On February 11, 2013, the United States District Court for the District of New Mexico denied a Motion for Preliminary Injunction filed by the Village of Logan, seeking to compel the Bureau of Reclamation (“BOR”) to perform an environmental impact statement (“EIS”) for the Ute Lake Diversion Project in eastern New Mexico.  The BOR issued an environmental assessment (“EA”), which analyzed the impacts from the diversion project based on the withdrawal of only 16,450 acre-feet per year (“af/yr”), despite the fact that the intake structure capacity is 24,000 af/yr.  The BOR contended that the intake structure did not have sufficient pumping capacity and other infrastructure to achieve 24,000 af/yr.

At the preliminary injunction hearing, Logan presented evidence that the Interstate Stream Commission of New Mexico (“ISC”), as the putative owner of the water rights within Ute Lake, had contracted to sell 24,000 af/yr and that the engineering analysis demonstrated sufficient existing capacity within the intake structure to accommodate withdrawals of 24,000 af/yr.  Consequently, similar to analyses required under other environmental laws, including the Clean Air Act, Logan argued that the impacts from the proposed project must be analyzed based on the maximum achievable withdrawal capacity of the intake structure.

The difference in the severity of impacts, based on 24,000 acre-feet withdrawals and 16,450 acre-feet withdrawals, was significant.  The EA conceded that, at 24,000 acre-feet per year, the minimum fisheries pool in Ute Lake – established to provide a minimum necessary habitat for recreational fishing – would be breached at least 20% of the time over a 30-year period.  Allowing the fisheries pool to be breached for at least 6 years over the life of the project created inter-related economic impacts, including significantly decreased property values on the shoreline, decreased tax receipts for the community, lost jobs, and significantly declining revenue for the New Mexico Department of Game and Fish.

The district court ruled that the EA, together with its finding of no significant impact (“FONSI”), was not arbitrary and capricious based on the assumption that the withdrawals would only reach 16,450 af/yr.  The Court stated that, “If in the future, more infrastructure is added to facilitate further withdrawals, primary analysis of the environmental impact may be undertaken then.”  The Court did not state whether such a “primary analysis” would occur within or outside of NEPA, and who would be responsible for initiating such an analysis.  Moreover, assuming that the Court meant an analysis of “direct impacts” by the phrase “primary analysis,” it is unclear how such an analysis would not suffer from predetermination under NEPA.  After all, the intake structure would already be built and there could not be any serious consideration of viable alternatives to the project.

The central issue on appeal is whether a federal agency may postpone part of its NEPA analysis to some unspecified time in the future, despite the fact that the capacity of the project, and the ability to withdraw 24,000 af/yr, is likely a “foreseeable” impact as defined in the Council on Environmental Quality regulations.

On April 23, a panel of the D.C. Circuit unanimously held in Mingo Logan Coal Co. v. EPA that the Clean Water Act gives EPA the authority to withdraw permits previously granted under section 404 of the Act.  The case emerged from EPA’s determination that the discharge of mining waste from the Spruce No. 1 mine in West Virginia into certain streams and tributaries would have an unacceptable adverse effect on environmental resources.  Based on this determination, EPA withdrew the Army Corps of Engineers’ prior specification of these streams and tributaries as disposal sites for the waste from mountaintop removal.

Several features of the case are striking.  First, the decision has obvious – and obviously important – implications for the ongoing debate over mountaintop removal and its irredeemable environmental impacts.  No longer can the argument be made that a permit, once issued, gives the permittee the power, in perpetuity, to blast the tops off of mountains and dump them into streams.

Second, the decision rested, for the most part, on a single word: “whenever.”  The Clean Water Act states that the Administrator of the EPA may withdraw the specification of a disposal site for dredge-and-fill material “whenever” she determines that it will have an “unacceptable adverse impact” on certain environmental resources.  The court took Congress, literally, at its word, and held that “whenever” means whenever – that is, even if EPA finds unacceptable adverse impacts after a permit has issued, the agency has the authority to pull the permit.

Third, as if to make certain its own holding is unambiguous, too, the court five times stated that the Clean Water Act unambiguously authorizes EPA to withdraw permits after they are issued.  EPA’s current interpretation of the Act is thus not changeable by a future administration.

Should permittees fear that “whenever” will become wherever?  It is worth remembering that EPA’s decision on the Spruce No. 1 mine was the first time EPA had – ever! – withdrawn a previously issued permit, in the 40-year history of the Clean Water Act.  Whether EPA will be emboldened by this decision, or will continue to mostly allow existing permits to stand, remains to be seen.

After decades of sparring over nutrient loading in the Illinois River, and following several short term extensions of a previous truce, Arkansas and Oklahoma recently executed an agreement, the “Second Statement of Joint Principles and Actions”, that establishes a procedural framework for attempting to resolve their long running trans-boundary water quality dispute.

The Illinois River heads up in a rapidly developing section of Northwest Arkansas and flows west into a comparatively undeveloped portion of Northeast Oklahoma, where the river is designated by state statute as a scenic river.  For more than two decades Oklahoma has worked to reduce the amount of nutrients, and particularly phosphorus, discharged into the Illinois River watershed.  In 2002 Oklahoma adopted a numeric water quality criterion for Total Phosphorus that many considered impossible to attain in a developed watershed.  In an effort to avoid litigation over the validity of the numeric criterion, Arkansas and Oklahoma entered into an agreement in 2003 known as the Statement of Joint Principles and Actions.  This agreement provided, among other things, that:  (i) Oklahoma would postpone for 10 years the date on which the numeric criterion would be fully effective; (ii) Arkansas sources would take a number of steps to reduce phosphorus discharges; and (iii) Oklahoma would review the existing numeric criterion, with an opportunity for Arkansas representatives to participate, before the end of the ten year period to determine whether the numeric criterion should be changed.

The ten year truce created by the Statement of Joint Principles and Actions was originally scheduled to expire in July 2012.  During the ten year period Arkansas sources made significant progress in reducing the amount of phosphorus they discharged in the watershed.  As a result, phosphorus levels in the Illinois River began to decline and most observers agreed that conditions in the river were significantly improved.  Towards the end of the ten year period Oklahoma undertook a review, with full participation by representatives of Arkansas, EPA, and the Cherokee Nation.  The review ended in a sharply divided report, with Oklahoma representatives stating that no change in the numeric phosphorus criterion was warranted and Arkansas representative stating that significant change was necessary.

As the end of the ten year truce approached, officials from Arkansas and Oklahoma began negotiations once again on how to avoid litigation.  Focus on the potential for costly litigation was sharpened by the fact that EPA had publicly commenced work on a Phosphorus TMDL for the entire Illinois River watershed.  After several agreements on short term extensions of the July 2012 deadline, Arkansas and Oklahoma reached agreement in February 2013 on a Second Statement of Joint Principles and Actions.  This new agreement provides, among other things, that Arkansas and Oklahoma will fund a joint three year water quality study using EPA protocols to determine the threshold Total Phosphorus levels at which shifts in algal species or biomass production occur that result in undesirable aesthetic or water quality conditions.  Oklahoma and Arkansas agree in the Second Statement to be bound by the findings of the joint study, and Oklahoma agrees to adopt a new numeric criterion for Total Phosphorus in the Illinois River if the results of the joint study are significantly different from the existing criterion (i.e., more than -0.010 mg/l or +0.010 mg/l than the existing .037 mg/l criterion).  During the term of the Second Statement of Joint Principles and Actions, both states agree not to initiate or maintain litigation contrary to the terms of the agreement, and the statute of limitations on all claims is extended.  Oklahoma agrees that it will postpone for the duration of the new agreement the date on which its existing, hotly disputed numeric criterion is to be fully effective.

EPA was not a party to the negotiation of the new agreement and it has not announced any formal position on its effect.  It is not clear what impact the new agreement will have on EPA’s work to develop a TMDL for Phosphorus in the Illinois River watershed or on the various NPDES permits for POTWs on the Illinois River that are currently pending review in EPA Region 6.

I get it that environmental groups place strict compliance with regulatory controls at a premium.  After all, the standards are designed to be protective of the resource, and they are The Law, which must be obeyed. 

But I sometimes find it dismaying when people conflate immediate, measured, and guaranteed compliance with ecological outcomes.  They are not the same.  I have been in settlement discussions in which I propose that we first come to agreement on what’s best for the resource, and then figure out how to make that fit into the regulatory framework, but have had few takers.  The number is the number is the number.

A recent example arises in the context of water quality trading.  EPA policy promotes alternative means of achieving regulatory compliance that promise environmental results at least as good as conventional, engineered approaches, and at lower cost.  For example, if discharge water temperatures are the problem, riparian shade tree planting could substitute for mechanical chillers.  Of course, measureable cooling would be deferred by many years while the trees grow, but the ancillary benefits of watershed restoration to habitat and ecosystem function are intuitive and compelling.  This approach is supported by academia, government, and many in the NGO community.  Some though are skeptical.

The City of Medford, Oregon, is embarking on a riparian vegetation approach to reduce temperatures at its wastewater treatment outfall, in full cooperation with Oregon DEQ.  A regional NGO, Northwest Environmental Advocates, however, has raised objections.  In a letter dated March 15, 2013, NEA asks EPA to examine DEQ’s implementation of the water quality trading policy with reference to Medford.  NEA questions allowance of “credits” for watershed restoration work that upstream nonpoint sources would have to do anyway, and asserts that no credits should be allowed until the new trees actually yield shade.

The problem is that the upstream nonpoint sources are not obligated by law to restore riparian vegetation; they just need to adopt best management practices to avoid further degradation.  More to the point, restoration of the watershed will simply not occur without the funding provided by a point source with a regulatory problem to solve, such as Medford.  By denying the City credits, the incentive to use a watershed approach disappears.  Similarly, if no credits are awarded until the trees are grown, funds that could go toward watershed restoration will be diverted to engineered controls on temperature.  As DEQ Director Dick Pedersen so aptly puts it, “[i]f we ever build a chiller at the expense of ecosystems, we’ve failed.”

According to the recent U.S. Drought Monitor, approximately 65% of the contiguous United States is currently experiencing “abnormally dry” to “exceptional drought” conditions. In my part of the country, a recent projection indicates that a reservoir supplying a significant portion of our municipal water supply could dry up within 3-4 years if severe drought conditions persist. Although an “Aquifer Storage and Recovery” program was previously developed to enhance the available supply of groundwater, it is only designed to replenish the drinking water aquifer from excess river flow during flood conditions—a rare occurrence during a severe drought.

I am not capable of allocating percentages of fault for this persistent drought between anthropic climate change and extreme climatic occurrences that are “normal” in the context of geologic time. However, I am persuaded by the argument that “climate change,” by whatever definition you choose to give it, is a problem not only of causation and prevention, but also of adaptation. A previous posting on the need to prioritize adaptation to climate change states the argument well. Is it time we give more thought to groundwater replenishment as an adaptation tool?

My practice includes representing clients at various hazardous substance release sites, under both state and federal law. The default remedy for contaminated groundwater at many of these sites remains extraction and treatment (commonly using air stripping technology) to both contain and clean up the extracted groundwater to “unrestricted use” quality. At most of these sites, however, treated groundwater is discharged to a ditch, creek or similar conveyance where the value of the groundwater as a critical natural resource is largely lost.

An environmental consultant at one such site recently calculated that, over the period of two years, the pump and treat system had removed and discharged to a nearby ditch approximately 110 million gallons of treated groundwater. During a period of severe drought, the system was depleting a drinking water aquifer by over two feet annually. In addition, it was estimated that the quantity of groundwater being treated, and largely wasted, was equivalent to the water used by 1,850 residents (27% of the population) of the city in which the site is located.

Beneficial reuse of “contaminated” water resources is obviously not a new concept, particularly the reuse of nonpotable water. Examples include the reuse of treated nonpotable water for industrial, municipal and agricultural purposes. Potable water reuse is less common for reasons related to water quality requirements, technical issues, cost and community and regulatory acceptance.

Notwithstanding the obstacles and additional costs, it may now be time for environmental professionals, regulators and attorneys to more systematically and creatively consider potable reuse options at contaminated groundwater sites. This would include an evaluation of discharging treated groundwater through infiltration basins, infiltration galleries and injection wells to replenish the drinking water aquifer from which it was extracted. Consideration should be given to partnering site regulators and responsible parties with nearby municipalities to revitalize drinking water aquifers or supplement other potable water resources. Another issue worthy of discussion is community acceptance, which may be more likely when treated contaminated groundwater is beneficially reused indirectly through aquifer replenishment, rather directly through discharge into water supply pipes.

I submit that all too often we accept without much thought the default option of permitted surface discharge of groundwater that has been treated to “non-detect”. Potable reuse through groundwater recharge and restoration involves significant cost and technical issues. But in our effort to add weapons to the climate change adaptation arsenal, all interested parties should more carefully consider such options notwithstanding the challenges.

Late last year, the United States Supreme Court used a mathematical hypothesis to solve a takings question involving environmental damage.  Remember the transitive property of equality?      

                                                A=C,  B=C, so A=B [and =C]

The Court summarized its opinion by noting: 

a government-induced flooding can constitute a [compensable] taking (A=C);
a temporary act can be a compensable taking  (B=C); so
a government-induced flooding even as a temporary act (A=B) may be a compensable taking [=C].

In takings analysis, flooding cases hold no special exempt footing.  Floodings need not be permanent or inevitable to result in a constitutional taking.  Seasonal, recurring flooding (similar to a repetitive flight overhead that interrupts a property’s intended use) can be a taking based on the facts and circumstances, like time and degree of interference, character of the land, reasonable investment-backed expectations and foreseeability.  See Arkansas Game and Fish Commission v. United States.

On Monday, EPA lost another battle in the war over guidance.  In Iowa League of Cities v. EPA, the 8th Circuit Court of Appeals vacated two letters that EPA had sent to Senator Charles Grassley concerning biological mixing zones and bypass of secondary treatment units at POTWs (also referred to as “blending”, because the POTWs blend wastewater that has not be subject to biological secondary treatment with wastewater that has, prior to discharge).  The Court concluded that both letters constituted promulgation by EPA of effluent limits under the Clean Water Act and that they constituted legislative, rather than interpretive rules (I refuse to refer to “interpretative” rules; sorry).  As a result, the Court vacated the letters due to EPA’s failure to follow notice and comment requirements applicable to promulgation of legislative rules.  Finally, the Court concluded that a duly promulgated rule concerning biological mixing zones might be valid under Chevron, but that a rule barring bypasses of secondary treatment would exceed EPA’s authority under the Clean Water Act.

In first determining whether the letters constituted “promulgation” of an effluent standard, the Court looked to whether the letters were binding on the regulated community.  Relying in part on Appalachian Power Co., the Court concluded that the letters were binding:

If an agency acts as if a document issued at headquarters is controlling in the field, if it treats the document in the same manner as it treats a legislative rule, if it bases enforcement actions on the policies or interpretations formulated in the document, if it leads private parties or State permitting authorities to believe that it will declare permits invalid unless they comply with the terms of the document, then the agency’s document is for all practical purposes “binding.”

As the Court noted with respect to the mixing zone issue, the “letter instructs state permitting authorities to reject certain permit applications, regardless of the state’s water quality standards.”  With respect to the bypass issue, EPA stated that “it will insist State and local authorities comply with” a never-issued policy that precludes the types of bypass at issue.  To try to suggest that words such as “insist” are not binding did not go over well with the Court.  “Just as it did in Appalachian Power, the EPA dissembles by describing the contested policy as subject to change.”

After concluding that the letters constituted promulgation of effluent standards, the Court went on to conclude that the letters constituted legislative, rather than interpretive, rules, and thus were subject to notice and comment rulemaking.  The following is the key paragraph for those of us attempting to beat back the kudzu that is EPA’s reliance on such informal guidance as a substitute for notice and comment rulemaking:

Identifying where a contested rule lies on the sometimes murky spectrum between legislative rules and interpretative rules can be a difficult task, but it is not just an exercise in hair-splitting formalism. As agencies expand on the often broad language of their enabling statutes by issuing layer upon layer of guidance documents and interpretive memoranda, formerly flexible strata may ossify into rule-like rigidity. An agency potentially can avoid judicial review through the tyranny of small decisions. Notice and comment procedures secure the values of government transparency and public participation, compelling us to agree with the suggestion that “[t]he APA’s notice and comment exemptions must be narrowly construed.”

“Layer upon layer of guidance.”  The “tyranny of small decisions.”  I couldn’t have said it better myself.

The Clean Water Act requires states, as well as Indian tribes, to review their water quality standards every three years.  The water quality standards include narrative and numeric criteria that differ based on the type of use designation for the particular stream.  Use designations include warmwater aquatic habitat, cold water aquatic habitat, primary and secondary contact recreation and others.  The Kentucky Division of Water has been engaged in the triennial review of the state’s water quality standards since early 2012.  In the latest development, the agency asked the legislative committee that reviews agency regulations to defer consideration of the rules for another month while the agency takes comment on a change to the state’s standard for selenium.

The Kentucky regulations address a number of changes to the water quality standards and included proposed deletion of the acute water quality criterion for selenium.  The proposal to delete the acute standard was based on findings that the current state standard, which was derived from USEPA guidance, was not based on sound science.  USEPA Region 4 commented on the proposed deletion and identified three options: (1) leave the current acute criterion in place and wait for release of any revisions to USEPA’s selenium criteria, (2) adopt the acute criterion from USEPA’s current national guidance, or (3) adopt an alternate criterion based on other scientifically defensible guidance.

In response, the Division conducted a survey of recent studies of selenium toxicity to aquatic species and determined that it was appropriate to develop state-specific water quality criteria for selenium.  The agency is proposing an acute criterion for warmwater aquatic habitat of 258 ug/L, with an alternate calculation option depending on the sulfate concentration that is present.  The proposed chronic criterion for warmwater aquatic habitat is 8.6 ug/g (dry weight) of whole fish tissue or 19.2 ug/g (dry weight) of fish egg/ovary tissue.  The analysis of fish tissue is triggered when the water column concentration of selenium exceeds 5.0 ug/L.  If the water column result is less than or equal to 5.0 ug/L, the water body is meeting is aquatic life uses.  If the water column result is greater than 5.0 ug/L, then the next step is to determine whether the site is attaining the fish tissue or egg/ovary tissue criterion.

Stay tuned as interested parties weigh in on the state’s proposed action.

In December 2010, the Wisconsin Department of Natural Resources (WDNR) put into place new rules to control phosphorus discharges.  Adaptive management is one of  four compliance options allowed under these new rules.  But what is “adaptive management”?

WDNR developed adaptive management to provide permittees with a less expensive, more flexible compliance option, and describes adaptive management this way:

 “a phosphorus compliance option that allows point and nonpoint sources (e.g., agricultural producers, storm water utilities, developers) to work together to improve water quality in those waters not meeting phosphorus water quality standards.  This option recognizes that the excess phosphorus accumulating in our lakes and rivers comes from a variety of sources, and that reductions in both point and nonpoint sources are frequently needed to achieve water quality goals.  By working in their watershed with landowners, municipalities, and counties to target sources of phosphorus runoff, point sources can minimize their overall investment while helping achieve compliance with water quality-based criteria and improve water quality.”

To be “eligible” to use adaptive management, a permittee must discharge to a water body that is exceeding its in-stream phosphorus criteria on which at least 50% of the total phosphorus loading comes from nonpoint sources, and would have to implement filtration or an equivalent technology to meet the new phosphorus limit.  Unlike water quality trading, which measures compliance with an end-of-pipe effluent limitation, the adaptive management permittee must meet an in-stream concentration of acceptable phosphorus.  Under adaptive management, the phosphorus in the effluent may be reduced over a longer period of time – in some instances, up to several WPDES Permit cycles – as compared to water quality trading which requires the credits to be generated before the permit is issued.  The job of identifying and finding partners falls to the permittee; WDNR does not intend to act as a broker to identify and bring prospective partners together.

An innovative alternative that seeks a watershed approach to control phosphorus, encourages nontraditional partnerships and cooperation between point and nonpoint sources, tries to provide flexibility in timing and doesn’t rely on the traditional and expensive construction of new treatment facilities – how’s it going so far?

For much of industry, forging such partnerships with other regulated and unregulated sources is unfamiliar territory and relying on those other entities to fulfill their commitments when the industrial permittee is the one that must demonstrate compliance is too uncertain to be acceptable.  Many municipalities are more comfortable with partnerships of this sort, but the early experience of one environmentally proactive municipality has demonstrated the enormous amount of time and effort required to take on the role of “champion”, educate and engage other partners in the watershed.  Agricultural interests are initially skeptical – concerned with the potential of taking land out of production.  The environmental advocacy community reaction is mixed.  One ENGO is actively working with the municipality to educate and engage partners and has written a guidance document on how to do adaptive management.  Another ENGO has filed suit against WDNR over WPDES Permits issued with adaptive management compliance schedules in them, reinforcing the reluctance of industrial and municipal permittees to commit to this approach.  And after approving WDNR’s rules in the first instance, EPA now takes such a strict reading of the rules that the intended flexibility may become illusory.

WDNR management is listening to all of this and seeking ways to adjust the implementation of “adaptive management” to respond to these very practical concerns.  No good deed goes unpunished. 

Rose Acre Farms, Inc. et al. vs. NC Department of Environment and Natural Resources, et al., decided January 4, 2013

On January 4, 2013, a North Carolina court held that an egg production facility could be required to obtain a National Pollutant Discharge Elimination System (NPDES) permit solely on the basis that feathers and dust carrying ammonia nitrogen and fecal coliform, expelled from henhouses by ventilation fans, can be “pollutants” from a point source for which an NPDES permit is required if those pollutants reach waters of the State.  This is a case of first impression in which a court held that the impact of air emissions on water bodies could be regulated under the Clean Water Act (CWA).

North Carolina egg producer Rose Acre Farms (RAF) appealed a decision by the NC Department of Water Quality (DWQ) that an NPDES Permit renewal required stringent new BMPs on the grounds that: 1) the DWQ had no authority to require an NPDES permit for a “no discharge” facility; and 2) even if DWQ had authority to require an NPDES permit, the DWQ had no authority to impose new BMPs because: a) the feathers, dust and litter expelled into the air from ventilation fans are not “pollutants” as defined in 33 U.S.C. §1362(6); and b) even if ammonia nitrogen, total inorganic nitrogen, total phosphorus and fecal coliform associated with the feathers, dust and litter are “pollutants” that enter waters of the State, that activity would be exempt under the agricultural storm water discharge exemption in 33 U.S.C. §1362(14).

The Court held that ammonia nitrogen and fecal coliform carried by feathers and dust expelled by ventilation fans in the henhouses are “biological materials”, a term included in the definition of a “pollutant” in the CWA.  In addition, the Court relied on EPA guidance letters to determine that feathers, dust and litter expelled from a henhouse by ventilation fans are discharges from a point source that could reach waters of the State.  Finally, the Court held that the agricultural storm water discharge exemption in 33 U.S.C. §1362(14) applies only to land application in accordance with site specific nutrient management practices and does not apply to pollutants from feathers, manure, litter or dust that are expelled from the RAF henhouses but are not entrained in irrigation water.

If courts in other jurisdictions follow suit, other sources of air emissions with the potential to reach a receiving water, such as power plants and industrial facilities, may be required to address the impacts of their emissions on those receiving waters in future NPDES permits, independent of required air permits.

On January 9, 2013, the Pennsylvania Department of Environmental Protection (PADEP) issued a final White Paper addressing the use of “mine influenced water” (MIW) in oil and natural gas operations.  For purposes of the White Paper, MIW is characterized as “water contained in a mine pool or a surface discharge of water caused by mining activities that pollutes, or may create a threat of pollution to, waters of the Commonwealth” and “may also include surface waters that have been impacted by pollutional mine drainage.” The White Paper outlines (1) the process for reviewing proposals to utilize MIW, (2) options for storing MIW (i.e. impoundments, tanks, etc.) prior to being used for oil and natural gas well development, and (3) possible solutions to long-term liability issues.

PADEP Secretary Mike Krancer deemed the use of MIW as a “win” for Pennsylvania’s environment and economy.  According to PADEP, more than 300 million gallons of water are discharged from Pennsylvania mines each day.  The water discharged, after being introduced to sulfides and other minerals occurring naturally within the mine, can be harmful to the receiving streams.  The natural gas industry uses between 3-5 million gallons of fresh water, typically withdrawn from surface waters and groundwater sources, for each well completion operation.   MIW use provides natural gas companies an alternative source of water for hydraulic fracturing operations with the potential to both lessen the natural gas industry’s dependence on freshwater sources and divert polluted water from watersheds.  

While the use of MIW in natural gas production operations can be an economical and environmentally beneficial practice, certain issues, particularly long-term liability, may require additional regulatory or legislative action before the practice becomes a viable option for the natural gas industry.  For example, under the current interpretation of Pennsylvania’s Clean Streams Law, an operator’s act of pumping water from an abandoned mine pool could create a legal obligation to treat the resulting discharge.  PADEP’s White Paper suggests two options for reducing a MIW user’s long-term liability: 1) obtaining protection from civil liability by qualifying for a “water abatement project” under Pennsylvania’s Environmental Good Samaritan Act; and 2) entering into a Consent Order and Agreement with the state.  Unfortunately, neither of these options guarantees protection from all potential liabilities under federal and state law for conditions associated with abandoned mines.

Notwithstanding certain concepts that require further consideration, PADEP’s White Paper serves as a platform for Pennsylvania and other states to promote the responsible production of coal and natural gas and, at the same time, to address some of the environmental challenges associated with both.  It is hoped PADEP’s White Paper will stimulate discussions regarding the use of MIW for natural gas production in other states with large reserves of coal and natural gas like Ohio, West Virginia, and Wyoming.  With additional input from stakeholders across various states, anticipated environmental and economic benefits of this practice may become a reality.

Section 316(b) of the Clean Water Act requires that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact.  Although the statutory language is straight-forward, EPA has run into enormous difficulties in promulgating rules to implement Section 316(b).

The latest in a series of rulemaking efforts began on April 20, 2011 when EPA published a proposed rule to protect fish from being killed at water intake structures that withdraw at least 2,000,000 gallons per day from waters of the United States and use at least 25% of the water they withdraw exclusively for cooling purposes.  Pursuant to a Settlement Agreement with the environmental group, Riverkeeper, and other organizations, EPA was required to issue the revised rule by July 27, 2012. 

When I last wrote about this rulemaking effort by EPA, EPA had received more than 1,100 comment letters and more than 80 documents containing new data for possible use in developing the final impingement mortality limitations.  On June 12, 2012, EPA offered a 30-day comment period on the new information with comments due on or before July 11, 2012. 

Through the Notice of Data Availability published by EPA on June 12, 2012, EPA also presented data it had received related to the results of EPA’s stated preferences survey.  Comments on the data related to EPA’s preference survey were also required to be submitted on or before July 12, 2012. 

In my previous blog on this subject, I wrote it was hard for me to understand how EPA would be able to comply with a court-ordered issuance date of new rulemaking by July 27. 

Not surprisingly, EPA was unable to issue its new rule by July 27.  Instead, EPA entered into a Second Amendment to the Settlement Agreement with Riverkeeper and other organizations.  The Settlement Agreement contains the following language:  “Not later than June 27, 2013, the EPA Administrator shall sign for publication in the Federal Register a notice of its final action pertaining to issuance of requirements for implementing Section 316(b) of the CWA at existing facilities.”  Since entry of the extension, EPA has been remarkably silent about any steps it plans to take prior to the June 27, 2013 deadline for notice of final action.

Concurrent activity at the state level is also of interest.  Prior to this latest extension, EPA Region 1 sent about ten extensive Section 308 information requests to facilities in Maine to set the stage for possible issuance of case-by-case, best professional judgment permit requirements pursuant to 316(b) for the selected facilities.  It is unclear how the facilities were selected given other Maine facilities also met the proposed thresholds.  Those facilities have responded to the information requests but further action even on those facilities is on hold.  EPA Region 1 and the Maine DEP have now determined that DEP, which administers a partially delegated NPDES program, now has the statutory capacity to administer the 316(b) program.  DEP is in the process of formally seeking explicit delegation for the 316(b) program as anticipated under the original EPA-DEP NPDES Memorandum of Agreement.  The DEP has indicated it intends to wait until after EPA issues a final rule implementing Section 316(b) before DEP decides how it proposes to implement 316(b) as a delegated state.

In my August 24, 2010 submission, I discussed the water wars between Oklahoma and Texas, summarizing the lower court holding in Tarrant Regional Water District v. Herman, et al.  The gist of the dispute is that a Texas water district wants to buy Oklahoma water, but Oklahoma isn’t selling, and has passed laws that effectively preclude the sale. The Tarrant Regional Water District (“TRWD”) cried foul, but the District Court did not agree with TRWD that Oklahoma’s refusal to sell water across state lines was a violation of the Commerce Clause.  Judgment was entered on July 16, 2010, and the case appealed to the Tenth Circuit shortly thereafter.  The Tenth Circuit affirmed the District Court.  656 F.3d 1222 (10th Cir. 2011).

The Appellate Court decided that Oklahoma statutes which precluded water being sold to users in Texas did not violate the Commerce Clause because the Red River Compact preempted it. Recall that the Red River Compact (signed by Texas, Oklahoma, Louisiana and Arkansas in 1978 and approved by Congress) divided the water from the Red River and its tributaries among the states involved.  The Compact has general language that gives the signatory states authority over the water allocated to them within their borders.  The Tenth Circuit held Texas to its bargain on the Compact and agreed with Oklahoma that the refusal to sell Oklahoma water to Texas users does not violate the Commerce Clause. 

Now, the United States Supreme Court will weigh in on the subject, as it granted certiorari on January 4, 2013.  Stay tuned.

Tremendous progress has been made in protecting and restoring the environment over the past 40 years since the passage of major legislation at the federal, state, and provincial levels in the United States and Canada.  However, our skill at measuring that progress is somewhat limited, and we may not have the kind of information we need to judge the health of our ecosystems or the effectiveness of our programs.  There have been some good efforts on an international, national, state, and provincial basis to evaluate the state of the environment using certain indicators, but one area needing much more attention is the Great Lakes. 

Although there are many indicators monitored on a continuing basis in the Great Lakes, the real difficulty has been synthesizing the information in a way that puts officials in a position to communicate effectively with the public, policy makers, and managers about whether the Great Lakes are getting better, worse, or staying the same.  The International Joint Commission (IJC) initiated an effort recently through its Water Quality Board (WQB) and Science Advisory Board (SAB) to identify a limited number of core indicators for this freshwater resource.  What’s needed now is a consensus among the scientific and policy leaders on the Great Lakes on the “few indicators that tell us the most” about the waters.

It was not hard to tell the Great Lakes were in trouble when enough dead alewives washed up on its shores requiring front end loaders to remove them, the Cuyahoga River and other tributaries caught fire, and Lake Eric was declared “dead” because of massive algal blooms.  Many of these conditions on the Great Lakes led to both a public outcry and Congressional action in order to deal with the lakes’ water pollution and other environmental problems.  As programs were put in place to keep oil out of the rivers and reduce nutrient loadings to the lakes, significant visible improvements were seen.  The underlying data was available to support the observations, but the visible improvements plus much better fishing success told the story in an easily observable way. 

Things are much more complicated now.  When looking at the fundamental three legged stool  supporting the Great Lakes’ ecosystem, being the chemical, physical, biological integrity of the resource, it is not easy to gage.  With regard to chemicals, very low concentrations of legacy pollutants like PCBs and dioxins can cause serious problems.  Likewise, ongoing contamination from airborne deposition of mercury is a real concern.  New chemicals such as flame retardants are the next problem area with which to deal.  Invasive species such as the zebra and quagga mussels, the ever present sea lampreys, and the threat from the Asian carp are a constant problem for maintaining the biological balance in the system.  From a physical standpoint, expanding urbanization, suburban sprawl, and the manifestations of climate change are also adding tremendous pressure on the Great Lakes.  What’s needed is a core set of chemical, physical, and biological indicators of the health of the ecosystem and the effectiveness of the programs to protect and restore it.

Good progress is being made on this front.  After several months of work by some of the top Great Lakes’ scientists and policy makers, a group of just over twenty indicators has been preliminarily identified, with a smaller group as the core.   They include:
    Physical: Coastal wetlands, land cover, and tributary physical integrity
    Chemical: Nutrient concentrations and loadings, and persistent bio - accumulative toxics
    Biological: Lower food web productivity/health, fish species of interest, harmful and nuisance algae, aquatic invasive species

Much of the foundation for the work done recently comes from what is known as the State of the Lakes Ecosystem Conference (SOLEC), which is a large gathering, primarily of scientists, held every two years to review and evaluate a large number of Great Lakes’ indicators on the Great Lakes.

What needs to happen next is for the IJC first to adopt a set of core indicators as the ones that tell us the most about the resource, then inform the U.S. and Canadian governments of its findings.  Under the recently updated Great Lakes Water Quality Agreement, the parties are responsible for establishing ecosystem indicators for the Great Lakes.

With a set of core indicators, both countries will be in a much better position to communicate with the public, elected officials, and managers about the health of the ecosystem and the effectiveness of programs.  In addition, our governments will be in a position to make better choices about the allocation of increasingly scarce resources to maximize the return on investment for improving the health of the Great Lakes, the largest, surface freshwater system in the world.

An earlier post noted that adaptation to climate change is inevitable and is finally emerging as a priority for public policy.  Long overshadowed by campaigns to prevent or slow global warming, federal and state initiatives and efforts by many professionals have resulted in efforts to start to collect data and promote serious planning for ocean rise and other effects of climate change.

Storm Sandy has more than reinforced that trend: it has established a much wider recognition that planning, design, engineering and regulatory decisions must incorporate the expected impacts of climate change and can no longer rely on historic weather and temperature conditions.  That shift will have broad implications throughout the legal system, amounting to an emerging law of adaptation to climate change that is distinguishable from the emerging law of greenhouse gas controls. 

As often is true, the legal academy is in the vanguard – there is a surge of law review articles and also a recent compilation published by the ABA.

For example, utility regulators have broad authority to require public service companies to prudently operate and maintain their systems.  It is common for regulators to require emergency response plans, and, in some states, to impose significant penalties for overly delayed restoration of service after storm events. 

Now, regulators are likely to require utilities also take account of changes because of global warming effects, not just based on historic conditions.  Environmental groups recently petitioned NY regulators to so require. 

But how exactly can this step be done?  Modeling of the timing and extent of climate change effects can only produce broad ranges and generalities and are indefinite about effects at particular locations.  What retrofitting is needed to assure reliable service to far future ratepayers and at what expense to current ratepayers? Ratepayers, regulators and utility stockholders will not reach agreement without significant dispute.

Existing zoning for flood plains should be modified to account for climate change.  Making those changes will trigger large disputes as previously settled expectations are overturned.  Until the rules are changed, are zoning bodies tied to outdated flood control maps incorporated into their regulations, or can they consider supplemental, updated information? 

Environmental impact reviews for proposed projects typically address the effects of a project on the environment.  Now must they consider the effects of the environment on the project?  How?   It will be litigated.

Also, as noted in an earlier post, the public trust doctrine might not serve to require regulatory agencies to regulate greenhouse gas emissions.  But will it successfully undergird a state’s assertion of authority to regulate activities on or affecting lands subject to the public trust in order to account for changes and threats to shorelines?  As beaches recede, will public trust lands start to incorporate currently private property?

The common law of property, too, will be affected.  A landowner can lose title to land if it slowly disappears by reliction due to changes in a water body’s natural behavior, whereas a sudden loss by avulsion allows the landowner to keep title and restore the land.  But what if the sudden loss is due to a storm event that is part of a slow rise in ocean levels?

Finally, at what point will it become clear that professionals must take account of global warming in designing structures or else experience risk of liability for unanticipated effects?

As the Clean Water Act celebrates its 40th anniversary, it has ignited a controversy in New Hampshire with potentially hundreds of millions of dollars at stake.  In the law’s early days,  publicly owned treatment works (“POTWs”), mandated and financed in large part with federal funds, were viewed as the “good guys” in the national effort to restore quality in receiving water bodies into which raw sewage was being discharged.  That view of POTWs seems to have changed in New Hampshire, at least as relates to the State’s largest saltwater estuary; the Great Bay.  Faced with the potential need to finance significant POTW upgrades or reconstruction, New Hampshire POTWs are challenging EPA’s permitting decisions in the courts, through administrative channels and in the press.

As we know, POTWs are regulated through National Pollutant Discharge Elimination System (“NPDES”) permits that monitor and control a variety of effluent criteria.  Interestingly, however, New Hampshire was and remains one of the few states that has not obtained authority to issue new and renewed NPDES permits.  Because of this status as a non-delegated state, dischargers in New Hampshire with expiring permits must apply to the federal government for renewal.  As environmental regulation has progressed, however, and as federal funds have diminished or disappeared, POTWs and the towns and sewer districts that operate them have found themselves opposed to the EPA’s efforts to impose stricter standards  to address pollutants that were not of primary concern when the POTWs were constructed and initially permitted.

In New Hampshire, this is seen vividly in NPDES renewal efforts EPA is undertaking for several POTWs that discharge under expired and expiring permits, directly or indirectly, into the Great Bay estuary located on the State’s coast.  Once a rich habitat for oysters, eel grass and other sea life, Great Bay is now stressed by a variety of factors including both point and non-point discharges as well as other environmental factors.   At the heart of the controversy  in New Hampshire is EPA’s intention to reduce effluent limitations for nitrogen to as low as three parts per million (the limits of technology) in order to ameliorate nitrogen related problems in Great Bay.  From the municipalities and POTWs perspective, the costs to comply with these new lower limits are exorbitant.  One widely cited study estimates that, for the Great Bay estuary POTWs to comply with the new nitrogen limit, it will cost in excess of one half billion dollars in capital,operation and maintenance expenses.  Those costs will, of course, be passed along to a relatively small population of ratepayers. 

A coalition of communities with affected POTWs has joined forces in response, proposing “adaptive management programs” combining somewhat lower discharge limits with comprehensive non-point controls aimed together at achieving EPA’s stated goals.  It is unclear at this time whether those efforts will be successful.  The coalition communities certainly have in mind the experiences in Chesapeake Bay, or closer to home in neighboring and similarly non-delegated Massachusetts, where EPA is using its  Residual Designation Authority (“RDA”) to require permits in the Charles River watershed.  EPA has been public with its view that the Charles River RDA program may become a model for watersheds elsewhere in New England and nationwide.  It is thought that an adaptive management program as proposed by New Hampshire’s coalition communities would obviate the need to utilize RDA for Great Bay, but that issue remains to be addressed in the future.

Although the still-divided Congress is unlikely to pass significant new environmental legislation over the next four years, the second-term Obama administration has an opportunity to pursue its environmental agenda through the EPA with diminished fear of impacts on the next election. 

The current term saw a period of strong leadership at EPA, but there is a feeling that the agency has not allowed the other regulatory shoe to drop.  EPA stalled on several important regulations, as if anticipating the Romney complaint that excessive regulation was a cause of the recession. Having escaped the prospect of a president hostile to its mission, EPA is now prepared to roll out a queue of pending air pollution regulations in the coming weeks.  The regulations will include final national ambient air quality standards, revised power plant emission standards, and expanded boiler emission rules.   

Since the election, articles and opinion pieces have abounded that speculate on the Obama administration’s second-term approach to climate change. On November 12, 2012, the New York Times published an op-ed article suggesting that the administration could tackle both climate change and the recession by imposing a carbon tax.  A similar suggestion was made in the New Yorker on December 12, 2012.  This is undoubtedly a worthwhile concept, but it is probably a regulation too far.

The second Obama term could be an opportune time to revisit old chestnuts and resolve issues that have bedeviled both the regulated community and environmental advocates.  For example, the EPA and the Army Corps of Engineers have been muddling through a proposed guidance document that aims to clarify the Supreme Court’s murky definition of “waters of the United States” subject to EPA jurisdiction under the Clean Water Act. But why should EPA and the Corps issue mere guidance rather than promptly promulgate binding regulations, which are subject to judicial review?  As a result of adopting binding standards the agencies could gain, in addition to regulatory certainty, a strong basis to resist efforts to make the federal government the national waterfront rezoning authority.

Another stalled national environmental initiative that would benefit from robust leadership in the Obama II administration is EPA’s effort to update its regulations for industrial cooling water intake structures.  EPA proposed regulations, designed to protect aquatic organisms, have remained in draft form since March 2011; additional data has been collected and is being analyzed in the interim.  Pending final federal regulations, states have been left to adopt varying approaches to this important issue.

Finally, this period of relative freedom from election concerns might allow the administration to address a significant example of environmental unfairness, CERCLA’s scheme of sticking certain liable parties with the “orphan share” of environmental remediation costs that arise from contamination, generated over the last two centuries of industrial development, for which no financially solvent responsible party can be identified.  The orphan share is often laid at the doorstep of a financially solvent polluter that caused some, but not all, of the pollution at a Superfund site.  Fairness dictates that the public fund the orphan share, as opposed to the party that is prepared to step forward and clean up its own portion of the mess.  Perhaps such a policy might have a sobering effect on the members of the public who clamor for a return to pristine conditions, so long as they don’t have to pay for it.

The song “Cool Water” was written and recorded in 1936 by Bob Nolan, an original member of the Sons of the Pioneers along with Len Slye, better known by his film name, Roy Rogers.  “Cool Water” could be the theme song for Texas and other water-short western states.  The Texas Water Development Board recently compiled “Water for Texas 2012 State Water Plan”.   Quite simply, Texas does not have enough water to meet its current needs, much less its future needs, during periods of serious drought conditions.   Texas is searching for cool, clear water.

Texas continues to grow.  According to the Plan, the population of Texas is expected to increase 82 percent between 2010 and 2060, from 25.4 million to 46.3 million.   Water needs are projected to increase by 22 percent, from 18 million acre-feet per year to 22 million acre feet per year in 2060.  At the same time as water demand is rising, existing water supplies are diminishing by almost 2 million acre feet per year.   Where will the additional water supplies be found to meet the identified needs?

The State Water Plan includes recommended water management strategies developed by regional planning groups, which include: conservation, drought management, conjunctive use of surface and groundwater, surface water reservoirs, aquifer storage, groundwater development, water reuse, desalination plants.  In addition to addressing surface and groundwater water rights, water planners and users will need to confront the environmental implications of these strategies.  What are the environmental regulatory constraints and impediments?

The implications and potential conflicts are far-reaching.  We can all anticipate the obvious regulatory hurdles,  contested procedures and property rights obstacles that projects to develop new surface reservoirs will confront.  But what of other strategies like water conservation and reuse?    Proposing water conservation (e.g. increased cooling water cycles) and reuse (e.g. use of treated municipal wastewater effluent) at a natural-gas fired power plant may  threaten surface water quality as the total dissolved solids to be discharged are concentrated through these strategies.   Also, what kinds of measures and alternatives under other environmental regulatory programs (e.g. Endangered Species Act) will need to be considered as these strategies are proposed?

The history of Texas is growth.   To do nothing to meet its increasing  water needs would result in staggering economic losses.    Texas met the challenge after the drought of record in the 1950s.  Texas will do it again!   The question is:  “how happy will the trails be?”

How far can affected stakeholders go in fashioning local, “place-based” solutions to water management problems?  In other words, is it OK to throw western water law out on its ear – a little bit -- if no one complains?

The policy question arises in Oregon in connection with recent efforts to balance the need for increased water supply to support the potential for substantial agricultural-based economic growth in the Umatilla Basin – a major Oregon tributary to the Columbia River system – with competing water demands to comply with the Endangered Species Act by restoring and protecting instream flow for listed salmon.  The balancing act also seeks to support treaty-based instream water rights for the Confederated Tribes of the Umatilla Reservation (CTUIR) and restore severely depleted ground water supplies (See CRUSTaskforce). The desire of stakeholders to explore new ideas that go beyond the boundaries established by existing water law is a foreseeable consequence of Oregon’s long-standing commitment to locally-based collaborative efforts to resolve complex natural resource issues  (See Oregon Solutions and http://www.oregon.gov/owrd/LAW/docs/i_Chapter_4_Final.pdf). Just how far should state bureaucrats be willing to go in bending or changing traditional programs and policies to make way for customized, place-based solutions?

The specific example in the Umatilla Basin relates to proposals for establishing a water bank and brokerage system.  (See http://orsolutions.org/beta/wp-content/uploads/2012/06/Oregon-Solutions-Presenation-6_18_2012-CRUST.pdf). A broad-based coalition of local interests including individual farmers, irrigation districts, the CTUIR, conservation interests, local governments and agri-businesses have jointly proposed an option for collaborative water management.  Under their concept, each year a water management plan would be filed with the state to describe how water would be used, and possibly redistributed under existing water rights.  The concept includes a bottom line requirement that the water management changes not result in injury to any water user not participating in the plan, and not diminish instream flows.  No harm, no foul.  However, in preliminary discussions, the Oregon Water Resources Department – the state agency in charge of allocating and administering water rights -- has balked at the plan because it could allow water users to ignore priority dates and “spread” water – concepts traditionally abhorred in Western water law.

So, the question is:  Should government get out of the way to let water users figure out their own strategies for managing water – even if it would throw certain principles of Western water law out on its ear? Why not, if it reflects a local consensus and no one complains?

Prior posts (by David Farer and William Hyatt) have featured comment on the litigation that resulted in the New Jersey Supreme Court’s decision in NJDEP v. Dimant (September 26, 2012) under the New Jersey CERCLA analog, the Spill Act, requiring a “reasonable link” between the discharge, the putative discharger, and the site specific contamination.  This alert focuses on the implications of the decision for building a liability case.

Dimant concerned liability for required remediation of perchloroethylene (“PCE”) contaminated groundwater at a site.  The New Jersey Department of Environmental Protection (“DEP”) inspectors observed for a portion of one day a pipe dripping a liquid onto blacktop.  Testing showed the drip contained more than 3,000 times the maximum contaminant level for PCE.  There was no evidence presented at trial, however, to indicate the blacktop was cracked, where the drips went, or the frequency or duration of the drips.  The DEP did not establish groundwater flow direction and therefore could not prove if the pipe location was up or down gradient of the PCE contaminated groundwater requiring remediation.  Also, there were several other potential sources of PCE in proximity to the defendant.  In other words, there was no proof connecting the defendant’s discharge of PCE to the PCE contaminated groundwater.

Keep in mind that the Spill Act imposes strict, joint and several liability on a person discharging or “in any way responsible” for a discharge, an arguably very broad standard indeed.  In its decision, the Court made it clear that “in an action to obtain damages, authorized cost and other similar relief under the [Spill Act] there must be shown a reasonable link between the discharge, the putative discharger and the contamination at the specifically damaged site.”  The Court disclaimed a proximate cause analysis, but did require “sufficient proof of a reasonable, tenable basis” showing how the discharge resulted in the contamination causing at least some of the damage at issue.  In short, the DEP failed to demonstrate “the requisite connection” between the dripping PCE and the PCE contaminated groundwater. 

What sunk the DEP’s case was a failure to prove the nexus between drips of PCE to the blacktop’s surface and some pathway for contribution of PCE through the soil and into the groundwater.  To avoid a similar fate, plaintiffs (including the State) will need proof that the defendant’s discharge actually reached the contaminated resource.  That evidence might be historical, physical or chemical analyses done to determine the source of releases affecting the resource.  This type of work is often referred to as environmental forensics and finding the right experts in this field will, in many New Jersey cases, be critical to establishing the “reasonable link” required by NJDEP v. Dimant.  To the extent that other state courts follow New Jersey’s lead, similar proofs will be necessary.

My views of the Great Lakes Water Quality Protocol of 2012, which was signed on September 7, 2012, by the United States and Canada, are influenced literally by where I sit.  For almost four decades I have daily seen the broad expanse of Lake Erie from my office window.  For as many days as I can in the summer, I sit on its beaches and swim in its waters.  Occasionally, I have sat on boats and fished Lake Erie.  My view of the Protocol is also influenced by the existence of many other Great Lakes programs, such as the Great Lakes Initiative, the Lakewide Management Plans, Remedial Action Plans, the Great Water Program, the Binational Toxics Strategy, Great Lakes 2001 as well as several State of Ohio programs aimed specifically at addressing Lake Erie’s environmental issues.

From where I sit, my view of the Protocol is not whether it is a comprehensive program or whether it recognizes the values of the Great Lakes.  Rather, my view is whether it will assist in addressing the most critical threats now facing the Great Lakes, and to Lake Erie in particular.   Those threats are, in my opinion, irreparable damage to the Lake Erie fishery and the continued inability to enjoy its beaches and other locations for swimming on many summer days due to the combined impacts of CSOs and excessive algae blooms due to nutrient loadings.

An invasion of the Asian carp into the Great Lakes threatens a permanent change in its fishery, the nature of which cannot be predicted.  The Asian carp would determine what the Great Lakes fishery would be.  Combined sewage overflows into the Great Lakes continue to produce beach closings for days after rainstorms forty years after the enactment of the Federal Water Pollution Control Act, and beach closings can be expected for at least another 40 years based on the current trajectory of CSO Control Projects.  The current generation of algae blooms in Lake Erie has produced swimming advisories for large portions of the Lake that persist for weeks.

Of the many issues that the Protocol addresses, preserving and enhancing the public’s ability to swim and fish in the Great Lakes are the most important.  For the public to fully value and to love the Great Lakes, they need to be able to touch it by wading, swimming or fishing.  Public support for the many programs under the Protocol will depend ultimately on the public’s love for the Great Lakes.

Perhaps the most surprising aspect of Superstorm Sandy’s destruction of the Jersey Shore is that some people were taken by surprise.  For decades, a central focus of coastal zone management and waterfront development restrictions has been to protect the fragile and shifting barrier islands, wetlands, and estuaries of the 130 miles of New Jersey at the intersection of land and ocean.  New Jersey’s Coastal Areas Facilities Review Act and its Waterfront Development Act contain among the toughest limitations in the nation to control growth and development and protect an environmentally sensitive ecosystem.  Over the decades, thousands and thousands of decisions have been made by legions of bureaucrats on projects big and small regarding application of land use regulations and the terms of permits and other approvals intended to preserve dunes, reduce beach erosion, prevent flooding and avoid loss of life and property as well as protect the environment.  Sandy seems to have made a mockery of the effort in the blink of an eye.

Sandy was not a black swan event—something heretofore not even contemplated and hence, unforeseeable.  The USGS modelers and their European counterparts had it right almost from the beginning.  Scientists have modeled not only storm tracking itself with better and better forecasts and therefore more warnings, but even the severity and effects of storm events.  These models have predicted the height and location of the storm surges and the resulting erosion and flooding with reasonable accuracy.  Plug in the real time coordinates and other data, and the models told us that the waves would attack the dunes and erode them back into the sea; that storm surge would carry the sand inland and that inundation would occur once the beach and dunes had surrendered to the sea and storm.

In Sandy’s immediate aftermath, two related themes have emerged to justify rebuilding in place.  Many have advocated continuing business as usual; after all, if this was the storm of the millennium, we have a thousand years before we have to worry about a similar event occurring again.  Others have suggested that by undertaking protective measures, we humans are still capable of living anywhere we choose. We just need bigger and better sea walls, flood gates, and other barriers; let the engineers figure it all out.  Eventually, however, these views will inform a more deliberate discussion about our ability to adapt to changing climate conditions—how and where shall we choose to confront Nature and how and where will we let her do as she is wont to do.  With billions of dollars at stake, this debate will get contentious, to be sure.  Climate change and weather volatility will not be easily accommodated.  The role of government in the process—as regulator, facilitator, first responder and insurer of last resort—will come under review.  The two character Chinese pictograph for the word “crisis” consists of the characters for “danger” and “opportunity.”  The crisis that is Sandy should remind us that we should not squander the opportunity to rethink our priorities and arrive at a better way to confront this danger in the future.

On January 27, 2011, the Bureau of Reclamation (“BOR”) issued an environmental assessment (“EA”) for the Ute Lake Diversion Project in eastern New Mexico, which would withdraw up to 24,000 acre-feet per year of water from Ute Lake and transport it via hundreds of miles of pipeline to communities in eastern New Mexico.  Inexplicably, the BOR found that this major federal project would not materially affect the environment and issued a finding of no significant impact (“FONSI”).  Based on the FONSI, the members of the proposed pipeline (including various municipalities in eastern New Mexico), announced their intention to begin construction of a $14 million intake structure at the side of the lake, which would require detonation activities and result in a potential fish kill from the detonation and the resulting turbidity.

The Village of Logan, a small community wholly dependent on the recreational resources derived from Ute Lake, filed suit in New Mexico Federal District Court, claiming that the BOR’s decision to perform an EA was contrary to its internal regulations and that an Environmental Impact Statement (“EIS”) must be prepared based on numerous significant environmental impacts resulting from the proposed project.  Additionally, Logan claimed that numerous alternatives existed to the project, including retiring groundwater rights presently used for agriculture, or treating effluent and re-injecting water into the Ogallala Aquifer.  Both options, according to Logan, would create a sustainable water source for eastern New Mexico until at least 2060.

The CEQ Regulations identify the specific circumstances under which a federal agency should perform an EIS before committing resources to a major federal action.  40 C.F.R. § 1501.4 provides that an EIS should be prepared where an agency’s own internal guidelines and procedures provide that a proposed federal action is the type that “normally requires” an EIS.  The BOR’s internal guidelines provide that the Bureau will “normally require” the preparation of an EIS prior to the initiation of construction of any major water project, which all parties agree includes the Ute Lake Diversion Project.  However, the BOR says it has discretion not to perform an EIS because the word “normally” does not mean “always.”  Logan has countered by claiming that the Bureau cannot avoid an EIS unless it has developed specific procedures stating when and under what circumstances an EA may be performed, in lieu of an EIS.  In the present situation, the BOR has no such guidelines identifying the projects for which an EA, rather than an EIS, may be appropriate.  Accordingly, Logan contends that there is no objective basis for the Bureau to side-step the EIS requirements and that the FONSI must be reversed.

The matter is presently scheduled for a preliminary injunction hearing before the Honorable William Johnson, District Court Judge, District of New Mexico.

When hydraulic fracturing “exploded” in Pennsylvania and Ohio to unlock the huge reservoirs of natural gas buried thousands of feet below surface in the deep shale formations, the initial environmental concerns focused on the potential for contamination of drinking water supplies from the “fracking” fluids and methane, and from the induced seismicity from the disposal of the waste brines into the underground injection wells.

While those concerns remain, new issues have surfaced.  In Ohio’s Utica shale play, the deep wells typically consume 5,000,000 or more million gallons of water for the hydraulic fracturing and well completion.  Beginning in June, a number of political subdivisions and water districts saw the energy industry’s needs for water as a wonderful business opportunity.  For example, the Muskingum Watershed Conservancy District, whose eighteen counties cover 20 percent of Ohio, reportedly contracted with one exploration and production company to sell millions of gallons of water from one of its reservoirs in eastern Ohio.  The City of Steubenville signed a five year contract to supply as much as 700,000 gallons a day from a reservoir that holds water from the Ohio River.  Newspaper reports at the time mentioned monthly payments to Steubenville on the order of $120,000.  The Buckeye Water District enjoyed a seven-month windfall of $24,000 per month for sales of water to a large drilling firm. Even the Ohio Department of Natural Resources weighed possible plans to grant drilling companies access to state-held reservoirs, lakes and streams.

But the public announcement of these water supply contracts produced significant public backlash.  The reaction to the plans of the Muskingum Watershed Conservancy District, for example, prompted a reversal of the sales, and lead to a moratorium pending completion of an independent water availability study by the U.S. Geological Survey and an updating of the District’s water supply plan with input from the new study.  Low stream flows in the Susquehanna River watershed in Pennsylvania lead the Susquehanna River Basin Commission to suspend 57 approved water withdrawals by gas drillers and other industrial users.

Perhaps in response to the public outcry over the potential impact on water resources, the Ohio General Assembly passed wide-ranging legislation to deal with the growth of shale gas exploration in Ohio.  One of the features of that bill requires drillers to disclose their water source and the likely volume of water for well completion.

The link to that legislation is here: 
http://www.legislature.state.oh.us/bills.cfm?ID=129_SB_315

In another piece of legislation, the Ohio General Assembly adopted a measure to regulate the withdrawal of water from the Lake Erie watershed, effectively precluding the use of Lake Erie watershed waters for hydraulic fracturing in the counties where the drilling is occuring because they are outside the watershed.

The legislation on the use of Lake Erie water can be found at this link:
http://www.legislature.state.oh.us/bills.cfm?ID=129_HB_473

Even with these safeguards, groups like the National Wildlife Federation urge the adoption of even stronger rules on the use of water for hydraulic fracturing.  With the projected exponential growth of shale gas drilling, there will be continuing efforts to regulate the use of water, and the encouragement for water recycle and reuse, for hydraulic fracturing.

The technique known as hydraulic fracturing (“fracking”), especially in the context of developing natural gas, continues to generate controversy, legal fees and emotion.  The question remains as to whether the technique itself presents any unusual risk to the environment or natural resources.  What is clear, however, is the political significance of fracturing and the challenges that our polarized, political dialog presents to achieving a rational result in or from  the fracturing debate.

On the federal side, the Administration has taken steps in order to represent to voters that the President has done what he could to see that hydraulic fracturing occurs in a manner that does not threaten the environment.  Concrete steps are taking place in three Agencies.

-    BLM has issued draft regulations relating to fracturing activities taking place on federal lands.  The proposal drew thousands of comments and no action is likely until well after the election.

-    EPA issued draft guidance proposing to regulate hydraulic fracturing under the UIC program.  This proposal also resulted in thousands of comments, all but precluding any chance that EPA will be in a position to act until well after the election.

-    EPA is continuing its study into the possible connection between hydraulic fracturing and underground sources of drinking water.  A partial report reflecting some retrospective analysis is due before year end, but the meat of the report will not be available until 2014.

-    EPA continues to pursue its general investigation into the way fracturing occurs through its investigation into 9 fracturing companies.  EPA has proposed to publish information reflecting well densities and chemical use relatively soon. 

-    EPA has reviewed and is continuing to review petitions filed by environmental organizations seeking to force the Agency to take steps to regulate fracturing under various regulatory programs, including TSCA.  EPA has denied some of the relief sought, but is collecting information under some and beginning its evaluation of others.

-    At the regional level, EPA has engaged in studies when citizen pressure has suggested a connection between fracturing and contaminated drinking water.  This has proven to be an area where EPA has not maintained consistency or scientific integrity.  The agency’s work at Dimmock, Pavillion and elsewhere has resulted principally in controversy and criticism, and has done little to advance the state of knowledge about fracturing.

-    DOE Secretary Chu has been an Administration spokesman for White House efforts to coordinate the many federal entities that seem to be working on fracturing issues.  His role has been above the weeds and the fact that a Secretary charged with overseeing national energy policy, if there is one,  is the Administration’s front man, appears to be a bone to those suggesting the sole interest of the President is in making energy development more difficult.

-    Within DOA, the Forest Service has sent mixed signals with respect to whether fracturing is viewed as posing risks to other resources.  While several forests have adopted plans anticipating the development of resources within their jurisdiction, including by fracturing, the George Washington National Forest plan remains under review, having proposed to ban fracturing in its initial draft release.

-    The USGS recently has entered the fray in connections with published concerns linking fracturing and increased seismic activity.  Preliminary indications suggest the true focus of such efforts may be long term injection wells, rather than transient fracturing activities, but there is more to follow on this topic.

The federal role in the fracturing debate also has occurred in courts.  Environmental interest groups recently have begun to raise fracturing activities in a number of lawsuits challenging the adequacy of the environmental reviews conducted in connection with federal leases.  Many  such cases are making their way through the courts, and are being watched for the decisions..

In his public statements, the President, of course, has been careful to promote the safe development of natural gas resources, including by fracturing.  He has offered what generally have been viewed as favorable statements in his state of the union address, and more recently in his remarks at the Democratic National Convention.  Of course none of those favorable comments has slowed any of the developments noted above, nor were the President’s remarks necessarily inconsistent with such action.

There is much resistance to the above federal efforts from states, and from industry which has had decades of experience accommodating state regulators in connection with drilling and developing wells.  States too have been active, to varying degrees, with some devising thoughtful programs balancing the needs of developers with the concerns of some members of the public.  The politicization of the issue also has reached the states, however, and nowhere is it more in evidence than in the glacial SGEIS process that has been under way for years, with no regulations on the horizon. There also have been intrastate efforts directed at fracturing by the Susquehanna River and Delaware River Basin Commissions, with the former moving forward with water management programs while the latter has, by default, banned fracturing until a compromise is agreed upon among the member sovereign constituencies.

And – don’t expect the controversy and misunderstandings surrounding fracturing to disappear soon.  In addition to a small scale advocacy film last year, Hollywood is entering the fray with a major film slated for release in the not-too-distant future.  Television already has managed to capitalize on the drama fracturing offers in more than one series.

Things will change after the election.  Stay tuned to find out how.