EPA Eliminates “But For” Causation From the Exceptional Events Rule: Tort Professors Everywhere Get Excited

Posted on September 21, 2016 by Seth Jaffe

On Monday, EPA promulgated amendments to its “Exceptional Events” Rule.  The rule is important, particularly in the Western states, and most particularly in connection with EPA’s latest iteration of the ozone NAAQS.  EPA’s most significant revision was to eliminate the requirement that state air agencies demonstrate that, “but for” the exceptional event, the state or relevant area would have complied with the applicable NAAQS.  The change is important for two reasons.  First, on the merits, EPA noted that:

"the “but for” criterion has often been interpreted as implying the need for a strict quantitative analysis to show a single value … of the estimated air quality impact from the event. As a result, some air agencies began using burdensome approaches to provide quantitative analyses in their exceptional events demonstrations to show that the event in question was a “but for” cause of a NAAQS exceedance or violation in the sense that without the event, the exceedance or violation would not have occurred. In many cases, the “but for” role of a single source or event is difficult to determine with certainty and it is more often the case that the impact of emissions from events and other sources cannot be separately quantified and distinguished."

I think that EPA got this exactly right.  As tort professors have always known, how a burden of proof is allocated is often outcome-determinative.

Which brings me to the second reason why the change is important – at least to me.  Just hearing the words “but for” causation triggers an uncontrollable wave of nostalgia.  In 1996, my client, New England Telephone, was keetenroberternesttnawarded summary judgment in a CERCLA contribution case.  It was then the first – and may still be the only – case in which a defendant who admittedly sent hazardous substances to a site was awarded summary judgment on the ground that its wastes had not caused the incurrence of any response costs.

I like to think that NET prevailed due to the fine lawyering of its counsel, but I have always known in my heart of hearts that the identity of the judge may have had something to do with the result.  The case was heard by Robert Keeton, distinguished judge, Harvard Law professor and – importantly – one of the authors of Prosser and Keeton on Torts.

At the summary judgment hearing, Judge Keeton did not want to hear from me, even though it was my motion.  He did not really even want to hear from the plaintiffs’ counsel.  Instead, he launched into an approximately 30-minute lecture on the role of causation in tort law, including, of course, a discussion of “but for” causation.  When he finished the discussion from Prosser and Keeton about the so-called “Minnesota fire cases”, Judge Keeton paused, looked up, smiled broadly, and said:  “I wrote that part.”

It was the best summary judgment argument I ever gave.  I never said a word.

A Lumber Mill Biomass CoGen Need Not Consider Other Fuels In Its BACT Analysis. Other Sources Should Be So Lucky.

Posted on September 8, 2016 by Seth Jaffe

Ever since EPA began considering how BACT analysis would be applied to greenhouse gas emissions, there has been concern that EPA would use its BACT authority to “redefine the source” – with the particular concern that BACT for a coal plant would now be to burn natural gas instead.  In Helping Hands Tools v. EPA, the 9th Circuit Court of Appeals this week gave some protection to biomass plants biomassfrom such redefinition of the source.  However, other types of facilities will get no comfort from the decision.

Helping Hands Tools involved a challenge to a PSD permit issued to Sierra Pacific for a cogeneration plant to be located at one of its existing lumber mills.  Under EPA’s BACT Guidance, Sierra Pacific stated that the purpose of the CoGen plant was to use wood waste from the mill and nearby facilities to generate electricity and heat. Relying in part on the 7th Circuit decision in Sierra Club v. EPA, which held that it would impermissibly redefine the source to require a mine-mouth coal generating plant to consider different fuels in its BACT analysis, the 9th Circuit found that EPA was reasonable in determining that, because a fundamental purpose of the CoGen plant was to burn wood waste, it would impermissibly redefine the source to require Sierra Pacific to consider solar power as part of its BACT analysis.

Importantly, the Court also rejected the plaintiffs’ request that Sierra Pacific consider greater use of natural gas.  The Court concluded that very limited use of natural gas for the purposes of startup, shutdown, and flame stabilization did not undermine the fundamental purpose to burn wood waste.  This is critical to source-located biomass facilities, because EPA’s GHG Permitting Guidance specifically says that greater use of an existing fuel should be considered in the BACT analysis:

"unless it can be demonstrated that such an option would disrupt the applicant’s basic business purpose for the proposed facility."

Unfortunately, the language of the decision appears to me to give EPA substantial leeway in future BACT analyses to redefine the source in other cases.  It seems to me that, building on the 7th Circuit decision, the Court has simply created an exception to potential source redefinition in circumstances where the location of the facility justifies a very narrow fuel selection.  If a coal plant intends to burn coal from the mine next door, ok.  If a lumber mill intends to burn its own wood waste, ok.  Otherwise, however, all bets are off.

What is particularly troubling was the Court’s acknowledgement that the GHG BACT guidance is vague, and its deference to EPA’s application of its own vague guidance. This is precisely the concern I noted when the Guidance was first issued.  Time will tell, but I foresee some fairly extreme BACT determinations being blessed by some very deferential courts.

Be Vewy, Vewy Quiet – EPA’s Noise Program Might Be Coming Back!

Posted on August 30, 2016 by Samuel I. Gutter

Many, many years ago, when I was a staff lawyer at EPA headquarters, my duties included advising the program that implemented and enforced the Noise Control Act of 1972.  My last involvement, though, was to help dismantle the program.  In one of the more curious footnotes to the deregulatory wave that swept EPA in the early years of the Reagan administration, EPA axed the program – sort of.  Leaving behind a regulatory ghost town, EPA revised its noise regulations to leave standing the bare structure of federally preemptive rules, while clearing the building of its regulatory and enforcement staff.  In effect, EPA took itself out of the picture, morphing the noise regulations into a self-certification program for manufacturers. 

And there, in 40 CFR Parts 201 through 211, the rules have resided (quietly) for the last 34 years – noise standards for rail equipment, trucks, and portable air compressors, as well as labeling requirements for hearing protectors.  (But not garbage trucks.  EPA promulgated final noise standards for those, but revoked the regulations on the eve of the DC Circuit argument in which EPA was to defend the rule.  Think about that next time you hear the hydraulics whining outside your bedroom window at 5:00 a.m.) 

Ah, but did the noise program really end?  As one of my EPA supervisors quipped at the time, the noise program is like a spider you’ve stepped on: you think it’s dead, but then its leg starts twitching.  Today’s twitch comes from the New York congressional delegation, specifically Congresswoman Grace Meng (D-NY), whose district lies in the flight path of LaGuardia Airport, and New York’s democratic senators, Chuck Schumer and Kirsten Gillibrand.  Together, they have introduced “The Quiet Communities Act of 2016.”  The bills (H.R.3384 and S.3197) would bring back EPA’s Office of Noise Abatement and Control.  The legislation focuses on aircraft noise (regulation of which has, since the early 1980s, rested solely in the hands of the FAA), and it’s fairly modest in scope, authorizing a program of studies and grants, not a return to command-and-control regulatory efforts.  However, both bills include a charge to EPA to “assess the effectiveness of the Noise Control Act of 1972” – kind of like checking on the Betamax hiding in your garage closet.

Let’s not get carried away by the imminent descent of the “cone of silence” over our nation, though:  www.govtrack.us gives the legislation a 2 percent chance of being enacted.  But hey, you never know.  All eyes on the spider!

A SEP in the Right Direction: The Path Toward Win-Win Scenarios

Posted on August 23, 2016 by Scott Fulton

One of the interesting questions that emerged in the strategic planning process for the Environmental Law Institute is whether ELI could offer more support in the development and/or administration of supplemental environmental projects, or “SEPs”. 

Having played a role in the birthing of the original SEP framework in the early 1990s while at EPA, and through my own experience as a practitioner, I am convinced that penalty mitigation through the performance of SEPs can come as close to a win-win as is possible in the enforcement context.  Rather than having penalties, payable as they are only to the U.S. Treasury, lose their site-specific identify and value, SEPs allow diversion of some of those resources to projects geared toward environmental or process improvements that not only achieve compliance, but also provide discrete and measurable environmental benefits. 

Development and implementation of a suitable SEP can at times be challenging.  For these reasons, companies sometimes opt in favor of paying a large penalty rather than a reduced penalty with a SEP.  Meanwhile, the government appears to be keener than ever about utilizing this tool.  EPA’s draft Environmental Justice Plan 2020 Action Agenda, for example, observes that “when these types of projects are feasible, they can play an important role in cases that raise environmental justice concerns. Thus, EPA is setting the goal of increasing the number of SEPs and mitigation projects affecting overburdened communities.” 

So here’s the thought.  Perhaps to lighten the SEP load for defendants and government alike, an entity like ELI could help in the conceptualization and, in appropriate cases, the administration of SEPs.  As it happens, ELI already has experience in this area.  For example, in the context of settlement negotiations between a state environmental regulatory agency and a defendant (I’ll not disclose identities here), ELI was brought in to help shape and then implement a SEP to develop a training module on the regulations at issue in the case.  Under the SEP, in addition to developing the training materials, ELI is to deliver at least two in-person classes to targeted audiences comprised of manufacturers and/or consumers, and to make these informational briefings more broadly available online (via, e.g., webinars, and audio-video recordings suitable for posting, including on the ELI website).

And this SEP is not a one-off.  As a research and education institute, a convener experienced in community outreach and engagement, and a non-partisan presence having affinities with both regulators and the business community, ELI is well-suited to work with companies and their representatives to craft and execute approvable SEPs.  These range from education of stakeholders about regulatory requirements and measures that go beyond compliance; to research, analysis, and publication of information on best practices for compliance and beyond; to monitoring and evaluating the success of on-the-ground SEPs undertaken by other organizations.  Also, it probably goes without saying, but because we’re a non-profit, we can and must do our work on a cost-basis.  In other words, we’re cheap. 

Just a thought to tuck away for the next time a SEP enters your or your client’s equation.

EPA’s Mighty Power

Posted on August 5, 2016 by Eric Fjelstad

In Mingo Logan Coal Company v. EPA, the D.C. Circuit recently upheld EPA’s use of its “veto” authority over an Army Corps of Engineers permit to fill jurisdictional waters for the Spruce Mine in West Virginia.  Section 404(c) of the Clean Water Act provides EPA authority to “deny or restrict the use of any defined area for specification (including the withdrawal of specification).”  This authority was described by the court in Mingo Logan as “a mighty power and its exercise will perhaps inevitably leave a permittee feeling as if the rug has been pulled out from under it.” 

The salient facts in Mingo Logan involved a Section 404 permit for a “mountaintop removal” coal mine.  After a 7-year EIS, the Corps issued the permit in 2006.  EPA expressed reservations with the permit, but communicated to the Corps that it “had no intention of taking [its] Spruce Mine concerns any further from a Section 404 standpoint.”  But times change – and so do administrations – and in 2009 EPA asked the Corps to suspend, revoke, or modify the permit.  After the Corps refused to do so, EPA began the 404(c) process, which led to a final decision in January 2011 to withdraw the specification for two (of three) disposal sites covered under the permit. 

On appeal, Mingo Logan argued that EPA did not consider the company’s sunk reliance costs (a point EPA conceded).  Even though 404(c) does not explicitly denote costs as a factor in EPA’s decision-making, the court stated that an agency “should generally weigh the costs of its action against its benefits.”  Unfortunately for Mingo Logan, the court found that the company had not appropriately raised the issue of reliance costs before EPA or the district court. 

The Mingo Logan decision is a bitter pill for developers, interjecting an additional element of uncertainty into a Section 404 regulatory process that is already challenging and subject to shifting political winds.  As noted at this site, the agencies and courts have struggled with the jurisdictional reach of Section 404 and when a party can challenge the government’s actions.  Key take-aways from Mingo Logan include:

First, 404(c) battles are not for the faint of heart.  EPA has successfully used the authority twelve times since the passage of the CWA.  Every attempt to stop EPA through litigation has ultimately failed. 

Second, Mingo Logan clarifies that a Section 404 permit can be withdrawn years after its issuance.  The decision will serve to undermine confidence in the integrity of the permitting process in the United States. 

Last, Mingo Logan highlights the inherent problems of shared EPA/Corps responsibility.  Defenders of 404(c) will note that this “mighty authority” is rarely used.  Although true, it misses the point that the effects of 404(c) are, in fact, regularly felt by the regulated community.  The ability to say “no” gives EPA significant leverage – behind the scenes -- in the permitting process. 

Query whether we would have a better, and more effective, Section 404 permitting process if all of the authority and responsibility for permitting were vested in a single agency – either the Corps or EPA.

Taking Colin to the Limit One More Time

Posted on August 4, 2016 by Andrea Field

This post started as a piece about a recent Fifth Circuit decision:  Texas v. EPA. In that case, the state of Texas (and others) challenge EPA’s disapproval of Texas’s (and Oklahoma’s) plans for controlling regional haze and EPA’s decision to impose its own haze-control program instead.  To make my drafting process more entertaining (and the task of posting more challenging for our official poster, Colin Gipson-Tansil), I set a goal for myself:  to include within my post at least 25 valid links to others’ posts during the past year.  Fortunately for me, there is almost nothing in Texas v. EPA that doesn’t link to one or more recent posts. 

Jurisdiction and Venue.  Many of the past year’s posts point out problems caused by the failure of the Clean Water Act to state unambiguously which federal court has jurisdiction to hear a specific challenge to an EPA action under that statute. Stoll’s 9/2/2015 post, Glick’s 10/9/2015 post, Horder’s 11/3/2015 post, Perdue’s 2/5/2016 post, and Uram’s 4/5/2016 post.  Texas v. EPA demonstrates that choice-of-court problems also exist under the Clean Air Act’s judicial review provision, §307(b)(1).

Clean Air Act §307(b)(1) – said the Fifth Circuit – is a two-fold provision:  first, it confers jurisdiction on the courts of appeals, and then it delineates whether the appropriate venue for challenges will be the regional circuits (if the challenged action is locally or regionally applicable) or the D.C. Circuit (if the action is nationally applicable).  Believing EPA’s disapproval of its regional haze program to be locally or regionally applicable, Texas filed its challenge in the Fifth Circuit.  EPA moved to dismiss or transfer the case to the D.C. Circuit based on a separate, not-as-well-known prong of §307(b)(1), which directs that a petition for review of what seems like a non-national action may be filed only in the D.C. Circuit if the action is “based on a determination of nationwide scope or effect and if in taking such action [EPA] finds and publishes that such action is based on such a determination.”  After an exhaustive de novo evaluation of that portion of §307(b)(1), the Fifth Circuit determined that because the challenged EPA actions are locally or regionally applicable and because they are not based on any determinations that have nationwide scope or effect, the Fifth Circuit is the appropriate court to hear the case.

But wait.  There are other link-worthy aspects of Texas v. EPA, including the following.

Explanations of Decisions to Stay Challenged Actions.  During the past year, posts have discussed whether and how much a court needs to explain the basis on which it stays a challenged rule pending completion of litigation concerning that rule’s validity. Jaffe’s 2/10/2016 post, Gerrard’s 2/10/2016 post.  If it is a lengthy explanation you seek for when and why a court should stay an EPA action pending completion of litigation, the Fifth Circuit provides that in Texas v. EPA.

Deference.  Other recent posts have addressed when deference to an agency interpretation is – or is not – appropriate. Kovar (12/10/2015); Percival (1/27/2016); Field (2/11/2016); Haynes (2/19/2016); May (6/9/2016); Civins (7/5/2016); Jaffe (8/2/2016).  In Texas, the Fifth Circuit put clear limits on deference, holding that the level of deference owed to an agency’s conclusions is “substantially diminished when the subject matter in question lies beyond the agency’s expertise.”  Thus, while the Fifth Circuit was prepared to defer substantially to EPA’s views on environmental science, it declined to defer to EPA’s views on whether its actions would impair the reliability of the electricity grid.  Since “EPA has no expertise on grid reliability” (that is FERC’s domain), the “deference owed to EPA’s assertions about grid reliability [is] diminished and the agency must support its arguments more thoroughly than in those areas in which it has considerable expertise and knowledge.” 

That limitation on deference could have an impact on the most talked-about case by ACOEL members this past year:  West Virginia v. EPA, in which more than two dozen states and many other parties challenge EPA’s Clean Power Plan. Jaffe’s 9/10/2015 post, Gerrard’s 2/10/2016 postJaffe’s 10/23/2015 post, Jaffe’s 12/9/2015 post, Percival’s 12/16/2015 post, Stoll’s 12/21/2015 post, Perdue’s 2/5/2016 post, Jaffe’s 2/10/2016 post, Field’s 2/11/2016 postSession’s 2/17/2016 post, and Freeman’s 3/2/2016 post. The Fifth Circuit’s limit on deference is the basis of a recent Federal Rules of Appellate Procedure 28(j) letter sent to the D.C. Circuit by the petitioning states in West Virginia.   According to those states, the Fifth Circuit’s decision in Texas v. EPA supports, among other things, the petitioning states’ argument that EPA has failed to show that the Clean Power Plan will not detrimentally affect grid reliability. 

Perhaps the link in which I take the most pride, though, is this last link – to Seth Jaffe’s October 2, 2015 Brief Rant on Cost-Effectiveness Analysis.  In that post, Seth argues that if the purpose of a rule is to improve visibility, EPA should use a measurement of visibility – a deciview (dv) – to assess visibility improvement. Well, in Texas v. EPA, the Fifth Circuit seemed to be heading in the direction of agreeing that in considering the cost of a regional haze program, EPA should use the $/dv metric.  Alas, at the last minute, the court pulled back on a complete endorsement of the $/dv metric:  because the petitioners had a “strong likelihood of establishing other flaws” in EPA’s actions, the court said it did not need to decide whether  EPA “fell short of its obligation to consider the costs of its regulations” by failing to use $/dv metrics.  So, Seth may have to wait a while longer before seeing a court mandate for EPA’s use of $/dv metrics to evaluate visibility improvements.  I, however, achieved my goal of including a record number of links in this post.  

Does It Matter That Air Quality Is Improving?

Posted on August 3, 2016 by David Flannery

The Environmental Protection Agency is expected to announce its final Cross State Air Pollution Rule (CSAPR) update by the end of summer 2016.  But does the update account for the fact that several new regulatory programs that could significantly improve downwind air quality?

In his posts of August 3, 2015 and April 30, 2014, ACOEL Fellow Paul Seals likened the voyage of the interstate transport of air pollutants to “Homer’s Odyssey”.  He promised us all that the D.C. Circuit decision of June 24, 2015, in the case of EME Homer City Generation, L.P., v. EPA, concerning the CSAPR would not end the voyage of interstate transport – and indeed it has not. 

Critical to the development of a rule to address the interstate transport of air pollutants is that the rule not call for emission reductions that are more than necessary to achieve attainment in every downwind state.  EPA’s 2017 deadline for attaining the 2008 ozone National Ambient Air Quality Standard (NAAQS) invites the question of what the ozone air quality is likely to be in 2017.  EPA’s proposed CSAPR Update identified only 4 monitors in the East that it predicted to be in non-attainment with the 2008 ozone NAAQS in 2017. 

EPA’s prediction of 2017 air quality, however, did not take into account several new regulatory programs that are either on-the-books or on-the-way. These programs are certain to continue to improve ozone air quality in the East.  Among the more significant of these programs are:  

-          Pennsylvania Reasonably Available Control Technology (RACT) II

-          Ozone Transport Commission Model Rules

-          Connecticut RACT

-          New York High Energy Demand Day (HEDD) controls; and

-          Connecticut High Energy Demand Day (HEDD) controls

To illustrate the significance of this point, Alpine Geophysics modeled the impact of only a portion of the Pennsylvania RACT II program on ozone concentrations at the nonattainment monitors downwind of Pennsylvania identified by in the CSAPR proposal.  The following results from the Alpine Geophysics report illustrate that even one of these new programs is likely to significantly improve ozone air quality at the critical monitors in the East:

EPA Nonattainment Monitors

Ozone Improvement needed (ppb)

Ozone Improvement Achieved By PA RACT Alone

Connecticut Fairfield (90013007) 1.2 83%
Connecticut Fairfield (90019003) 2.1 48%
Connecticut New Havens (90019003) 1.3 54%

Such improvement - related to only one of the unaddressed programs - raises the question about whether all of the EPA identified nonattainment monitors will, in fact, be in attainment with the 2008 ozone NAAQS when these on-the-books and on-the-way programs are implemented in 2017, even without the CSAPR update. 

The answer to this question, and to the merit of any new transport rule, lies with additional air quality modeling of these programs.  When EPA announces its final rule on the CSAPR update by the end of summer, we will see whether the agency has taken account of these additional programs and see the future direction of this on-going odyssey.  

Chevron Deference Lives! EPA’s Boiler Rule (Mostly) Survives Review

Posted on August 2, 2016 by Seth Jaffe

On Friday, the D.C. Circuit largely upheld EPA’s Boiler MACT rule. boiler-mactThe industry challenges were a complete washout.  The environmental petitioners won one significant victory and a number of smaller ones.

The environmental petitioners’ one significant victory is important.  EPA included within relevant subcategories any source that burns a fuel containing at least 10% of the “subcategory-defining fuel.”  However, for defining MACT, EPA included only those sources that burn fuel containing at 90% of the subcategory-defining fuel for existing sources, and 100% for new sources.  The Court rejected this approach.

"The CAA, however, demands that source subcategories take the bitter with the sweet. Section 7412 mandates, without ambiguity, that the EPA set the MACT floor at the level achieved by the best performing source, or the average of the best performing sources, in a subcategory. It thus follows that if the EPA includes a source in a subcategory, it must take into account that source’s emissions levels in setting the MACT floor."

Which brings me to my big take-away from this decision.  Chevron lives.  By my count, The Court cited Chevron 30 times.  Chevron pervades the decision.  Even in the one big issue that EPA lost, the Court’s decision was based not on a rejection of EPA’s interpretation of an ambiguous provision under step 2 of Chevron, but on a plain meaning interpretation of § 112.  EPA defined what a source is, but it then refused to calculate MACT based upon the performance of all of the sources in a given subcategory.  The statute simply did not allow EPA that leeway.

Other than EPA’s attempt to avoid taking “the bitter with the sweet”, however, the Court’s deference – by three Republican appointees – to EPA’s technical decisions was notable.  Not every case is the Clean Power Plan.  Where EPA is not really pushing the boundaries, I don’t see the Supreme Court weakening Chevron any time soon.

D.C. Circuit: Save Us Sinners Who Fail to Object When There Is Nothing to Object To!

Posted on June 7, 2016 by Richard G. Stoll

Clean Power Plan (CPP) groupies are beside themselves over the D.C. Circuit’s surprise “straight-to-en banc” move for CPP judicial review.  The buzz is mostly over the survivability of the CPP’s interpretations of Clean Air Act (CAA) §111(d) in light of the nine judges’ dispositions.

I won’t weigh in on that issue here.  My target is another issue, one that has been lurking in the background and has bugged me greatly for the last couple of years.  Now that the issue is before an en banc panel, I am fervently hoping the Court will do what only en banc panels can do:  declare that a few recent D.C. Circuit rulings are wrong.

The issue involves garden variety adlaw:  should the CPP be vacated because EPA failed to propose or adequately foreshadow key elements of the final rule?  Parties attacking the CPP have advanced this argument, and EPA has defended on numerous grounds that its notice was adequate. 

I won’t opine here on whether EPA’s notice was adequate.  My beef is with EPA’s fall-back defense:  EPA’s argument that even if there were wholly insufficient notice of the CPP’s final provisions, the Court has no authority to vacate the CPP on those grounds. 

EPA’s theory is that since CAA §307(d)(7)(B) provides that only an issue raised in public comments can be raised on judicial review, a final rule that was never proposed cannot be challenged on judicial review because there were no public comments on that provision.  Yep, read on.

EPA argues that parties claiming a final rule was never proposed must instead file administrative petitions for review under CAA §307(d)(7)(B) and wait (usually for a few years, if ever) for EPA to act on those petitions.  In the meantime, under EPA’s position, regulatory provisions that were never proposed or foreshadowed must go into full force and effect.

This means that EPA can get away with murder, at least in the adlaw context.  Just forget the bedrock principle that an agency can impose and enforce only those rules that have first been proposed.  Under EPA’s position, the bedrock is blown away by a Richter 8.8 otherwise known as CAA §307(d)(7)(B). 

In the last two years, EPA has managed to convince D.C. Circuit panels to accede to this unfair and baseless approach.  See my 2015 ACOEL post discussing these opinions.  In a piece I published in Bloomberg BNA in 2014, I showed how the D.C. Circuit had never previously interpreted CAA §307(d)(7)(B) in this fashion , and had on many occasions vacated final rule provisions that had never been proposed. 

As explained in the above-cited pieces, the absurdity of EPA’s position is that final rules will go into full force and effect against parties because they failed to object to something they could not object to.  This just can’t be right.  The en banc CPP panel should do the right thing and declare the three most recent decisions to be wrong.

[Mr. Stoll is not representing any party in the pending D.C. Circuit CPP judicial review proceedings.]

Roger Goodell and EPA Administrative Orders

Posted on May 4, 2016 by George von Stamwitz

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

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

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

EPA Gets the Black Flag on Clean Air Act Racing Exemption

Posted on April 28, 2016 by Samuel I. Gutter

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

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

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

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

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

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

Dispute Resolution for CERCLA Sediment Investigations

Posted on February 22, 2016 by Mark W. Schneider

In my last blog entry, I advocated for the amendment of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) to eliminate the bar on pre-enforcement review as one step toward improving the investigation and cleanup of sediment sites.  In this entry, I propose that the U.S. Environmental Protection Agency (EPA) and potentially responsible parties (PRPs) significantly revise the dispute resolution process for EPA Administrative Settlement Agreements and Orders on Consent (“ASAOCs”) to require the resolution of disputes by neutral third parties unaffiliated with EPA or an affected PRP. 

The goal of sediment remediation is to protect public health and the environment through prompt and cost-effective remedial action.  Unfortunately, this goal has not been met at many sediment sites.  At some sites, neither the public nor the PRPs have been served by investigations that have unnecessarily taken decades and wastefed hundreds of millions of dollars to undertake.  EPA’s selection of remedies at many sites has been delayed and has not resulted in the selection of protective and cost-effective remedies.

Most sediment cleanups are performed in accordance with consent decrees, which appropriately vest dispute resolution authority in federal district court judges.  In contrast, most sediment investigations are conducted under ASAOCs, which vest dispute resolution authority in EPA personnel.  While many at EPA with responsibility for dispute resolution have the best of intentions and seek to be objective, the fact that they work for EPA, often supervise the EPA staff who made the decision leading to the dispute, and are often steeped in EPA practices renders most of them unable to serve in a truly independent role.  To ensure fairer dispute resolution, ASAOCs should instead vest dispute resolution authority in neutral third parties with no affiliation with either EPA or the PRPs subject to the ASAOC.  This would require the amendment of existing ASAOCs and the insertion of new dispute resolution language, which differs from EPA’s model language, in ASAOCs that have not yet been signed. 

Additionally, while the dispute resolution official should be deferential to EPA, he or she should not rubber-stamp agency decisions, as currently is often the case.  Where investigations have been mired in years of inaction, an independent dispute resolver with a fresh perspective may determine that EPA has sufficient data to make informed cleanup decisions and could compel agency action.  At other sites where EPA is requiring PRPs to prepare feasibility studies advocating for remedies that almost certainly will fail, it is essential that a neutral decision-maker act independently to ensure that feasible remedies are selected.

EPA will resist any effort to revise its approach to dispute resolution, and it may require the intervention of elected officials or others to compel such a change. The public, EPA, and affected PRPs would all benefit from it. 

Revisiting CERCLA Pre-Enforcement Review

Posted on February 22, 2016 by Mark W. Schneider

As a private practitioner and former trial attorney at the U.S. Department of Justice, I have advocated for timely and cost-effective cleanups that protect public health and the environment.  Unfortunately, only a minority of cleanups under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) have met these criteria.  Of the many impediments to the thorough, prompt and cost-effective remediation of contaminated sites, and sediment sites in particular, one of the most significant is CERCLA’s bar on pre-enforcement review of the U.S. Environmental Protection Agency’s (EPA) remedial decisions.  To promote more effective and timely cleanups of sediment sites, I suggest that CERCLA be amended to eliminate the current bar on pre-enforcement review.  By allowing potentially responsible parties (PRPs) to seek and obtain judicial review of EPA decisions or failures to make decisions, more progress would likely be made on more sites.

CERCLA Section 113(h) states that, with limited exceptions, “No Federal court shall have jurisdiction … to review any challenges to removal or remedial action selected under section 9604 of this title, or to review any order issued under section 9606(a) of this title ….”  42 U.S.C. § 9613(h).  Despite many challenges, courts have generally upheld the validity of this provision.  As a result, PRPs typically cannot challenge EPA's decisions unless EPA has sought to compel performance under an enforcement order or if EPA is acting under a consent decree.  As the “opportunity” for challenge may not come until years after EPA has made its cleanup decision, most PRPs are not willing to face the risk of losing a remedy challenge and the potential imposition of treble damages.  

CERCLA should be amended to allow parties to challenge agency action or inaction at other times in the process, such as during the preparation of remedial investigations and feasibility studies.  At many sediment sites, EPA has delayed remediation and required parties to incur hundreds of millions of dollars during investigations.  If PRPs had the opportunity to obtain judicial review of agency action and inaction earlier in the process, they could seek to compel the agency to act in a way that is consistent with CERCLA’s requirements.

Having worked at the Department of Justice when CERCLA Section 113(h) was drafted, I recall my colleagues stating at the time that a bar on pre-enforcement review was necessary to avoid the challenges of having a non-expert federal judge address complex scientific questions and to prevent PRPs from tying up EPA in litigation.  I offer three suggestions in response to these concerns.  First, if a federal judge were confronted with a particularly complex issue, the court could appoint a special master to handle the proceedings.  Second, to encourage PRPs to seek prompt resolutions, a CERCLA amendment could require PRPs to fully comply with an agency’s directives pending resolution of the judicial dispute and impose a penalty on those parties whose challenge of agency action was unsuccessful.  Third, agencies could seek an expedited hearing of disputed issues.

While it is very unlikely that Congress would consider a CERCLA amendment to address only this issue, PRPs should raise this issue the next time amendments are being considered.  It will succeed only through the concerted efforts of advocates who seek more and better cleanups and those who seek prompt and reasonable government decision-making.   

Courts Narrow Citizen Suit Potential

Posted on February 18, 2016 by Donald Shandy

Citizen suits under federal environmental laws have been under fire through criticism of “sue and settle” where agencies, in particular the U.S. EPA, have been accused of intentionally relinquishing statutory discretion for the sake of settling lawsuits without participation by affected third parties.  From this perspective, the scope of citizen suits has broadened.  However, two recent federal circuit court opinions curb this growth. 

On January 6, 2016, the Third Circuit and Sixth Circuit Courts of Appeals issued opinions that underscore certain limitations in the citizen suit provisions.  The Third Circuit examined a Clean Air Act citizen suit in Group Against Smog and Pollution, Inc. v. Shenango Inc. (No. 15-2041) (GASP). The Sixth Circuit examined a Clean Water Act citizen suit in Askins v. Ohio Dept. of Agriculture, Ohio Envtl. Prot. Agency, U.S. EPA (No. 15-3147). Both courts affirmed dismissal of the citizen suits by the district courts based on statutory limitations Congress placed in each statute.

These two cases highlight a couple of important components of citizen suits.  First, citizen suits are to serve as a backup to the non-discretionary functions and enforcement responsibilities of the States and the EPA.  As the U.S. Supreme Court has said, “the citizen suit is meant to supplement rather than to supplant governmental action.”  The Sixth Circuit stated, “Paradoxically, [Plaintiffs’] expansive reading of the citizen-suit provision would grant citizen greater enforcement authority than the U.S. EPA. . . . Congress did not intend to give citizens greater and faster enforcement authority against a state than the U.S. EPA.” 

The other important component highlighted is the role of the “diligent prosecution bar” against citizen suits.  Citizen suits are prohibited if the EPA or State agency “has commenced and is diligently prosecuting” the matter.  While most courts seem willing to restrict citizen suits when there is clear prosecution (civil or criminal) in a state or federal court, the answer is less clear when there is no active or concluded matter at the courthouse or the enforcement action is only administrative. In GASP, the Third Circuit slightly tilted the bar in favor of the agency and regulated entity by concluding that if the agency has diligently prosecuted a suit, the presence of a final judgment, consent decree, or consent order and agreement would likely prevent a citizen suit challenge.  This is logical given that environmental enforcement proceedings that are filed in court often, if not always, result in a judicially enforceable consent decree or consent order and agreement in which the regulated entity must fulfill specified obligations or be subject to stipulated penalties. It also provides certainty to the agreement reached between the agency and the regulated entity, which benefits all involved. 

While these recent decisions were not momentous court opinions, the Third and Sixth Circuits did provide a bit more clarity to the role citizen and how our environmental laws are enforced.  In this arena, I think we all would agree that a little clarity can go a long way.

The Supreme Court Doesn’t Think Much of Paris in the Springtime

Posted on February 17, 2016 by William Session

            For us gray hairs, the phrase used to be “Dateline”, now it’s “Tweetline” . . .  Flash!. . . President Obama @POTUS “. . . Addressing climate change takes all of us, especially the private sector going all-in on clean energy worldwide."

            Apparently “all of us” didn’t include five Supreme Court Justices, led by its Chief Justice, John Roberts.  Indeed, it was SCOTUS going “all out” for climate change.  As in, going “all out” to frustrate one of the EPA’s and President Obama’s signature efforts to respond to and act upon climate change challenges to the global environment. What EPA and the President got (by a split decision) instead was a stay that some have characterized as the quashing of the biggest environmental regulatory change in United States history. 

            That body blow to regulatory appropriation of the climate change debate was instigated by the challenge of virtually every major coal power company to the EPA’s issuance of binding emission reduction requirements for existing domestic power plants.  The coal, fired power industry argued that EPA’s action was “draconian” and would cause the “shutting down or curtailing generation from existing plants and shifting that generation to new sources”.  That, of course, was the precise intent of POTUS and other signatories of the Paris climate change accord last year.

            SCOTUS’s stay was unprecedented and terse.  Not a word of explanation about why the stay was issued.  The proponents of the stay were modestly baffled.  In the words of Basin Power’s legislative rep, Dale Niezwaag, the decision came as a surprise . . . "The supreme court has never issued a stay on a rule that hasn't been ruled on by a lower court.  So this is precedent, setting from our point.  When we put it in, we figured it was going to be a long shot, so we were very surprised that the Supreme Court ruled in our favor”. 

            There are takeaways galore.  However, two are most intriguing to me.  Was this unprecedented stay an unwarranted and thinly disguised, reach into the realm of executive branch constitutional authority?  Second, did the Supreme Court simply muscle its way into a social and scientific debate that begs any legal or factual question of “irreparable harm” to either the power industry or the citizenry of the republic.  In short, was the stay an expression of SCOTUS climate change denial?

The stay makes EPA’s rules unenforceable and will undoubtedly limit their intended goal of achieving emissions cuts to (ostensibly) slow global warming.  More importantly, the ruling, in effect, invalidated POTUS’s pledge on climate agreement made in Paris last spring.  How should one construe the interjection of the Supreme Court into a case that would have, under normal circumstances, been taken up by the Court of Appeals for the District of Columbia Circuit as soon as early 2017?  Was a signal being sent to that court to heed the antipathy some believe certain SCOTUS justices have towards the global warming debate altogether? 

            In keeping with my “newsflash” metaphor, since I started writing this post, the country mourns the unexpected passing of Justice Antonin Scalia.  The lack of a tie breaker justice for the foreseeable future could throw the question of the right of the EPA to forge ahead on the POTUS’s climate change agenda into months or years of limbo.  Will the D.C. Circuit’s decision answer the question next spring?  Will certain senators relent and vote in a replacement for Justice Scalia this year?  Will the eight remaining justices do something other than call things a tie until they have a full complement on the bench? 

            Stay tuned to this blogspot for more breaking news.

Supreme Court Puts Clean Power Plan on Hold, but Clean Agriculture Can Move Forward

Posted on February 12, 2016 by Peter Lehner

The Supreme Court's unexplained stay of the clean power plan was "one of the most environmentally harmful judicial actions of all time," writes Michael Gerrard of Columbia Law School in a recent, excellent blog. Rather than venting outrage, Gerrard quickly moves on to explain that the Clean Power Plan isn’t the only way to cut carbon pollution.

Ramping up efforts like fuel efficiency standards for cars and trucks, and building efficiency standards, he notes, will also help reduce carbon pollution. Gerrard mentions a couple of points about agriculture, but often, this sector is overlooked when it comes to climate solutions. It’s worth taking a closer look at some of the opportunities to reduce climate pollution from our food system.

Food waste is the second largest component of most landfills. As it rots, it releases methane, a potent greenhouse gas. A recent report by the UN Conference on Trade and Development estimates that 2 percent to 4 percent of all manmade climate pollution arises simply from food rotting in landfills.

Keeping food waste out of landfills can help reduce methane pollution. Massachusetts, California, Connecticut, Rhode Island, Vermont, and some cities have enacted laws to manage organic waste disposal in landfills. The idea is to create incentives to reduce food waste and divert it to other purposes, such as animal feed or composting. Instead of being thrown away and becoming a source of pollution, this “waste” can be put to good use. Landfill gas collection systems can be further incentivized. And the nascent effort to reduce food waste from businesses and households can be significantly ramped up.

Another major source of greenhouse gases is the over application of fertilizer. Excess nitrogen fertilizer causes two big problems. The first is water pollution. Nitrogen that isn’t taken up by crops runs off farms and enters larger waterways, where it stimulates the growth of algae and creates “dead zones” deprived of oxygen. The second, and less frequently discussed issue, is the volatilization of nitrogen into nitrous oxide, a greenhouse gas about 300 times more potent than CO2.  The IPCC estimates that 12 percent of all non-CO2 greenhouse gas emissions come from synthetic fertilizer application.  

A number of techniques can reduce these emissions while also providing a cost benefit to farmers. Farm policies could encourage practices like cover cropping, which reduces the need for fertilizer by making soils more rich and fertile. Crop rotations can do the same, yet current crop insurance programs actually discourage the use of these practices. Precision application technologies for fertilizers are getting ever better, but their uptake on farms is slow.

Manure from animals, and the "enteric emissions" from cattle (more commonly thought of as belching) are two more significant sources of climate pollution. Enteric fermentation alone may account for as much as 40 percent of all non-CO2 greenhouse gas emissions, according to the IPCC. Changes in diet might help with these emissions, but this is an area that needs more research.

Some of the emissions from manure can be captured if manure lagoons were covered and better managed. As it stands, these pits are only slightly regulated and are major sources of water pollution sources as well as odor nuisances. An even better practice is to raise cows on rotating pastures, where their waste can enhance soils and help store carbon. And, of course, if Americans did shift to a diet lower in red meat, as per the recommendation of the Dietary Guidelines Advisory Committee, we could further reduce climate pollution from cattle.

Agriculture is one of our nation's most important economic sectors, and is especially vulnerable to the extreme weather impacts of climate change. Its product -- food -- is critical not only for our economy, but is an integral and uniquely personal part of our everyday lives. When we think about how to address climate change, it makes sense to think about food and agriculture. The food we choose to produce, and how we produce it, use it, and dispose of it, all have an impact on climate pollution—and therefore have the potential to become climate solutions. 

Unprecedented Program Leads To Unprecedented Response

Posted on February 11, 2016 by Andrea Field

I am a terrible predictor of what cases the Supreme Court will hear and what the Court will decide on those matters it chooses to hear.  For example, I wrongly predicted that the Supreme Court would never consider reviewing the D.C. Circuit’s decisions in cases involving other recent EPA regulations, but the Supreme Court chose to hear those cases, which led to its decisions in Utility Air Regulatory Group v. EPA and Michigan v. EPAAnd if asked to guess whether the Court would issue a stay of EPA’s Clean Power Plan under section 111(d) of the Clean Air Act, I might well have said that the odds were greatly against that happening – despite the merits of the arguments being raised by those seeking the stay. 

Perhaps, though, my poor predictive abilities are the result of my looking at each case in isolation instead of looking at them in combination and considering whether the Supreme Court’s February 9, 2016 stay decision is an outgrowth of the combined knowledge gained by the Court in its recent reviews of those other Clean Air Act cases.  Specifically, as pointed out by State Petitioners in their briefs in support of a stay of the Clean Power Plan (see here and here,) EPA has touted its Plan as being one that will completely transform the way energy is created and delivered in this country even though – argued State Petitioners – the plain statutory language (of Clean Air Act section 111(d)) does not authorize such Agency action, and the approach of the Clean Power Plan is at odds with EPA’s 45-year history of implementing section 111(d).  Maybe such claims struck a chord with the Court, which – in UARG – told EPA that the Agency cannot make “decisions of vast ‘economic and political significance’” under a long-extant statute, like the Clean Air Act, without “clear congressional authorization.” 

And then there was Michigan, where the Court determined that EPA had proceeded unlawfully in adopting another extensive and expensive Clean Air Act regulatory program.  State Petitioners in the Clean Power Plan litigation made sure that the Court was aware that by the time the Court issued its decision in Michigan – a case where the underlying rule was not stayed during the pendency of litigation – the affected parties had spent billions of dollars to meet the terms of the underlying, un-stayed rule.  In other words, justice delayed in Michigan was justice denied.

None of this is to say what the Court will or will not do if and when it reviews arguments on the lawfulness of the Clean Power Plan.  I make no predictions on that.  But I believe the Court acted appropriately in calling for the completion of litigation before requiring affected parties to make the massive, unprecedented, costly, and transformative changes to the energy industry that the Clean Power Plan demands.       

EPA and DOJ Cannot Sugarcoat This: SCOTUS Stays the Clean Power Plan

Posted on February 10, 2016 by Seth Jaffe

Yesterday, the Supreme Court stayed EPA’s Clean Power Plan rule.  No matter how much EPA and DOJ proclaim that this says nothing about the ultimate results on the merits, the CPP is on very shaky ground at this point.

Everyone, supporters and opponents alike (and yours truly), thought that there was no possibility that the Court would grant a stay. And it is precisely because a Supreme Court stay of a rule pending judicial review is such an “extraordinary” – to use DOJ’s own word – form of relief that one has to conclude that five justices have decided that the rule must go.

This isn’t just a preliminary injunction; it’s a preliminary injunction on steroids.  First, everyone seems to acknowledge that it’s unprecedented for the Supreme Court to stay a rule pending judicial review.  Second, the standards in DOJ’s own brief make pretty clear that a stay will only issue if the Court is pretty convinced on the merits.  Finally, it’s worth noting that the Court implied that it does not even trust the Court of Appeals, because the stay will remain in force, even if the D.C. Circuit affirms the rule.  The stay will only terminate either:  (1) if the Court of Appeals upholds the CPP and the Supreme Court denies certiorari or (2) if the order is upheld and the Supreme Court also upholds it.

Back to the drawing board for EPA.  Perhaps § 115 of the Clean Air provides a way out!

"We All Let the Citizens of Flint Down"

Posted on February 4, 2016 by Alexandra Dapolito Dunn

With busloads of concerned citizens from Flint and nearby cities gathered around the Rayburn House Office Building on February 3, environmental regulators and science experts appeared before the U.S. House Committee on Oversight and Government Reform (Committee) to give testimony regarding lead contamination in Flint, Michigan’s public drinking water.  As detailed in this recent NPR podcast, well worth the 40 minute listen, between 6,000 and 12,000 children are estimated to have elevated blood lead levels following the City’s drinking water source change from Detroit water to water from the Flint River in 2014. 

How could a crisis like this have happened? While at first water policy groups were quick to highlight the nation’s aging water infrastructure and investment gap – EPA’s most recent estimate is that $384 billion is needed to assure safe drinking water from 2013 to 2030 – and certainly lead pipes to homes in older communities is a costly replacement problem – at the root of Flint was classic government dysfunction combined with assessments of safety that make sense to regulators but perhaps not to everyday people. At the hearing Joel Beauvais, acting Assistant Administrator for the U.S. Environmental Protection Agency’s Office of Water faced questions from Committee members about the Agency’s delayed response to the situation, while the Michigan Department of Environmental Quality’s acting Director Keith Creagh was to explain why state officials did not act to address contamination immediately. Both officials attributed the crisis to breakdown in communication between the agencies that inhibited officials’ swift action. What happened in Flint “was avoidable and should have never happened,” according to Beauvais; while Creagh’s testimony stated that “[w]e all share responsibility in the Flint water crisis, whether it’s the city, the state, or the federal government… We all let the citizens of Flint down.”

The hearing ultimately took on a forward look, noting a reaffirmed commitment to protecting public health. “We do have clear standards. We do have clear accountability, so we have a clear path forward, said Creagh. “We are working in conjunction with the city, the state and federal government to ensure it doesn’t happen again.”  Beauvais noted “it is imperative that Michigan, other states, EPA and drinking water system owners and operators nationwide work together and take steps to ensure that this never happens again.”

EPA and Michigan state and local officials are now in non-stop mode to ensure that prompt, concerted efforts are taken to address public health hazards. Members of Congress are introducing bills to fund Flint’s systems and to aid the affected citizens.  Even philanthropic groups are stepping in.  EPA’s Inspector General is doing a deep dive into the Agency’s response, Michigan Governor Snyder is seeking answers, and even the Federal Bureau of Investigation is looking into criminal aspects of the matter. Flint’s drinking water will get better – and yet the affected population may never fully recover from their excessive lead exposures.  

The #FlintWaterCrisis is a sober reminder of the need to keep the nexus between environmental quality regulation and public health protection very tight.  As professionals in the environmental field, we cannot fear having frank conversations in the open about risks – and the importance of taking precautionary steps – when human health is at issue.  

EPA Has Surprisingly Broad Authority to Regulate GHGs

Posted on January 28, 2016 by Michael Gerrard

Our friend Seth Jaffe wrote a very interesting blog on January 20, “Does the Paris Agreement Provide EPA With Authority Under the CAA to Impose Economy-Wide GHG Controls? Count Me Skeptical.”  It took issue with a paper that I co-authored with several other colleagues in academia in which we argue that Section 115 of the Clean Air Act provides the EPA with broad authority to implement a multi-state, multi-source, multi-gas regulatory system to reduce greenhouse gases.  

The blog post agreed with our paper that it would be great if Section 115 provided this authority because it means EPA could implement an efficient, flexible, cross-sectoral approach to reducing greenhouse gases (GHGs).

However, Seth questioned our conclusion that Section 115 provides such authority because, in his view, courts are likely to conclude the “reciprocity” requirement in Section 115 could not be satisfied by the nonbinding emissions reduction commitments countries made in the Intended Nationally Determined Contributions (INDCs) they submitted for the Paris agreement concluded at the United Nations climate conference in December.  In the words of blog post, “I think most judges would interpret the word ‘reciprocity’ in a statute to mean something that is legally-binding; otherwise, it doesn’t mean anything.”  For several reasons, we disagree.

First, a reviewing court does not need to interpret what the word “reciprocity” means in Section 115, because Congress has explicitly defined it.  Reciprocity is the title of Section 115(c), which provides:

"This section shall apply only to a foreign country which the Administrator determines has given the United States essentially the same rights with respect to the prevention or control of air pollution occurring in that country as is given that country by this section."

The only right given to a foreign country by Section 115 is a provision in Section 115(b) that states a foreign country affected by air pollution originating in the U.S. “shall be invited to appear at any public hearing” associated with the revision of a relevant portion of the state implementation plan to address the pollutant.  In short, Section 115 specifies that reciprocity means the foreign countries in question need to have given the U.S. “essentially the same rights” as are given by Section 115, and the only right provided in Section 115 is the procedural right to appear at a hearing. 

Understanding the legislative history helps explain why the focus of the reciprocity requirement is on a procedural right.  As we explain in detail in the paper, Section 115 was a procedural provision when it was first enacted in 1965:  if pollution from the U.S. was endangering other countries, the other countries had a right to participate in abatement conferences where potential responses would be discussed, not a right to insist on actual emission reductions.  Although Congress amended the provision in the 1977 Clean Air Amendments to replace the abatement conference with federal and state action through the Section 110 state implementation plan process, the reciprocity language in Section 115(c) was not changed, leaving it with its procedural test.     

Second, we note in our paper that the Paris agreement contains a new set of procedures through which countries that join the agreement will be able to review and provide input on each other’s respective emissions reductions plans.  To the extent a court might conclude that such procedural rights must be "legally binding," then the Paris agreement satisfies that test because although the emission reduction targets themselves that were submitted in the INDCs will not be legally enforceable by other countries, the procedural elements of the Paris agreement will be binding international law.  

We note in the paper that although Paris provides a strong basis to satisfy Section 115 reciprocity, that reciprocity could also be satisfied by other international arrangements that the United States has with a variety of countries, particularly Mexico and Canada, the EU, and China.

Third, the blog post does not engage the issue of procedural reciprocity; rather it focuses on a substantive view of reciprocity (i.e. that reciprocity requires that other countries are actually reducing emissions of GHGs) and asserts that substantive reciprocity requirement could not be met by the internationally non-binding commitments made in the INDCs.  Although we believe that the correct reading of Section 115 is that it only requires procedural reciprocity, we recognize that a court could conclude that Section 115 also implicitly includes a substantive reciprocity requirement.  In the first instance, we noted that this requirement might be met by the international law principle sic utere tuo ut alienum non laedus, which directs nations to avoid causing significant injuries to the environment of other nations, most recently explained in the International Court of Justice’s Pulp Mills case.  

The author skips over this element to focus his skepticism that the reciprocity requirement could be satisfied by non-binding commitments in the INDCs.  But actually the U.S. and other countries have made reciprocally non-binding commitments in their INDCs.  That is, the U.S. has made an international political commitment to reduce emissions a certain amount, and has received essentially the same rights in the non-binding international commitments from other countries to reduce emissions.  

Someone could argue that the U.S. INDC may be non-binding, but Section 115 is domestic law in the U.S. and substantive reciprocity cannot exist unless other countries also have domestic laws requiring emission reductions.  If this is the test, however, it can also be met.  In fact, the INDCs submitted by other countries identified the binding domestic laws through which the INDCs would be implemented.  We did not focus on this aspect in our paper, but some examples are: (1) the United States identified the Clean Air Act and other laws and regulations “relevant to implementation” of the U.S. commitment; (2) China identified the measures that had been incorporated into domestic law and regulation through previous five-year plans, and outlined a variety of policies and strategies that would be incorporated into subsequent five-year plans to implement their emissions commitment; and (3) the EU noted that the necessary legislation to implement its target was being introduced to the EU parliament in 2015 and 2016.  Therefore, if “legally binding” domestic laws are required to find reciprocity under Section 115, EPA could reasonably examine the legally binding provisions in other countries’ domestic systems to find that reciprocity.

To summarize, our view is that Section 115 likely requires only procedural reciprocity.  If a court concluded Section 115 required substantive reciprocity, then EPA could reasonably find that requirement met through the reciprocal political commitments that the U.S. and other countries made in Paris as well as through the binding domestic laws and regulations in the U.S. and other countries that will implement the commitments.

We look forward to further dialog on this topic, which we think is an important part of unlocking this powerful, untapped tool that the EPA possesses to design an efficient and flexible system to reduce GHGs.

Does the Paris Agreement Provide EPA With Authority Under the CAA To Impose Economy-Wide GHG Controls? Count Me Skeptical

Posted on January 20, 2016 by Seth Jaffe

In a very interesting article, Michael Burger of the Sabin Center and his co-authors suggest that, following the Paris climate agreement, § 115 of the Clean Air Act provides authority for EPA to develop economy-wide GHG emissions reduction regulations that would be more comprehensive and efficient than EPA’s current industry-specific approach.  And what, you may ask, is § 115?  Even the most dedicated “airhead” has probably never worked with it.

Section 115 provides that, where EPA determines that emissions from the US are endangering public health or welfare in a foreign country, it may require SIP revisions sufficient to eliminate the endangerment – but only so long as there is “reciprocity”, i.e., the foreign country:

"has given the United States essentially the same rights with respect to the prevention or control of air pollution occurring in that country as is given that country by this section."

I love the idea.  An economy-wide regime would be much more efficient.  I wish that the argument made sense to me, but it does not.

The authors state that a global treaty could provide reciprocity, but then argue that “less binding commitments, including political commitments, should also suffice.”  Thus, they conclude, the “Intended Nationally Determined Contributions”, or INDCs, which are the basis of the Paris Agreement, can provide reciprocity.  Can you say “ipse dixit“?

They provide no precedent for this, because, as they acknowledge, § 115 has never been used.  EPA started to use it once, and the authors provide two letters from then-Administrator Costle, suggesting that legally binding reciprocity is not required.  However, EPA dropped the plan and the two letters were not finally agency action and were never subject to judicial review.  Otherwise, the arguments simply seems to be that EPA can cloak itself in Chevron deference and that that is the end of the story.

Sorry, I don’t buy it.  We’re talking about the law here.  I think most judges would interpret the word “reciprocity” in a statute to mean something that is legally-binding; otherwise, it doesn’t mean anything.  I don’t think it’s even a close enough question that Chevron deference will get EPA over the finish line.

The illogic of the authors’ argument seems to me to be demonstrated by their own words, when they argue reciprocity can’t mean a legally binding agreement, because that would mean that the foreign nations would be able to go to court to ensure that the US also meets its commitments under the Paris agreement, and the US would never allow that.  But that’s precisely the point!  Because there is no treaty, and the US would not let other nations try to enforce the US commitments under Paris, we cannot enforce theirs, and there is no reciprocity.

I wish it were otherwise.

ipse dixit

After 15 Years, EPA Finally Moves to Ban Brain-Damaging Pesticide Chlorpyrifos

Posted on December 4, 2015 by Peter Lehner

Nearly 15 years have passed since the EPA effectively banned the residential use of the pesticide chlorpyrifos (often marketed under the name Dursban), which causes brain damage in children. Kids were exposed at home when they played on pesticide-treated rugs, or hugged pets wearing flea collars containing chlorpyrifos. Yet the agency’s decision left farmworkers and children in rural areas unprotected, as chlorpyrifos was still allowed in agriculture (often marketed under the name Lorsban). This organophosphate pesticide was, and still is, one of the most widely used in agriculture.

Last month, after a decision by the 9th Circuit Court of Appeals that called the EPA's delay "egregious," the EPA at last proposed to ban most agricultural uses of this toxic pesticide.  If the ban on food use applications is finalized -- and it will surely be fought by the agricultural industry-- it will be a major victory for public health and farm communities.

Back in 2007, Earthjustice (which under full disclosure is my employer) began legal action to protect children, farmworkers, and rural communities from chlorpyrifos. Despite the clear evidence of harm, more than five million pounds of toxic chlorpyrifos were still being sprayed every year on soybeans, fruit and nut orchards, and other crops, putting hundreds of thousands of people at risk of exposure. Farmworkers who handled chlorpyrifos, even with safety gear, had been poisoned. (The new farmworker protection standards, which required more vigilant training and monitoring, among other things, should reduce such harms.)  Their children risked exposure at home, as chemicals can linger on clothing. Not only farmworker communities, but anyone living downwind of farms could be exposed when the wind carried the toxic spray into their neighborhoods. Community monitoring even found chlorpyrifos in schoolyards. 

The EPA was failing to protect children from pesticide drift; nor did the agency recognize the growing body of peer-reviewed, published research that found children exposed to the pesticide in the womb had serious brain impairments, including lower IQs and attention deficit disorder.

Over the next nine years, the EPA repeatedly missed deadlines to respond to the petition, and it relied on a questionable exposure model created by Dow, the manufacturer of the pesticide. (In 1995, Dow was fined $732,000 by the EPA for concealing more than 200 reports of poisoning related to chlorpyrifos.)

Only in response to multiple lawsuits, and a court decision that set a mandatory deadline for response, did the EPA at last take action. The public comment process and the finalization of the rule still remain, but at least the process has started. This is a great step forward. Moreover, the EPA is also reviewing all organophosphate pesticides, which are used in the United States and worldwide on a wide variety of crops from corn to cotton to nuts. The decision on chlorpyrifos should set a strong example. 

Petitioner Beware: A Shift in Industry Standing Doctrine in the D.C. Circuit

Posted on November 17, 2015 by Ray Ludwiszewski

In a string of recent decisions, the U.S. Court of Appeals for the District of Columbia Circuit appears to be shifting away from the long-standing general presumption that standing is self-evident for target entities  of a regulatory program — Coalition for Responsible Regulation, Inc. v. EPA, Grocery Manufacturers Ass’n v. EPA, Alliance of Automobile Manufacturers v. EPA, and Delta Construction Company v. EPA.  

In Coalition for Responsible Regulation v. EPA, the D.C. Circuit held industry had “failed to establish that the [Greenhouse Gas] Rules caused them ‘injury in fact,’ [or that] injury … could be redressed by the Rules’ vacatur.” The court found that although “Industry Petitioners contend[ed] that they are injured because they are subject to regulation of [GHGs],” they lacked standing because several aspects of “the … Rules … actually mitigate Petitioners’ purported injuries.”

In Grocery Manufacturers and Alliance of Automobile Manufacturers, EPA decisions concerning the ethanol regulatory program were challenged by a multitude of trade groups – automakers, oil companies, food suppliers – each claiming  its  members were harmed by the regulations.  In twin decisions separated by over two years, the D.C. Circuit held  none of this broad universe of industry petitioners had standing to challenge EPA’s actions.   

In Delta Construction Company v. EPA, the D.C. Circuit held all petitioners lacked standing to seek remand of EPA’s Greenhouse Gas (“GHG”) emission standards for heavy-duty trucks.  Some Petitioners had attacked the Rule because the emission standards would drive up the price of the trucks they purchased; another Petitioner alleged the rule made its products—modified diesel engines to run on vegetable oil —“economically infeasible.”  The Court found the Purchaser Petitioners’ standing failed on both the causation and redressibility prongs of the standing test.  The Manufacturer Petitioner was determined not to fall within the “zone of interests” intended to be protected by the Clean Air Act. 

These four D. C. Circuit rulings all found technical defects in the industry petitioners’ standing.  They may signal a lasting shift away from the basic  assumption that a regulated industry has standing to challenge regulations aimed at its activities.  

Given this new, strict scrutiny of industry standing, practitioners would be well advised not to take for granted the standing of their clients.  In the docketing statement for a regulatory challenge, industry counsel should substantively focus on the “brief statement of the basis for the … petitioner’s claim of standing” and reference materials in “the administrative record supporting the claim of standing.”

EPA To Rename OSWER: How About “The Office That Should Be Eliminated As Soon As Possible”?

Posted on November 2, 2015 by Seth Jaffe

According to the Daily Environment Report (subscription required), EPA is going to change the name of the Office of Solid Waste and Emergency Response to the Office of Land and Emergency Management.  What a grand name; surely it is an improvement.

I don’t think that this quite rises to the level of rearranging deck chairs on the Titanic (though I certainly have clients who would not object if OSWER sank without a trace), but one does get the sense of a bureaucracy beginning the long, hard, slog of trying to figure out how to perpetuate its existence as Superfund – mercifully – begins to fade away.

It’s probably a vain hope, but mightn’t EPA determine instead how to reallocate those functions of OSWER that need to continue, but actually try to figure out a way to shrink this element of the bureaucracy, instead of repurposing it?

titanic

EPA RELEASES FRAMEWORK FOR FUTURE CERCLA 108(b) FINANCIAL RESPONSIBILITY RULEMAKING

Posted on October 26, 2015 by Ronald R. Janke

The Environmental Protection Agency has released a framework for its future financial responsibility rulemaking under CERCLA 108(b).  Although this framework states EPA’s current thinking only in general terms, this document represents the clearest public statement of the agency’s intentions since it announced its intention to develop such rules for hardrock mining facilities in 2009.  This framework also informs of EPA’s intentions toward other classes of facilities in future rulemakings under this authority.  This framework appeared as part of a court filing on August 31, 2015 and was the subject of an EPA webinar on September 29, 2015.

EPA states that the regulatory approach it is considering has five foundational components. First, the universe of facilities to be regulated are hardrock mines and “primary processing activities located at or near the mine site that are under the same operational control as the mine.”  Second, the flow of funds from the financial responsibility instrument to the CERCLA would supplement existing CERCLA sources of funding, as EPA intends to use its existing CERCLA enforcement processes first to clean up sites.  Third, the scope and amount of financial responsibility would consist of three components: (1) response costs, calculated based on a model being developed by EPA to reflect the primary site conditions; (2) a fixed amount for natural resource damages and (3) a fixed amount for health assessment costs.

Fourth, EPA does not intend to preempt state, tribal and local government mining and reclamation closure requirements.  EPA intends to avoid preemption under CERCLA 114(d) by adopting financial responsibility requirements that are “in connection with liability for a release of a hazardous substance” in contrast to “many” state regulatory requirements designed to assure compliance with reclamation and closure requirements.  Fifth, EPA likewise intends that its CERCLA financial responsibility requirements will be distinct from federal closure and reclamation bonding requirements imposed by other federal agencies under other laws with jurisdiction over mining on federal lands.

The morsel of information provided in EPA’s framework leaves interested parties hungry for more information by what is left unsaid.  Particular concerns are the response cost model and its inputs and the path that EPA intends to tread around the multitude of existing financial assurance mechanisms that already apply to hardrock mining to avoid duplication and preemption.  In this regard, EPA could not have picked a more difficult place to begin drafting CERCLA 108(b) rules than for this industry, which has in place many and extensive financial assurances governing the impact of its operations.