Landfills Stink – So Let’s Have More

Posted on May 27, 2016 by Charles F. Becker

In 1991, Iowa passed a law prohibiting the delivery of yard waste to landfills.  It was during a time when there was a general panic that landfills were filling up too fast.  Twenty-two states have passed similar laws.  They all saw it as a win-win: compost could be created and sold by the city and the landfills would last longer.  A couple short decades later, several states have had second thoughts.  In 2015, Iowa passed a law that allows certain landfills to start accepting delivery of yard waste.  The reasoning is instructive. 

Landfills contain a staggering amount of potential energy.  The tires, paper products and plastic wastes, when burned for energy recovery, could light up a town.  But the cost of getting the BTUs out of the waste doesn’t make economic sense – yet.  There are exciting, new processes on the horizon that will have us mining that garbage for the energy sink it actually is, but that is still a ways off.  One form of energy recovery that is economically viable, however, is methane recovery.  As the garbage breaks down, it gives off methane gas that can be captured and burned.  Many landfills across the country do this type of recovery and find it simple and profitable.

To effectively produce methane, however, garbage must degrade.  The recycling push of the 80s and 90s took away the really good degradables from the waste stream – boxes, newspapers and yard waste were targeted as prime recyclables.  The effect was that the best fuel for garbage degradation (and thus methane creation) was banned.  Sure, it went towards the worthy goals of paper recycling and creation of high quality compost, but at what cost?

Iowa decided to look into that question.  They considered the cost of producing compost from yard waste and compared it to the cost of recovering additional methane that would be made possible by returning the green gold of yard waste to the landfill degradation process.  As it turns out, recycling loses. 

            The analysis turned on a number of factors:

·         The cost of buying, maintaining and fueling the trucks, machinery and facility needed for composting would be eliminated resulting in a yearly savings of $2 million;

·         Methane recovery would increase from the equivalent of powering 11,000 homes to powering 18,000 homes;

·         According to a study commissioned by the city of Des Moines, annual greenhouse gas emission would be reduced by 11% and the landfilling option would provide more than three times the greenhouse gas benefit presented by composting. 

Sierra Club is on record as opposing the trend (Georgia, Arkansas, Florida and Nebraska also now allow landfilling of yard waste) because it will result in landfills reaching capacity sooner.  In the case of one Iowa landfill, its estimated life would be reduced from 2054 to 2052.  Also, Sierra Club argues that more uncaptured greenhouse gases will be produced, but this seems to ignore the net savings from the other GHG reductions identified in the study.

I don’t have any idea whether returning yard waste to landfills is a net positive for the environment.  As counterintuitive as it seems, it appears to hold promise.  And if it does, where else might full cost accounting be used to guide environmental legislation?  At least some states are asking the question - and I suspect more will follow.

WHO IS IN CHARGE HERE?

Posted on May 26, 2016 by Kevin Beaton

Until recently I thought state water quality agencies with oversight from EPA were in charge of setting water quality standards, establishing mixing zones and similar activities.  However, the National Marine Fisheries Service (NMFS) and the United States Fish and Wildlife Service (USFWS) has recently served notice that they are the new water quality sheriffs in the Northwest.

It is well known that the Endangered Species Act (ESA) is a comprehensive statute designed to protect and recover species that are listed as threatened or endangered by the USFWS and the NMFS (collectively referred to as "Services").  One of the key provisions in the ESA is 16 USC § 1636 (or Section 7) which requires federal agencies to utilize their authority to conserve endangered species and "consult" with the Services whenever any discretionary action by the acting federal agency has the potential to negatively affect listed species.  Many no doubt recall the decision in TVA v. Hill, 437 U.S. 153 (1978), in which the Court determined that Section 7 required the acting federal agency to halt construction of an almost completed major federal dam in Tennessee (Tellico Dam) because it would undisputedly eradicate the listed species ("snail darter" or perch), destroy its critical habitat and therefore completion of the dam would clearly violate Section 7.                                                                                                                        

What constitutes "jeopardy" and destruction of critical habitat under the ESA has come a long way since TVA v. Hill.  The ESA gets a lot of play in the Northwest principally because there are large tracts of undeveloped federal land, human population is relatively sparse and pristine waters combine to provide habitat for many listed aquatic species such as various species of salmon.  In one of the latest iterations of what constitutes "jeopardy" the Services recently determined in lengthy biological opinions that EPA's approval (some twenty years ago) of Idaho's Water Quality Standards for certain toxic metals would jeopardize the continued existence of listed species and destroy or adversely modify critical habitat. 

There is a question whether EPA approval of state water quality standards pursuant to § 303 of the CWA is the type of discretionary action that even triggers ESA consultation.  See National Association of Homebuilders v. Defenders of Wildlife, 551 U.S. 644 (2007) (Section 7 consultation not required when EPA authorizes state to take over the NPDES permit program under § 402 of the CWA).  Assuming consultation is required, certainly there had been a lengthy delay in EPA and the Services completing consultation on Idaho Water Quality Standards (over twenty years).  This delay gave rise to a lawsuit brought by regional environmental groups to force completion of the consultation.  See Northwest Environmental Advocates v. The National Marine Fisheries Service, USDC Idaho, Case No. 1:13-cv-00263-EJL. 

But, how can a water quality criteria jeopardize the existence of an endangered species?  Water quality standards under the CWA are goals set by each state for state surface waters.  NPDES Permits must meet state water quality standards and if a waterbody is not meeting standards then states must adopt pollution control plans (known as "TMDLs") to bring a waterbody into compliance also subject to EPA approval.  Adoption of criteria itself cannot jeopardize endangered species or for that matter save a species.

If one has the fortitude to power through the Services lengthy biological opinions, which were not subject to public comment, there is no finding that state standards at or below the current criteria are actually harming any fish in the thousands of miles of streams and rivers affected by the opinions.  Rather the Services take exception to the somewhat esoteric process by which EPA develops national recommended water quality criteria (which most states ultimately follow).  The Services found EPA should have relied on different laboratory studies in developing and approving criteria.  Many of the laboratory studies the Services relied upon do not even involve listed species.

The Services then suggested that EPA must adopt replacement criteria (or force the state to do so) over the next few years via reasonable and prudent alternatives (or RPAs) to avoid the alleged jeopardy.  An RPA are measures "suggested" by the Services under Section 7 to the action agency (EPA) to avoid jeopardy which are within the discretion of the action agency and are economically and technically feasible.  In the meantime the Services suggested as an interim measure how EPA should regulate point source dischargers into waters containing listed species by meeting certain prescribed mixing zones.

While the Services’ jeopardy determinations on Idaho's standards are a far cry from jeopardy to the snail darter caused by the construction to the Tellico Dam many years ago, the Services’ findings may go unchallenged.  It is likely EPA will follow the RPA's (or force the state to do so) for fear of another lawsuit that EPA is violating its obligations under Section 7.  Likely the only remedy to question the Services’ jeopardy determinations may be a judicial challenge to the Biological Opinions.  However in such a challenge a court would be forced to evaluate the "science" behind the Services’ jeopardy determinations which is an area the courts generally will defer to the expertise of the agency.  One would think that EPA or state water quality agencies would be the experts on setting water quality standards and establishing mixing zones, but the Services will no doubt claim they are now the experts.  Sometimes it is difficult to figure out who is in charge.

Close but No Cigar

Posted on May 25, 2016 by Lynn L. Bergeson

As divisive as Congress is, Members miraculously seem to agree that our chemical management law, the Toxic Substances Control Act (TSCA), needs modernizing.  On May 6, the key Members of the Senate announced that they had reached agreement on draft TSCA reform legislation; the House is expected also to act soon, perhaps before Memorial Day.  This means that TSCA, our chemical control law enacted almost 40 years ago, could be significantly modernized this year -- a goal that has proven to be uniquely elusive.  Many believe that TSCA’s greatest failing, and the deficit that most undermined the public’s confidence in the U.S. Environmental Protection Agency’s (EPA) ability to assure chemical safety, is EPA’s limited authority under TSCA to regulate “existing” chemical substances believed to pose risks.  Pending TSCA reform legislation that is supported by an unusually broad group of stakeholders would strengthen EPA’s authority and address this failing.  Consensus on the contentious issue of preemption has proven especially challenging as many states are aggressively enacting chemical-specific measures, have been for years, and do not wish to cede authority to EPA.  Now that the Senate has reached agreement, the hope is the House can also agree quickly as time is running out.  TSCA reform is urgently needed.  Congress has never been this close to making it happen, and while we are not there yet, Congress seems poised uncharacteristically to make the right choice.  Tobacco products will still not be subject to TSCA jurisdiction, but celebrations will be in order if this elusive milestone is finally reached.

ACOEL Announces June 28 MCLE-Accredited Clean Power Plan Telephone Seminar in Collaboration with American Law Institute CLE

Posted on May 24, 2016 by David B. Farer

The American College of Environmental Lawyers is pleased to announce its first collaboration with the American Law Institute Continuing Legal Education Group (ALI CLE).  On June 28, 2016, from 2:00 pm to 3:30 pm EDT, the College and ALI CLE will be presenting an MCLE-accredited telephone seminar: The Clean Power Plan: Issues and Challenges.

The seminar panel will feature ACOEL Fellows Mike Gerrard (Columbia Law School/Sabin Center for Climate Change Law), Pam Giblin (Baker Botts) and Bob Martineau (Tennessee Department of Environment and Conservation). 

The College has provided the planning, faculty and content of the program; ALI CLE is providing the administrative end, including production and CLE accreditation for the 1.5 hour program.  (CLE credits range from 1 to 2 depending on state; most are 1.5.) The planning chairs are ACOEL Fellows Ted Garrett (Covington & Burling LLP) and me (Greenbaum, Rowe, Smith & Davis LLP).

The ALI CLE  web brochure, including details on registration,  is posted at: www.ali-cle.org/tsxx04

The seminar topic is an outgrowth of the August 2015 announcement by President Obama and EPA of promulgation of the final Clean Power Plan regulations, the subsequent challenges to the Plan pending before the D.C Circuit Court of Appeals (scheduled for June but now pushed back to September before the full D.C. panel), and the U.S. Supreme Court’s stay of the regulations pending judicial review on whether EPA exceeded its authority under the Clean Air Act.

The ACOEL panelists will provide diverse and thoughtful perspectives on key issues concerning the CPP, including:

            • Pending judicial challenges to the regulations

            • Compliance issues

            • State implementation issues

            • Implications for the Paris Agreement

We hope that you will register for this timely and informative seminar.

Thanks much to Mike Gerrard, Pam Giblin and Bob Martineau for agreeing to participate, and to Ted Garrett for his involvement in planning the phone seminar.

The Global Warming Solutions Act Requires MassDEP to Promulgate Declining Annual GHG Emissions Limits for Multiple Sources: Yikes!

Posted on May 23, 2016 by Seth Jaffe

On Tuesday, the Supreme Judicial Court of Massachusetts (SJC) ruled that MassDEP had violated the Global Warming Solutions Act progress-on-2020-planby failing

"To promulgate regulations that address multiple sources or categories of sources of greenhouse gas emissions, impose a limit on emissions that may be released, limit the aggregate emissions released from each group of regulated sources or categories of sources, set emissions limits for each year, and set limits that decline on an annual basis."

Phew.

The SJC gets the final word, so I won’t spend much time explaining why the SJC got it wrong, though I will note that to suggest that the legislature’s use of the phrase “desired level” of GHG emissions unambiguously requires MassDEP to establish hard targets was at best overenthusiastic.

The bigger question at this point is what the decision means.  First, it’s clear that MassDEP must establish hard declining emissions limits for more than one, but less than all, categories of GHG emitting sources.

Second, MassDEP must promulgate regulations that limit total emissions – not emission rates.

Third, the regulations must truly control Massachusetts sources.  The SJC specifically found that RGGI doesn’t satisfy the GWSA requirement, in part because Massachusetts sources can purchase allowances from out of state facilities.

But where does this leave MassDEP?  In a deep hole, for sure.  Unless it wants to ditch RGGI, it can’t regulate power generation, because the type of program that the SJC said is required would simply be incompatible with RGGI.

How about mobile sources?  They are the largest growing source of GHG emissions.  Unfortunately, we come back to the SJC’s injunction that MassDEP must regulate total emissions, not emission rates.  You tell me how MassDEP is going to issue regulations setting a cap on mobile source emissions.

The only obvious candidates I see are buildings and industrial sources other than power generation.

I don’t envy MassDEP – and the nature of the task only emphasizes the extent of the SJC’s overreach here – but I said I wouldn’t get into that.

Looking Back Over 100 Years of the National Park Service, Looking Ahead to the Future of Environmental Law

Posted on May 20, 2016 by Benjamin F. Wilson

August 25, 2016 is the 100th anniversary of the National Park Service.  The many planned celebrations and observances provide an opportunity for everyone to become reacquainted with these great outdoor spaces and reflect on the world around us.  As your summer plans take shape, be sure to visit FindYourPark.com and try to visit at least one national park.  I invite you to share photos of your travels in the comments section of this post, and perhaps ACOEL can find a place for the collection of images of its members enjoying these national treasures.

As I reflect on the Park Service’s anniversary, I observe that it presents a chance for me – and for all environmental lawyers – to take stock of where we have been as a profession.  Why – and how – we do what we do?  What challenges will the next 100 years hold?

I issue this charge, in part, to carry on the conservation legacy of Henry L. Diamond.  Henry was a founder of my firm, Beveridge & Diamond, and a great environmental lawyer and mentor to many (including myself).  Sadly, we lost Henry earlier this year.

Henry and many others like him paved the way for our generation to be stewards of the planet and the environmental laws that govern our interactions with it.  We have made progress, but new challenges have emerged.  Easy answers, if they ever existed, are fewer and farther between.  So what, then, does the future hold for the next generation of environmental lawyers? 

Future generations of lawyers would do well to focus on the funding mechanisms that are critical but often overlooked components to achieving our most important environmental and sustainability goals.  As an example, we can look to the past.  Early in his career, Henry Diamond assisted the Chairman of the Outdoor Recreation Resources Review Commission, Laurance Rockefeller, in editing the Commission’s seminal report, Outdoor Recreation for America, that was delivered to President John F. Kennedy in 1962.  Among the Commission’s more significant recommendations was the idea to use revenues from oil and gas leasing to pay for the acquisition and conservation of public lands.  Congress took action on this recommendation, creating the Land & Water Conservation Fund in 1965 as the primary funding vehicle for acquiring land for parks and national wildlife refuges.  While the fund has been by all accounts a success in achieving its goals, much work remains to be done and the fund is regularly the target of budgetary battles and attempts to reallocate its resources to other priorities.  Today, the four federal land management agencies estimate the accumulated backlog of deferred federal acquisition needs is around $30 billion. 

I expect climate change will dominate the agenda for the young lawyers of our current era.  They will need to tackle challenges not only relating to controlling emissions of greenhouse gases, but also adaptation resulting from climate change.  Sea level rise, altered agricultural growing seasons, drought and water management, and other issues will increase in prominence for this next generation.

We can expect our infrastructure needs to continue to evolve – not only replacing aging roads, bridges, tunnels, railroads, ports, and airports, but also the move to urban centers and the redevelopment of former industrial properties.  Autonomous vehicles and drones also pose novel environmental and land use issues.  These trends will require us to apply “old” environmental tools in new ways, and certainly to innovate.  As my colleague Fred Wagner recently observed on his EnviroStructure blog, laws often lag developments, with benefits and detractions.  Hopefully the environmental lawyers of the future will not see – or be seen – as a discrete area of practice so much as an integrated resource for planners and other professions.  Only in this way can the environmental bar forge new solutions to emerging challenges.

The global production and movement of products creates issues throughout the supply chain, some of which are just coming to the fore.  From raw material sourcing through product end-of-life considerations, environmental, natural resource, human rights, and cultural issues necessitate an environmental bar that can nimbly balance progress with protection.  As sustainability continues its evolution from an abstract ideal to something that is ever more firmly imbedded in every aspect of business, products, services, construction, policymaking and more, environmental lawyers need to stay with their counterparts in other sectors that are setting new standards and definitions.  This area in particular is one in which non-governmental organizations and industry leaders often “set the market,” with major consequences for individuals, businesses, and the planet.

Finally, as technology moves ever faster, so do the tools with which to observe our environment, to share information about potential environmental risks, and to mobilize in response.  With limited resources, government enforcers are already taking a page from the playbooks of environmental activists, who themselves are bringing new pressures for disclosures and changes to companies worldwide.  With every trend noted above, companies must not underestimate the power of individual consumers in the age of instantaneous global communication, when even one or two individuals can alter the plans and policies of government and industry.

Before Henry Diamond passed away, he penned an eloquent call to action that appeared in the March/April edition of the Environmental Law Institute’s Environmental Forum (“Lessons Learned for Today”)I commend that article to you.  It shares the story of the 1965 White House Conference on Natural Beauty and how a diverse and committed group of businesspeople, policymakers, and conservationists (some of whom were all of those things) at that event influenced the evolution of environmental law and regulation for the decades to come.  Laws such as the National Environmental Policy Act, the Clean Air Act, the Clean Water Act, and others have their roots in that Conference.  In recognition of his lifetime of leadership, Henry received the ELI Environmental Achievement Award in October 2015.  The tribute video shown during the award ceremony underscores Henry’s vision and commitment to advancing environmental law.  I hope it may inspire ACOEL members and others to follow Henry’s lead.

These are just a few things I think the future holds for environmental lawyers.  What trends do you predict?  How should the environmental bar and ACOEL respond?  

Deal or no Deal? - Partial Dismissal of CERCLA Claims Against United States and Tribal Entities

Posted on May 19, 2016 by Larry Ausherman

Three companion decisions in Atlantic Richfield Co. v. U.S. et. al., Case No. 1:15-cv-00056, in the U.S. District Court for the District of New Mexico, provide insight on the CERCLA statute of limitations, potential pitfalls in pleading CERCLA claims, and the defense of sovereign immunity by an Indian Pueblo in the context of CERCLA and contract claims.  The case remains pending.

In the 1940s, when the war was over, the federal government was in the market for uranium concentrate for bombs, and it encouraged private entities to mine and mill uranium for sale to the government at prices set by the government.  Much of the country’s uranium reserves were in the Grants Uranium Belt in western New Mexico, an area that includes the Laguna Pueblo. 

Uranium was discovered on Laguna Pueblo lands in 1952, and Anaconda Copper Mining Company entered into mining leases with Laguna, which were approved by the Bureau of Indian Affairs, acting pursuant to its trust responsibility to the Pueblo.  Much uranium was mined there from the Jackpile Paguate mine beginning in 1952, and operations continued until 1982.        In 1986, the Pueblo and Anaconda’s successor, Atlantic Richfield Co. (“ARCO”), entered into an agreement to terminate the leases and perform remediation.  ARCO agreed to pay the Pueblo to perform remediation, and the Pueblo agreed to assume all liability and release ARCO regarding it.  The Department of the Interior approved the agreement and, following the preparation of an EIS, BLM and BIA issued a ROD that established requirements for the remediation.  ARCO paid $43.6 million to the Pueblo to perform the remediation and release ARCO. 

All defendants were involved in varying degrees with the remediation.  BIA had responsibility to determine the extent of remediation required and approve key remediation decisions according to a cooperative agreement with the Pueblo.  But BIA and the Pueblo saw in ARCO’s $43.6 million payment an economic development opportunity.  The Pueblo formed Laguna Construction Company (“LCC”) to conduct the remediation, and BIA ceded certain oversight to the relatively inexperienced LCC as well.  Work on the initial remediation ended in 1985.  Beginning in 2007 the Pueblo, and then EPA, investigated the adequacy of mine reclamation at the mine site and found problems.  In 2012 EPA proposed listing on the NPL, and in 2014 it asserted that ARCO should fund the RI/FS, but EPA has brought no litigation. 

ARCO claims that the remediation was mishandled and brought CERCLA claims against the United States, the Pueblo and LCC, seeking cost recovery, contribution, and declaratory relief.  The United States moved to dismiss.  In detailed decision by Senior United States District Judge, James A. Parker, all of ARCO’s claims against the United States were dismissed.    In companion decisions, some claims against the Pueblo and LCC were dismissed and some survived motions to dismiss.  Dismissals were based in part on the CERCLA statute of limitations, the court’s determination that the ARCO pleadings were deficient and sovereign immunity.

ARCO sought to recover two categories of response costs:  (1) the $43.6 million it paid to the Pueblo in 1986 in exchange for the Pueblo’s agreeing to be responsible for the remediation and to release ARCO from all responsibility for it; and (2) the significant costs ARCO incurred in responding to EPA’s more recent efforts to shift responsibility to ARCO.  The Court dismissed ARCO’s claims for cost recovery and contribution for the 1986 settlement payment as time barred.  The Court dismissed ARCO’s claim to recover the costs in responding to EPA and associated investigation as inadequately pled to establish that the expenditure constitutes “necessary costs of response.”  Claims for contribution under 113(f)(1) (referenced by the court as “post judgment contribution claim”) were dismissed as premature because ARCO had not been sued.  Finally, the claims against the United States for declaratory judgement were dismissed; the court ruled that ARCO cannot bring a claim for declaratory relief because it has failed to establish a valid underlying contribution or cost recovery claim. 

Claims against the Pueblo and LCC are somewhat more complicated as a result of sovereign immunity defenses they raised.  The court considered the sovereign immunity defense asserted by both Laguna Pueblo and LLC, its federally-chartered Tribal Corporation.  The Court concluded that both the Pueblo and LCC are entitled to assert sovereign immunity as a bar to ARCO’s CERCLA claims because the language of existing waivers of sovereign immunity was not unequivocal enough to cover CERCLA claims.  The Court therefore dismissed those CERCLA claims.  However, the court found that the Pueblo and LCC waived sovereign immunity with regard to ARCO’s breach of contract claims.  The source of this waiver for the Pueblo is in the 1986 Agreement to Terminate Leases.  The court found that this agreement served to waive sovereign immunity from claims brought under that contract.  Regarding LCC, the source of the waiver of sovereign immunity for breach of contract claims was in the Articles of Merger associated with the merger of LCC from a New Mexico corporation to a federal LCC formed under 25 USC §477, which may assert sovereign immunity.  A motion for reconsideration by LCC is pending.

Although the facts of Atlantic Richfield are unique, its lessons are broader.  First, in pleading a CERCLA claim for cost recovery, care should be taken to allege in some detail facts which support all elements of the claim, including facts showing that necessary response costs within CERCLA were incurred.  Second, without adequate waiver of sovereign immunity, the settlement and payment in exchange for a release and commitment by a tribe or tribal corporation to assume full responsibility for clean-up may leave the door open for CERCLA liability in the future without recourse through CERCLA-based contribution and cost recovery claims.  Finally, although the court’s decision confirmed that the defense of sovereign immunity applies to CERCLA contribution and cost recovery claims brought by private parties against sovereign Indian tribes and their federally chartered corporations, the court’s analysis confirms that under the right circumstances, a tribe may waive its sovereign immunity protections. 

Energy Policy Modernization Act of 2015 Passes Senate

Posted on May 17, 2016 by Chester Babst

On April 20, 2016, the U.S. Senate passed S.2012, the Energy Policy Modernization Act of 2015, by a vote of 85-12.  If enacted, S.2012 would be the first comprehensive energy legislation since the Energy Independence and Security Act of 2007.  This bipartisan bill is intended to expand domestic energy systems, facilitate investment into critical infrastructure and improve the performance of federal agencies while protecting the environment.

S.2012 contains two notable provisions that would impact domestic oil and natural gas production and infrastructure development.  First, the Act would designate the Federal Energy Regulatory Commission (“FERC”) as the lead agency responsible for coordinating all applicable federal authorizations and National Environmental Policy Act (“NEPA”) review for proposed natural gas projects and facilities.  According to the Act, once FERC determines that an application for a project or facility is complete, all required federal authorizations must be issued within the timeframe specified by FERC, which “should” not exceed 90 days.  The provision would likely speed the federal approval of interstate pipeline and liquefied natural gas (“LNG”) projects.

Second, the Act creates a Bureau of Land Management (“BLM”) pilot program that would allow operators to lease and develop certain mineral interests owned by the federal government without a federal drilling permit.  Specifically, the pilot program would include 2,000 spacing units in which the federal government owns 25% or less of the mineral interests and none of the surface estate.  BLM would be authorized to waive the requirement that operators obtain a federal drilling permit for the spacing units if BLM determines that the mineral interests are adequately protected by the lease terms or other laws and regulations.  The proposed pilot program may lead to permanent programs that ease the restrictions on exploration and production activities affecting mineral interests in which the federal government owns only a minority share.

The White House has previously threatened to veto legislation aimed at speeding the federal authorizations necessary to construct LNG facilities and pipelines.  However, no such veto statement has been issued with respect to S.2012.  This legislation may not face opposition from the White House because it was developed after numerous listening sessions were held with stakeholders across the country and after weeks of negotiations by many senators seeking common ground for modernizing energy policy.  Senator Murkowski (R-Alaska), Chairman of the U.S. Senate Committee on Energy and Natural Resources, stated that she expects a formal conference with the U.S. House Energy and Commerce Committee to merge the Senate and House bills, but no timeline for a meeting has been established.  

Fresh Breeze or Last Sigh? Budha Ismail Jam et al v. International Finance Corporation, No 15-cv-00612 (JDB) (D.D.C.)

Posted on May 16, 2016 by Todd D. True

The Tata Mundra “Ultra-Mega” coal-fired power plant on the coast of India north of Mumbai is a behemoth by any measure.  Capable of producing over 4,000 megawatts of electricity from five huge boilers, it can consume over 12 million tons of coal per year and requires millions of gallons of seawater a day for its once-through cooling system.  Indeed, the plant is so large it requires its own coal port, its own water intake channel (nearly 150 meters wide) and its own outfall that discharges warm water equal to almost half the mean flow of the Potomac River.

For generations, the area where the plant is now located supported a system of small fishing villages where fishing families move from inland locations to the coast for several months each year following the monsoon to catch and dry fish which they sell to traders.  This income has supplemented income from agriculture and provided the villages and families with a subsistence living. 

The arrival of the Tata Mundra Plant changed all that:  construction disrupted access to fishing locations; dredging altered the natural systems and the fish disappeared as water salinity and temperature changed; fresh water supplies dwindled as the plant’s water use led to increased saltwater intrusions into groundwater; and a way of life that had sustained families and villages disappeared.

So what does this story of displacement and disruption half way around the world have to do with environmental law in the U.S.?  In today’s world, where it’s clearer day-by-day that everything is connected to everything else, the answer is “more than you might think.” 

The Tata Mundra Plant would not have been built without financing from the International Finance Corporation (IFC) based in Washington.  The IFC is an organization of member states and part of the World Bank Group.  To its credit, the IFC recognized the environmental risks of the project from the outset noting that it had the potential to have “significant adverse social and/or environmental impacts that are diverse, irreversible, or unprecedented.”  And, consistent with its lending policies, it put in place as part of its loan agreement social and environmental performance standards and requirements to mitigate these impacts. 

It all looked good on paper.  But then the plant was built and the IFC looked the other way.  We know this because individual villagers who depended on the resources the Tata Mundra Plant destroyed complained through a local fishing union and village government to the IFC’s ombudsman office.  That office issued a scathing report criticizing the IFC for its multiple failures to ensure implementation of the protective measures in its loan agreement.  The IFC shrugged; the ombudsman’s office has no enforcement powers.

Frustrated with their inability to achieve any meaningful accountability through the IFC, a handful of individual fishers and villagers, a local fishing union, and a village governmental entity filed a complaint against the IFC in the U.S. District Court for the District of Columbia, Budha Ismail Jam et al v. IFC, No 15-cv-00612 (JDB), in April of 2015.  The IFC moved to dismiss the complaint on sovereign immunity grounds.  The IFC is covered by the International Organizations Immunities Act (“IOIA”), which Congress passed in 1945, and is entitled to the “same immunity” in U.S. courts as foreign nations. While the immunity enjoyed by foreign nations has changed significantly since 1945, the IFC asserted that its had not -- and remained near-absolute.

The District Court concluded, in light of longstanding D.C. Circuit precedent dealing with immunity from wage garnishment proceedings for an employee of one of the IFC’s sister international organizations, the Inter-American Development Bank, that it was bound to dismiss the complaint against the IFC on sovereign immunity grounds.  Budha Ismail Jam et al v. IFC, No 15-cv-00612 (JDB), Memorandum Opinion (Mar. 24, 2016 D.D.C.).

This outcome raises serious questions about the accountability of international lending organizations like the IFC that finance potentially environmentally destructive project around the world while professing to follow the most stringent lending practices for protecting people and the environment.  If we are “all in this together,” a serious failure of accountability on the other side of the world is not something we can just shrug off as someone else’s problem.  We live in a global commons – industrial projects built anywhere can affect us all.  The most obvious example is the effects on the climate from the dramatic expansion of fossil fuel-based power generation around the world, much of it built with international financial support, often originating in the U.S.

Nor is the law of sovereign immunity as clear or unfavorable to the plaintiffs as the District Court’s decision suggests.  First, since 1945, sovereign immunity for foreign states has developed a well-recognized exception for commercial activities, activities that do not enjoy immunity.  IFC lending decisions – on which the IFC makes a profit – are nothing if not commercial activity.  Second, and maybe more significantly, sticking with an out-dated, circa-1945 version of sovereign immunity actually undermines the credibility of the IFC itself.  For the IFC to continue enjoying the financial support of its member states, its commitment to responsible lending must be real and reliable, not illusory.  If it continues to finance projects without real environmental accountability, its members may become inclined to withdraw their support because they will not want it lending to their neighbors: environmental harms don’t recognize geo-political boundaries and irresponsible financing for a polluting facility in one country may well harm another.

Because the facts of Budha Ismail Jam et al v. IFC are so stark, because accountability in international finance for major industrial projects is increasingly important both here and abroad in a world facing rapid climate change and its effects, and because the plaintiffs are appealing the District Court’s order of dismissal, this is a case worth watching.  It could be the first whisper of a new breeze in accountability for the environmental effects of international lending decisions -- or the last sigh from beneath a suffocating blanket of sovereign immunity.

Roger Goodell and EPA Administrative Orders

Posted on May 4, 2016 by George von Stamwitz

You do not have to be a football fan to be aware of the legal battles between NFL Commissioner Roger Goodell and the star quarterback, and perpetual winner, Tom Brady arising out of Brady’s use of deflated footballs at a playoff game. Brady won the round in district court where the judge focused on the merits of the factual case. Goodell recently won on appeal where the court of appeals focused on the fact that the NFL Players Association bargained away the right to challenge Goodell’s decisions on the merits. On appeal, it did not matter whether Brady did anything wrong. All that mattered was that Goodell thought Brady did something wrong.

In recent dealings with EPA on its model Administrative Order on Consent (“AOC”) for Remedial Investigations and Feasibility Studies (“RI/FS”), it seems EPA wants PRPs to make the same mistake the Players Association made: let EPA be judge and jury over any dispute that arises under the AOC. The most troubling language in the model is that EPA’s final decision on the dispute “becomes part of the Order.” While the vast majority of EPA folk I have met are more reasonable than Roger Goodell, RI/FS projects can involve millions of dollars, which sets the table for expensive disputes.

What is a Brady fan to do? First, the model should be changed to allow pre-enforcement review, as pointed out in a recent ACOEL post by Mark Schneider. Second, if the AOC process is otherwise desirable, there are ways to minimize the effect of the model language on at least one category of dispute: work expansion disputes, often the most serious and expensive variety of disputes. A very specific Scope of Work attached to the AOC would minimize the risk of work expansion by EPA through dispute resolution. If a dispute arises that could expand the work, do not invoke dispute resolution. Take the position that the AOC does not apply to EPA’s demand because the demand is beyond the scope of the AOC. If EPA enforces the AOC on this point you can defend without EPA’s position becoming part of the AOC beforehand. Thus, you avoid Brady’s fate—having a good argument and nowhere to go.

Keystone XL Pipeline Goes To Court

Posted on April 29, 2016 by Mark Walker

In January TransCanada sued the Obama Administration over its denial of a permit for the Keystone XL pipeline to cross the US-Canada border. In its lawsuit TransCanada asserts that the President exceeded his executive authority and usurped Congress’ constitutional power to regulate commerce.

The lawsuit, filed in federal court in Houston, Texas, comes after TransCanada spent seven years mired in the administrative process. TransCanada’s complaint recounts the key events of those seven years as follows.

In 2008 TransCanada was granted a border crossing permit for Keystone I, so there is already a Keystone pipeline that crosses the US-Canada border in North Dakota. The State Department raised no objections regarding GHG emissions in connection with that permit. In 2009, then Secretary of State Clinton granted a cross-border permit to Enbridge for its Alberta Clipper pipeline, concluding that GHG emissions were not a basis for denying a border crossing permit.

In 2008, seeking to expand capacity, TransCanada applied for a second US-Canada border crossing permit for the Keystone XL project. The permit application covered a 1.2 mile section of pipe that was part of a broader 1,700-mile pipeline project, most of which was to be located in the United States.

Following this application, the State Department issued a series of draft and final environmental impact statements that found minimal GHG impacts. Nevertheless, in November 2011 the State Department announced it could not make a final determination until an alternative route through Nebraska was selected.

In December 2011 Congress passed an act that required the President to grant the permit to TransCanada within 60 days or report to Congress why the President did not believe the pipeline crossing served the national interest. In January 2012 President Obama directed the Secretary of State to deny the permit on the ground that 60 days was insufficient time. Secretary Clinton denied the permit but indicated that a renewed application would be considered. In May 2012 TransCanada submitted a renewed application.

Following this second application the State Department issued another series of EISs which found that the project would not substantially increase GHG emissions. In early 2015, Congress passed the Keystone Pipeline Approval Act, which authorized the Keystone XL project without any further action or approval by the President. President Obama vetoed the Act and Congress was unable to override the veto.

In November 2015, Secretary Kerry denied the renewed application. The Record of Decision found that the pipeline would advance the national interest by providing added energy security and economic benefits, and furthering the United States’ relationship with Canada. The ROD also found that GHG emissions might actually increase without the pipeline because the crude oil would otherwise be transported by rail and tankers. Nevertheless, the Secretary concluded that the pipeline did not serve the national interest because it “would undermine U.S. climate leadership and thereby have an adverse impact on encouraging other States to combat climate change” in advance of the December 2015 Paris climate negotiations.

It is with the backdrop of these events that TransCanada challenged the President’s authority to regulate international pipeline border crossings.

Where does the President derive the authority to regulate international pipeline crossings, and particularly on the basis of the United States’ symbolic leadership role on climate change? The President relies upon Executive Order 13337, under which the President delegated authority to the Secretary of State to deny border crossings that do not “serve the national interest”. But because the Constitution gives Congress the power to regulate commerce, where does the President derive the power to delegate to the Secretary of State in the first place, particularly since Congress has never delegated the authority to regulate such border crossings to the President?

TransCanada’s complaint discusses the various U.S. Supreme Court decisions which address the President’s power to act in areas otherwise reserved to Congress but where Congress has not yet acted. These cases hold that the President does have power to act in such circumstances, but also hold that the President’s authority can be revoked at any time by Congress by simply expressing its contrary will. TransCanada argues that Congress expressed such contrary will when it passed the Keystone Pipeline Approval Act, thereby depriving the President of authority to take further action.

On April 1 the Obama Administration filed a Motion to Dismiss, arguing that the President’s powers over foreign affairs and as Commander-in-Chief provide sufficient independent constitutional authority to regulate pipeline border crossings. In addition, the Administration argues that, because the Keystone Pipeline Approval Act never became law, it provides no basis to challenge the President’s decision. The Natural Resources Defense Council, Friends of the Earth, Texas Environmental Advocacy Services, Community In-Power and Development Association and Center for Biological Diversity recently filed an Amicus Brief.

The outcome of this environmental controversy will depend not on statutory interpretation or common law but on fundamental concepts of separation of powers. The sometimes murky line between Presidential and Congressional authority will be tested here.

EPA Gets the Black Flag on Clean Air Act Racing Exemption

Posted on April 28, 2016 by Samuel I. Gutter

In auto racing, the black flag is the ultimate sanction, signaling that a competitor has been disqualified and has to leave the race. That’s what happened to EPA recently, when it withdrew a controversial proposed rule to “clarify” that the Clean Air Act prohibits converting a certified vehicle for racing.

Merits aside, EPA’s start-and-stop performance is an excellent example of notice-and-comment rulemaking gone wrong. The original proposal appeared last July, a brief passage buried in the middle of a 629-page proposed rule on greenhouse gas emissions for medium- and heavy-duty engines and vehicles – hardly the place where one would look for a rule directed at race cars. See 80 Fed.Reg. 40137, 40527, 40552 (July 13, 2016). As should have been expected, EPA’s pronouncement that the Clean Air Act flatly prohibits converting emission-certified vehicles for competition went unnoticed for months. It wasn’t until late December, nearly three months after the close of the comment period, that SEMA (the Specialty Equipment Market Association, the trade group representing the motor vehicle aftermarket industry) discovered the proposed rule.

That’s when the yellow flag came out. SEMA and its members blasted EPA’s interpretation as reversing a decades-old policy that allowed the race-conversion market to flourish, and for hiding the proposal in an inapplicable rule. EPA’s response was to hold to its interpretation and to post SEMA’s comment letter in a “notice of data availability” so that others could comment – not on EPA’s proposal, but on SEMA’s letter. 81 Fed.Reg. 10822 (March 2, 2016). 

SEMA stepped up the pressure with a White House petition that quickly garnered more than 150,000 signatures. Then came a letter to EPA from seven state attorneys general, and bills in both the House and Senate (brilliantly named the Recognizing the Protection of Motorsports Act, or “RPM”) to reverse EPA’s interpretation and codify the race exemption in the Clean Air Act.

On April 15, EPA hit the brakes, announcing that it was withdrawing its proposal. www.epa.gov/otaq/climate/regs-heavy-duty.htm. EPA stated that it never meant to change its policy towards “dedicated competition vehicles,” but admitted that its “attempt to clarify led to confusion.” EPA voiced its support for “motorsports and its contributions to the American economy and communities all across the country.

The checkered flag came out, but EPA had already pulled into the pits.

Big Changes With Little Fanfare: The FHWA Proposes to Use GHG Emissions as a Performance Measure

Posted on April 27, 2016 by Seth Jaffe

This week, the Federal Highway Administration issued a Noticed of Proposed Rulemaking to promulgate performance measures to be used in evaluating federal funding of transportation projects.  The requirement for performance measures stems from the Moving Ahead for Progress in the 21st Century Act, aka MAP-21.  MAP-21 requires the FHWA to establish performance standards in 12 categories, one of which is “on-road mobile source emissions.”  MAP 21

The NPRM addresses this criterion, focusing largely on emissions of criteria pollutants.  However, buried in the 423-page NPRM is a six-page section labeled “Consideration of a Greenhouse Gas Emissions Measure.”

And thus the FHWA drops a bomb that could revolutionize federal funding of transportation projects.  It’s important to note that this may not happen.  If the next President is Republican, it certainly won’t.  Even if the FHWA goes forward, there would be legal challenges to its authority to use GHG as part of the performance measures.

If it does go forward though, it really would be revolutionary.  As the NPRM states, transportation sources are rapidly increasing as a source of GHG emissions:

GHG emissions from on-road sources represent approximately 23 percent of economy-wide GHGs, but have accounted for more than two-thirds of the net increase in total U.S. GHGs since 1990.

The enormity of both the challenges facing the FHWA in attempting to establish a performance measure for GHG emissions and the potential impact implementation of a GHG performance measure would have is reflected in some of the 13 questions that FHWA posed for comment:

  • Should the measure be limited to emissions coming from the tailpipe, or should it consider emissions generated upstream in the life cycle of the vehicle operations?
  • Should CO2 emissions performance be estimated based on gasoline and diesel fuel sales, system use (vehicle miles traveled), or other surrogates?
  • Would a performance measure on CO2 emissions help to improve transparency and to realign incentives such that State DOTs and MPOs are better positioned to meet national climate change goals?
  • How long would it take for transportation agencies to implement such a measure?

Welcome to the brave new world of integrated planning to manage GHG emissions in a critical sector of our economy.

Emotional Distress Claims in Environmental Torts: Does the “Zone of Danger” Rule Allow Recovery for Fear of Future Injury?

Posted on April 26, 2016 by H. Thomas Wells Jr.

Two legal rules frequently come into play in environmental tort cases that are difficult to reconcile: the rule allowing recovery for emotional distress damages without physical injury if someone is found to be in the “zone of danger,” and the rule not allowing recovery for mere fear of a future injury.

Normally, recovery for emotional distress (sometimes called mental anguish) requires the plaintiff to suffer some actual physical injury, however slight.  But one exception allows someone who is in the “zone of danger” to recover despite the lack of any physical injury. Usually, the danger must be an immediate physical injury. For example, one case allowed recovery for emotional distress under a “zone of danger” theory for the driver at whom a gun was pointed, but not for the passenger in the same car. Another case allowed recovery to someone who had to escape his burning home, and then watched it burn to the ground, but not for someone who merely saw his house burning when he returned from work. Yet another case allowed recovery for floodwaters entering a home because the floodwaters were infested with snakes.  Presumably, without the snakes, there could have been no recovery for emotional distress for the flood.

How does this “zone of danger” rule square with claims in environmental tort cases?  Many courts do not allow recovery for a mere fear of an injury in the future, or so-called “cancerphobia” cases.  Despite this rule, can one recover for emotional distress in, for example, an air pollution case, arguing that the plaintiff is in the “zone of danger” despite no present physical injury?

Plaintiffs in environmental tort cases, such as flooding, air pollution, and others, have indeed been asserting “zone of danger” theories to avoid the physical injury rule, and are asking juries to award them emotional distress or mental anguish damages.  These claims must walk a fine line, since most courts do not allow recovery for mere fear of future injury. Where is that line drawn in an environmental tort case? For example, since presumably any amount of air pollution is bad for one’s lungs, is mere exposure to air pollution enough to recover for mental anguish for worrying about one’s self or one’s children?  Or is this argument simply an end run around the ban on recovery for fear of future injury?  Courts will have to draw lines in these environmental tort cases, and the lines they draw may not all be bright or easy to see.

Doin’ the Dunes – Final Installment

Posted on April 20, 2016 by Joseph Manko

Last month when the Ocean County, NJ challenge to the New Jersey Department of Environmental Protection’s (“NJDEP”) authority to implement dunes for shore protection was dismissed, I wrote that the decision could very well be precedential for similar challenges in other New Jersey counties. 

And so it was. In a 65-page opinion, Superior Court Judge Julio Mendez also upheld the DEP’s authority to construct dunes in the City of Margate (Atlantic County) as being neither “arbitrary or capricious” nor an “abuse of power.” The opinion recognized the US Army Corps of Engineers’ (“Corps”) 6-year study and the need to be better prepared for coastal storms such as Hurricane Sandy in 2012.  With this ruling – absent an appeal – the DEP will proceed to obtain the necessary easements through the eminent domain process (a prior attempt to do so via an administrative order having failed) with the appropriate compensation paid to the affected beachfront owners.

Judge Mendez acknowledged that the dunes on the oceanfront would not resolve flooding concerns to the bayfront properties nor obviate some protection afforded by seawalls and bulkheads.  Interestingly, he found that the dunes in the adjacent City of Ventnor had not only protected Ventnor’s beaches but also expanded the beaches in Margate, and that the dunes in Margate would be protective of its coastal properties and was therefore not arbitrary or capricious.  

Doin’ the Dunes – Part IX

Posted on April 19, 2016 by Joseph Manko

Last month, while New Jersey Superior Court Judge Julio Mendez was considering Margate’s challenge to the authority of the New Jersey Department of Environmental Protection (“DEP”) to condemn City-owned lots on which to build dunes, New Jersey Superior Court Judge Marlene Lynch Ford dismissed a similar challenge by 28 oceanfront property owners in Ocean County, NJ.

In her decision, she ruled that (1) DEP’s condemnation activities were authorized to “protect the state’s fragile coastal system and [afford] public access” and (2) the taking of the requisite coastal acreage to do so was as a lawful use of that authority, provided that the eminent domain process of compensating affected property owner was followed, which she found to be the case in this instance. 

Although it would appear likely that this decision should have significant precedential effect on the other pending challenges, it should be pointed out that the theory in other cases includes not only a challenge to DEP’s authority, but the reasonableness of constructing dunes on the beachfront as opposed to other “shore protection projects.”  In fact, although she dismissed the challenge to DEP’s authority to condemn, Judge Ford granted a hearing to other homeowners who claim that DEP acted arbitrarily because their sea walls eliminated the need for dunes. 

And so, although the authority of DEP to use eminent domain for shore protection would appear to be judicially blessed, the manner in which it is does so remains subject to challenge. 

So, as always, stay tuned.  

Children’s Crusade to Combat Climate Change Continues

Posted on April 18, 2016 by Rick Glick

As reported by Seth Jaffe in this space, a federal magistrate judge in Oregon has kept alive the dreams of a group of young plaintiffs—aided by environmental advocacy groups—to compel government action against climate change.  Like a similar case brought by the same plaintiffs a few years ago in state court, discussed below, the federal case seeks a declaration that government inaction violates the public trust.  But in the federal case, plaintiffs added claims that their constitutional rights to life, liberty and property also are being violated.

The judge denied the government’s motion to dismiss on the basis that the matter is a political question better left to Congress.  Magistrate Judge Thomas M. Coffin reasoned that the pleadings were adequate on their face and that the substantive issues raised by the defendants should await motions for summary judgment or trial.  Still, the judge gave hope to the plaintiffs, which, I think will be short lived.  Climate change is simply too big, diffuse and complex an issue for the courts to try to fashion a remedy around.

This same group of plaintiffs has had mixed success in pursuing its objectives at the state level.  In June 2014 I posted about the Oregon Court of Appeals reversing and remanding a trial court’s dismissal of a similar claim against the state.  The appellate court concluded that the plaintiffs were entitled to a determination whether the atmosphere is a public trust resource and whether Oregon state government had breached its fiduciary responsibility by not adequately protecting it.  On remand, Lane County Circuit Court Judge Karsten H. Rasmussen granted the state summary judgment and dismissed the suit with prejudice.  The case is now again pending before the Court of Appeals.

In his 19-page opinion, Judge Rasmussen concluded that the public trust does not extend to the atmosphere.  The contours of the public trust are a matter of state common law, and Oregon law ties the public trust to title and restraints on alienation.  The court concluded that there could be no title in the atmosphere and therefore public trust fiduciary obligations do not exist.  The court also noted that traditional public trust resources, such as submerged lands, are exhaustible, which under Oregon law confers a fiduciary responsibility on the state.  While the atmosphere may be altered or even damaged, the court found that it is not exhaustible.

The court added the following thought, which I think will guide the U.S. District Court when it hears the current case:

The Plaintiffs effectively ask the Court to do away with the Legislature entirely on the issue of GHG emissions on the theory that the Legislature is not doing enough. If "not doing enough" were the standard for judicial action, individual judges would regularly be asked to substitute their individual judgment for the collective judgment of the Legislature, which strikes this Court as a singularly bad and undemocratic idea.

            Watch this space for further developments in Oregon state and federal courts.

Show Me The (Big) Money – CERCLA Financial Assurance in the Era of Megasites

Posted on April 14, 2016 by David Van Slyke

In the CERCLA world, the low hanging fruit has largely been picked.  Long gone are the days of the run-of-the-mill $3M RI/FS leading up to a $30M RD/RA.  We are getting to the tough stuff now – the megasites – and all the difficult issues related to PRP involvement in RD/RA (whether via consent decree settlement or compliance with a UAO) are on steroids.

One of those more difficult issues in the context of multi-party megasites relates to financial assurance (“FA”) requirements in RD/RA UAOs and consent decrees.  The 29-page April 2015 EPA FA Guidance, while helpful on some levels, is remarkably thin (2 paragraphs) when it comes to dealing with multi-party sites.  And in a breathtaking understatement, especially with regard to big-ticket sites, EPA notes in the guidance that “FA matters can get complicated with multi-PRP-led cleanups….” 

Recently, added pressure has been placed on the Agency in this area as a result of a March 31, 2016 EPA Inspector General report stating that “[d]ata quality deficiencies and a lack of internal controls prevent the EPA from properly overseeing and managing its financial assurance program for RCRA and CERCLA.”  In particular, EPA’s OIG analysis indicates (among other things) that there are 128 CERCLA sites with no (or expired) financial assurance in place and the estimated cleanup costs for those sites is over $3.7B.

As Proposed Plans and RODs continue to roll out from the Agency with billion-dollar-plus price tags – typically related to multi-party contaminated sediment sites – the difficulty of up-front funding of these hugely expensive remedies becomes obvious.  PRPs at multi-party sites will have varying abilities and business desires to up-front fund liquid FA mechanisms, and while some entities will prefer (and be able) to provide assurance by a financial test or corporate guarantee, many will not. 

And EPA’s willingness to deal with multiple mechanisms (either different mechanisms from multiple parties or multiple mechanisms from a PRP group) is limited.  In fact, the use of multiple financial assurance mechanisms is discouraged under the 2015 FA Guidance.  Further, the September 2014 Model Remedial Design / Remedial Action Consent Decree along with the September 2015 Model Unilateral Order for Remedial Design / Remedial Action specifically state that while PRPs may use multiple mechanisms, this can only occur with liquid mechanisms – trust funds, surety bonds guaranteeing payment or letters of credit.  Interestingly, the 2014 Model CD also allows the use of insurance policies, indicating that the Agency’s thinking about the liquidity of insurance policies has evolved. 

The viability of financial assurances is not simply an EPA-driven issue.  Given the multi-decade cleanup process and huge stakes involved at CERCLA megasites, and with the overlay of joint and several liability, PRPs need to be thinking carefully about the financial viability of their co-PRPs when entering into CDs or PRP agreements to perform under a UAO.  And regardless of how EPA ultimately decides to deal with this issue at megasites, PRPs no doubt will be pushing each other to ensure long-term equitable responsibility for meeting their FA obligations at this new breed of Superfund sites.

A Substantive Due Process Right to Climate Change Regulation? What’s a Lonely Apostle of Judicial Restraint To Do?

Posted on April 13, 2016 by Seth Jaffe

Late last week, Magistrate Judge Thomas Coffin concluded that the most recent public trust Mosaic_of_Justinianus_I_-_Basilica_San_Vitale_(Ravenna) (1)case, which seeks an injunction requiring the United States to take actions to reduce atmospheric CO2 concentrations to 350 parts per million by 2100, should not be dismissed.

The complaint here is similar to, but broader than, others of its ilk.  As we noted previously, at least one federal court has already held that there is no public trust in the atmosphere.  Perhaps in response to that case, the plaintiffs here appear to have focused their arguments on the government’s public trust responsibilities with respect to various waters of the United States, though the opinion does not make clear precisely what the complaint alleges to be the subject of the public trust obligation.

The plaintiffs not only allege that the United States has violated its public trust obligations, but that that violation in turn constitutes a violation of the plaintiffs’ substantive due process rights.  Magistrate Judge Coffin takes pains to make clear that this is only about a motion to dismiss, but I still think he got it wrong.

Indeed, I think that Magistrate Judge Coffin ignored that well known latin maxim:  “Oportet te quasi ludens loqui.” (Which is how the on-line translator I used translated “You must be joking.”  I hereby disclaim any warranty that this is even close to correct.)

Call me old-fashioned, but I believe in judicial restraint.  And that applies to everyone.  Traditionally, conservatives have accused liberals of judicial activism.  To my totally objective mind, in recent years at least, it is the conservative judges who could more fairly be called activist.  For one case, at least, the shoe seems to be back on its original foot.  I just cannot see this decision standing.  The District Judge should reject Magistrate Judge Coffin’s Findings and Recommendation.  If he or she doesn’t, this case is sufficiently novel and important to warrant interlocutory appeal, and the 9th Circuit should reverse.  And if that doesn’t happen, it will be up to the eight (oops, I meant nine) members of the Supreme Court to get it right.  One of them surely will.

Order In The Court: The Congress Should Specify A Court For Review Of Challenges To The Clean Water Rule

Posted on April 5, 2016 by Robert Uram

More than 40 years after the Corps and EPA first adopted regulations to define their jurisdiction over the discharge of dredged and fill materials into waters of the United States under Section 404 of the Clean Water Act, the agencies find themselves mired in litigation over the Clean Water Rule, their most recent attempt at rulemaking on the issue. 80 Fed. Reg. 37054 (June 29, 2015).  The Clean Water Rule seeks to address issues raised by the Supreme Court’s decision in the Rapanos case. Challenges to the Clean Water Rule have been filed in eight Courts of Appeal and ten District Courts.  Not only is there disagreement over the substance of the rule, there is disagreement over which court or courts have jurisdiction to review challenges to the rule. This disagreement pushes the resolution of the substantive issue far to the future. 

It is discouraging to have this kind of uncertainty over a major piece of environmental legislation. While some people may see benefit in uncertainty, the lack of clarity on which court has jurisdiction needlessly wastes time and money that could be put to better use. Especially if the eventual ruling is that District Courts have jurisdiction, questions about the validity of the Clean Water Rule will linger for years.

To address the procedural issue, the Congress should pass legislation to specify a single court to hear all challenges to the Clean Water Rule. Under other laws, such as the Surface Mining Control and Reclamation Act, the Congress had the wisdom to specify clearly a single court with authority to review agency regulations--the Federal District Court for the District of Columbia.  Similarly, Section 307(b) of the Clean Air Act gives the Court of [Appeals for the District of Columbia exclusive jurisdiction over challenges to regulations of national effect. Judicial review using a single court to review all challenges is orderly and efficient. By contrast, the flurry of lawsuits challenging the EPA and Corps new Clean Water Act regulations is costing the parties millions of dollars just to figure out which court (or courts) should review the challenges to the regulations.  Is it too much to ask to have the Congress end the procedural jousting and specify a single court for judicial review?

Diversionary Tactics

Posted on April 4, 2016 by David Ullrich

With increasing recognition of the value of water across the globe, in 2008 eight U.S. states and two Canadian provinces established the Great Lakes and St. Lawrence River Basin Sustainable Water Resources Management Agreement, and the states created a parallel compact on the U.S. side approved by the U.S. Congress. The primary purpose of the Agreement and Compact is to prohibit diversions of water outside the basin, with very limited exceptions. The first real application for an exception to the Agreement and Compact is under consideration by the Regional Body created under the Agreement and the Compact Council created under the Compact. This is receiving much attention and close scrutiny in the U.S. and Canada because many feel it will set the course for many future applications.

The city of Waukesha, Wisconsin, sits just outside the basin in Waukesha County, which straddles the basin line. Waukesha has a problem: the aquifer it uses is contaminated with naturally occurring radium, and beyond that, the city has concerns about its capacity to serve future needs. As a result, Waukesha has applied for an exception to the Agreement and Compact to withdraw up to 10.1 million gallons per day from Lake Michigan, which would be used, treated, and returned to the Lake through the Root River.

Communities, like Waukesha, that are located in counties straddling the water divide line can ask for water diversions from the Great Lakes, governed by strict rules. The key provisions of the exception standard under the Compact and Agreement that Waukesha must meet are:

  • The Water shall be used solely for the Public Water Supply Purposes of the Community within a Straddling County that is without adequate supplies of potable water;
  • There is no reasonable water supply alternative within the basin in which the community is located, including conservation of existing water supplies;
  • Caution shall be used in determining whether or not the Proposal meets the conditions for this Exception. This Exception should not be authorized unless it can be shown that it will not endanger the integrity of the Basin Ecosystem;

There is little dispute that the amount of water taken by Waukesha from Lake Michigan will have any impact on the Lake, especially since all of the water not consumed in Waukesha will be returned, with a small supplement of water from outside the basin to replace the consumed water. The concern is over the precedent it would set for straddling communities and counties all around the basin in Canada and the U.S. and the potential cumulative effect. The real question is whether these three portions of the exception standard are met.

The key word in the first standard noted above for review of the application is “Community,” which is defined in the Compact as “any incorporated city, town or the equivalent thereof, that is located outside the Basin but wholly within a County that lies partly within the Basin and that is not a Straddling Community.” Waukesha’s application indicates that the water will go to a “service area” that goes beyond the boundaries of the City to several towns and unincorporated areas in Waukesha County. They add that they are required by State law to provide water to the service area. Opponents of the application assert that a “service area” is not a “community” within the meaning of the Compact and on those grounds alone, should be denied. Waukesha asserts that the Compact contemplated the “service area” as a “community.” A definition this broad would open the door to areas well beyond the intent of the Compact’s limited exception to the prohibition of diversions.

In the second element of the exception standard, the availability of a “reasonable water supply alternative” is another consideration. Waukesha argues that treatment alternatives are not appropriate and that getting water from Lake Michigan is the best alternative. Opponents argue that there are reasonable alternatives, and that the nearby communities of Brookfield and Pewaukee are utilizing treatment for radium successfully now. They add that the standard is “reasonable,” and that it does not need to be the best alternative, even though treatment for radium may well be the best.

The third element of the standard highlighted is that the diversion will not endanger the integrity of the Basin Ecosystem. The return flow from Waukesha to Lake Michigan is through the Root River. Under the terms of the Compact, as well as State and Federal Law, the discharge must meet all the terms of a permit. Waukesha argues that this protects the Root River and will even improve it. Opponents say that the volume and thermal component, as well as unregulated contaminants such as pharmaceuticals, microbeads, phosphorus and others, will jeopardize the integrity of the Root River. In the summer months, the effluent from Waukesha could be up to 80% of the flow of the River.

Beyond the three elements of the exception standard, there is a question of precedent with this being the first application for an exception to the prohibition against diversions under the Compact and Agreement. Waukesha claims that it meets the exception standard, and that only other straddling communities and counties around the basin might benefit from approval. Opponents claim that the exception standard must be applied strictly because there are so many straddling counties and communities across the eight Great Lakes states and two Canadian provinces that could qualify for exceptions. Furthermore, they argue that jurisdictions outside the straddling counties and communities will be watching closely for an opening to broaden the exceptions to the Compact.

The Regional Body of the eight states and two provinces will meet April 21 and 22, 2016 to make a recommendation on the application to the Compact Council consisting of just the eight states, which will meet in June. It will require a unanimous vote of the Compact Council to approve the application. The decision has implications well beyond Waukesha’s application, and could chart the course for future attempts to divert water from the Great Lakes and St. Lawrence.

@GLSLcities

An "Inside the Fence" Analysis of CO2 Emissions from Fossil-Fueled Power Plants

Posted on March 28, 2016 by Eugene Trisko

On February 9, 2016, the Supreme Court issued a stay of U.S. EPA's Clean Power Plan (“CPP” or "Power Plan,” 80 Fed. Reg. 64,662, October 23, 2015) for reducing CO2 emissions from existing fossil-fueled electric generating units. The Court's action was unprecedented because challenges to the Power Plan by 27 states and numerous utility, business, and labor parties were still being heard before the U.S. Court of Appeals for the D.C. Circuit. West Virginia et al. v. EPA, DC Cir. No. 15-1363. The stay will remain in effect until the conclusion of all litigation against the rule. 

Among the core legal arguments against the Power Plan is EPA's reliance on "outside-the-fence" measures to reduce CO2 emissions. Section 111(d) of the Clean Act calls for EPA to set guidelines for states reflecting a standard of performance for "sources" based on the "Best System of Emission Reduction" ("BSER") that has been “adequately demonstrated.”  EPA defined BSER to include emission reduction actions that could be taken throughout the electric grid, such as limiting generation from coal units while increasing the output of existing natural gas combined-cycle units, and increasing reliance on new renewable energy sources. The data reviewed below show that the standard of performance established for coal-based generating units based on this BSER, 1,305 lbs. CO2/MWh, is not achievable in practice by any conventional coal unit. 

The Power Plan also calls for efficiency improvements at coal units that could reduce CO2 emissions. By adjusting units’ past heat rate data, EPA estimated that potential heat rate improvements of 2.1% to 4.3% were achievable for each of three regions in the U.S.  See 80 Fed. Reg. at 64,789. However, implementing these "inside-the-fence" measures would result in less than 100,000 tons of emission reductions - about two/tenths of one percent - of the overall 413-415 million ton CO2 emission reduction from base case levels projected to result from full implementation of the rule by 2030. See, EPA Tech. Sup. Doc., State Goal Computation, Table 5 (extrapolated to 48-state basis), Aug. 2015; CPP Reg. Impact Analysis at Table 3-5. 

An "inside-the-fence" analysis

EPA's methods for measuring the potential emission reductions achievable through efficiency improvements did not take into account the effects of different coal types on CO2 emissions.  Such "subcategorization" is specifically authorized by Section 111 of the Clean Air Act. This post seeks to open a line of inquiry into an alternative approach to achieving CO2 emission reductions based on the emission characteristics of the best-performing units in the coal fleet and taking into account differences in coal type.

A statistical analysis of CO2 emissions from coal plants was performed using the DOE/NETL 2007 coal plant public data base. This data base contains detailed coal type and emissions control and performance data for 2005. The objectives of the analysis were twofold:

1) To determine whether plants burning different grades of coal (bituminous, subbituminous, and lignite) have sufficiently different emission rates measured in pounds of CO2/MWh to consider subcategorization by coal type; and

2) To assess the potential CO2 emission reductions associated with applying a standard of performance based on the best-performing units in each coal category. 

The NETL data base was sorted to identify coal-fired units likely to remain in operation after implementation of EPA's 2012 Mercury and Air Toxics Standards (MATS) rule (77 Fed. Reg. 9,304, February 16, 2012).  Three screening criteria were applied: unit capacity of 400 MW or greater, current age of 50 years or less, and heat rate of 9,000 BTU/kWh or higher, typical of the performance of conventional pulverized coal boilers.

This sort produced 272 units, totaling 176.7 Gigawatts (GW) of capacity, grouped as follows:

·141 bituminous units, totaling 94.0 GW, with an average emission rate of 2,055 lbs. CO2/MWh;

·110 subbituminous units, totaling 69.5 GW, with an average emission rate of 2,214 lbs. CO2/MWh; and

·21 lignite units, totaling 13.1 GW, with an average emission rate of 2,425 lbs. CO2/MWh.

The total generating capacity represented by these 272 units is comparable to EPA’s projection of 174 to 183 GW of coal capacity remaining in service in 2030, following full implementation of the Power Plan. See, EPA CPP Reg. Impact Analysis at Table 3-12.

Regression analyses performed on the three plant groups assesses the relationship between heat rate (the independent variable) and CO2 emissions per MWh of generation (the dependent variable.) The results are summarized in Chart 1 for all 272 sampled units. The linear regression trend line confirms a moderate positive association between plant heat rate and CO2 emissions (i.e., units with lower heat rates tend to have lower CO2 emissions per MWh, and vice versa.)

Differences among the three coal types measured in average CO2 emission rates per MWh support subcategorization by coal type. As shown in Table 1, the sampled lignite units have an average CO2 emission rate 13% above the sample mean, and 18% above the average for bituminous coal units.  The average emission rate of bituminous units is 4% below the sample mean, while subbituminous coals have an average rate 3% above the sample mean. 

These differences among coal types could justify subcategorization similar to EPA’s MATS rule. MATS provides separate mercury emission limits for low-BTU lignite coals compared with the standard set for bituminous and subbituminous coals (defined by EPA as coals with a heat content of 8,300 lbs. of CO2 per million BTU, or greater.) See, 77 Fed. Reg. 9,304, 9,379.

Illustrative emission rate calculations

The three sample coal groups were analyzed for average CO2/MWh emission rates by quintile (i.e., lowest 20% emitting units, next lowest 20% emitting units, etc.)  Results of this subcategorization analysis are summarized in Table 1.  Assigning the average emission rate in CO2/MWh for the best-performing 20% units of each group of units to the other four quintiles (an approach similar to that prescribed by Congress for section 112 “MACT” standards) reduces the allowed emission rates for each subgroup, and the indicated levels of CO2 emissions measured in tons.

The overall reduction of CO2 emissions for the three coal types is 117 million tons based on 2005 emission rates and tonnages.  These data reflect NOx control retrofits in response to EPA’s 1998 NOx SIP Call, as well as scrubbers and other controls applied to meet CAA Title IV acid rain control limits. However, the data do not reflect additional retrofit control technologies added in response to the 2005 Clean Air Interstate Rule, as well as state laws and consent decrees.  The additional parasitic load associated with add-on controls would increase average heat rates (BTUs per kWh) by reducing net plant generation and increasing CO2 emission rates per MWh.

Additional research and applications

Additional analyses using more recent data are needed to assess the CO2 emission effects of retrofit controls applied since 2005, including those deployed in response to the MATS rule. This research could include additional subcategorization analyses based on metrics such as boiler age, size, and type.

If subcategorization by coal type or other criteria were applied to determine standards of performance for existing fossil-based generating units, states should be provided with flexible implementation mechanisms such as emissions trading and averaging "outside the fence." This would ensure that emission reduction targets could be achieved in a cost-effective manner, without mandating unachievable or uneconomic emission limits for specific units.

The findings of this preliminary analysis are also relevant to the determination of New Source Performance Standards (NSPS) in light of the substantial CO2 emission rate differences among different coal types. EPA chose not to subcategorize by coal type in its NSPS rulemaking under Section 111(b), and issued a uniform performance standard for coal-based generation units of 1,400 lbs. CO2/MWh.  Based on the sample unit data, meeting this standard implies a 42% reduction of CO2 emissions from lignite coals, and a 32% reduction for bituminous coals. Petitions for review of this standard also have been filed before the D.C. Circuit.  North Dakota et al. v. EPA, DC Cir. No. 15-1381.

_______

*The author is an attorney in private practice (emtrisko@earthlink.net) who has specialized in Clean Air Act legislation and regulation since 1980. The coal quality and statistical regression data presented in this post were provided by the author to U.S. EPA staff in the pre-proposal stage of the development of the Clean Power Plan. The analysis set forth here is offered without prejudice to any legal positions by state or non-state petitioners before the D.C. Circuit in West Virginia et al. v. EPA or North Dakota, et al. v. EPA.

 

Table 1.  Summary of CO2 Emission Rates and Potential Reductions by Coal Type for

272 Unit Sample (176,679 MW) Assuming All Units

Meet Top-20% Average Emission Rate of Each Coal Type

 

Avg. Lbs. CO2/MWh

2005

Avg. Lbs. CO2/MWh Top 20% of Units

Pct. Diff. vs. 2005 Avg.

2005 CO2 Emissions (Mil. Tons)

CO2 Emissions @ Top-20% Rate

(Mil.Tons)

CO2  Reduced

(Mil. Tons)

Bituminous

2,055

1,838

-11%

597.4

540.4

-57.0

Subbituminous

2,214

1,973

-11%

498.1

446.0

-52.1

Lignite

2,425

2,235

-8%

114.6

106.7

-7.9

Total

2,148

n.a.

-10%

1,2010.0

1,093.1

-117.0

 

 

Chart 1. Regression Analysis of All 272 Coal Units,

Lbs. CO2/MWh vs. Heat Rate BTU/KWh

Risky Business? Third Party Auditing, Risk Management Planning, And The General Duty Clause: Time to Vote!

Posted on March 25, 2016 by David Tripp

Third Party Auditing may not be the first choice of the estimated 12,000 companies covered by the Clean Air Act Risk Management Plan (RMP) rule. Many of these companies are not traditional "stationary sources" of air emissions, but are warehouses and other facilities that process or repackage chemical products containing toxic or flammable substances. Third Party Auditing is coming to those companies under EPA's proposed RMP rulemaking announced on March 14, 2016, when they have an accidental or "near miss" of a release involving an RMP-regulated chemical.

Why Third Party Auditing? Is it a good thing or a bad thing? It can be a good thing, depending on how the Audit is structured and implemented,. There are several recent judicial consent decrees containing Third Party Audit requirements that are being implemented successfully. EPA's new rule will require Third Party Auditing when there has been a fire, explosion, release or near release of chemicals. Experience with Third Party Audits shows that a well-designed audit protocol with emphasis on improved internal company environmental tracking and management systems can actually create efficiencies in product logistics and cost control.

Some brand-name companies such as PepsiCo use voluntary Third Party Audits to highlight independent audit programs and results:

In 2013, all company-owned plants were assessed against PepsiCo’s global Health and Safety program and, following completion of the audit, each plant developed an improvement action plan. In addition, 65 plants are OHSAS 18001-certified by independent consultants, and 31 facilities in the United States are part of the Occupational Safety and Health Administration Voluntary Protection Program, the industry standard for health and safety.

Is Third Party Auditing Under EPA's New Rule An Expansion of Existing RMP Requirements? Yes. Companies subject to RMP already are required to periodically review their risk plans and update terms each five years, or earlier, when conditions change. Most companies follow that practice. However, EPA cites the 2013 West Fertilizer explosion in West, Texas as one example of the ineffectiveness of existing RMP regulations to prevent a fire and explosion where RMP chemicals are stored or handled. From the West case and others, EPA sees a need for additional strengthening of the RMP rules.

Third party auditing as an enforcement compliance tool is becoming more common. The U.S. v. Tyson Foods Consent Decree (2014) required an independent third party auditor to investigate equipment processes and safety issues. The third party auditor was to evaluate ammonia refrigerant systems at 23 plants in four states, and report directly to EPA on the findings of discrepancies or violations. In addition to RMP requirements, other recent EPA and Department of Justice enforcement cases require injunctive relief in the form of Third Party Audits on RMP and General Duty Clause (GDC) compliance.

How Does the General Duty Clause Become Involved in Third Party Auditing? EPA's RMP amendments occur at a time when interpretation of the CAA Sec. 112(r) GDC by EPA also subjects each stationary source to audit and enforcement based on chemicals in storage. The GDC interpretation does not rely only on the presence of regulated quantities of Extremely Hazardous Substances at a facility and is not limited to enforcement of RMP requirements. GDC requirements focus on unsafe conditions at a facility, and the compliance thresholds arise from potentially applicable regulations, electrical, fire and explosion advisories by the National Fire Protection Association, American Petroleum Institute, American Chemistry Council, industry practice and other health, safety or environmental authorities. Any fire, explosion or injury incident, the reporting of a near miss that might have resulted in catastrophic damage or injury, or an inspector's subjective audit finding of the presence of dangerous conditions from an audit or after-the-fact review may trigger an EPA demand for a Third Party Audit.

Risky Business or Not? Increased use of Third Party Auditors will be required if EPA's proposed changes to the RMP rules are adopted Owners and operators will be required to engage and pay for the services of Independent Auditors when a release of a reportable quantity of regulated chemicals has occurred, or the facility has had a "near miss" incident that might have caused a catastrophic release. Manufacturers in the chemical, paper and oil/coal categories must also undertake a root cause failure analysis, and additional reporting on process hazard analysis following a release or near miss. But under those circumstances, companies facing a demand for a Third Party Audit can take the opportunity to investigate improved process safety, product management and internal management systems, all of which will result in reduced environmental and health risks, and overall cost savings.

Action Items? Get Out and Vote!
Proponents and Opponents of EPA's proposed changes to the RMP rules and requirements for Third Party Auditing can register their position on EPA's rulemaking docket. The deadline for comments is May 13, 2016.

The Limitations on Limited Liability for Environmental Harms for Members of Limited Liability Companies in Connecticut

Posted on March 23, 2016 by Gregory Sharp

The limited liability form of corporate organization generally offers small businesses the favorable tax treatment of a sole proprietorship or partnership, along with protection from personal liability, up to a point.  That protection in Connecticut is far from bullet-proof when it comes to liability for environmental harms.  Business people acquiring potentially contaminated property should ask: If I create a Limited Liability Company to take title to the property, will I be protected from personal liability for a clean-up?  In Connecticut, the answer ranges from “no” to, at best, “it depends.”  This is counter-intuitive to clients who believe they are protected by Connecticut’s Limited Liability Company statute which provides generally that a member of an LLC is not liable for the obligations of the LLC.  See Conn. Gen. Stat. § 34-133 & 134.

The core of the conflict lies in language in the environmental statutes and case law from the state’s courts.  Contrary to the tenor of the LLC enabling statutes, Connecticut’s pollution control statutes were amended in 1995 to include specifically a member of an LLC in the definition of a “person” subject to the issuance of a pollution abatement order.  See Conn. Gen. Stat. § 22a-123.

In addition, the Connecticut Supreme Court in 2001 adopted the “responsible corporate officer doctrine” holding that a corporate officer whose conduct has a responsible relationship to a violation may be held liable for abatement of the violation through an order from the state environmental agency.  See BEC Corp. v. Dept. of Environmental Protection.

In December, 2015, the Connecticut Appellate Court applied the responsible corporate officer doctrine to the sole member of an LLC finding her personally liable for pre-existing contamination at property acquired by the LLC which she created knowing the contamination was present.  See Vorlon Holding, LLC, et al. v. Commissioner of Energy and Environmental Protection.

The risk of personal liability for owners of small businesses contemplating acquisition of environmentally challenged property increases the likelihood that these properties will become, or remain, unproductive “brownfields.”  Fortunately, the legislature has created mechanisms within the last few years to provide funding for site assessments without liability attaching and tools to limit liability to potential purchasers who can meet the legislative requirements.

A more detailed discussion of the evolution of the responsible corporate officer doctrine in the federal courts and its application in Connecticut courts in environmental cases is available in an article by John R. Bashaw and Mary Mintel Miller.

Should Environmental Agencies be able to Revoke Consent Orders Unilaterally?

Posted on March 17, 2016 by Mark R. Sussman

In a highly unusual case that has led to a near unanimous call for legislative change by environmental lawyers in Connecticut, a Superior Court judge ruled that the Connecticut Department of Energy & Environmental Protection (“DEEP”) can unilaterally revoke a consent order that it negotiated with a company requiring the investigation of a contaminated site.  The lawsuit was initially brought by DEEP, among other reasons, to enforce the consent order.  However, after the defendant filed a counterclaim against DEEP alleging that the department had not acted reasonably and breached the order, the department unilaterally revoked the order and moved to dismiss the counterclaim.  The court held that the state statute that authorizes the department to issue, modify, or revoke orders, allows the department to revoke consent orders.  

Although the state agency may have had good reason to revoke the consent order in this case to help it improve its position in the litigation, that decision undermines the public policy in favor of encouraging negotiated settlements in environmental matters.  Most environmental consent orders are carefully negotiated, with give and take on each side.  If a private party knows that the environmental agency can simply revoke a consent order at any time, why would that party make concessions to resolve a dispute through an administrative order on consent?  

The U.S. Supreme Court in United States v. ITT Continental Baking Company long ago recognized that administrative consent orders and judicial consent decrees are in the nature of contracts and should be construed basically as contracts.  Therefore, the federal courts typically place a heavy burden on a party seeking to modify a consent decree.  Even the Connecticut court which ruled that DEEP can unilaterally revoke consent orders questioned the wisdom of such authority.

It remains to be seen whether the Connecticut state legislature will clarify that the state environmental department lacks the authority to unilaterally withdraw from an agreement that it negotiated.   A bill, S.B. 431, was recently proposed by the Judiciary Committee of the State General Assembly to reverse the Superior Court decision. The general assembly has until May 4, 2016, when the session ends, to pass such legislation.   If the legislation does not pass, and DEEP retains such authority, it is likely to find it much more difficult to settle administrative orders on consent in Connecticut.