“DISCARDED” or “NOT DISCARDED”: That Is the Question (or “Asked and (finally) Answered!”)

Posted on July 31, 2019 by Karen Crawford

On July 2, 2019, the D.C. Circuit Court of Appeals denied a petition brought by an environmental group for review of EPA’s Transfer-Based Exclusion for secondary hazardous materials in California Communities Against Toxics v. EPA (D.C. Cir. July 2, 2019) (No. 18-1163).  The court found that “EPA did not act contrary to RCRA in adopting the Transfer-Based Exclusion because hazardous secondary materials are not necessarily ‘discarded’ each time they are transferred from a generator to a reclaimer along with payment”, and that “EPA has provided a reasoned explanation for applying different standards to materials that are not yet part of the waste disposal problem RCRA addresses where they meet conditions EPA concluded were adequate for safe transfer and legitimate recycling.”  This is exclusion is set forth a 40 C.F.R. § 261.4(a)(24).

Background

In 2008 EPA promulgated the Transfer-Based Exclusion, along with the Generator-Controlled Exclusion, to encourage and expand the safe, beneficial recycling of hazardous secondary materials when carried out in accordance with specified “legitimacy factors”.  After challenges to the rule by both environmental and industry groups, EPA replaced the original Transfer-Based Exclusion with a new rule known as the Verified Recycler exclusion.  This new rule was also challenged and was vacated in 2017 when the appellate court reinstated the original rule with requirements added in 2015 to cover emergency preparedness and containment.  American Petroleum Institute v. EPA, 862 F. 3rd 50 (D.C. Cir. 2017).  On rehearing, the court expanded the exclusion to cover spent refinery catalysts.  American Petroleum Institute v. EPA, 883 F 3rd 918 (D.C. Cir. 2018).  Later the same year, without further notice and comment, EPA published the Transfer-Based Exclusion as modified by the D.C. Circuit throughout the 10 years of challenges as a final rule entitled Response to Vacatur of Certain Provisions of the Definition of Solid Waste Rule, 83 Fed. Reg. 24,664 (May 30, 2018), resulting in another challenge and the July decision of the D.C. Circuit Court of Appeals.

RCRA Authority

While Petitioners did not contend that the act of transferring the waste or of reclamation constitute “discard,” they did contend that a generator’s payment to a reclaimer to accept such material necessarily indicated the material has negative value to the generator, and thus the transfer constitutes a means of getting rid of, or “discarding”, the material.  RCRA does not define “discarded material” or address payment, but the court found precedent in its own prior decisions which foreclosed petitioners’ contention that payment is determinative of “discard”.

In particular, the court concluded that Congress had not directly resolved whether “discarded material” must include hazardous secondary materials that a generator paid a reclaimer to accept.  It then moved to the question of whether EPA’s interpretation is “based on a permissible construction of the statue,” (i.e., whether or not it is the only permissible interpretation) and found support for EPA’s decision to equate legitimate recycling with lack of “discard”.  The court noted that EPA had considered the payment to reclaimers issue and studied the market forces, and had determined there were various reasons for payments to recyclers, including lack of competition in recycling markets, cost savings compared to compliance with Subtitle C requirements, and the need for capital costs to develop and implement the necessary recycling infrastructure and market.  The court concluded that instead of ignoring the relevance of the payment issue, EPA had addressed it in the Legitimacy Factors analysis but declined to make it dispositive, a permissible interpretation of “discard” that was not contrary to RCRA.

Reasoned Basis

The court also concluded that EPA’s Transfer-Based Exclusion was not arbitrary and capricious as the conditions imposed under the exclusion ensure that the hazardous secondary materials do not end up in a landfill or incinerator but remain in a continuous stream or flow of production within industry processes, and they cover potential risks by requiring third-party reclaimers to handle them properly and safely and to not discard them.  Those provisions address excessive accumulation, requiring reclamation of at least 75% of hazardous secondary materials that a reclaimer obtains over a calendar year.  In addition, residuals must be managed in compliance with applicable regulations, including Subtitle C, when “discarded.”  Because there is no statutory requirement that these conditions be identical to Subtitle C requirements, the court determined that EPA’s response was not arbitrary and capricious.

The court also reviewed EPA’s explanation for its changed position as to whether the Transfer-Based Exclusion’s restrictions and conditions were adequate.  The court noted that recycling management and controls had improved over time due to enforcement and to generator audits of reclaimer performance and financial viability. As a result, EPA’s restrictions and conditions were found to be sufficient to ensure safe recycling activities.

Conclusion

The impact of this decision on the regulated community will depend on whether the Transfer-Based Exclusion, as modified by EPA in 2015, was incorporated into the state’s hazardous waste regulations, as well as the authorization status of the state; however, those states that delayed adoption of the rule, awaiting the final outcome of this long legal battle, now have clearer direction. 

This thoughtful and practical opinion seems to provide EPA with a tutorial on promulgating a defensible regulation, and perhaps even a final answer on a long debated rule!  This author would like to see EPA use the opinion as a template to try again with other important, but now vacated rules.  How about a new comparable fuels rule?

The Supreme Court’s Most Important Environmental Law Decision in 35 Years

Posted on July 30, 2019 by Robert Brubaker

As our esteemed colleague John Cruden is fond of saying, administrative law is a subset of environmental law.  My vote for the most important Supreme Court environmental law decision in 35 years goes to the administrative law case (involving not environmental rules but the interpretation of a Department of Veterans Affairs rule) handed down on June 26, Kisor v. Wilkie.

I believe Kisor will prove to be the watershed case that that marks a consensus on shifting core principles of administrative law for decades to come.  To me, it continues what I saw as Justice Scalia's project to reform reflexive deference to agency “interpretations” (with the GHG Tailoring Rule case, UARG v. EPA, being a notable milestone, and probably also the thinking behind his final vote, on the extraordinary Clean Power Plan stay).  What are the odds that Auer v. Robbins is the unnamed case that Justice Thomas was referring to in his humorous anecdote at former Justice Scalia’s memorial about “Nino’s” outrage at “one of the worst ever” decisions of the Court (that Nino wrote)?   

Kisor goes a long way toward fulfilling Justice Kennedy's 2018 recommendation in his final opinion (Pereira v. Sessions) to reconsider "the premises that underlie Chevron and how courts have implemented that decision."  And, it further cements Justice Kagan's observation, in her 2015 Scalia Lecture at Harvard that "we're all textualists now."  It clearly articulates and shines a bright and permanent light on the concern about administrative agencies pushing too far at times in combining the power to make, interpret, change, administer, and enforce binding law, with too little independent judicial oversight.

The four separate opinions in Kisor distinguish judicial review of agency interpretations of their own rules (Auer deference) from agency interpretations of statutes (Chevron deference), but there are some inevitable parallels.  Kisor establishes a three-step analysis for agency interpretations of its own rules: 1) is the rule genuinely ambiguous? 2) if so, is the agency’s interpretation of the genuine ambiguity reasonable? and 3) even if an agency interpretation of a genuine ambiguity is reasonable, is it of a “character and context” that justifies deference?  Step 1 is strikingly similar to the pre-Chevron deference analysis under Skidmore (acceptance of an agency’s interpretation is commensurate with its “persuasive power”).  As Justice Kagan put it: “serious application of these tools [of construction, such as text, structure, history] therefore has use when a regulation turns out to be truly ambiguous.  The text, structure, history and so forth at least establish the outer bounds of permissible interpretation.”  Steps two and three of the Kisor framework add specificity and rigor to the judicial inquiry not spelled out in Skidmore.  Importantly, Kisor casts a highly skeptical eye on agency interpretations that circumvent appropriate procedural safeguards, or veer outside the lane of the agency’s expertise, or conflict with a prior agency construction.

It is significant that Kisor is authored by Justice Kagan, and joined by Justices Ginsburg, Breyer (noted for his command of administrative law), and Sotomayor, and joined in part by Chief Justice Roberts.  This is not a majority that can be characterized as anti-administrative state or as sponsors of a partisan Republican or conservative agenda.  Chief Justice Roberts wrote a short concurring opinion, expressing his view that the “distance between the majority and Justice Gorsuch is not as great as it may initially appear” because the majority’s catalog of the “prerequisites for, and limitations on” Auer deference has much in common with Justice Gorsuch’s list of the reasons that a court might be persuaded to adopt an agency’s interpretation.  Justice Gorsuch wrote a 42-page concurring opinion, joined by Justice Thomas and in parts by Justices Kavanaugh and Alito, touring the history of the Court’s deference jurisprudence and expressing a preference for overruling Auer and reverting to Skidmore deference.  Justice Kavanaugh wrote a concurring opinion, joined by Justice Alito, opining that “rigorously applying footnote 9” in Chevron (exhorting courts to “exhaust all the ‘traditional tools’ of construction” before concluding that an agency rule is ambiguous) should lead “in most cases to the same destination” as Justice Kagan’s majority opinion and eliminate any basis “to put a thumb on the scale in favor an agency” interpretation.

The boundaries on administrative powers and discretion are placed by Kisor in the hands of the judiciary, with paramount responsibility to judge conscientiously based on a searching and independent inquiry into the relevant legal and factual circumstances involved, and not based on some dogmatic, oversimplified, or wooden formula.  Deference cabined by a diligent judiciary is better than deference too readily or haphazardly granted or denied.  Justice Kagan's detailed instructions ("we mean it" she wrote) to judges handling administrative interpretation cases may well do more good for the opponents of Auer deference than an outright overruling of Auer.  If the Auer precedent had been overruled, instead of being "restated" and "somewhat expanded on," there would be more uncertainty and inconsistency, over a longer period of time, about exactly what replaces Auer deference.  The implicit call to legislators and administrators to pay better attention to the text and clarity of the laws they write is constructive too.  Good work Justice Kagan.

Martha Pagel: Giant of the Oregon Water Bar

Posted on July 25, 2019 by Rick Glick

With great sadness, I write to mourn the loss of my dear friend and ACOEL Fellow, Martha Pagel.  In her long battle with cancer, Martha demonstrated great character, courage and grace, never losing her sunny and defiant outlook.  Those of us who knew her well were not surprised by how she fought that battle, but it was humbling and inspiring to witness.

Martha was at the center of Oregon’s water law community, known throughout the state not just for her legal acumen, but also for her ability to find solutions to challenging water supply problems that were fair to all parties.  She was a great strategist, whether representing small family farms or large public utilities, and enjoyed the respect and friendship of decision makers—agencies, legislators and governors.

Martha’s reputation for excellence and good judgment extended beyond Oregon.  For example, she served as an arbitrator appointed by the States of Kansas, Nebraska and Colorado to resolve a dispute pursuant to the decree entered by the U.S. Supreme Court in an original jurisdiction case, Kansas v. Nebraska & Colorado (No. 126, Original).

She had a deft touch that made people want to follow her direction.  I have had the good fortune of being a supplicant before the agencies Martha ran, on opposite sides of Martha in disputes and, most recently, as co-counsel for a major hydropower permitting process.  Whether one was opposed to her or worked alongside her, the experience was always upbeat and fun, most often resulting in workable outcomes.  It was Martha’s style not to attack opponents, but rather to bring them along to her way of thinking, which often proved irresistible.

Martha had a long and distinguished career.  After graduating from San Diego State University and Willamette University College of Law, Martha served as assistant attorney general with the Oregon Department of Justice’s Natural Resources Section, director of the Oregon Department of State Lands, natural resources advisor to former Governor Barbara Roberts, and director of the Oregon Water Resources Department.  She joined Schwabe Williamson & Wyatt as a shareholder in 2000, where she led the firm’s Environmental Group and mentored many young attorneys.

Martha was a Fellow in the College and served on the Membership Committee.  Among her many other honors, in 2015 Martha received the Oregon State Bar’s Environmental and Natural Resources Section Award in honor of her leadership, service, and outstanding contributions in the areas of environmental and natural resources law in the Pacific Northwest. Martha was consistently listed in The Best Lawyers in America and was recognized by Oregon Super Lawyers for her work in water and natural resources law. This year, Martha was recognized as a Band 1 Environmental lawyer by Chambers USA. 

Martha and her husband Vic loved to dance, and Fellows attending the annual meeting in New Orleans will remember them on the dance floor.  She was graceful on her feet, and graceful in the practice of law. Enviable, but hard to emulate.

Martha’s contribution to Oregon water law and to ACOEL will long be remembered.  We will miss her.

Carbon Taxes and Carbon Offsets -- A Path to Net Zero?

Posted on July 18, 2019 by Jeffrey C. Fort

Two recent press pieces caught my eye.  “UK Signs Net-Zero Emissions Requirement into Law,” and “GOP Pollster pitches Republicans on carbon pricing.” The first reflects recent studies with respect to a potential [or even likely] environmental calamity; the other suggests signs of political reconsideration on climate change.  As welcome as the latter is, and most economists praise the use of a carbon tax, it is likely not nearly enough.

According to the latest scientific forecast, meeting the Paris objective of no more than a 2 C increase in global temperatures from pre-industrial temperature levels will require worldwide net zero emissions of carbon-dioxide-equivalent (CO2e) gases by 2050.  In any event, the UK, France, Norway and Sweden have adopted a net-zero requirement to be achieved no later than 2050 and more than a dozen large US cities have done likewise.

How a net-zero requirement can be met, with all the extant emissions from industry, transportation and buildings, is perhaps the most important research and development task facing us.

Consider whether another approach should be considered. In a 2017 op-ed Wall Street Journal piece, James Baker and George Schultz recommended a “carbon tax” on emissions of carbon dioxide equivalent gases.   This recommendation is the centerpiece of a memorandum to “Interested Parties” by a Republican pollster and strategist suggesting that the Republican Party should heed polling results and embrace the Baker/ Schultz suggestion that the Republican Party ought to support a “Carbon Dividends” proposal. This proposal would feature “four pillars”: a tax (of $42/ metric tonne of CO2e, indexed to rise with inflation), an equivalent “dividend” to working class Americans, a border adjustment for carbon content of imported goods, and elimination of EPA’s regulatory authority concerning climate issues.  The tax revenues would be returned to private citizens with the lowest incomes, as a “Carbon Dividend” to mitigate the increased energy costs.

However, the Carbon Dividend proposal says nothing about reducing emissions other than by raising a “price on carbon.”  But will a tax achieve that goal? Some parties may choose to emit and pay the tax so there is no guarantee that emissions will be reduced and certainly not to achieve net-zero emissions. Any reduction in energy use by businesses would depend on the elasticity of the market for other inputs and competition for the output products. For businesses that have inelastic demand curves the costs just get passed through with no or little emission reduction.  In other words, a carbon tax will not yield significant environmental results, however admirable its intentions.

However, emission reduction credits, or “offsets,” is a tool which has been used for nearly 50 years under the Clean Air Act.  Verified offsets provide real reductions.   Verified offsets have been used to allow large new construction projects in dirty air areas, to reduce the costs of compliance measures in state implementation plans, and now as a means of reducing costs in most of the climate legislation around the world.  Offsets are not easy to create.  Using standard protocols, there must be a scientific method which has been adopted in a public process and adherence to that methodology then for a project to be undertaken.  Both are validated and verified by an independent third party. Only then is the “offset credit” created.  Offsets seem to attract entrepreneurs who have a “better idea” of what projects can be implemented at a much lower cost that an EPA-approved, command and control requirement.   The U.S. now has three independent offset verifiers which have produced millions of tonnes of extra reductions -- proving that the concept can work at scale.   These are real and verified reductions and the current prices are a small fraction of the $42 per tonne price in the Carbon Dividend proposal.  Verified offsets are a much better and cost-effective way to produce reduce real emission reductions.  

For a “tax” on carbon emissions, we would start with an existing and established measuring tool; those sectors covered by the Mandatory Reporting Rule (MRR).  The covered sectors have already been established as the most carbon-intensive industrial activities.  The MRR is established and tested and would not require a new system.

A proposed carbon tax systems could then allow a credit or a “deduction” for other state requirements for GHG controls.  State carbon reductions requirements (e.g. AB32 in California and RGGI in the Northeastern states or other state adopted requirements, see) could be recognized, which would reduce the taxable quantity.  Allowing offsets, including those purchased from sources “outside the [MRR] cap” would provide further reductions, and further reduce net taxable emissions.   But a complete elimination of taxable carbon emissions appears unlikely in the near term.

There are many sectors who now perform “voluntary” projects, at a cost far below $42/ metric tonne.  Among the sectors outside the MRR list, are:

  • agricultural and forestry programs (famers and foresters have produced substantial volumes of offset credits to date);
  • unregulated industrial processes, such as those emitting methane, nitrous oxides and hydrofluorocarbons, which are not subject to the MRR; and
  • abandoned coal and gas well vents.

Not only would using offsets provide an incentive for extra reductions on a voluntary basis, the existing voluntary programs are examples of innovation. Small businesses, new ideas, and new ventures have created most of the offsets now used in compliance and voluntary systems.

Carbon offsets are real reductions, and not just a fiscal policy redistribution.  In addition to providing a “dividend,” a carbon tax offset policy could stimulate new ideas and businesses as well as substantially reduce carbon emissions.  This would align sound climate policy with sound tax policy by using a tool developed long ago, updated based on recent experience.

The Seals of Disapproval, and the Return of Jaws

Posted on July 12, 2019 by Samuel I. Gutter

We are fortunate to live on Cape Cod, where the abundant marine life is a consistent source of joy.  We watch osprey and terns diving for fish, and crabs scuttling along the beach.  The local radio station announces when the blues and stripers are running, and where best to find them.

But all is not well in and on the water.  In the midst of stories about the depletion of marine resources, the Cape, we now know, has an overabundance of a particular marine mammal:  the grey seal.  Once widely hunted by early European settlers and then by fisherman who viewed them as competitors for the fishstock, in recent years the seals have rebounded with stunning success.  An estimated 30,000 to 50,000 grey seals make their home on the Cape, densely clustering in areas like the Monomoy National Wildlife Refuge off Chatham, where the seals are so plentiful that they can be seen from space.

Many people, of course, love the seals, with their sleek fur, woeful eyes, and playful antics.  But people aren’t the only ones attracted to seals:  sharks “love” them, too, for obviously different (and decidedly gustatory) reasons.  And not just any sharks.  We’re talking about great white sharks, the predatory hunters with rows of razor-sharp teeth that inspire primal fear among beachgoers.  After all, while “Jaws” was set in the mythical New York town of Amity, the locals all know that it was filmed on Martha’s Vineyard, a scant few miles off Cape Cod.

Given the huge seal population, even the most inept and myopic shark should have no problem finding something it likes on the seal take-out menu.  And Jaws aside, sharks are not known to intentionally hunt humans.  Shark attacks are rare – generally believed to be the result of human/seal mistaken identity.  But last August, a swimmer in Truro, on the Outer Cape, suffered serious injuries from an attack by a great white 50 yards off shore, and a month later the Cape experienced its first fatal shark attack since 1936, when a man riding a boogie board was attacked and killed by a great white in Wellfleet, close to shore.

While attacks are rare, shark sightings are becoming more common.  The vigilant can even track sightings on The Sharktivity App.  Sightings have forced the temporary closure of popular Cape beaches, likely causing some to consider the appeal of alternate vacations on quiet mountain lakes, where the top aquatic predator is the largemouth bass.  And that presents another sort of problem.  Sharks might thrive on seals, but Cape Cod thrives on tourism, and sharks (other than sales of toothy t-shirts) are bad for business.

Enter Willy Planinshek and his partner Kevin McCarthy of Deep Blue LLC, who have come forward with a plan to use an underwater sound system to scare the seals away from beaches.  Where the seals go, their theory holds, the sharks will follow.  Although Messrs. Planinshek and McCarthy have no particular expertise, funding, prototype or research to back up their proposal, they still managed to draw a capacity crowd to a meeting of the Barnstable County Commission to consider the concept.  They have been invited back in the fall for further consideration.

But as we all know, even the best ideas are often beset by regulatory and bureaucratic hurdles.  In this case, the Barnstable County Commissioners will be well-advised to read the Marine Mammal Protection Act, 16 U.S.C. 1361, et seq.  Under the MMPA, it is illegal to “take” any marine mammal without a permit.  Moreover, “take” is broadly defined to include not only the hunting and killing of marine mammals, but harassing them, as well – which is, after all, the entire point of the underwater sound blast.  Additionally, the ensuing federal permitting process would surely trigger some level of NEPA review.  And let’s not forget potential applicability of the Coastal Zone Management Act, as well as federal and state endangered species laws (grey seals aren’t endangered, but other marine species that frequent the area might be).

Such hurdles aside, the ultimate question remains whether any such plan, if approved, will even work.  Seals eager to get to their mating grounds might habituate to the sounds, or simply swim with their heads above water.  As the fictional Ian Malcolm (played with perfect nerdiness by Jeff Goldblum) proclaimed in Jurassic Park:  “Life will not be contained.  Life breaks free.  It expands to new territories, crashes through barriers, painfully, maybe even dangerously.”  In more colloquial terms, beware the unintended consequences of messing with Mother Nature – seals and sharks included.

Over/Under—Great Environmental Fiction/Nonfiction

Posted on July 10, 2019 by Dick Stoll

I just finished reading two books that I would highly recommend to anyone concerned about the environment and global climate:

—  The Overstory, a novel by Richard Powers.  It won the 2018 Pulitzer Prize for fiction.

—  Underland, a 2019 non-fiction “deep time journey” by Robert Macfarlane.  

Each book is exceedingly sweeping in scope and chock full of scientific information and details that even I (a political science and English major) could essentially understand and find captivating.   An overriding theme of each book is that humans aren’t doing much good for this planet.  

Each book may fairly be called a magnum opus, and I can’t even begin to describe their full sweep in a blog like this.   So I urge you to do a little googling for reviews.   I am linking a good review of each here:

https://www.theatlantic.com/magazine/archive/2018/06/richard-powers-the-overstory/559106/

https://www.npr.org/2019/06/03/729156788/underland-connects-us-to-dazzling-worlds-beneath-our-feet

The Overstory is mainly about trees and people — how trees interact with each other, how people interact with each other, and how people interact with trees.   Lots of bad things get done by some people, some good things get done by some people, and lots of good things get done by trees.   

After reading the book, I am paying a heck of a lot more attention to trees than I ever did before.  In fact, my current iPhone wallpaper is a close-up of a beautiful redwood I recently photographed in northern California.  

Underland primarily focuses on what goes on under the earth’s surface — today, for millions of years before today, and projectively for eons to come. The author relates how humans have used the “underland” over history in various positive and negative ways for all kinds of storage, disposal, and extraction.  He describes intriguing and dangerous underground “journeys” of his own in several places around the world.  His last journey is to a repository being readied for nuclear waste way under Finland.  

Each book is laden with concerns about the future for the global environment and climate.   The Overstory hits hard on deforestation, Underland hits equally hard on melting ice.

I am retired now and have more time to read books like these.   But I encourage those of you still practicing to find the time.