
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21 (1) The highest royalty percentage paid to any consenting co-tenant in the same coal land;
22 or
23 (2) Seven percent, with no deductions for any related mining, processing, transportation,
24 or marketing costs.
25 (d) An operator shall:
26 (1) Submit a report concerning each reserved interest for each unknown or unlocatable
27 interest owner to the State Treasurer, as the unclaimed property administrator, not more than 120
28 days from the date upon which any amount is reserved for an unknown or unlocatable interest
29 owner pursuant to subsections (a) and (b) of this section and §37B-4-1 et seq. of this code, and
30 each calendar quarter thereafter;
31 (2) Concurrently with the report required in subdivision (1) of this subsection, remit the
32 amount reserved in accordance with the provisions of §37B-4-1 et seq. and §36-8-1 et seq. of
33 this code and as determined by the State Treasurer; and
34 (3) Submit any quarterly report and remittance required by this subsection by the first day
35 of the month following each calendar quarter.
36 (e) Unless otherwise agreed to in writing or defined by this section, any nonconsenting co-
37 tenant or unknown or unlocatable interest owner:
38 (1) Is subject to and shall benefit from the terms and provisions most favorable to the
39 nonconsenting co-tenant or unknown or unlocatable interest owner that are contained in any lease
40 executed by a consenting co-tenant; and
41 (2) Is not subject to nor liable under any warranty of title, jurisdictional or choice of law
42 provision, or arbitration provision contained in any lease executed by a consenting co-tenant.
43 (f) A nonconsenting co-tenant may challenge an operator’s representations regarding the
44 highest royalty the operator has paid in the same coal estate pursuant to subsection (c) of this
45 section, and the lease terms and provisions pursuant to subsection (e) of this section, by filing a
46 petition for accounting with the West Virginia Tax Commissioner within 45 days following the
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47 operator’s written delivery of royalty and lease information required by subsections (c), (d), and
48 (e) of this section. The Tax Commissioner shall make a written ruling on the nonconsenting co-
49 tenant’s petition within 60 days of receipt of the petition. If either the nonconsenting co-tenant or
50 the operator is dissatisfied with the Tax Commissioner’s ruling, he or she may file a petition for
51 appeal with the West Virginia Office of Tax Appeals. Judicial review of a decision by the Office of
52 Tax Appeals is governed by §11-10A-19 of this code. At the operator’s discretion, disclosure of
53 the payment terms may be made under seal. While a petition is pending:
54 (1) Production of the coal estate may continue during the proceedings; and
55 (2) Proceedings regarding the petition shall be limited in scope to the disclosure of the
56 payment terms or other terms and provisions the operator has made pertaining to the same coal
57 land.
58 (g) After seven years from the date of the first report to the State Treasurer, a surface
59 owner may file an action to quiet title to the interests of all unknown and unlocatable interest
60 owners of the coal estate. To the extent relevant and practical, the action shall follow the
61 provisions of §55-12A-1 et seq. of this code.
62 (1) Upon presentation of proof sufficient in the court’s discretion, a surface owner is entitled
63 to receive a special commissioner’s deed transferring title to the interest of any unknown or
64 unlocatable interest owner in a coal estate which underlies the surface tract.
65 (2) A surface owner is entitled to his or her proportionate share of any of the accrued funds
66 attributable to the interests of the unknown or unlocatable interest owners that have been remitted
67 to the State Treasurer prior to the execution of the special commissioner’s deed and to any future
68 proceeds.
69 (3) An unknown or unlocatable interest owner is not entitled to any amounts paid to any
70 grantee of the special commissioner’s deed after that deed is recorded with the clerk of the county
71 commission of the county in which the coal estate is located.
§37B-3-5. Limitations of liability for nonconsenting co-tenants.
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1 A nonconsenting co-tenant including, but not limited to, any unknown or unlocatable
2 interest owner:
3 (1) Is not liable for any bodily injury, property damage, warranty of title, or environmental
4 claim arising out of site preparation, coal extraction, maintenance, reclamation, or any other
5 operation regarding coal produced from the co-tenant’s property; and
6 (2) Is liable for his or her intentional acts.
§37B-3-6. Surface use.
1 (a) It is the intent of the Legislature in enacting this article to leave unchanged the common
2 law of this state as it relates to a coal owner’s right to use the land surface for extracting coal.
3 (b) This article does not modify the obligations imposed by §22-3-1 et seq. of this code.
4 ARTICLE 4. UNKNOWN AND UNLOCATABLE COAL INTEREST OWNERS ACT.
§37B-4-1. Short title.
1 This article is and may be cited as the Unknown and Unlocatable Coal Interest Owners
2 Act.
§37B-4-2. Relationship between unknown and unlocatable interests and unclaimed
property.
1 The provisions of this article shall be read and applied in conjunction with and not in conflict
2 with the provisions of the West Virginia Uniform Unclaimed Property Act in §36-8-1 et seq. of this
3 code.
§37B-4-3. Definitions.
1 As used in this article:
2 Terms and phrases have the meanings provided in §36-8-1 et seq. and §37B-3-1 et seq.
3 of this code;
4 "Fund" means the Unknown and Unlocatable Coal Interest Owners Fund created in §37B-
5 4-5 of this article; and
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6 "Reserved interests" means all amounts payable for the use, development, extraction,
7 production, or sale of coal due to an unknown or unlocatable interest owner. Reserved interests
8 includes all royalties and any other amounts due and payable to an unknown or unlocatable
9 interest owner based on the mining, extraction, production, or sale of coal.
§37B-4-4. Report of unknown and unlocatable interest owners.
1 (a) A holder shall:
2 (1) Make a report to the administrator each calendar quarter concerning reserved interests
3 for each unknown or unlocatable interest owner;
4 (2) Concurrently with the report required by subdivision (1) of this subsection, remit to the
5 administrator the amount of the reserved interests; and
6 (3) Submit the report and remittances required by this subsection by the first day of the
7 month following each calendar quarter.
8 (b) A report required by this section shall contain:
9 (1) A full legal description of the coal interest and any other information that identifies the
10 interest;
11 (2) If known, the name, last known address, and Social Security number or taxpayer
12 identification number of any unknown or unlocatable interest owner or apparent owner;
13 (3) Any date on which reserved interests became payable with respect to the property;
14 and
15 (4) Any other information the administrator may prescribe by rule as necessary for the
16 administration of this article.
17 (c) Prior to the date a report is due to be filed, the holder of reserved interests may request
18 the administrator extend the filing deadline. The administrator may grant an extension for good
19 cause.
20 (d) A holder is not liable to any person for wrongful use or appropriation of an interest
21 owner’s personal information by another person described in the reports required by this section.
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22 (e) A holder’s obligations regarding any unknown or unlocatable interest owner, as
23 required by this chapter, are satisfied when the report and remittances required by this section
24 are submitted to the administrator.
§37B-4-5. Unknown and Unlocatable Coal Interest Owners Fund; duties of the State
Treasurer.
1 (a) The Unknown and Unlocatable Coal Interest Owners Fund is created in the State
2 Treasury as a special revenue and interest-bearing account to be administered by the State
3 Treasurer for the purposes prescribed in this article.
4 (b) The administrator shall deposit all moneys received pursuant to §37B-3-1 et seq. and
5 §37B-4-1 et seq. of this code into the fund. All expenditures from the fund shall be in accordance
6 with this article.
7 (c) The administrator shall invest the moneys in the fund with the West Virginia Board of
8 Treasury Investments. All earnings shall accrue to the fund and are available for expenditure in
9 accordance with this article.
10 (d) The administrator shall pay all lawful claims of unknown and unlocatable interest
11 owners from the fund.
12 (e) The administrator may expend moneys from the fund for the following expenses:
13 (1) Expenses incurred identifying, locating, and returning property to owners, including
14 without limitation the costs of postage, publication, and real estate or coal title investigations within
15 this state and in other jurisdictions;
16 (2) Reasonable administrative fees, not to exceed four percent; and
17 (3) Expenses incurred in examining the holders’ reports and collecting the reserved
18 interests.
19 (f) The administrator shall determine the amount that is transferrable from the fund after:
20 (i) Deducting the claims paid and the expenses provided in subsection (e) of this section; and (ii)
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21 maintaining a sum of money which the administrator estimates will be needed to pay claims and
22 expenses duly allowed from the reserved interests received and deposited into the fund.
23 (g) At least 60 days prior to the seven-year anniversary of the first report to the
24 administrator concerning the property of an unknown or unlocatable interest owner, the
25 administrator shall publish a notice in a newspaper of general circulation in each county of this
26 state where the coal is located once a week for two successive weeks as defined by §59-3-1 of
27 this code. The publication shall provide notice of the impending seven-year anniversary to all
28 possible surface owners and unknown or unlocatable interest owners.
§37B-4-6. Crediting interest to an owner’s account.
1 (a) The administrator shall credit the amount of interest earned to each owner’s account
2 and shall pay the interest earned when a claim is paid on that account.
3 (b) This section does not entitle an owner to interest on property that did not realize or
4 accrue income or gain while in the administrator’s possession.
§37B-4-7. Rules.
1 (a) The administrator shall propose rules for legislative approval pursuant to §29A-3-1 et
2 seq. of this code to implement the provisions of this article.
3 (b) The Legislature finds that an emergency exists and, therefore, on or before September
4 1, 2026, the administrator shall promulgate an emergency rule to implement the provisions of this
5 article in accordance with §29A-3-1 et seq. of this code.
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The Clerk of the Senate and the Clerk of the House of Delegates hereby
certify that the foregoing bill is correctly enrolled.
...............................................................
Clerk of the Senate
...............................................................
Clerk of the House of Delegates
Originated in the Senate.
In effect 90 days from passage.
...............................................................
President of the Senate
...............................................................
Speaker of the House of Delegates
__________
The within is ................................................ this the...........................................
Day of ..........................................................................................................., 2026.
.............................................................
Governor
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