Environmental Justice in Mississippi

Posted on March 30, 2011 by John Milner

On April 1, 2011, the American Bar Association Section of Environment, Energy and Resources will hold a national symposium on environmental justice and the law at the University of Mississippi School of Law in Oxford, MS. The Symposium will bring together representatives of academia, government, the private bar, nongovernmental organizations, and the corporate sector to discuss the evolution of efforts to more effectively address the conflicts that can arise around industrial facility operations and siting and community needs.

Conflicts regarding facility operations and environmental justice were recently highlighted at the Mississippi Legislature. On January 24, 2011, Rep. Gregory Holloway, Chair of the House Forestry Committee, chaired a hearing at the Mississippi Legislature on environmental justice for affected communities in Mississippi. Holloway called the hearing at the request of Sherri Jones, Coalition of Communities for Environmental Justice.

Jones said she believes Mississippi Department of Environmental Quality (MDEQ) failed in its prior assessment of a proposed site because pollutants are still present on the “old” agriculture site. After researching the work of MDEQ across the state, Jones claims that many sites are cleared by MDEQ when, in fact, the sites are still full of harmful pollutants. Tracy McGaugh, Professor of Touro Law Center in New York, explained that she came to Jackson, Mississippi at her own expense in order to help the people in contaminated communities receive the environmental justice they deserve.

Aware of the growing need for transparency and community input, MDEQ has created a new office at the agency, the Office of Community Engagement. The goal of the Office of Community Engagement is to build effective relationships and partnerships with internal and external stakeholders. For example, in 2010, the Office of Community Engagement hosted over 70 face-to-face meetings representing environmental justice communities. The Office of Community Engagement has implemented the “Gulf Coast Environmental Initiative” to ensure environmental justice is considered throughout the natural resource damage assessment process in the state following the Deepwater Horizon oil spill.

Upcoming Federal Trade Commission Revised "Green Guides"

Posted on February 14, 2011 by Joseph Manko

The Federal Trade Commission (FTC) Act prohibits “unfair and deceptive acts or practices.” 15 U.S.C. § 45. In 16 CFR § 260.2, unfair and deceptive acts or practices are defined as being a representation, omission or practice that (1) is likely to mislead consumers acting reasonably under the circumstances and (2) is material to a consumer’s decision. In essence, the FTC evaluates marketing from the consumers’ perspective and in the words of its Chairman Jon Leibowitz: “What companies think green claims mean and what consumers really understand are sometimes two different things.”

In the environmental area such claims can attach to a product, package or service in its labeling, advertising, promotional materials or other forms of marketing or sales paraphernalia, in any medium, expressed or implied, and including words, symbols, logos, depictions, brand names, etc. To avoid being deceptive, there has to be a reasonable basis to substantiate a claim which often requires competent, reliable scientific evidence, often based on tests, analyses, research or studies.

The original Green Guides were issued in 1992, and were amended in 1996 and 1998. The FTC began its current review of the Guides in 2007, proposed revisions in October 2010 and closed the public comment period on December 10, 2010.

Although the proposed Green Guides are voluminous and people should refer to the proposal in the October 15 Federal Register, suffice to say that they now intend to cover not only the products and services within a building, but the proposed Guides, if adopted in their current form, would be interpreted to apply to buildings themselves, which was contrary to the former belief that product liability did not attach to buildings. According, in addition to concern for environmental disclosures, regulated by the Securities Exchange Commission, the FTC would now constitute a second regulatory review agency.
 

Michigan Makes Sweeping Changes In Its Environmental Response Act

Posted on January 19, 2011 by Jack Shumate

When Michigan adopted the Environmental Response Act in 1995, codifying numerous statutes into a comprehensive code, people throughout the United States hailed Part 201 as the most business-friendly environmental remediation statute in the country. Part 201 of the new Michigan Environmental Response Act (MERA) largely did away with status liability and made it possible for a new owner or occupant, through the use of a vehicle called a Baseline Environmental Assessment (BEA) to take title or occupancy of contaminated property free of liability so long as it did not exacerbate the situation or expose occupants of the property to undue risk.

Almost from the moment that MERA was enacted, staff of the Michigan Environmental Regulatory Agency began to adopt and implement regulations making it increasingly difficult to obtain an approved BEA for industrial, and some commercial, properties. Regulations such as the Draconian ones regulating groundwater-surfacewater interface and vapor intrusion discouraged the re-use and redevelopment of contaminated corporate properties. Some of the district offices of the Michigan Department of Environmental Quality (MDEQ) even went so far as to flatly refuse to even consider review of a draft BEA seeking approval for a new use of contaminated property if the new owner or occupant was likely to generate any contamination identical to pre-existing contamination.
 

The debate between MDEQ staff and environmental groups on one side and business interests on the other raged until late 2010, when a lame duck Legislature approved, and lame duck Governor signed, an amendatory act making significant changes in Part 201. Now, the statute - and, hopefully, the regulations implementing the revised statute - will bring the Michigan procedure much more closely in line with the Federal All Appropriate Inquiry rules. It is believed that this will encourage Brownfields redevelopment and badly needed business expansion in the state.

Attached is a brief summary prepared by The Dragun Corporation, environmental consultants, highlighting some of the most significant changes - and also pointing out a few potential pitfalls.

For further information contact Jack Shumate at shumate@butzel.com or 248.258.1405.

California's New "Green Chemistry Initiative"

Posted on January 6, 2011 by Robert L. Falk

Manufacturers and retailers who import consumer products from overseas are facing a significant new challenge emerging from California. The State’s “Green Chemistry Initiative” has the goal of removing, reducing, or replacing potentially harmful chemicals in consumer products. Given that its market represents the world’s seventh largest economy, California’s Green Chemistry Initiative will likely have a significant impact upon the worldwide supply chains for these products.

 
California’s Green Chemistry Initiative was enacted on September 29, 2008, through two companion bills, Assembly Bill 1879 and Senate Bill 509. These statutes broadly describe a general structure for the law, with the details left to future regulations by the lead agency, the California Department of Toxic Substances Control (“DTSC”).DTSC released its most updated version of proposed implementing regulations on November 16, 2010. These consisted of requirements regarding:

  1. the prioritization of chemicals and products of high concern,
  2. requirements for an alternatives assessment process, and
  3. regulatory options for DTSC to exercise based on its review of such assessments, which may require a manufacture to reformulate a product or stop its sale in California.


Although the proposed regulations implementing the Green Chemistry Initiative were due to be finalized by January 1, 2011, given the impending swearing in of Jerry Brown as California’s new Governor, on December 23, 2010, the California Environmental Protection Agency stated that “substantive and valid concerns” had been raised by “industry, environmental groups, scientists, and legislative leaders,” such that the proposed regulations will be reviewed, and likely amended, by a “Green Ribbon Science Panel” before going into effect.


While the final shape of the regulations remains to be seen, the heart of DTSC’s draft scheme is likely to survive even if modified. Its key feature is an alternatives assessment requirement which mandates evaluation of the potential impacts of chemicals of concern in products and an identification of less toxic alternatives to reduce those impacts. This analysis must also consider how the product is manufactured and used; what happens to it after its useful life; and its other likely effects on health, the environment, and other resources throughout its life cycle. As drafted, the regulations ultimately would require the manufacturer to select and propose to DTSC the alternative it intends to implement and to provide DTSC with the rationale for the selection and a proposed timetable for implementation. The process by which DTSC reviews a manufacturer’s alternatives assessment and provides an approval is likely to be resource-intensive, requiring management of an enormous amount of detailed and potentially conflicting scientific information. At a time when California faces a large fiscal crisis, funding such a new and far reaching program may prove unrealistic; this funding gap may dictate a change in the proposed regulations. Notwithstanding the Green Ribbon Science Panel’s forthcoming review, all eyes will be on newly-inaugurated Governor Brown’s office to provide direction on the future of this program.


The California Legislature believed the Green Chemistry Initiative will lead to safer products, fewer exposures to potentially harmful chemicals, and a healthier environment. While these goals are laudable, as a practical matter, it remains to be seen whether the State’s plan for implementing this ambitious law will be successful or end up being crushed by its own weight.
 

Changes Coming In The Michigan Environmental Regulatory Authority

Posted on December 30, 2010 by Jack Shumate

Michigan’s Governor–elect Rick Snyder has announced that he intends to split the Michigan Department of Natural Resources (MDNR) into two departments – the MDNR and a Department of Environmental Quality (MDEQ) – after he takes office on January 2, 2011.

This will be the latest change in an oft – reorganized environmental enforcement structure in Michigan. The two functions were originally consolidated in the MDNR, but it was recognized that they were incompatible after the MDNR was forced to fine itself for dumping toxic substances into a river, resulting in a major sport fish kill. The current Governor, Jennifer Granholm, merged the two departments again in an effort to save money.

Details of how regulatory functions will be divided have not been announced but it may be anticipated that Governor-elect Snyder, a former corporate CEO, will favor a regulatory regime that seeks to encourage growth and development of business in the state.

For further information contact Jack D. Shumate at shumate@butzel.com.

EPA's Roll-Back of Bush-Era Rules Appears to Begin in Earnest

Posted on February 13, 2010 by Seth Jaffe

While a lot of attention has been paid to whether EPA would reverse the Bush EPA decision denying California’s petition to regulate greenhouse gas emissions from mobile sources,  it is now clear even outside the climate change arena that life at EPA is going to be substantially different under the current administration.  As if evidence were really needed for that proposition, EPA announced this week that it was putting on hold the NSR aggregation rule that EPA had promulgated on January 15, 2009.

The rule, which had been long sought by industry, would have provided that nominally separate projects would only have to be combined – aggregated for NSR/PSD purposes – if  they are “substantially related.” It also would have created a rebuttable presumption that projects more than three years apart are not substantially related. Responding to a request from NRDC and the OMB memo asking agencies to look closely at rules promulgated before the transition but not yet effective, EPA concluded that the rule raises “substantial questions of law and policy.” Therefore, EPA postponed the effective date of the rule until May 18, 2009 and also announced that it was formally reconsidering the rule in response to the NRDC petition.

To those in industry, the aggregation rule was not a radical anti-environmental roll-back of environmental protection standards.  Rather, it was more of a common-sense approach towards making the NSR program simpler and clearer.  It is one of my pet peeves with the prior administration, however, that it gave regulatory reform a bad name.  

In any case, I feel as though I should open a pool regarding what will be the next Bush-era rule to be tossed overboard.  We surely won’t have to wait long for it to happen.

Revisiting Rules: How Far Back Is Too Far Back?

Posted on December 29, 2009 by Andrea Field

Recently, while searching my bookshelves for a missing volume, I came upon a three-ringed binder of documents related to EPA’s 1980 PSD rules. Of particular interest to me were (1) my October 30, 1980 letter to then-EPA Administrator Douglas Costle asking that he clarify parts of those 1980 PSD rules, and (2) Administrator Costle’s letter responding to my inquiry. In his response, Administrator Costle assured me that the Agency would positively address my concerns in technical and conforming amendments that EPA was then preparing.

Any possible euphoria that I might have felt at the positive tone of Administrator Costle’s response was more than offset by the date of his letter: January 19, 1981, the day before Administrator Costle would be leaving EPA in advance of the inauguration of Ronald Reagan.   Even early in my legal career almost thirty years ago, I knew I could not put much faith in the well-intentioned assurances of an outgoing EPA Administrator. The incoming Administrator would look at all pending issues with fresh eyes and might – or might not – decide to continue down the path laid out by Administrator Costle.

In fact, the incoming Reagan Administration decided to re-examine many of the actions taken by the Carter Administration in its waning days.   Just as – 12 years later – the incoming Clinton Administration re-examined actions taken by the Bush (41) Administration as it left office; and 8 years after that, the new Bush (43) Administration re-thought actions of the departing Clinton Administration; and now -- 8 years later -- the Obama Administration is revisiting actions of the Bush Administration.         

I do not here bemoan the fact that new administrations want to revisit the end-of-term decisions made by their predecessors. I ask, though, how far back in time should new administrations reach in their “revisitings”? We have come to expect incoming regulators to review rules that are still in proposed form and to pull back from publication rules that were only recently signed but have not yet been published in the Federal Register. We have also come to expect incoming administrations to look at rules that were published by a previous administration and are the subject of ongoing litigation so that new regulators can determine if they wish to continue to defend their predecessors’ rules or, instead, to re-examine those rules.

What happens, though, when a new administration reaches back to reexamine rules that have been on the books for many months or even years and that are in the midst of being implemented by the states and the regulated community? And what happens if the new administration wants to keep in place portions of a rule but wishes to scrap the remainder of the rule? This is happening now as EPA reconsiders the ozone ambient standard rule that was adopted by the Bush EPA early in 2008 and that is now the subject of litigation in the D.C. Circuit. No one would have been surprised if the new administration had asked the D.C. Circuit to remand the 2008 ozone standard rule so that EPA engage in a sped-up rulemaking to develop new/replacement ozone standards while continuing to implement the 2008 rule. Instead of doing that, though, EPA is essentially asking the D.C. Circuit to divide its ozone rule into pieces, thus allowing EPA to implement parts of the ozone rule while essentially trying to stay implementation of other parts of the regulation.

A new administration’s going back farther in time to “undo” programs currently being implemented -- and trying to stay portions of those programs while continuing to press for implementation of other parts of the programs -- is disruptive for both regulators and the regulated community. I hope that the D.C. Circuit recognizes this in the ozone ambient standard litigation and decides to impose a rational framework for this – and any new -- administration to follow as it goes down the well-trod path of trying to change a rule of its predecessors.

Obama Administration Environmental Initiatives & Priorities

Posted on September 14, 2009 by Rachael Bunday

Audio Now Available:

 A Special ACOEL Event

Obama Administration Environmental Initiatives and Policies

 

DAVID J. HAYES

Deputy Secretary, U.S. Department of the Interior

 

Interviewed by David B. Farer, Farer Fersko

 

Audio of Mr. Farer's interview of Mr. Hayes at the Department of Interior on July 14, 2009, with discussion topics focusing on Interior's priorities concerning climate change, renewable energy and water.

 

Running time:  Approx. 45 min.

More than Indemnity?

Posted on September 8, 2009 by Brian Rosenthal

Is an indemnity for a third party’s liabilities just an indemnity and not a right of direct action? Yes, says the District Court for the Eastern District of Pennsylvania because the indemnitor avoided words like “assume,” “become liable for,” or “assume all of the liabilities and obligations.” 

 

Here, the United States argued the indemnitor had crossed the line of indemnity into the land of assumption. The federal government pointed to a settlement agreement where the indemnitor agreed to provide remediation required by “law, regulation, order, judgment, or settlement agreement.” Finding the question one of contractual intent, the court found the language to defend and hold harmless does not sound in assumption and is only triggered when an indemnitee suffers a claim or pays damages on a claim. Finding the agreement lacking in the standard words of assumption, the indemnitor prevailed by summary judgment. United States v. Sunoco, Inc. No. 05-633 (E.D. Pa. 2009).

EPA Clears the Way for Regulation of GHG

Posted on April 17, 2009 by Theodore Garrett

The Environmental Protection Agency has formally declared carbon dioxide and five other heat-trapping gases to be pollutants that threaten public health and welfare, setting in motion a process to regulate carbon dioxide and other gases associated with global warming. This announcement comes two years after the Supreme Court's decision in Massachusetts v. EPA. The Agency said the science supporting its so-called endangerment finding was "compelling and overwhelming." The ruling triggers a 60-day comment period before any proposed regulations governing emissions of greenhouse gases are published. Lisa P. Jackson, EPA's Administrator, said: "This finding confirms that greenhouse gas pollution is a serious problem now and for future generations.

Fortunately, it follows President Obama's call for a low-carbon economy and strong leadership in Congress on clean energy and climate legislation." EPA's announcement does not include specific targets for reducing greenhouse gases or new requirements for energy efficiency in vehicles, power plants or industry sources. Such new restrictions would be developed in subsequent rule-making or in legislation enacted by Congress. EPA's announcement stated that "[n]otwithstanding this required regulatory process, both President Obama and Administrator Jackson have repeatedly indicated their preference for comprehensive legislation to address this issue and create the framework for a clean energy economy."

Pres. Obama's DOJ Takes Second Shot at Citizen Suit Dismissal

Posted on April 3, 2009 by Jarred O. Taylor, II

Citizen suits in the environmental world are those filed in federal court under the authority Congress gave to a citizen to seek enforcement of the environmental laws, typically when the citizen believes the regulatory authority (i.e. EPA or a state agency) is not doing its job or has missed a violation.  

 

Entire articles have been written about the efficacy of such suits, and their appropriateness in the face of an already-initiated governmental enforcement or cleanup action. Recent cases suggest the courts want to encourage, and not discourage, such filings, although one recent US Supreme Court decision found the citizens lacked standing because there was not an actual, live, dispute. Summers v. Earth Island Institute, __U.S.__(No. 07-463, March 3, 2009) (see ACOEL blog entry of March 4, 2009).

 

Some, therefore, found it surprising when, on March 6, 2009, President Obama’s Justice Department filed a motion seeking the dismissal of a citizen suit filed against the United States over alleged mining contamination in a national forest. What some found even more surprising was this was not the DOJ’s first shot at the citizen group, the DOJ having attempted to get the case dismissed one time before, under Pres. Bush’s DOJ.

 

In Washington Environmental Council v. Mount Baker-Snoqualmie National Forest (W.D. Wash, CV No. 06-1249), the United States had argued in 2007 that it was already taking action at the site under Superfund, and argued that the citizen suit was a barred challenge to the United States’ “removal or remedial action” under Section 113(h) of Superfund. The federal district court denied this first motion to dismiss on the basis that the US Forest Service was just at the inspection and investigation stage, and had not actually selected a remedy.

 

On March 6, 2009, with the citizen suit still pending, DOJ filed another motion to dismiss, arguing that the US Forest Service had advanced its Superfund work so that all of its inspections were complete and it was beginning to perform the engineering evaluation for remediation, and to calculate those costs. DOJ argued in its motion that such activity, even though before any cleanup had been actually conducted, does meet the Section 113(h) criteria barring such challenges, and that the citizen suit should be dismissed. The author is unaware of a court ruling on this recent motion.

 

One hopes the administration’s position in this case (whether right or wrong) would be the same if the subject of the citizen group’s complaint was a non government organization or other private company, and not the United States. Comments?

New Requirements for Siting and Permitting in Connecticut

Posted on March 13, 2009 by Earl Phillips

As of January 1, 2009, a party seeking to develop or expand certain facilities in Connecticut that require approval by the state Siting Council or the Department of Environmental Protection (DEP) must comply with significantly expanded public participation requirements before applying for or receiving approval from the Siting Council or DEP.

The new requirements arise from Public Act 08-94, An Act Concerning Environmental Justice Communities and the Storage of Asbestos-Containing Material (the "Act"), enacted in May 2008.  The Act applies to certain proposed new or expanded facilities — including but not limited to a "major source" of air pollution under the federal Clean Air Act, certain electric generating facilities with a capacity of more than 10 megawatts, a sewage treatment plant with a capacity of more than 50 million gallons/day, and certain types of waste management facilities — that are located in an "environmental justice community."  An "environmental justice community" is defined as either a U.S. census block group for which 30 percent or more of the population consists of low-income persons (income below 200 percent of the federal poverty level), or a Connecticut "distressed municipality," as defined by other state statutes relating to economic development.

 

In general, the Act requires a subject party to take three main steps:

  1. Before filing an application for a "new or expanded" permit with DEP or an application for a Certificate of Environmental Compatibility and Public Need with the Siting Council, the party must now file and receive approval of a "meaningful public participation plan" from DEP or the Siting Council.  "Meaningful public participation" means that community residents and other potentially affected persons are sought out and provided an opportunity to participate in and influence the regulatory agency's decision.  The "meaningful public participation plan" must include an informal public meeting to be held for community residents. The plan must also contain measures to facilitate public participation.  The Act specifies in great detail measures that may or must be taken, including sign posting, newspaper ads, Web page notices, and written notification to neighborhood and environmental groups and to local and state elected officials.
  2. The party must hold an informal public meeting and offer "clear, accurate and complete" information about the proposed facility or facility expansion and its potential environmental and health impacts.  The DEP or the Siting Council may not take any action on the party's permit, certificate, or approval earlier than 60 days after the informal public meeting.
  3. The party must also consult with the chief elected official(s) of the town(s) in which the facility is to be located to evaluate the need for a "community environmental benefits agreement," which is defined as a written agreement by which the property owner or developer commits to the municipality to provide "financial resources" to mitigate, in whole or in part, "impacts reasonably related to the facility, including, but not limited to, impacts on the environment, traffic, parking and noise."  The municipality must provide community residents an opportunity to be heard concerning the need for and terms of such an agreement.

Where a facility must comply with the Act for both Siting Council and DEP approvals, the Act allows DEP to waive the requirement for an additional informal public meeting if one has already been held for purposes of the Siting Council approval.

DEP estimates that some or all of about 69 municipalities in the state qualify as an "environmental justice community."  DEP is now working with the Department of Economics and Community Development (DECD) to identify these areas more specifically.  DEP has also drafted template and guidance documents and will discuss these at a public workshop on Tuesday, January 13, 2009, 10:00 to 12:00 noon at DEP offices in Hartford.

In summary, the Act has the potential to alter significantly the timing, cost, and outcome of DEP and Siting Council applications for affected facilities.

Robinson & Cole is currently advising a number of clients regarding the Act and its potential impacts on facility development in Connecticut.  We stand ready to apply our experience and insights to your operations and strategic planning.  If you would like to discuss these issues and how they may impact your business, or if you would like a copy of the draft DEP implementation documents, please contact any of the following attorneys in our Environmental and Utilities Practice Group:

Earl Phillips, (860) 275-8220, ephillips@rc.com  
Ken Baldwin, (860) 275-8345, kbaldwin@rc.com
Brian Freeman, (860) 275-8310, bfreeman@rc.com
Pamela Elkow, (203) 462-7548, pelkow@rc.com

Another RICE Crop: EPA Proposes Additional Rules for Stationary Reciprocating

Posted on March 13, 2009 by Earl Phillips

On February 25, 2009, EPA proposed a new set of rules and rule revisions applicable to a broad universe of existing stationary reciprocating internal combustion engines (RICE). These engines are typically used for a variety of purposes at commercial and industrial facilities, such as providing back-up electricity and powering fire pumps. The proposed rule for existing engines would supplement (and in certain instances, modify) the 2004 and 2008 rules for new engines. Collectively, these rules address "hazardous air pollutants" (HAPs) and are formally known as the RICE National Emission Standards for Hazardous Air Pollutants (NESHAPs).

 

Like the 2004 and 2008 rules, the proposed rules are dense and complex. They would apply to engines in three basic categories of stationary RICE: 

  • Existing smaller (<500 horsepower) engines at "major sources" of HAPs (i.e., facilities with potential emissions of at least 10 tons/year of an individual HAP or 25 tons/year of any combination of HAPs)
  • Certain new or reconstructed engines at "major sources"
  • Existing engines at "area sources" (i.e., non-major sources)

The definition of "existing" and "new or reconstructed" varies depending on such factors as the design type, power rating, fuel type, and usage of a particular engine. Similarly, such factors also would determine whether and how the engine would be subject to various proposed numeric emission limits or other requirements regarding fuels, emission controls, periodic emission testing, operating and maintenance practices, and associated recordkeeping and reporting.

Notably, EPA is proposing that RICE sources would not have the benefit of the "startup, shutdown, and malfunction" exemption that traditionally has been part of numerous NESHAP regulations, including the existing RICE NESHAP. (The legal status of this exemption is currently uncertain, following a December 2008 court ruling that struck it down.) However, EPA is also "co-proposing" an alternative limited exemption for certain engines that use catalytic controls: such engines would be subject to more relaxed emission limits during startup and malfunction, but not shutdown.

Public comments on this proposed rule must be received on or before the later of May 4, 2009, or 30 days after EPA holds a public hearing on the proposal.

The scope and complexity of the proposed rules present significant challenges in determining if and how the rules would apply to any individual engine. From our experience in counseling clients regarding the 2004 and 2008 rules, we stand ready to assist with the regulatory analysis, or with preparing public comments to EPA about the proposed rules and revisions. If you would like to discuss the proposed rules, please contact any of these attorneys in our Environmental and Utilities Practice Group:

Earl W. Phillips, Jr.
ephillips@rc.com
(860) 275-8220 

Christopher Foster
cfoster@rc.com
(617) 557-5908

Brian C. Freeman
bfreeman@rc.com
(860) 275-8310

Kirstin M. Etela
ketela@rc.com
(203) 462-7534

Priscilla Summers v. Earth Island Institute Supreme Court Decision

Posted on March 4, 2009 by Theodore Garrett

In a 5-4 decision, the Supreme Court held that environmentalists' lacked standing to challenge a Forest Service regulation limiting public involvement in timber sales decisions. Priscilla Summers v. Earth Island Institute, et al.,__U.S.__(No. 07-463, March 3, 2009). The decision found that respondents’ argument that they have standing because they suffered procedural injuryi.e., they have been denied the ability to file comments on some Forest Service actionsfails because such a deprivation without some concrete interest affected thereby is insufficient to create Article III standing. Justice Scalia, writing for the majority, stated "Accepting an intention to visit the National Forests as adequate to confer standing to challenge any Government action affecting any portion of those forests would be tantamount to eliminating the requirement of concrete, particularized injury in fact."  The following is a link to the Court's opinion: http://www.supremecourtus.gov/opinions/08pdf/07-463.pdf

OBAMA AND THE ENVIRONMENT

Posted on February 24, 2009 by Elliot Laws

As Lisa Jackson completes her first month as President Obama’s environmental chief, she is just scratching the surface on some of the myriad issues that will likely have impacts far beyond typical environmental concerns, for decades to come. There has to be some mixture of excitement and fear facing this new administration, as the challenges before it dwarf all of those in memory. That mixture will be especially prevalent at EPA. Usually in times like these — war, recession, high unemployment –— environmental issues can be expected to fade from the front pages. An EPA administrator would receive the old admonition to be seen and not heard. However, unlike past crises environmental issues are in the forefront — primarily in the form of climate change and energy. It is notable that when the government is lending billions of dollars to Citibank and debating the very existence of the big three automakers, one of the first actions of the incoming Obama administration has been to review EPA’s previous decision to deny California’s petition for a Clean Air Act waiver to allow it to regulate greenhouse gases from mobile sources.

 

 

The expectations for success that many Obama supporters have are high. Those expectations are high in the environmental community — perhaps too high. The ongoing financial collapse in the United States and abroad has changed the landscape in ways that could not have been imagined as recently as August, when Obama accepted the Democratic nomination for president. With the federal government having committed nearly $1 trillion in an attempt to save financial institutions across the country; with Congress passing an economic stimulus package costing an additional $750 billion; with the United States still conducting wars in Afghanistan and Iraq, outside of the infusion of stimulus cash for “shovel-ready projects” the expectation that EPA’s budget will experience significant increases over the Bush years is hardly a reasoned view. It’s not just the mind boggling challenge facing us on the economy, it’s also the difficult decisions that must be made to address climate change; it’s the need to seriously address the nation’s nearly suicidal dependence on foreign oil; and it’s myriad other issues that will all require hard choices and sacrifice.

 

Those expectations are probably low in the business community — as they normally are when the country shifts from a Republican to a Democratic administration. And similarly, those expectations are perhaps too low. I believe if this president will be true to one of his campaign promises, it is to govern in a way that puts partisanship on the sidelines. He has already proved that commitment by sending a strong signal to Senate Democrats that he does not wish to see retaliation against Senator Joe Lieberman (I-Connecticut) for his support not only of John McCain, but also Republican senatorial candidates in Minnesota, Maine, and Oregon. What Obama signaled with that position is that he is not going to put partisanship ahead of his plans to help America, even if partisans refuse his offers to join him.. He is looking at new alliances and will work with people who were not shy in their opposition to his election as he works as president. The mantra of “no permanent friends; no permanent enemies” is likely to be the Obama approach to working in Washington, DC.

 

We as a nation are facing an uncertain future. The environment is likely going to play a larger role in the lives of average Americans than it has since its heyday in the 1970s. Lisa Jackson has the monumental task of rallying an agency suffering from low morale, with precious few additional resources, to make decisions in perhaps the most hotly debated and controversial area of environmental law and policy ever. She will make recommendations and decisions that will have implications not only on the very future of the United States, but likely for the world as well. To the NGO community, the challenge is not to be disappointed as this president makes decisions that balance multiple important considerations and who will often decide that another consideration must trump the environmental choice. To the business community, the challenge is to be more optimistic and to show the initiative and courage necessary to work with this new administration and its traditional allies to solve the monumental problems facing the world.

EPA's Roll-Back of Bush-Era Rules Appears to Begin in Earnest

Posted on February 13, 2009 by Seth Jaffe

While a lot of attention has been paid to whether EPA would reverse the Bush EPA decision denying California’s petition to regulate greenhouse gas emissions from mobile sources,  it is now clear even outside the climate change arena that life at EPA is going to be substantially different under the current administration.  As if evidence were really needed for that proposition, EPA announced this week that it was putting on hold the NSR aggregation rule that EPA had promulgated on January 15, 2009.

The rule, which had been long sought by industry, would have provided that nominally separate projects would only have to be combined – aggregated for NSR/PSD purposes – if  they are “substantially related.” It also would have created a rebuttable presumption that projects more than three years apart are not substantially related. Responding to a request from NRDC and the OMB memo asking agencies to look closely at rules promulgated before the transition but not yet effective, EPA concluded that the rule raises “substantial questions of law and policy.” Therefore, EPA postponed the effective date of the rule until May 18, 2009 and also announced that it was formally reconsidering the rule in response to the NRDC petition.

To those in industry, the aggregation rule was not a radical anti-environmental roll-back of environmental protection standards.  Rather, it was more of a common-sense approach towards making the NSR program simpler and clearer.  It is one of my pet peeves with the prior administration, however, that it gave regulatory reform a bad name.  

In any case, I feel as though I should open a pool regarding what will be the next Bush-era rule to be tossed overboard.  We surely won’t have to wait long for it to happen.

An Update on AIG Environmental and the Current Environmental Insurance Market

Posted on January 6, 2009 by David Farer

Significant management changes announced this week by AIG Environmental, and further news in the wake of that announcement, may further impact the changing environmental insurance market. 

 

Joe Boren, longtime Chairman and CEO of AIG Environmental, and John O'Brien, President of the Company, have both resigned. On January 5, AIG Commercial Insurance issued a statement that Russ Johnston has been named President and CEO of AIG Environmental, and that Kim Hanna is now Executive VP and COO of the Company.

 

Over the past ten years, environmental insurance products have been utilized as a key component in many brownfield redevelopment projects and real estate transactions, and have become a common risk-reduction tool in the real estate and manufacturing sectors.

 

Most recently, the leading players in the environmental insurance market have been AIG Environmental, XL Environmental and Ace, with AIG most active in writing cost-cap and pollution legal liability ("PLL") policies for real estate transactions and brownfields projects. Zurich has also played an important role in the market, although historically the company has been particularly risk-adverse. Chubb has been writing PLL policies, but not cost-cap policies.

 

In recent months, however, Zurich has been indicating an enhanced interest in considering the underwriting of projects and transactions that they might previously have declined. Chubb has also expressed an interest in growing its PLL portfolio.

 

Additionally, in the aftermath of AIG's statement on the management changes, the Bermuda-based insurer Ironshore, Inc. announced on January 6 that Joe Boren and John O'Brien have joined a newly established Environmental Insurance division of Ironshore in New York City, with Boren as CEO and O'Brien as President.

 

The impact of AIG’s recent and highly publicized financial woes, and the ensuing reductions in the ratings of AIG's insurance companies, have generated a good deal of speculation about the future of AIG Environmental and whether the Company would maintain its aggressive underwriting of brownfields projects and real estate deals.

 

It is yet to be seen whether the financial problems of the parent company and   management-level changes at AIG Environmental are leading to an overall change in approach, but with XL and Ace still in the market, Zurich and Chubb expressing a greater interest in underwriting, and Ironshore opening a new environmental division with experienced management, there may be more options available to those seeking such policies, and greater competition on policy terms and pricing.

Supreme Court to Open its 2009 Term

Posted on October 2, 2008 by Theodore Garrett

As is its custom, the Supreme Court will open its 2009 Term next Monday, the first Monday in October. In anticipation of that event, the Court held its first conference of the Term this Monday, and yesterday issued orders from that conference. The court granted two certs of note.

Nos. 07-1601, Burlington Northern & Santa Fe Railway Co. v. United States and 07-1607, Shell Oil Co. v. United States, present the question of whether owners of land subject to environmental cleanup may be held jointly and severally liable under CERCLA.

No. 07-1410, United States v. Navajo Nation, involves the government's fiduciary responsibility to Indian tribes relating to mining rights on tribal land. In 2003, the Court held that there were no enforceable fiduciary duties under federal statutes relating to mineral leasing. But on remand, the Federal Circuit held that the government breached duties under the common law of trust and the Indian Tucker Act. The Supreme Court will consider whether its prior ruling foreclosed the court of appeals' decision, and if not, whether the court was correct to hold the government liable as a matter of law for $600 million to the tribes under those sources of law.