Delaware Environmental Law Update

Posted on May 23, 2008 by Robert Whetzel

On May 15, 2008, Delaware enacted legislation that will affect the transfer or closing of facilities in Delaware where chemical or hazardous substances have been or are located. The legislation establishes three principal requirements for affected facilities. First, prior to the transfer of a facility, the parties to the transaction must conduct "All Appropriate Inquiry" as defined in Delaware's Hazardous Substances Cleanup Act, and all documents prepared or identified pursuant to such inquiry must be submitted to the Department of Natural Resources and Environmental Control (DNREC). Second, if an affected facility terminates its operations or files for bankruptcy, certain requirements must be completed no later than 90 days after termination of all business or activities at the facility, including certification of the removal of the chemicals or hazardous substances from the facility. Third, financial assurance will be required for transferred facilities or new facilities, in an amount to ensure that, upon termination, abandonment or liquidation of activities at the facility, all appropriate means will be taken to stabilize and secure the facility.

The legislation will become effective upon the promulgation by DNREC of facility transfer regulations. DNREC will begin the development of regulations to implement this legislation in late summer or early fall and is expected to promulgate regulations in early 2009.

 

If you have any questions about this Delaware Corporate Update , or other legal issues, please contact a Richards, Layton & Finger attorney.

WHOA THERE

Posted on May 8, 2008 by Brian Rosenthal

Broad statement of underlying support cannot sustain EPA regulatory definition of navigable waters [1]

 EPA’s broad regulatory reach on navigable waters is rejected by the United States District Court for the District of Columbia. 

Setting aside the EPA’s regulatory definition of navigable waters, the D.C. Circuit Court  found the EPA’s definition was inadequately explained in light of recent United States Supreme Court cases. Oil producing facilities that add pollutants to navigable waters were required to develop spill prevention, control and counter measure plans under a Clean Water Act regulation that broadly defined navigable waters. Affected industry participants and associations successfully challenged the regulation.  

The question became whether in promulgating a regulation in an area where there has been recent Supreme Court activity whether the EPA considered all the relevant factors. If it did not, plaintiffs argued the EPA’s decisions were arbitrary and capricious or a clear error of judgment. The EPA argued while concise, its explanation was adequate. Its explanation came in a response to a comment and provided in part: “The case law supports a broad definition of navigable waters, such as the one published today, and that definition does not necessarily depend on navigability in fact.”[2]

The court could not reconcile, however, recent cases, that do not define navigable waters as broadly as in the EPA’s expansive rule. Noting recent courts have reined in the reach of the definition of navigable waters to not reach the fullest extent of the commerce clause, the court found inadequate EPA’s brief comment statement. Thus, the court agreed the EPA rule was not the product of reasoned decision making and struck it.



[1] American Petroleum Ind. v. Johnson, No. 02-2247 (D.D.C. March 31, 2008) (LEXIS 24963). 

[2] 2002 SPCC Rule, 67 Fed. Reg. at 47,075.

Acknowledging under an EPA review, the agency’s explanation must only be concise and general, the court noted that an explanation still must be provided showing that the relevant factors are considered. The EPA’s broad statement regarding case law support offered few clues as to which cases were used for reliance; thus, while the EPA’s statement was concise and general it did not provide sufficient support for the regulation. 

While expert agencies deserve deference and a “law review article” basis is not required for support, the court found the particular issues in this case provided a “unique burden” based on the recent Supreme Court case law that addressed the very issue.[1] 

At the very least, the court found recent case law established the Clean Water Act jurisdiction is not as broad as the limits of the Commerce Clause. In essence, the court concluded while the EPA may have taken a look at the factors, it could not conclude the look was reasoned enough to sustain the regulation. 

Therefore, the regulatory definition of navigable waters was set aside and vacated as arbitrary and capricious. 

The case has a nice overview of organizational and individual standing and ripeness. It also contains an interesting analysis of available remedies, discusses the reopening doctrine and the administrative review standard for cases in the D.C. Circuit. 



[1] Rapanos v. United States, 547 U.S. 715, 126 S. Ct. 2208 (2006); Solid Waste Agency of N. Cook County v. U.S. Army Corp of Engr’s, 531 U.S. 159, 121 S. Ct. 675 (2001).