Federalism can be Messy -- BPA and Product Regulation in the States

Posted on September 27, 2012 by Kenneth Gray

Depending on how you count, advocates have led over 25 state legislatures or regulators to consider or adopt bans on certain uses of Bisphenol A (BPA), the recently publicized monomer that is (or was) present as a residual at low levels in some plastic products.  Recently, the U.S. Food and Drug Administration (FDA) accepted a petition from the American Chemistry Council banning use of BPA in baby bottles and sippy cups, because the use had been abandoned by manufacturers. 

For many, FDA’s scientific review of BPA studies and thoughtful analysis on the merits of regulation was too slow, and to those who conclude “I don’t want exposure to any substances of concern” use-by-use regulation did not (and will never) provide comfort.  What started as a concern in baby bottles and sippy cups, and was the subject of numerous state bans several years ago -- before the FDA acted this summer to acknowledge the abandonment of BPA in those bottle and sippy cups -- is more recently the subject of additional state proposals for bans from lids of food cans and containers.  Some ask: “Can you please ban it from any product that may reach my children?”

Because it is difficult to get the federal machine to act quickly, why not seek an audience in your state capital?  It is easier to file legislation in many states than in Congress, easier to get exercised citizens to the state capital, easier to involve local media looking for a controversy, and cheaper for citizens to play at the state level than in Washington.  However, state toxicologists and regulators often don’t have the resources of the FDA, they are often not as well equipped (and certainly not as experienced) in making the necessary risk evaluations and product regulations.  And putting environmental police in the grocery aisles seems to squander limited state environmental resources.  As Maine DEP Commissioner Patricia Aho recently put it: “We’re environmental regulators.  You’re asking us to be the FDA in some regards here.”

Even assuming states are equipped to address those issues, how can national manufacturers (or national or regional retailers) deal with state-by-state regulation of different products using the same materials?  Not very well!  And how are consumers to understand why chemicals in a product present acceptable risks in one state, but unacceptable risks in another?  They don’t.  Why is state-by-state regulation of chemicals in products in the national interest when FDA has jurisdiction?  Maybe it isn’t. 

Congressman Markey has petitioned the FDA for a federal ban on coatings in infant formula packages (arguing abandonment), and the federal agency has sought comment.  But that petition was made after extensive state efforts against use in baby bottles and sippy cups.  The FDA will consider the matter, so it may be some time before the FDA acts.  In the interim, states are still being encouraged to adopt their own bans on certain uses of BPA.

FDA is even more broadly considering BPA safety and its uses under FDA jurisdiction, but in the meantime, keep your eye on your local legislature if you want to watch a messy process that is frustrating for everyone.

NO GLOBAL WARMING? ARCTIC SUMMER SEA ICE DOWN ALMOST 50% SINCE 2004

Posted on September 21, 2012 by Stephen Herrmann

The August 2012 preliminary results from the European Space Agency’s CryoSat-2 probe indicate that 900 cubic kilometers of summer sea ice has disappeared from the Arctic ocean over the past year.  This rate of loss is 50% higher than most scenarios from historic information outlined by polar scientists.  The summer figures provide a real shock.  In 2004 there were about 13,000 cubic kilometers of summer sea ice in the Arctic -- now only 7,000 cubic kilometers were measured.  If the current annual loss of around 900 cubic kilometers continues, summer ice coverage could disappear in about a decade in the Arctic.

The new sea ice measurement was set on August 26, 2012, a full three weeks before the usual end of the melting season, according to the National Snow and Ice Data Center.  So more melt in 2012 is predicted.  Every major scientific institution that tracks Arctic sea ice agrees that new records for low ice area, extent, and volume have been set.  These organizations include the University of Washington Polar Science Center (a new record for low ice volume), the Nansen Environmental & Remote Sensing Center in Norway, and the University of Illinois Cryosphere Today. 

The consequences of losing the Arctic’s sea ice coverage, even for only part of the year, could be profound.  Without the cap’s white brilliance to reflect sunlight back into space, the region will heat up even more than at present.  As a result, ocean temperatures will rise and methane deposits on the ocean floor could melt, evaporate and bubble into the atmosphere.  Scientists have recently reported evidence that methane plumes are now appearing in many areas.  Methane is a particularly powerful greenhouse gas and rising levels of it in the atmosphere are only likely to accelerate global warming.  And, with the disappearance of sea ice around the shores of Greenland, its glaciers will melt faster and raise sea levels even more rapidly than previously predicted.

COURTS FRIENDLIER TO EPA IN CLEAN WATER ACT CONTEXT THAN CLEAN AIR ACT?

Posted on September 19, 2012 by Rick Glick

In his blog post of August 27, Rob Brubaker reported on three cases in which the courts refused to grant deference to EPA decisions under the agency’s Clean Air Act authority.  EPA has fared a bit better in two recent Clean Water Act cases.

In Upper Blackstone Water Pollution Abatement District v. EPA case, the issue was whether EPA properly issued a stringent NPDES permit renewal to a sanitary district to control excessive nitrogen and phosphorus loading.  The First Circuit Court of Appeals rejected the district’s argument that EPA should have waited until the district could complete its modeling effort, even though the model did not seem close to ready, and that EPA did not apply the best science.  The court declined to conduct a de novo review of EPA’s scientific analysis, limiting its inquiry to whether EPA followed the appropriate administrative process, based its decision on record evidence and clearly articulated its reasoning. So long as the criteria imposed are within the “zone of reasonableness”, the court will not strike it down.

Interestingly, the Upper Blackstone court also rejected the district’s argument that the new permit is improper because even with stricter criteria, it would not be sufficient to correct the eutrophication problem in the watershed.  The court set that aside, noting that the CWA contemplates multiple sources of contamination and no one party is responsible for cleaning up the river. 

The Upper Blackstone case is consistent with the U. S. District Court’s decision in the Northwest Environmental Advocates v. EPA, which I discussed in my March 23 post.  In the latter case, the court upheld EPA’s approval of Oregon’s numeric temperature standards, deferring to the EPA’s scientific expertise.  It took issue with the narrative Natural Conditions Criteria because it was so broad that the court concluded it supplanted numeric standards.  The court left the door open for the Oregon Department of Environmental Quality to rewrite the narrative standard for EPA review, based on the agencies’ own review of the science and a good explanation in support of the standard. 

It appears the theme running through three Clean Air Act cases cited in the Brubaker post is that the reviewing court found no authority supporting EPA’s action, or that EPA’s interpretation defied the plain meaning of the statute.  In the Clean Water Act cases, EPA overreaching on the Upper Blackstone permit or approval of Oregon water quality standards was not at issue.  The focus instead was on whether EPA demonstrated it properly considered the best science available under the authority it had, and then explained how it got to its decision.  In that context, EPA and state regulatory agencies will win more than they lose.

Themes in Recent Changes to Offshore Oil and Gas Regulations

Posted on September 18, 2012 by Pamela Giblin

By Pam Giblin and Amber MacIver, Baker Botts L.L.P.

The regulatory landscape for the offshore oil and gas industry has been subject to rapid change in the two years following the Macondo Incident in the Gulf of Mexico.1   Two primary themes have emerged in the new and revised regulations:  (1) increased agency oversight, and (2) requirements for third party certification.  The regulations are relatively recent, but operators can expect to feel the impacts over the next year.

Increase Agency Involvement
The Mineral Management Service (MMS) oversaw many of the revenue collection, leasing, permitting and enforcement functions for the offshore industry prior to the Macondo Incident.  Following that event, the MMS was restructured into separate agencies in part to enable increased agency involvement and oversight.2  The three new agencies are:

(i)    the Bureau of Ocean Energy Management (BOEM), which has the leasing functions;
(ii)    the Bureau of Safety and Environmental Enforcement (BSEE), which has responsibilities for permitting and enforcement; and
(iii)    the Office of Natural Resources Revenue (ONRR), which has revenue collection.

The new agencies, and in particular BSEE and ONRR, have demonstrated a trend of increased agency involvement.  With respect to the ONRR, in just the past year, it has issued penalties that represent an increase in excess of three times the previous yearly average under MMS.3   This increased enforcement is a trend we expect to continue.
 
BSEE’s increased oversight is seen in the numerous regulations it has issued in the past two years.  Many of those new rules require additional agency intervention in offshore oil and gas operations.  For example, Section 250.456(j) of the Drilling Safety Rule requires that before an operator may switch from heavy to light drilling fluid, the operator must receive approval from BSEE.  The Workplace Safety on Safety and Environmental Management Systems (SEMS) rule requires operators to submit their self-audit plans to BSEE for review, BSEE may make changes to the plan, and it has the option to participate in the audit.4   In addition to formal changes in the regulations, both the former director of BSEE and the current director have indicated a potential shift in enforcement policy that would add contractors to the scope of BSEE’s enforcement actions, contrary to former MMS policy, further expanding the agency’s oversight of the industry.  We have not seen an example of this yet, but would expect that contractors could see enforcement in the near future.

These changes, among others, illustrate a trend of increased agency oversight of the offshore oil and gas industry.  It is a trend we expect to see continue at least during the next year.

Third Party Certification
BSEE has issued new regulations and amended others, adding dozens of new rules and requirements for offshore oil and gas operations.  The trend that runs through many of these changes is a requirement for certification by a third party.  For example, the Drilling Safety Rule requires that operators have a professional engineer independently certify that the casing and cementing program is appropriate for the purpose for which it is intended under expected wellbore pressure.5    Although the current SEMS rule allows for self-audits to be conducted either by designated qualified personnel (DQP) or third party auditors, the proposed SEMS II rule would eliminate the option to use DQP, requiring all self-audits to be performed by independent third party auditors.6

The likely outcome of the changes that result from these two overarching themes, increased agency involvement and third party certification, is additional enforcement and red tape.  Operators may face difficulty in scheduling operations when they have to rely on outside parties to certify their work or agency approval to make changes.  Enforcement actions are likely to increase as agency oversight increases.  Operations that have not been subject to scrutiny in the past are likely to face additional hurdles and possibly enforcement under the new regulations.  Offshore oil and gas operators need to closely follow the evolving regulatory scheme to stay in compliance with the rules and avoid costly enforcement actions.

      1The “Macondo Incident” refers to the April 20, 2010 explosion from the Deepwater Horizon drilling rig, in the Macondo prospect, Mississippi Canyon Block 252. 
      2See DOI Secretarial Order No. 3299 (May 19, 2010) (issued in May 2010 and gave the Assistant Secretary- Land and Minerals Management and the Assistant Secretary -- Policy, Management and Budget 30 days to develop a schedule to implement the Order).
     3See, e.g. ONRR Press Release, April 30, 2012, http://www.onrr.gov/about/pdfdocs/20120430.pdf, last visited July 9, 2012 ($1.9 million civil penalty against Cabot alleging inaccurate records); ONRR Press Release, March 29, 2012, http://www.onrr.gov/about/pdfdocs/20120329.pdf, last visited July 9, 2012 ($1.7 million civil penalty against Merrion for late royalty payments); ONRR Press Release, July 11, 2012, http://www.onrr.gov/about/pdfdocs/20120711.pdf, last visited August 30, 2012 ($1.2 million civil penalty against QEP resources for  maintenance of inaccurate reports).
     430 C.F.R. § 250.1920(b).
     530 C.F.R. §§ 250.418(h), 250.420(a)(6).
     676 Fed. Reg. 56683 (Sept. 14, 2011).

Scope of the Single Source Doctrine

Posted on September 17, 2012 by Richard Horder

Companies who wrestle with whether their various air pollution-emitting operations must be grouped together for Title V permitting purposes have received some assistance from a recent Sixth Circuit opinion.  In Summit Petroleum Corporation v. U.S. EPA, 2012 FED App. 0248P (6th Cir.), the court curtailed EPA’s expansive interpretation of a “single source” under the Clean Air Act. 

By rule, operations belong to a single source if they: (1) possess the same SIC codes; (2) are located on contiguous or adjacent land; and (3) are under common control.  See 40 C.F.R. § 52.21(b)(5), (6).  In addition, by policy, EPA has expanded the definition of “single source” to include not only the facilities that meet these three criteria, but also those facilities that provide support to an adjacent central operation.  See Preamble to the August 7, 1980 final Prevention of Significant Deterioration (PSD) regulations, 45 FR 52676; Preamble to Revised Part 51 and Part 70, Draft, February 18, 1998.  And, EPA has taken a “functional” approach to the term “adjacent,” such that these support facilities need not even physically adjoin the main facility.  For example, EPA considered two aluminum smelter facilities adjacent, despite their 3.4 mile separation, due to the extensive truck traffic between the two properties.  See Letter from Steven C. Riva, U.S. EPA, to Robert Lenney, Alcoa Inc., Mar. 9, 2009.  See also Letter from Pamela Blakely, U.S. EPA, to Don Sutton, Illinois EPA, re: General Dynamics, Ordinance & Tactical Systems, Inc., Mar. 14, 2006 (several plants considered a single source, despite their 8-mile separation, because they met a “common sense notion of a plant”).

Therefore, when EPA recently considered whether Summit Petroleum Corporation’s gas wells and associated flares should be considered a single source with its gas sweetening plant, EPA did not find it dispositive that several of the wells were located over a mile from the plant and were separated by other intervening properties.  Instead, EPA noted that the wells and the plant were highly interdependent and under Summit’s common ownership.  As a result, the wells and plant met the “common sense” notion of a single facility.  See Letter from Cheryl Newton, U.S. EPA, to Scott Huber, Summit Petroleum Corporation, Oct. 18, 2010.

Summit challenged EPA’s single source determination, and the Sixth Circuit vacated that determination in Summit Petroleum Corporation v. U.S. EPA.  The court found it “unreasonable and contrary to the plain meaning of the term ‘adjacent’” that EPA equated “functional relatedness” with “physical adjacency.”  Id., at *2.  The court ordered EPA to use instead the “ordinary, i.e., physical and geographical” meaning of the word “adjacent.”  Id.

This decision will affect long-standing EPA policy and practice in making single source determinations.  As the Director of EPA’s Region VIII Air Program noted, there is “no evidence that any EPA office has ever attempted to indicate a specific distance for ‘adjacent’ on anything other than a case-by-case basis.”  See Letter from Richard Long, U.S. EPA, to Lynn Menlove, Utah Division of Air Quality, “Response to Request for Guidance in Defining Adjacent with Respect to Source Aggregation,” May 21, 1998, citing 45 Fed. Reg. 52,676, 52,695 (August 7, 1980) (“EPA is unable to say precisely at this point how far apart activities must be in order to be treated separately.  The Agency can answer that question only through case-by-case determinations.”).  Therefore, companies with “functional” single-source determinations should consider whether the recent Sixth Circuit decision could impact their status under the Title V program.

Defining a Stationary Source: How Much Aggregation is Too Much Aggregation?

Posted on September 13, 2012 by Theodore Garrett

One company may own a variety of “functionally related” facilities that are located on various contiguous and non-contiguous parcels of land, spread out over many square miles.  May all those “functionally related” facilities be considered “adjacent” and thus deemed to be one single major stationary source for Clean Air Act Title V permitting purposes?

A Court of Appeals recently weighed in on this issue.  On August 7, 2012, the Sixth Circuit vacated EPA’s determination that Summit Petroleum Corporation’s natural gas sweetening plant and gas production wells located in a 43-square mile area near the plant were “adjacent” and thus could be aggregated to determine whether they are a single major stationary source for Title V permit purposes. Summit Petroleum Corp. v. EPA, 2012 WL 3181429 (6th Cir., Aug. 7, 2012). The majority held that EPA’s position that “functionally related” facilities can be considered adjacent is contrary to the plain meaning of the term “adjacent,” which implies a physical and geographical relationship rather than a functional relationship.  The court also found EPA’s interpretation to be inconsistent with the regulatory history of Title V and prior EPA guidance.  The case was remanded to EPA for a reassessment with the instruction that Summit’s activities can be aggregated “only if they are located on physically contiguous or adjacent properties.”

Lucy, Ethel, and the Chocolate Factory – Reflections on EPA’s Draft Vision Statement for the Clean Water Act 303(d) Program

Posted on September 11, 2012 by Allan Gates

EPA recently issued a new draft vision statement for the Clean Water Act 303(d) program, the program under which impaired water bodies are identified and TMDLs performed.i   It is fitting that this draft vision statement coincides with the 60th anniversary of the classic episode of I Love Lucy in which Lucy and Ethel struggle mightily to wrap chocolate bonbons as they proceed down a conveyor belt.ii  At first all goes well.  Then the conveyor belt speeds up.  Lucy and Ethel are soon frantically pulling candies off the conveyor belt, stuffing them into their hats, their mouths, and even down the front of their uniforms in order to keep pace with the conveyor belt.

The CWA 303(d) program started off quietly.  States occasionally sent EPA lists of impaired water bodies (the so-called 303(d) lists), and EPA dutifully filed most of them away.  Even a few TMDLs – the studies intended to describe how impaired water bodies should be restored – got performed.  Then came the TMDL litigation.  Dozens of lawsuits in the 1990’s led EPA and the states to begin serious periodic assessments of state water bodies for compliance with water quality standards; and quotas were set by judicial decree or regulatory fiat for the issuance of TMDLs for all of the water bodies found to be impaired.  Soon TMDLs were flying down the conveyor belt at a speed never previously experienced.  EPA reports that we are very close to reaching the milestone of 50,000 TMDLs.

With two decades of experience issuing thousands of TMDLs per year it is reasonable to step back and consider the water quality results obtained.  The simple truth is that restoration of impaired water bodies has not come anywhere close to keeping up with the pace at which TMDLs have been rolling off the bureaucratic assembly line.  There are a variety of reasons for this paucity of results in restoring impaired water bodies.  Frequently the principal causes of impairment identified in a TMDL are non-point source contributions that are largely beyond the direct reach of regulatory programs.  Load reductions prescribed by TMDLs usually require significant expenditures, but funding is rarely available.  Public buy-in for the changes prescribed by TMDLs is often lacking, frequently because the TMDLs are viewed as products of obscure regulatory processes that are not responsive to stakeholder sentiment.  Although the problems addressed by TMDLs are commonly quite complex, the quality of the analysis in some TMDLs is indefensibly poor.  Sometimes the water quality standards that triggered the TMDL are unrealistically ambitious to begin with.  Even when the relevant standards are appropriate, the process of identifying impaired water bodies is commonly mired in bureaucratic minutiae and delay.  States are frequently late in sending in their biennial 303(d) lists to EPA; and EPA is equally delinquent in meeting the 30-day time limit set in its own regulations for completing federal review and approval of state 303(d) submissions.

Given the litany of issues that have limited the success in achieving most TMDL load reductions, it is interesting to read EPA’s new draft vision statement:

“The Clean Water Act Section 303(d) Program provides effective integration for implementation of activities to restore and protect the nation’s aquatic resources, where the nation’s waters have been assessed, restoration and protection objectives have been systematically prioritized, and Total Maximum Daily Load and alternative approaches are being adaptively implemented to achieve water quality goals with the collaboration of States, federal agencies, tribes, stakeholders, and the public.”

In fairness to EPA’s draft, almost all vision statements are insufferably stuffy and meaningless to everyone except those few who were in the room and argued vigorously for the addition or deletion of a particular word or phrase when the inscrutable language was crafted.  Moreover, EPA’s new draft vision statement is accompanied by “goals statements” that offer somewhat more concrete prospects for program improvements at the margin, such as protection of unimpaired waters, increased focus on prioritization, and more flexible approaches to TMDL implementation.  If we want to achieve major improvements in water quality, however, we need visionary leaders not a new vision statement.  We need to spend a lot of money, and we need to spend it in a smart way.  We need new programs that fix the regulatory limitations of the current laws, not repackaged versions of the status quo.  And we need a broad public commitment to achieve change.  In the early 1970s political leaders managed to do these things on a bipartisan basis for the sake of improving the nation’s water quality.  Unfortunately, the current state of partisan gridlock offers little hope for major change in the foreseeable future.

Maybe a new vision statement is the best we can hope for given the strong anti-regulatory sentiment in the current public discourse.  Against this background, one cannot help but reflect on the end of the iconic scene in the chocolate factory.  The supervisor comes into the room, pleased that Lucy and Ethel have not allowed a single bonbon to make it past their work station unwrapped.  She announces “Why you girls are doing splendidly,” and then yells to the conveyor belt operator, “Speed it up a little!”

i A Long-Term Vision for Assessment, Restoration, and Protection under the Clean Water Act Section 303(d) Program, FINAL DRAFT FOR STATE/EPA REVIEW (1 August 2012).  An earlier version of the same document, a Stakeholder Review Draft dated June 2012, is accessible here.
ii I Love Lucy, Season 2, Episode 4, broadcast on September 15, 1952, accessible here. Copies of the chocolate factory scene are accessible on YouTube.

Odor Regulations Stink

Posted on September 6, 2012 by Kevin Finto

Federal and state regulators have, over the years, frequently received complaints about odor.  Because the problem is a common one -- and because the origins of environmental law lie, in part, in the common law of public nuisance -- one might think we would have developed a consistent, practical way of regulating odor.  We haven’t.  No federal laws address odor, and the  various state laws and rules addressing odor are a hodge-podge of not fully-considered  ideas. 

This is likely due in part to the subjective nature of odor:  one person’s stench may be another person’s sweet smell of success.  More importantly, though, there is no commonly accepted way of quantifying or measuring odor.  If you cannot define something precisely and cannot agree on how to measure it, it necessarily follows that you will have a hard time regulating it.    There have been attempts to use odor measurement technologies including the scentometer or field olfactometer, but they ultimately rely on subjective human olfactory assessment.  While some states allow them as a guide, it does not appear that any statutory or regulatory scheme has adopted their use, and in fact, some states legislatures have adopted resolutions prohibiting their agencies from using such technologies for enforcement purposes.

So what is a regulator to do?  Consider the efforts made by one state, my beloved Commonwealth.  Virginia has tried to cram the square peg of odor into the round hole of the Best Available Control Technology (“BACT”) requirement of the Clean Air Act’s prevention of significant deterioration of air quality (“PSD”) preconstruction permitting program.  Applying the BACT process to odor may have sounded like a good idea back in the day when the PSD rules were first adopted and BACT was a sexy new acronym, but implementation of the BACT approach for odor has not been easy. 

At the outset, there is the difficulty that the BACT process applies only to things that are “pollutants” under the Clean Air Act.  Not everything that regulators want to regulate under the Clean Air Act, however, is considered a “pollutant” under the Act.  (If you doubt this, recall that it took many years of agency action and litigation and decisions by the United States Courts of Appeals and the Supreme Court before it was generally accepted that carbon dioxide is a pollutant under the Clean Air Act.)  And so it is with odor, which is defined by Webster’s Dictionary as  “a quality of something that stimulates the olfactory nerves or the stimulation itself.  In short, odor is definitely not a “typical” Clean Air Act pollutant.  (Interestingly, certain substances that are pollutants, also carry the name “aromatic” if they also happen to be organic compounds with a cyclical structure, but I digress.) 

Even if one can accept that “odor” is a “pollutant,” though, can the BACT process be applied to it?  Not really.  ”Best available control technology” means “an emission limitation based on the maximum degree of reduction of [a pollutant . . .] which the permitting authority . . . , taking into account energy, environmental, and economic impacts and other costs, determines is achievable . . . .” Clean Air Act § 169(3).  And typically BACT is determined through a top-down approach, i.e., one starts with the most stringent emission limitation theoretically achievable and then moves down from there only if the various costs of that approach are too high.  How can such an approach work for odor, though, when we do not have a unit measure for odor, much less a quantitative scale for objectionable scent.  Without such a measure or scale, it is effectively impossible to evaluate whether the environmental, economic or energy costs of reducing odor are reasonable or cost-effective.

So, if my beloved Commonwealth doesn’t now have the answer, let me cast my net more broadly and ask if anyone knows of a good practical scheme for regulating odor.