(1) The department may impute the value when coal is sold or used under the following circumstances:

(a) the operator of a coal mine is using the produced coal in an energy conversion or other manufacturing process;

(b) a person sells coal under a contract that is not an arm's length agreement, and the transaction price is less than market value; or

(c) the person neglects or refuses to file a statement.

(2) Market value means the FOB mine price of a similar ton of coal, as established by the marketplace.   In determining said FOB mine prices, the department will consider the contract term, tonnage, quality, Btu rating, and any other appropriate comparability criteria.

(3) The department will not impute a value according to (1) (b) above unless the price differential is more than 10 cents/ton or 1% of FOB mine price, whichever is higher.

(4) Contract data provided by the producer in question will be used whenever possible.