The Packers, Beer, Cheese Curds and …Regulatory Reform?

Posted on January 30, 2018 by Todd E. Palmer

If states are the crucible of policy experimentation, Wisconsin’s regulatory reform efforts deserve attention as the Trump Administration implements its federal deregulatory agenda.   Wisconsin has been pushing an aggressive deregulatory agenda for the last five years and its experiences might better inform the federal debate in this area.

The cornerstone of Wisconsin’s regulatory reform effort has been Act 21.  Enacted in 2011 during a Special Session of the Legislature, Act 21 prohibits a state agency from implementing or enforcing any requirement, standard or permit term unless it is explicitly required or authorized by statute or administrative rule. Although largely ignored for its first five years, Act 21 has become a significant force in the state.  A previous ACOEL blog post highlights a Wisconsin Attorney General opinion that interprets Act 21 as restricting the Wisconsin DNR’s authority to regulated high capacity wells.  That issue is working its way through state courts.  More recently, Act 21 has been the legal predicate for further limiting state agency regulation in other areas, including:

-          A decision issued by the Wisconsin DNR Secretary concluding that her department lacks explicit authority to impose a limit on the number of animals at large livestock operations or to require that monitoring wells be installed around such operations. The Secretary’s decision reversed an ALJ’s opinion to the contrary.

-          A State Attorney General opinion that animal unit limits in WPDES permits are unlawful because they are not explicitly authorized by a statute or rule.

-          A judicial settlement agreement executed by the State of Wisconsin agreeing to refrain from enforcing any standards applicable to feed storage leachate or runoff management unless promulgated as a rule.  The state further agreed to withdraw and not enforce draft program guidance that sought to impose such requirements. 

-          A State Attorney General opinion that state agencies cannot enforce rules that are not explicitly authorized by statute, even if those rules were promulgated before enactment of Act 21.

-          A State Attorney General opinion that state agencies do not possess “any” inherent or implied authority to promulgate rules or enforce standards, requirements or thresholds.  The general statements of legislative intent, purpose or policy that are often found in statutory provisions do not confer or augment agency rulemaking authority.  

In the wake of these developments, the State Attorney General recently observed that “Act 21 completely and fundamentally altered the balance [of government administrative power], moving discretion away from agencies and to the Legislature.” 

As Act 21 forces Wisconsin agencies to create rules to implement their regulatory programs, the State Legislature is turning its attention to the rulemaking process. The Legislature passed its own version of the Reins Act (Regulatory Executives in Need of Scrutiny) which, in the most general of terms, increases the procedural requirements and legislative oversight of the state’s rulemaking process.  It now takes roughly three years to pass an administrative rule in Wisconsin.   

Having added procedures that delay the rulemaking process, the Legislature is debating bills that would expedite the rule repeal process. These bills would establish an expedited process requiring agencies to inventory and petition the Legislature for repeal of certain rules. For example, one bill would require the repeal of state rules concerning air pollutants that are not regulated under the federal Clean Air Act.  Another bill would automatically repeal certain environmental regulations ten years after they take effect. Although the Wisconsin DNR could attempt to readopt an expiring rule, that effort could not commence any sooner than one year before a rule’s expiration. 

In the Judicial Branch, the Wisconsin Supreme Court will soon decide whether the state’s practice of deferring to agency interpretations of statutes comports with the Wisconsin Constitution.  Recent decisions suggest that the majority of Justices will answer in the negative.  A decision should be issued this summer and could impose additional restrictions on agency authority.  

Not surprisingly these reforms have been controversial.  ENGOs have filed lawsuits challenging permits that fail to include terms and conditions due to the restrictions of Act 21.   The regulated community has taken the opposite view, challenging permit terms and conditions that are not explicitly authorized by rule or statute.  At some point these roles are likely to reverse since the regulated community often relies upon implicit agency authority to establish permit conditions which it finds favorable. 

Much like the federal initiative, Wisconsin’s reforms have been wrapped in the trope of reducing the regulatory burdens placed on state businesses and thereby improve the state economy. So far the state’s economy is doing quite well.  These efforts warrant continued monitoring to gauge how the economy and environmental concerns have been balanced while implementing these reforms.   

Musings on Starting a New Superfund Case – Hope springs eternal?

Posted on January 25, 2018 by David Rosenblatt

As lawyers, many of us enjoy the “rush” of starting a new case.  A new matter can be a welcome fresh tablet, providing us with the opportunity to use our skills and experience in creative and interesting ways to further our client’s interests.

But -- for those of us who have fought for clients on the front lines of EPA’s Superfund program over the years -- maybe not so much.  As Superfund practioners, we must deal with a cumbersome, almost 40-year-old law and an agency whose approach is dictated by a raft of standard operating procedures within an entrenched bureaucracy, decades-old guidance documents and forms, and a seemingly endless review and comment process.

To add to the challenge, clients have changed over the past 40 years, even if the Superfund law and its implementation have not. Today’s clients demand quicker, more practical, and cost-effective solutions in resolving their legal problems, without years of negotiations and endless administrative boxes to check off along the way in assessing and cleaning up sites.

There are other paradigms.  Many states have operated as laboratories of innovation in site cleanup through privatization and reduction of bureaucratic obstacles. In July 2017, EPA issued a Superfund Task Force report recommending numerous reforms to streamline the Superfund process and expedite cleanup.

Yet despite these advances on the state level -- and a supposedly business-friendly administration now in Washington and at EPA -- Superfund, well, remains Superfund. 

So here I embark on yet another Superfund Special Notice negotiation in early 2018.  I am armed with fresh ideas to bring to the table and an EPA Task Force report in my pocket, just hoping I will discover that a few of these new approaches will somehow have resonance with my EPA counterparts and that Superfund 2018 is somehow different from Superfund 1998.

Anyone want to take any bets on what I will find?    

One Brief Shining Moment of WOTUS Clarity

Posted on January 24, 2018 by Rick Glick

In a rare moment of clarity in the benighted history of the Waters of the United States or WOTUS rule, a unanimous Supreme Court declared that jurisdiction to review the WOTUS rule lies in the District Courts and not the Courts of Appeal.  The immediate effect of the January 22 ruling in National Assn. of Manufacturers v. Dept. of Defense  is to lift the nationwide stay of the rule imposed by the Sixth Circuit—which held that the appellate courts have original jurisdiction over the rule—thus reigniting a lot of dormant trial court challenges. 

The Clean Water Act applies to “navigable” waters, which is defined simply as “waters of the United States, including the territorial seas.”  EPA and the Army Corps of Engineers administer the CWA, and have tried without much success to refine this vague definition.  The latest attempt is the WOTUS rule, adopted by the Obama EPA in 2015.  The issue in National Assn. of Manufacturers is not whether that attempt hits the mark, but in which court should challenges be heard.

As noted in Bob Brubaker’s take on this case, the Court looked to the plain language of the statute, and to context when further explanation is needed.   The CWA extends original jurisdiction to the Circuits for EPA “approving or promulgating any effluent limitation or other limitation.”  The government argued that the WOTUS rule falls within “any . . . other limitation.”  The Supreme Court rejected that argument, holding that such other limitations must be related to effluent limitations, and the WOTUS rule just establishes a definition that would apply generally to the scope of CWA.  The Court also rejected applicability of another CWA basis for Circuit Court jurisdiction advanced by the government, “issuing or denying any [NPDES] permit,” concluding simply that the WOTUS rule is not the same as permit issuance.

So what difference does it make if a trial judge or an appellate judge makes the initial decision on WOTUS?  WOTUS has drawn a multitude of challenges in both the District Courts and Courts of Appeals, including some in which plaintiffs filed in both courts to be on the safe side.  The case will end up at the Supreme Court anyway, right? 

True, but consider that the Sixth Circuit consolidated all the challenges in other Circuits and issued a decision that applied across the country.  The district court litigation has not been consolidated, and some cases have come to different conclusions, with many remaining to be litigated.  So, we can expect years of litigation in many different courts, followed by years of appeals heard by the Circuits, and finally to the Supreme Court . . . again.

But wait, Scott Pruitt’s EPA has initiated a rulemaking process to rescind and replace the WOTUS rule, so wouldn’t that moot the pending challenges to the rule?  It would not.  EPA has announced it is delaying the effective date of the 2015 rule for two more years to allow the Agency to develop its replacement.  But, in the meantime, the 2015 WOTUS rule remains in place.

The practical result is that the current round of cases in the District Courts will continue, followed -- if not accompanied -- by a new round of litigation challenging the proposed change of effective date, and the proposed rescission and replacement rules.  Safe to say there will be no certainty on the definition of WOTUS and the scope of Clean Water Act jurisdiction for many years to come.

Justice Sotomayor’s Two Greatest Commandments of Statutory Interpretation

Posted on January 23, 2018 by Robert Brubaker

I expect to see many brilliant ACOEL blog posts (from members that unlike me are Clean Water Act oracles) on the Supreme Court’s decision in National Association of Manufacturers v. Department of Defense et al., No.16-299 (January 22, 2018).  That decision holds that the district courts rather the circuit courts have initial jurisdiction to review EPA’s action in promulgating the Waters of the United States (WOTUS) rule.  I write to comment briefly on one aspect of the opinion: what it teaches us about statutory interpretation.

The field of environmental law is comprised of an exceptionally abundant amount of statutory law (in contrast to, say, antitrust law at the other extreme).  Environmental practitioners are continuously confronted with issues of statutory interpretation, often of incredible difficulty.  What jumps out at me from the unanimous WOTUS opinion, authored by Justice Sotomayor, is the clarity of articulation of the two greatest commandments of statutory interpretation.  The first commandment is that the statute’s plain language is of paramount importance to the correct interpretation, transcending all other considerations.  The second commandment is that context and structure are the most important guides to the correct interpretation when the statutory text is insufficiently clear.  We are well-advised to not overlook or overcomplicate the two most basic rules of statutory construction.

Another thing jumps out at me from Justice Sotomayor’s opinion for a unanimous Court.  To my knowledge, it is the first federal appellate court decision since 1984 involving an EPA interpretation of its enabling legislation, in a notice and comment rulemaking, that does not cite Chevron v. NRDC.

Even the irrationality of a bifurcated judicial review scheme, and the compelling interests in quick and orderly resolution of rulemaking disputes, in judicial efficiency, in avoiding conflicting outcomes in district court cases brought as late as six years after the claim accrues – all ably argued by EPA – were not enough to overcome the two greatest commandments of statutory interpretation.

WHEN SCOTT MET JANUS

Posted on January 16, 2018 by Robert M Olian

The amateur horologists among you will recall that all of the calendar months are named after fabric fresheners (February - Febreze), gods (March - Mars, April - Aphrodite, May - Maia, June - Juno), emperors (July - Julius, August - Augustus), or simply their place in the calendar - Sept, Oct., Nov. and Dec. for the seventh, eighth, ninth, and tenth…. Whoa, wait a sec!  (I could explain, but instead that issue is left as an exercise for the reader).

We are interested in January, named for the god of beginnings, Janus, who is always depicted as facing in two directions.  Could one write a blog post about the current state of environmental law based on the theme of a two-faced ruler who thinks he’s one of the gods?

OF COURSE one could! But that would be too easy. Instead, how about a blog post to make everyone happy, while the festive warmth of the holidays is still washing over us? Using the game of MadLibs as our inspiration, first complete the following phrase by choosing either Answer A or Answer B.

“I {insert answer} vote for Donald Trump in the 2016 Presidential election.”

A. did not

B. did

If you picked answer A, read the following blog post using the phrases from option A. If you picked answer B, read the post using the phrases from option B. Make sure you use the correct option, or you will be an unhappy reader instead of a happy reader, and we don’t want that.

*******************

The environmental trade press is replete with top ten lists at this time of year —top ten judicial rulings, top ten regulatory decisions, etc. — but the goal here is to step back and look at things from the 50,000-foot level. Here’s the shorter meta list:

1.  EPA Administrator Scott Pruitt installed a Sensitive Compartmented Information Facility (SCIF) costing nearly $25,000 in his personal office (EPA already had another secure room in the headquarters building) and is the only EPA Administrator to ever request a 24/7 security detail. The 18-member security detail cost taxpayers more than $830,000 in Pruitt’s first three months at the helm and required that EPA agents be pulled away from ongoing criminal investigations to staff the security detail. These actions suggest that EPA is being run by someone who is

1A. self-aggrandizing to the point

1B. appropriately conscious

of

2A. paranoia.

2B. security risks that are increasingly important at a time where environmental issues intersect those of national security.

2. “More than 700 people have left the Environmental Protection Agency since President Trump took office, a wave of departures that puts the administration nearly a quarter of the way toward its goal of shrinking the agency to levels last seen during the Reagan administration,” (NYT, 12/22/17), including a disproportionate number of scientists. The brain drain is intentional according to:

1A. Obama science adviser Thomas Burke

1B. Trump OMB Director Mick Mulvaney

who added,

2A. “The mission of the agency is the protection of public health. Clearly there’s been a departure in the mission.”

2B. “You can’t drain the swamp and leave all the people in it. So, I guess the first place that comes to mind will be the Environmental Protection Agency.”

3. The United States withdrew from the Paris climate accords, a move that was

1A. denounced

2A. praised

by many, ranging from:

2A. the Pope to the head of Goldman Sachs.

2B. Charles Koch to David Koch.

4. The United States was battered by record flooding, hurricanes and forest fires, all of which were

1A. substantial evidence suggesting the existence of

1B. a bizarre coincidence.

2A. anthropogenic climate change.

2B. [Sorry, there is no phrase to describe something whose existence is denied]


But wait, you say, that’s only four items, not a top ten. Sorry, but there are eight; you only read four. If one of you As will add another to the comments, and one of you Bs will do likewise, that will get the total to 10.

A VISIT TO THE DUTCH ROYAL PALACE TO HONOR GLOBAL ENVIRONMENTAL INNOVATORS

Posted on January 10, 2018 by Robert Percival

The initial email, quickly skimmed, had hallmarks of spam – words like “royal palace” and “100,000 Euros”.  But the attached letter of invitation contained wonderful news.  The Dutch royal family’s Prince Claus Fund had selected Chinese environmentalist Ma Jun to receive its top award. They wanted me to prepare a tribute to him for inclusion in the official awards book and to be their guest at the presentation at the Royal Palace in Amsterdam.

I first met Ma Jun after I gave a talk in Beijing in 2009.  Astonishingly, he asked me to autograph the fourth edition of my casebook Environmental Regulation: Law, Science & Policy. When I asked why, he declared that “page 438 changed my life.”  That was the portion of the book where material on the U.S.’s Emergency Planning and Community Right-to-Know Act (EPCRA) began. Ma Jun was so impressed by the EPCRA’s Toxics Release Inventory that he vowed to create a website providing the Chinese public with similar information.  But he did not stop there.  He created apps that enabled the public to use their cellphones to access real time information on air and water quality in more than one hundred Chinese cities. 

In a country that at the time lacked express legal authorization for citizen suits, Ma Jun grasped the power of information to mobilize public demand for environmental protection.  He founded an NGO called the Institute for Environmental and Public Affairs (IPE) that quickly became a major force in China’s environmental movement.  Working with a coalition of NGOs, Ma Jun launched audits of the Chinese supply chains of major multinational electronics companies to assess their compliance with environmental and labor laws.  The results of these audits helped convince Apple to agree to regular, independent audits of it Chinese suppliers, the results of which now are presented annually in the company’s Supplier Responsibility Reports.

Another brilliant project that Ma Jun pursued jointly with NRDC’S Beijing Office was to publish annual ratings of China’s 120 largest cities reflecting how well local governments comply with requests for environmental information under China’s Open Information Law. This Pollution Information Transparency Index (PITI) has become a powerful tool for encouraging compliance with the law.  IPE and NRDC frequently hear from local officials in China who want to improve their ratings, much as U.S. universities scramble to increase their annual standings in the U.S. News rankings.

The Prince Claus Fund, named for the late husband of former Queen Beatrix, is funded in part through the Dutch Ministry of Foreign Affairs. It also made awards to other social and cultural innovators. These included Brazilian filmmaker Vincent Carelli, a champion of indigenous tribes, scientist Brigitte Baptiste, who is working to protect post-conflict areas in Colombia, Burkino Faso architect Diébédo Francis Kéré, who designs green buildings for African villages, Khadija Al-Salami, who champions women’s rights in Yemen, and Indian artist Amar Kanwar. It was inspiring to get to meet these heroes during the ceremony at the Royal Palace and to learn more about their work helping to build a better world in all corners of the planet. 

Chronic Pesticide Exemptions May Increase Risks to Our Pollinators

Posted on January 8, 2018 by Stephanie Parent

EPA has the responsibility to protect the public and the environment, including bees and other pollinators, from the use of pesticides under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). Before any pesticide can be sold or distributed in the United States, EPA must register it after determining that its use will not generally cause “unreasonable adverse effects on the environment.” Section 18 of FIFRA allows use of pesticides that have not met this standard if “emergency conditions exist.” Congress intended use of Section 18 emergency exemptions to address urgent pest conditions such as severe and unexpected insect outbreaks. Yet, in some cases, EPA seems to administer the emergency exemption program so that it functions as a shortcut, allowing pesticide use to bypass the registration standard.

EPA’s repeated “emergency” exemptions for use of the insecticide sulfoxaflor on cotton and sorghum over the last six years are a good example of this. Sulfoxaflor is an insecticide, which EPA acknowledges is very highly toxic to bees. In 2015, the Ninth Circuit vacated EPA’s decision to register sulfoxaflor because “[w]ithout sufficient data, the EPA has no real idea whether sulfoxaflor will cause unreasonable adverse effects on bees, as prohibited by FIFRA.” In 2016, EPA registered sulfoxaflor without additional bee data or studies. Instead, EPA explained that the new registration results in “essentially no exposure to bees” because this time it did not allow use on indeterminate blooming crops, such as cotton, or on crops grown for seed. And, the registration restricted applications on certain “bee attractive” crops to post-bloom only.

Despite these restrictions in the registration designed to avoid harm to bees, EPA has exempted the use of sulfoxaflor over 70 times from 2011 through 2017. All but one of these exemptions was for use on cotton, which was retracted from the registration application following the Ninth Circuit’s decision, or on sorghum, which was never included in the registration in the first instance. Most recently, EPA exempted the use on alfalfa grown for seed, even though the registration also prohibits such use to avoid adverse effects to bees. The Center for Biological Diversity, where I work, makes the case that EPA’s chronic approvals of Section 18 exemptions for use of sulfoxaflor no longer reflect “emergency conditions” and are circumventing the FIFRA’s registration standard. We may learn more about sulfoxaflor and other exempted pesticide uses when EPA’s Office of Inspector General concludes its evaluation of whether EPA’s emergency exemption process maintains environmental and human health safeguards. 

Environmental and Energy Executive Orders – Ever Expanding Exercise?

Posted on December 26, 2017 by John Milner

The presidential use of executive orders (EOs) is not a new practice but President Trump is using EOs to impact significant environmental and energy issues.  He is reported to be issuing EOs at the second-fastest rate of any modern Republican president, second only to President Eisenhower. This trend exists despite consistent criticism prior to being elected of President Obama’s EOs: “Obama … goes around signing all these executive orders.  It’s a disaster.  You can’t do it.”

What is an EO?  Here is a quick summary.  An EO is a directive issued by the president to federal governmental agencies.  The president may revoke, modify, or supersede any prior EO.  Presidents often undo the EOs of their predecessors, as President Trump has done a number of times with regard to EOs issued by President Obama.  Courts can declare an EO to be illegal or unconstitutional.  Congress can pass legislation overturning an EO, subject to the president’s veto authority.

In the environmental and energy areas, President Trump has issued the following EOs:

1.       “Expediting Environmental Reviews and Approvals for High-Priority Infrastructure Projects,” EO No. 13766, dated January 24, 2017.

The EO directs the chairman of the Council on Environmental Quality (CEQ), within 30 days after a request, to determine a project’s environmental impact and decide whether it is “high priority.”

2.      “Reducing Regulation and Controlling Regulatory Costs,” EO No. 13771, dated January 30, 2017.

The EO states that executive departments and agencies must slash two regulations for every one new regulation proposed. Regulation spending cannot exceed $0 and any costs associated with regulations must be offset with eliminations. The EO also directs the head of each agency to keep records of the cost savings, to be sent to the president.

3.      “Restoring the Rule of Law, Federalism, and Economic Growth by Reviewing the ‘Waters of the U.S.’ [WOTUS] Rule,” EO No. 13778, dated Feb. 28, 2017.

The EO calls on federal agencies to revise a regulation put in place by President Obama called the Clean Water Rule or WOTUS. Published in 2015, WOTUS arguably expanded the number of bodies of water protected by the federal government to include certain streams, ponds, and smaller waterways that were not previously clearly covered.  The EO directs the administrator of EPA and the assistant secretary of the Army for Civil Works to review WOTUS and propose a new one that either eliminates or revises the rule.

4.      “Promoting Energy Independence and Economic Growth,” EO No. 13783, dated March 28, 2017

The EO directs EPA to review the Clean Power Plan (CPP) EO, signed by President Obama in 2014. In 2016, the Supreme Court granted a stay pending review in the U.S. Circuit Court for the District of Columbia of the CPP, which aimed to reduce carbon pollution from power plants.  This EO also requires federal agencies to review any regulations that could “potentially burden the development or use” of oil, natural gas, coal, and nuclear energy resources. Within 180 days, the agencies must submit reports to the Office of Management and Budget, which will take action to eliminate burdensome regulations.

5.      “Implementing an America-First Offshore Energy Strategy” EO No. 13795, dated April 28, 2017

The EO reverses a prior ban on Arctic leasing put in place under the Obama administration and directs the Interior Secretary to review areas available for off-shore oil and gas exploration.

6.      “Establishing Discipline and Accountability in the Environmental Review and Permitting Process for Infrastructure,” EO No. 13817, dated August 15, 2017

The EO establishes “One Federal Decision” for major infrastructure projects, assigning each project a lead federal agency and creating a performance accountability system to track its progress.  It sets a goal of two years for the average completion time of the permitting process.  The EO also revokes Executive Order 13690, which mandated stricter environmental review standards in floodplains as part of President Obama’s Climate Action Plan.  That prior EO required planners to use flooding predictions that incorporated climate science.

The president may also issue proclamations, as well as presidential memoranda.  Like EOs, presidential proclamations and memoranda can have significant impacts.  For example, on December 4, 2018, President Trump issued a proclamation to substantially reduce the size of the Bears Ears and Grand Staircase-Escalante National Monuments in Utah.  Additionally, the EPA administrator may issue directives to the agency staff that have important ramifications, such as Administrator Scott Pruitt’s October 16, 2017 directive to end so-called “sue and settle” judicial settlements relating to EPA regulations.

It appears that EOs and their related executive edicts have become the standard operating procedure for presidents and their appointees.  The pressure to have “instant impact” is due, in part, to the political division in Congress and the impatience and uncertainty of legislative action.  As always, “the buck stops” with the courts to deal with the issues created by these executive actions.  As we all know, judicial action can bog down resolution of these issues almost indefinitely.  There is no easy way out of this quagmire.

Kozinski Resignation Complicates Mandamus Ruling in Kids Climate Lawsuit

Posted on December 22, 2017 by Patrick A. Parenteau

In a stunning development, Judge Alex Kozinski announced on Monday December 18 that he was resigning effectively immediately from the Ninth Circuit after multiple former clerks and junior staffers came forward with allegations of sexual misconduct against him.

Kozinsky was a member of a three judge panel that had just heard arguments on December 11 in United States v US District Court for the District of Oregon   in which the Trump administration is seeking a writ of mandamus to bar the climate lawsuit filed by 21 youth plaintiffs in Juliana v United States  which is scheduled for trial in February before the federal district court in Oregon.

By way of background, in November 2016, the district court denied motions to dismiss the action, allowing federal public trust and Fifth Amendment due process claims to proceed. After unsuccessfully seeking permission for interlocutory appeal, the United States filed the petition for writ of mandamus under the All Writs Act, arguing that the district court committed clear error in denying the motions to dismiss. The government also argued that the discovery process would be unduly burdensome and would distract senior administration officials like Scott Pruitt and Rick Perry from the more important work of dismantling the regulatory programs adopted by the Obama administration and increasing the nation’s reliance on fossil fuels.

Kozinski, as is his wont, was the most aggressive questioner at oral argument peppering plaintiffs’ counsel with questions regarding standing and justiciability and making it pretty clear how he was going to come down. By contrast, the other members of the panel, Chief Judge Sidney Thomas and Marsha Berzon, focused on the narrower question whether mandamus was the proper remedy at this stage of the case. Both noted that the court had never granted mandamus where there was no conflict over discovery orders. Both noted that the case had become much more manageable with the departure of the industry interveners who had been the major target of discovery requests. Both noted that District Judge Aiken and Magistrate Coffin had narrowed discovery and had pledged to exercise a “firm hand” on the pretrial proceedings. Though each judge expressed reservations about various aspects of the plaintiffs’ claims and standing neither thought those were appropriate grounds for mandamus. Commenting on the unprecedented nature of what the government was seeking Judge Thomas observed: "We would be absolutely flooded with appeals from people who think their case should be dismissed by the district court."  

Kozinski’s resignation throws a bit of a monkey wrench into the proceedings. Judge Thomas must decide whether to replace Kozinski on the panel and schedule a new oral argument or proceed to decide the mandamus issue. If he and Judge Berzon are in agreement that the writ should be denied the simplest solution would be to issue a decision to that effect.

There is precedent for this. In Connecticut v AEP a three judge panel of the Second Circuit heard arguments in a case involving a public nuisance action brought by a number of states against utilities operating coal fired power plants. While the case was pending one member of the panel, Judge Sonia Sotomayor, was nominated to the Supreme Court and had to recuse herself.  The remaining members of the panel proceeded to decide the case in the states’ favor and Judge Peter Hall wrote an exhaustive opinion on standing and political question in the context of climate litigation. Though the Supreme Court ultimately reversed on other grounds the jurisdictional holdings were affirmed by a divided vote. 

The upshot is that there is a good chance we will see the “trial of the century” unfolding sometime next year.  Mr Pruitt may get a chance to try out his “red team, blue team” climate science debate in a real courtroom.

The North Slope Is Really, Really, Getting Warmer. Drill, Baby, Drill

Posted on December 20, 2017 by Seth Jaffe

The Washington Post reported last week that Utqiagvik, Alaska (formerly known as Barrow), has gotten so warm, so fast, that NOAA’s computers can’t even believe it.  The data for Utqiagvik (that’s hard to type!) were so high that the computers determined it must be anomalous and pulled all of the data from Utqiagvik from the NOAA monthly climate report.  Only when scientists realized that Utqiagvik was completely missing from the report did they notice what had happened.

How hot does it have to get to get bounced by the computer?  How about average October temperatures 7.8 degrees warmer than in 2000?  Average November temperatures 6.9 degrees warmer than in 2000?  Likely culprit?  Melting sea ice means that less sunlight is reflected.  That’s one nasty negative feedback loop.

In the meantime, as I noted in October, Alaska Governor Bill Walker has concluded that Alaska needs more oil drilling (can you say “Open ANWR” three times fast?) in order to pay for climate change mitigation.  It’s apparent that Governor Walker has not read Faust.

Governor Walker, this one’s for you.

READY FOR AN ENVIRONMENTAL BILL OF RIGHTS?

Posted on December 19, 2017 by John A. McKinney Jr

As this is written, a New Jersey legislator plans to introduce a bill that could lead to the amendment of the state constitution.  This amendment is being referred to the “Bill of Environmental Rights.”  Here’s the proposed language:

(a) Every person has a right to a clean and healthy environment, including pure water, clean air and ecologically healthy habitats, and to the preservation of the natural, scenic, historic, and esthetic qualities of the environment. The State shall not infringe upon these rights, by action or inaction. (b) The State’s public natural resources, among them its waters, air, flora, fauna, climate, and public lands, are the common property of all the people, including both present and future generations. The State shall serve as trustee of these resources, and shall conserve and maintain them for the benefit of all people. (c) This paragraph and the rights stated herein are (1) self-executing, and (2) shall be in addition to any rights conferred by the public trust doctrine or common law.

Unlike a law which requires compliance, this amendment will be used to obtain the “pure water, clean air and ecologically healthy habitats” guaranteed as a constitutional right, no different than the rights of free speech and freedom of religion.  Because it is not clear what a “right to a clean and healthy environment” actually means, state courts will have to decide the breadth and scope of such rights and the how they are protected. 

New Jersey courts can handle it.  They have dealt with similar broad language in the constitution which requires the legislature to provide “a thorough and efficient system of free public schools.”  That phrase has been fought over, in the courts and in the legislature, since the 1970’s.  It is still a hot button issue.

Will the New Jersey constitution ultimately include a Bill of Environmental Rights?  I am not sure but if it does, it will continue the state’s reputation as a great place to be an environmental lawyer.

Are RCRA Endangerment Claims Becoming The Preferred Way for Third-Parties To Regulate Point Source Discharges?

Posted on December 18, 2017 by Edward F. McTiernan

In 1972, Congress adopted the Clean Water Act (CWA) prohibiting discharges of pollutants from point sources without a permit.  Four years later, when Congress enacted the Resource Conservation and Recovery Act (RCRA), it included two notable provisions.  First, Congress excluded from the definition of “solid waste”—and thereby from regulation under RCRA—“industrial discharges which are point sources subject to permits under” CWA Section 402 (i.e., NPDES permits).  Second, Congress barred RCRA from applying to “any activity or substance which is subject to” various environmental statutes (including the CWA), “except to the extent that such application (or regulation) is not inconsistent with the requirements of such” other environmental statutes.  The net effect of these two RCRA “anti-duplication” provisions prevents RCRA from encroaching upon activities regulated by the CWA.  While much of this year’s Clean Water Act action seemed to focus on the WOTUS rule, 2017 may ultimately be remembered as the year in which plaintiffs were able to break through RCRA’s anti-duplication provisions and use endangerment claims to regulate point source discharges.

In Tennessee Riverkeeper, Inc. v. 3M Co., plaintiffs convinced a district court that they were entitled to pursue RCRA endangerment claims to regulate discharges of perfluorinated chemicals.  The court  refused to dismiss the case because, in its view, the defendants had failed to provide ‘‘any authority stating that a citizen cannot bring an RCRA claim to try to impose stricter limits on the disposal of hazardous waste than those imposed by an EPA-approved State permit or to supplement the terms of such a permit.”  Slip Op. at 20.  On November 2, the Ninth Circuit reached a similar result.  Ecological Rights Foundation v. Pacific Gas & Electric Company, (“ERF”).  Following an extensive (and largely unnecessary) analysis of RCRA’s non-duplication provisions, the Ninth Circuit stated: “RCRA’s anti-duplication provision does not bar RCRA’s application unless the specific application would conflict with identifiable legal requirements promulgated under the CWA or another listed statute.” Slip op. at 25.  In other words, plaintiffs may use RCRA to impose discharge limits on any substance not specifically named in a Clean Water Act permit, and perhaps to lower the discharge limits of substances that are.

By encouraging exactly the sort of dual regulation of a single discharge under both the CWA and RCRA that the RCRA non-duplication provisions appear intended to prevent, these decisions appear to be inconsistent with a proper reading of RCRA’s non-duplication provisions.  They may allow a judge to set discharge limits, displacing the limits (or the lack thereof) established by agency scientists following a public process.  This is problematic for several reasons.  A CWA permitted discharge may contain tens or hundreds of pollutants, but the permit typically regulates only those of most concern.  According to the Ninth Circuit,  however, the rest can now be regulated by RCRA.  Indeed, these recent decisions may open the door to using RCRA to cover pollutants  already regulated under the permit, as long RCRA imposes “stricter limits” (in the words of the Tennessee Riverkeeper court) than the CWA permit.  If the sole criterion is that RCRA endangerment claims must impose “stricter limits” than the CWA permit, plaintiffs may now have a legal basis for rewriting permits to contain whatever regulatory standards, technology requirements or procedural measures they can convince a court to impose.

ACOEL’s Alex Dunn to Serve as Regional Administrator for EPA Region 1

Posted on December 13, 2017 by Andrea Field

Last month, EPA Administrator Scott Pruitt announced the well-deserved appointment of the ACOEL’s own Alexandra Dapolito Dunn as Regional Administrator for EPA Region 1.  The press release accompanying the announcement described Alex’s exceptional qualifications and extensive environmental experience.  It also included endorsements and accolades for Alex from a remarkably diverse group of people, including senior regulators in the Region 1 states, representatives from environmental advocacy groups, and academics.

Those of us in the College both congratulate Alex and thank her for helping to raise the profile of the American College of Environmental Lawyers by somehow ensuring (we don’t know how and we don’t care) that Administrator Pruitt’s press release included numerous references to the College.  The announcement not only noted Alex’s membership in the ACOEL (and her recent election to the College’s Board of Regents), but also it included the endorsement of Alex by John Cruden and noted John’s current position as ACOEL president.

So, best of luck, Alex, and thanks for your efforts to help us achieve John Cruden’s goal of spreading the word on the ACOEL!  

Oh, Well, Some Folks Don’t Like Oysters, Anyway….

Posted on December 12, 2017 by James I. Palmer, Jr.

As a kid growing up in the hills of North Mississippi, I was introduced to oysters by my maternal Grandmother in Biloxi, down on our Coast.  I wasn’t particularly impressed with the slimy mollusks then, but my tastes changed over many years and I now enjoy them, especially in po’boys and on the half shell.

For the longest, I have considered oysters from Apalachicola Bay, Florida, to be the best along the Gulf Coast.  Large, plump, salty, everything an oyster fan likes.  But, today the oyster industry in the Bay has declined dramatically, and many Floridians believe that the ultimate fate of this historic mainstay of the economy of the area will soon be determined by the Justices of the United States Supreme Court.

The “Tri-State Water Wars” among Alabama, Georgia, and Florida are now several decades long, and never more intense.  Two interstate compacts, covering six river basins in the three states, failed to yield an “equitable apportionment” of the flows from these basins, and expired by their terms.  Follow-on negotiations fared no better.  So, in 2013 Florida sued Georgia in the Original Jurisdiction of the Supreme Court, but didn’t join Alabama.  The case was tried before the Special Master from October 31, 2016 through December 1, 2016.

At the core of Florida’s claims is the ever-growing demand for water in Georgia, principally (but not only) in metropolitan Atlanta.  Even the definition of “metropolitan Atlanta” differs among websites, so the data showing the population trends over the last 50 years also differs somewhat, but the numbers I will use for general reference show that the population of metropolitan Atlanta was 3,317,000 in 1990, 4,548,000 in 2000, 5,034,000 in 2004, and the 2010 U.S. Census recorded 5,800,000.  I’ve seen one projection of 8,000,000 by 2020.  Using these statistics purely for the sake of argument, the population of metropolitan Atlanta in 2020 – just over two years away – could have grown by over 240% in 30 years.  

Too, production agriculture in southwestern Georgia, heavily dependent upon surface water and groundwater supplies for irrigation, has also burgeoned during this same time period.  Groundwater levels in the Flint River basin have declined significantly because of what one of Georgia’s own witnesses at trial attributed to essentially lax regulatory management at the State level.  No surprise, these declines in groundwater availability have ratcheted up pressures on surface water resources in the Flint River watershed.

Thus, given these twin realities of seemingly insatiable urban and agricultural demands for water in Georgia, it’s no wonder that folks down in the Apalachicola Bay area staunchly believe that this is the principal cause of declining freshwater flows into the Bay, and, inevitably, will lead to the irrecoverable loss of the Bay ecosystem, itself.

The Special Master rendered his Report on February 14, 2017, and it was filed on March 20, 2017.  The Special Master found, as a matter of fact and law, that Florida had failed to prove its case by clear and convincing evidence, and recommended that the Supreme Court deny Florida’s claims.

Florida filed its Exceptions to the Report of the Special Master on May 31, 2017.  Georgia filed its Reply opposing Florida’s objections on July 31, 2017, and Florida filed its Sur-reply on August 30, 2017.  Amicus briefs supporting Georgia’s position have been filed by the United States (on behalf of the Corps of Engineers), the State of Colorado, and the Atlanta Regional Commission, et al.  The case has been set for oral argument before the Supreme Court on Monday, January 8, 2018.

Of the several issues before the Court, the two major ones are the “clear and convincing evidence”  burden of proof standard the Special Master imposed upon Florida and the general issue of “redressability,” which turns on the obligation of Florida to prove both substantial (some would say “irreparable”) injury and that the relief sought (a consumption cap on Georgia water use, primarily in the Flint River Basin) would, in fact, provide additional flows into Apalachicola Bay sufficient to save the ecosystem and the oyster industry.  Understandably, Georgia strongly rejects Florida’s contentions.

The cases relied upon by Georgia and the amici are, in the main, decisions in litigation between and among western states whose organic water resources laws are grounded in the doctrine of prior appropriation.  Here, the dispute is between two states whose organic water resources laws arise under the common law doctrine of riparianism (or, in modern times, regulated riparianism).  Interestingly, because the Supreme Court departed from pure riparian principles in early cases involving interstate fights over the water needs of huge urban areas like New York City, Florida contends that it is appropriate in this case for the Court to apply traditional equitable principles in addition to equitable apportionment principles that have evolved over many years of case law.  While not dismissing the argument out of hand, I think it could be a real challenge for Florida to make it stick.

Ultimately, the Court will either accept the Report and recommendations of the Special Master and dismiss Florida’s case outright, or decline to accept the Report and remand the case to the Special Master for further proceedings.  Given the deference the Supreme Court generally accords Special Masters in Original Jurisdiction cases, I think Florida, figuratively, now has to push a very heavy anchor chain up a very steep hill to stay in the fight it started.  If the State fails, locals say that the loss will likely result in a knockout blow to the oyster industry in Apalachicola Bay, which is already on the ropes.  Maybe, yes.  Maybe, no.  Maybe, not yet.  Time will tell.  Oh, well, some folks don’t like oysters, anyway….

It Ain’t Over ‘til It’s Over -- The Congressional Review Act & the Search for Zombie Regulations

Posted on December 7, 2017 by Allan Gates

Enacted in 1996, the Congressional Review Act (CRA) affords Congress the opportunity to review and disapprove final rules of federal agencies.  In the first 20 years of its existence, only one regulation was disapproved using the CRA.  In the first 100 days of the Trump administration, however, Congress invoked the CRA to disapprove thirteen separate regulations.  The White House advertised the CRA disapproval resolutions as the top legislative accomplishment of the administration’s first 100 days, proudly claiming that President Trump had signed more CRA resolutions than any other President in history.

By mid-summer most observers assumed the push to roll back Obama-era regulations using the CRA was over because the statute provides a narrow window of time for introducing resolutions of disapproval (generally 60 legislative days from the date the regulation is received by Congress), and it similarly limits the time within which expedited legislative procedures – including passage by simple majority vote in the Senate – can be used.

But wait, there’s more  – 

The window of time for introducing a disapproval resolution under the CRA begins to run on the day a regulation is submitted to Congress.  And it turns out agencies have not always been careful about sending their rules to Congress.   According to a 2014 report, hundreds of final regulations published in the Federal Register each year have never been reported to Congress.  Moreover, since the rules subject to review under the CRA are not limited to those published in the Federal Register, the report suggests there may be thousands of unreported interpretive rules, guidance documents, “Dear Colleague letters,” and the like.

Conservative activists aware of the inconsistent agency filing practices have begun to argue that all older regulations that were not reported to Congress are still subject to CRA review.  One conservative group has established a separate website, RedTapeRollback.com, proclaiming that:

“Powerful new ideas to use the CRA for older rules not reported to Congress are causing great excitement. This is a regulatory game changer!”

The website includes a database of rules it claims were not reported; and the website urges its visitors to, “Help us find and report more rules that were never submitted to Congress.”

The activists promoting use of the CRA to attack older, unreported regulations offer three rollback strategies.  First, private parties who are subject to the requirements of an older, unreported regulation could argue the regulation has never taken effect. There is certainly language in the CRA to support such an argument:

“Before a rule can take effect, the Federal agency promulgating such rule shall submit to each House of the Congress [a report containing a copy of the rule.]”

Another provision of the CRA, however, has language that may preclude a private party’s ability to obtain judicial review of claims based on the CRA:

“No determination, finding, action, or omission under this chapter shall be subject to judicial review.”

The second strategy calls for the Trump administration to identify undesirable rules that were never reported to Congress, state that the rules have never taken effect because of the agency’s failure to report them, and abandon or vacate the rules.  Under this scenario, the Trump administration would roll back undesirable rules immediately without the necessity of going through notice and comment rulemaking procedures otherwise required to repeal the rules.

The third strategy suggests the Trump administration could identify undesirable rules that were never reported, report them to Congress, and encourage Congress to adopt resolutions of disapproval.  If this occurs, Section 801(b)(2) of the CRA precludes reissuance of a disapproved rule in the same or similar form unless Congress affirmatively adopts legislation authorizing the promulgation.

It may well be that the activists’ frothy enthusiasm for expanded use of the CRA will come to very little.  It is possible, perhaps even likely, that most of the unreported rules were insignificant, unobjectionable, or even exempt from reporting and review under the CRA.  Moreover, as a practical matter it is unlikely that Congress would be willing to devote significant amounts of floor time to debate the disapproval of a large number of older, unreported regulations.  Nevertheless, a cursory examination of RedTapeRollback’s database of supposedly unreported rules cannot help but give one pause.   Think the 2010 Chesapeake Bay TMDL and EPA’s 2008 Rapanos Guidance.

Interest in use of the CRA did not end with the flurry of disapproval resolutions in the first one hundred days of the Trump administration.  At a September House Subcommittee on Regulatory Reform oversight hearing focused on agency compliance with the CRA, witnesses urged Congress to attack older regulations that were never reported to Congress.  In late October, Congress passed and the President signed a disapproval resolution invalidating an arbitration regulation adopted by the Consumer Financial Protection Bureau, an independent agency whose regulations are not ordinarily subject to Executive review and approval.

The recent surge in use of the CRA has not gone without opposition.  The Center for Biological Diversity (CBD) has filed suit to vacate a CRA resolution that nullified an Interior Department regulation limiting the methods used to hunt wolves and bears in Alaska wildlife refuges.  Among other things, CBD argues that the CRA limitation on issuance of future regulations without express approval of Congress infringes on the constitutionally protected separation of powers.  The court’s decision in the CBD case is likely to provide guidance on the reach of the language quoted above that limits judicial review of claims arising under the CRA.

Against this background it is safe to say that we have not seen the last of the CRA in the Trump administration.  As Yogi Berra once said, “It ain’t over ‘til it’s over.”

PASSING LESS GAS

Posted on December 5, 2017 by Keith Hopson

While some still debate climate change, on 11/22/17, eight of the oil and gas industry’s biggest players signed on to a set of Guiding Principles for reducing methane emissions across the natural gas value chain.  BP, Eni, Exxon Mobil, Repsol, Shell, Statoil, Total and Wintershall, in collaboration with international institutions, NGOs and academics, drafted the Guiding Principles.

The five guiding principles are: continually reduce methane emissions; advance strong performance across value chains; improve accuracy of methane emissions data; advance sound policy and regulations on methane emissions; and increase transparency.  Click here for the entire Guiding Principles document.

It will be interesting to see if these “voluntary principles” eventually become enforceable regulations.  Likewise, it will be interesting to see if these guidelines become “industry standards” and, accordingly, whether by acquiescence, private litigation, or lender requirements, become de facto regulations.

Time will tell.

It is significant to see so many major oil and gas industry actors responsibly, firmly and publicly commit to both reduce methane emissions and advance monitoring.  Perhaps now others in the industry will be more inclined to join the responsible eight and commit to pass less gas.

The Truth about Sue and Settle that Scott Pruitt Ignores

Posted on December 4, 2017 by Jonathan Z. Cannon

Seth Jaffe’s post about EPA Administrator Scott Pruitt’s sue and settle directive is right on. As he notes, the Administrator punts on the question at the core of his holy war against sue and settle: that is, what is the evidence that sue and settle has been abused in the way he presumes?  In particular, was sue and settle systematically used during the Obama administration as a vehicle of collusion between environmental groups and sympathetic agency officials, catering to the greens through rulemaking in secret? That was the characterization advanced by the Chamber of Commerce and other pro-business and anti-regulatory groups that made sue and settle a battle cry in their war against Obama’s environmental policies. Without citing any evidence, Pruitt has proceeded as if that characterization is correct.

A careful, fact-based, analytically disciplined examination of the practice of sue and settle during the Obama administration shows that this characterization is not correct.  That examination appeared in a law review note by a former law student of mine, Ben Tyson, who went on to clerk for Chief Justice Roberts on the Supreme Court.  I recommend that anyone who is interested in this issue -- and who delights in careful research and analysis – read the entire article. But here’s a brief summary for those who don’t have the time.

Tyson’s analysis is based on eighty-eight sue and settle cases arising under the Clean Air Act, Clean Water Act, and the Endangered species act during the Obama administration.  This data set includes twenty-eight cases that were missed by the Chamber of Commerce in its 2013 report, Sue and Settle: Regulating Behind Closed Doors.  In his analysis Tyson is careful to distinguish between decision-forcing consent decrees, which simply require the agency to do what it is statutorily required to do and do not have a potentially adverse effect on public participation in rulemaking, and substantive consent degrees, in which the agency agrees to propose a particular regulatory change, with dismissal of the litigation dependent upon adoption of that change after public notice and comment. Of the total eighty-eight sue and settle suits, seventy-nine were brought by environmental groups.  But all but four of these suits by environmentalists sought decision-forcing consent decrees, not substantive outcomes. And in three of those four cases, there was at least one industry intervenor that had a right to be heard on the proposed decree.  Tyson concludes: “Sue-and-settle, when used by environmental group plaintiffs, is not principally about secret, backdoor rulemaking.” Instead, overwhelmingly, environmental groups used litigation to enforce existing statutory requirements. 

Ironically, although industry brought far fewer sue and settle suits overall (only nine compared to the environmental groups’ 79), five of those suits resulted in consent decrees with substantive terms. And there was no environmental intervenor in any of those cases to contest entry of the consent decree. Based on the data, industry used sue and settle to achieve substantive outcomes more often than environmental groups. And the total number of substantive sue and settle suits by industry and environmental groups was relatively small (9, or 10% of the 88 cases). Improving public participation is always worth attention, but one wonders what all the fuss was about.

Water Quality: Wading Into Trading

Posted on November 28, 2017 by Ridgway Hall

For over 20 years EPA has been promoting water quality trading – with particular emphasis on nutrients and sediment – as a way to improve water quality at reduced costs. Trading is based on the simple proposition that if Party A can reduce a pollutant at a lower per-unit cost than Party B, who needs to reduce its discharges of that pollutant, it is more economically efficient for Party A to reduce its discharges below what is required by law, and sell the additional reduction, or “credit”, to Party B. If the price is less than what Party B would otherwise pay and more than it costs Party A to make the reduction, B will save money and A will make money. 

The focus is on nitrogen, phosphorus and sediment because these pollutants have for many years been leading causes of water quality impairment and, in the case of nutrients, adverse effects on human health when the resulting algae blooms release toxins and harmful bacteria.  In 2016 EPA reported that nutrient-caused algae blooms were on the rise, causing fish kills, contamination of fish and shellfish, and beach closures, resulting in significant damage to local economies and impairments to human health. The biggest source of these pollutants is farming operations. Trading seems especially well-suited to help reduce polluted runoff from farms because their per unit cost of removing nutrients is far lower than for wastewater treatment plants. Finally, because farm runoff is a nonpoint discharge, it is not regulated under the Clean Water Act. Regulation is left to states. While many states require farms to have nutrient management plans, because the states have limited resources to inspect and enforce, finding incentives to stimulate a market-driven solution has obvious appeal.

So why are there so few trading programs in place? The GAO attempted to find the answers in its report Water Pollution: Some States Have Trading Programs to Help Address Nutrient Pollution, but Use Has Been Limited (October 2017). The report addresses (1) the extent to which nutrient trading programs are being used, (2) how EPA and the states oversee these programs, and (3) what factors affect participation in trading.  As of 2014, eleven states had some form of trading programs: California, Connecticut, Florida, Georgia, Idaho, Minnesota, North Carolina, Ohio, Pennsylvania, South Carolina and Virginia. Most of the trading was being done in Connecticut, Pennsylvania and Virginia, so GAO focused primarily on these programs.

All three of these states established their trading programs through legislation and implementing regulations. All three allow point-source to point-source trading, but as of 2014 only Pennsylvania allowed non-point sources to generate credits. Virginia appears to be moving in that direction through pending regulatory amendments.  Connecticut uses a general permit that allows 79 point sources in the Long Island Sound watershed to trade nitrogen credits through a Nitrogen Credit Exchange Program. Each year plants that are not meeting their discharge limits can buy credits from plants who are below their required limits.

Virginia allows trading of nitrogen and phosphorus credits between point sources.  Most but not all sales are through a Nutrient Credit Exchange Association, which is privately run in consultation with the state, and provides tracking of credit generation and sales.  Pennsylvania allows a point source to buy credits generated by nonpoint and point source dischargers. It has a credit exchange, PENNVEST, but most trades are outside it.  The state keeps a registry of credits generated, sold and used. During 2014, there were 39 trades in Connecticut, 151 in Pennsylvania, and 31 in Virginia.

Trading programs are managed by the states, with oversight by EPA to be sure that both the elements of the trading program and individual permits that incorporate trades comply with the Clean Water Act. Those who buy credits said that the benefits of doing so include reduced cost of compliance, risk management (credits can be used to address plant failures which cause noncompliance), and flexibility in timing technology upgrades. 

GAO cites two primary disincentives to trading. First, if water quality criteria are written in narrative form, permits are also often written in narrative form, so it is difficult to determine whether or when use of a credit might be helpful. While EPA has been pressing states to adopt numerical criteria for nutrients, GAO reported that as of 2017 only 6 states had them.  I believe that this problem can be mitigated by including numerical water-quality based effluent limits (WQBELS) in NPDES permits even when the criteria element of a water quality standard is narrative.  I don’t know how widely this is done, but typically a total maximum daily load (TMDL), which is required for water bodies not meeting water quality standards, is expressed in numerical terms, and that provides the basis for WQBELs. GAO observed that the Ohio River Basin Interstate Water Quality Trading Project allows trading among sources in Ohio, Kentucky and Indiana, but almost no trading has occurred because there are no numerical limits in the water quality standards or a TMDL.

The second reason given by stakeholders to GAO for limited trading is the difficulty in determining the water quality benefits of a best management practice (BMP), which is what is installed on farmland to reduce runoff. Models do exist for converting the benefits of BMPs, such as vegetated buffers, no-till farming and cover crops, to numerical pollution reduction on an annual basis, but these are only estimates, and lack the precision that a point source discharger looks for in deciding whether to buy a credit from a farmer. EPA has recommended the use of an “uncertainty factor”, such as 2:1, by which a buyer of 100 nitrogen credits would have to buy 200 credits. This could be modified upwards or downwards based on site-specific conditions. It is still an estimate, and any trading program will need to apply a dose of adaptive management if it wants nonpoint source trading to get up and running.  The potential cost savings are sufficiently great that such an uncertainty ratio would not by itself, in most cases, discourage trading.

Several other factors, not discussed by GAO, also tend to discourage nonpoint source trading. There is the uncertainty of the buyer, who will rely on the credit to meet its NPDES permit terms: what if the BMP on which the credit is based fails? This is a particular concern for public utilities, whose managers and ratepayers may not want the utility relying for compliance on a set of BMPs over which the utility has no control. On the farmer side, what if the farmer invests substantial sums in BMPs to generate credits, but there turns out to be little or no market for them? Several states and some financing institutions are exploring ways to create a market to jump start the process, and we will likely see more on that. Finally, there is an inherent reluctance to be among the first in what is still largely an experimental program – especially if it is being run by a government agency.

It is no coincidence that two of the three most active programs, Pennsylvania and Virginia, are in the Chesapeake Bay watershed, where a numerical multi-state TMDL has been in place since 2010. (That TMDL was discussed in my blog article EPA Issues Biggest TMDL Ever for the Chesapeake Bay Watershed, posted March 4, 2011.) At this writing Maryland, also in the Chesapeake watershed, is developing a trading program which will include nonpoint source trading and will be run jointly by the Maryland Departments of Environment and Agriculture.  The only way the goals of the Chesapeake TMDL will be achieved is through major reductions of the nitrogen, phosphorus and sediment released by farms. In a future post, I will explore those three programs in more detail.

Pruitt Banishes “Sue and Settle” – A Solution In Search of a Problem?

Posted on November 27, 2017 by Seth Jaffe

EPA Administrator Scott Pruitt earlier this month issued a Directive prohibiting the practice of “sue and settle.”  He also issued a Memorandum to senior staff explaining in more detail some of the concerns about “sue and settle.”  They are two very strange documents.

As to the substance of how EPA will handle future citizen suit claims, there are some specific concrete steps which individuals and groups across the political spectrum actually can support.  These include:  (1) making more information available to the public about notices of intent to sue and filed complaints; (2) involvement of affected states; (3) maintenance of a data base of citizen suits; and (4) providing a public explanation and rationale for settlement of citizen suits; and (5) providing opportunities for public comment, even where not otherwise required by law.

So far, so good.  However, at a certain point, the Administrator seems to have gone off the rails.  First, one final substantive point – the Directive purports to forbid the payment of attorneys’ fees in any settlement, on the ground that, in a settlement, there is no “prevailing party.”  Of course, if a citizen’s group has a meritorious claim, why would it give up its claims to attorneys’ fees?

What’s really strange about the documents, though, is that they make no effort to demonstrate that there has been such a thing as “sue and settle.”  Instead, the Directive merely states that:

"It has been reported, however, that EPA has previously sought to resolve lawsuits filed against it through consent decrees and settlement agreements that appeared to be the result of collusion with outside groups."

The Administrator pledges that the “days of this regulation through litigation, or ‘sue and settle’ are terminated.”

The Memorandum is even better, citing to the Federalist Papers and the correspondence of Thomas Jefferson.  I’m almost persuaded that this is the greatest threat to the American Way of Life since the fluoridation of water.  Far be it from me to compare the Administrator to General Jack D. Ripper, but this is what first came to my mind after reading these documents.

What’s Happening with the Other Clean Air Act (CAA) §111(d) Rule?

Posted on November 24, 2017 by Steve Kohl

Long ago and in what seems like a faraway place, the D.C. Circuit vacated the NESHAP for boilers and the NSPS for Commercial and Industrial Solid Waste Incineration (CISWO) units. (See “EPA in the D.C. Circuit – Where Has All the Deference Gone”, ACOEL Blog, September 23, 2008). The demarcation between boilers and other process heaters and CISWI units is whether or not they burn waste. The D.C. Circuit held that EPA had improperly drawn that line. Since the source categories are mutually exclusive under the Clean Air Act, the improper line drawing resulted in the improper definition of each source category, resulting in the demise of the rules. Fast forwarding (sort of) to 2013, EPA finally promulgates a new and improved boiler NESHAP and new NSPS rules for new and existing CISWI units. These rulemakings were only made possible by the Non-Hazardous Secondary Materials (NHSM) rule which defines what is or is not a waste when burned. It takes the entirety of 40 C.F.R. Part 241 to provide this definition and the processes for determining if something is a waste or a fuel. 

Now comes the fun part. An existing boiler burning clean wood had to be in compliance with the NESHAP by early 2016, but the same existing boiler burning “dirty” wood categorized as a waste under the NHSM rule didn’t have to comply with the NESHAP since it is not a boiler but an incinerator. Well, it must have to comply with CISWI existing incinerator standards, right?  Well no. In fact, there really aren’t any applicable NESHAP requirements for existing boilers burning waste. 

The CISWI standards for existing units, 40 C.F.R Part 60, subpart DDDD, are §111(d) guidelines, which additionally must address the requirements enacted for incinerators in §129 of the CAA.  Those who have followed the Clean Power Plan (CPP) about which much has been written, including several ACOEL blogs (Is You Is Or Is You Ain’t Transformative?Unprecedented Program Leads To Unprecedented ResponsePulling the Plug on Greenhouse Gas Emissions), recognize that most states were in the process of developing state implementation plans (SIPs) to implement the CPP when the Supreme Court stayed the rule.  That’s because the CPP was also a §111(d) “guideline” for existing electric steam generation units. Actual application of the CPP was dependent upon SIPs approved by EPA which implement the guidelines or, if a state defaults, a federal implementation plan (FIP) implementing the CPP guidelines. Similarly, the CISWI standards for existing units must be implemented through approved SIPs or a FIP.  The SIPs or FIP required to implement the CISWI standards for existing units are required to be in place within five years, or February 7, 2018 and compliance is required by that same date.  However, no such SIP has been approved and no FIP finally promulgated.  Polite inquiries to EPA have provided no insight to the ultimate timing.

The delay in taking final agency action to implement CISWI standards for existing sources creates some interesting circumstances.  A state may recognize that through a renewal or a reopener of a facility’s Title V permit it should incorporate CISWI requirements, but it really can’t since there isn’t a federally enforceable requirement for CISWI. Subpart DDDD guidelines contain some provisions for determining whether certain sources qualify for an exemption from CISWI under §129. If they are exempt from CISWI, then they should be complying with the currently applicable boiler NESHAP, but there really isn’t any applicable rule for determining the validity of an asserted exemption. Subpart DDDD guidelines also provide that if a waste-burning source does not want to comply with CISWI and instead intends to comply with an applicable NESHAP, it must cease burning waste six months in advance of the date its chooses to switch from being a CISWI source to a NESHAP source. So if that dirty wood burning boiler doesn’t intend to comply with CISWI as of the ostensible compliance date of February 7, 2018, should it have switched to clean wood in July of 2017 even though there was no applicable rule requiring the six month period?

Final promulgation of the FIP or approval of the submitted SIPs would not appear to be a heavy lift since the proposed FIP and the submitted SIPs essentially mirror subpart DDDD.  So the delay to what is now four years and nine months out of the five years allowable under the CAA is somewhat incomprehensible. It begs the question, “What’s happening with this §111(d) rule?” 

MEAT CLEAVER OR SCALPEL?

Posted on November 22, 2017 by Annette Kovar

It’s been a long time coming. Regulatory reform is on the agenda again and maybe it’s real this time. Spawned by a quantitative “snapshot” of the state’s regulatory text developed by researchers at the Mercatus Center at George Mason University, Nebraska is embarking on a comprehensive review of its state regulations, including environmental regulations.  EPA has also been directed to take a critical look at its regulations.

Whether or not one agrees with all the methods used or conclusions drawn by regulatory reformers, it’s hard to disagree with the basic premise that the sheer amount of current regulation is daunting. Maybe the time has come to examine whether we can consolidate or even eliminate some requirements that have been on the books for years even though no one really knows why. Maybe the underlying problems that were meant to be addressed by many of our current regulations don’t occur anymore.  Maybe some regulations were developed based on worst case scenarios, oftentimes because there was a reluctance to leave anything to the discretion of the implementing environmental agency.

Process improvement and streamlining are hot topics these days in government circles, and I’m all for that! I do not favor being less protective of the environment, but I am for eliminating the complexity and multiplicity of paperwork, for making regulations easier to read and understand, for providing helpful guidance rather than just paraphrasing statutes, and for rethinking traditional paradigms and coming up with something more user-friendly. In short, it make sense to me to examine whether we need all the regulations now on the books and to think about streamlining and clarifying the regulations that we do need.

EPA Tries Again to Keep Toxic Pollution Information from Communities

Posted on November 21, 2017 by Peter Lehner

Your Thanksgiving turkey, like most meat in America, was probably produced at an industrial animal facility in rural America. These facilities hold thousands or tens of thousands of animals in a confined space and can produce as much waste as a mid-sized city. They are prodigious factories that generate dangerous air and water pollution, yet unlike other factories, they’ve been given a free pass from reporting their toxic emissions.

Community and environmental groups have been pushing the Environmental Protection Agency to address pollution from animal feedlots for decades, and recent court decisions seemed to indicate that the veil of secrecy surrounding these operations might finally be tugged back. However, instead of following the court’s latest ruling to ensure that industrial animal factories report toxic emissions, the EPA is proposing a sweeping exemption that would shield thousands of livestock facilities from reporting. 

This move represents the third attempt by the EPA to block these reporting requirements. Under President George W. Bush, the EPA suspended them in 2005, claiming the issue was being studied, then pushed through an illegal exemption in 2008, which was rejected in court.  And now, Scott Pruitt’s EPA is making a fresh attempt to make the exemption even broader. It’s a move that favors industry over the health of affected communities. The EPA itself has rejected this exemption, a proposal favored by industry, three times before.

While polluters are benefiting from the EPA’s dereliction of duty, people who live near these facilities continue to suffer. “During the summer we can’t keep our doors or windows open because of the stench,” writes Iowa farmer Rosemary Partridge, who lives near 30,000 hogs concentrated in factories near her farm. Partridge has worked with Earthjustice since 2015 to fight for more oversight of industrial animal agriculture. “Sometimes it gets so bad [my husband and I] get headaches and feel nauseous.”

Toxic gases from animal waste, which is often stored in open pits and sprayed over fields, include substances like hydrogen sulfide and ammonia that can cause nausea, headaches and chronic lung disease. Children in nearby schools have a heightened risk of asthma. Dairy farm workers have fallen into manure pits and drowned after being overcome by toxic fumes.

Feedlots tend to be clustered in low-income communities, and in some parts of the country, especially the Southeast, in communities of color. Earthjustice and others brought a civil rights complaint in 2014, which EPA found to have merit, over the concentration of hog farms in North Carolina.

A recent stinging report from the EPA’s independent Office of the Inspector General recommended that the EPA stop shielding polluters. Yet the agency still took a third, wild swing at stopping pollution reporting requirements for industrial animal agriculture. It’s time for the EPA to put down the bat and take the field for healthy communities.

Coming Soon to a Northeast or Mid-Atlantic State Near You: Regulations on Carbon Emissions From Transportation

Posted on November 16, 2017 by Seth Jaffe

Earlier this week, eight states in the Transportation Climate Initiative issued a joint statement pledging to pursue regional solutions to GHG emissions from transportation.  The statement does not identify any specific policy options; instead it simply announced that they are “initiating a public conversation about these opportunities and challenges.”

Even if the statement doesn’t say so, what everyone is hearing from this announcement is simply this:  RGGI for transportation.

To give one an idea of the momentum that is finally building in support of regulation of transportation sector GHG emissions, one need look no further than the recent letter sent jointly by the New England Power Generators Association (our client), the NRDC, the Sierra Club, the Union of Concerned Scientists (also our client!), and the Acadia Center to four New England governors, requesting that they

"develop and participate in a regional, market-based policy to address greenhouse gas emissions from the transportation sector."

If the letter seems at first blush to involve strange bedfellows, think again.  From NEPGA’s perspective, its members are reasonably sick and tired of being the only target of GHG emissions regulations – particularly given that electric generation now represents less than ½ the GHG emissions from transportation.  From the perspective of the environmental groups, they know that it will be literally impossible to meet targets of 80% reductions in GHG emissions by 2050 without very substantial reductions in emissions from transportation.

For too long, states focused on electric generation emissions to the exclusion of transportation for one reason only.  Transportation will be difficult.  Difficult is no longer an excuse.

It’s about time.

AS IT TURNS OUT, NEW SOURCES OF ENERGY ARE BLOWING IN THE WIND

Posted on November 13, 2017 by Gregory H. Smith

There is growing recognition that New England’s energy costs are much higher than neighboring parts of the country.  To a large extent, these high costs are due to the combination of transmission congestion, an ever-increasing reliance on natural gas and a shortage of natural gas supply in the New England market.  As a result, new participants are seeking entry into the market, including several seeking to expand the diversity of generation sources.

Antrim Wind Energy, LLC is an example of new participants seeking entry into the market.  In 2015, Antrim filed an Application for Certificate of Site and Facility with the New Hampshire Site Evaluation Committee (“SEC”) to develop a wind farm.  The Application was Antrim’s second attempt to gain SEC approval.  As noted in this space, an earlier Antrim project was denied in 2013 based primarily on its “aesthetic” effect on the region.    Several key factors led to a different outcome in the second proceeding.

Since 2013, the New Hampshire SEC has substantially revised its siting rules. Particularly pertinent to the Antrim Wind Project are new, more specific rules for aesthetic assessments.  Although review of aesthetic effects are, by their nature, somewhat subjective, the rules provide objective standards for visual impact assessments to provide greater predictability of outcomes.  The SEC rules require the Committee to consider seven different, specific criteria in making a determination as to whether a proposed project will have an unreasonable adverse effect on aesthetics. 

In reviewing the second Antrim proposal, the SEC placed particular emphasis on criterion six (6), whether the project would be a dominant or prominent feature in the landscape. 

In its second proposal, Antrim made several significant modifications to its earlier application case, that, coupled with the changes in the governing law, produced the favorable outcome.  Most important, the number of wind turbines, and their size and scale were reduced.  This modification doubtless affected the Committee’s analysis of whether the project “would be a dominant and prominent feature” in the landscape.

The SEC also adopted a public interest test as part of the new rules, which made a significant difference in review of the 2015 application.  No clear definition is provided in the rules as to how an applicant can demonstrate that a project is in the public interest.  A focus on project benefits seems to be a key factor.  In the Antrim case, beyond the obvious benefits of diversifying energy generation to include clean, renewable wind energy with the corresponding beneficial effect on climate change, there were recognized benefits to the community similar to those in the land use approval process.  These included stabilizing tax payments through a municipal agreement, investments in community infrastructure, and permanent preservation of 908 acres of land as a form of mitigation. 

The Antrim Wind project now stands alone in New Hampshire as the only sizable energy project to first have been rejected by the SEC, and subsequently reheard and approved.  The protracted Antrim case demonstrates that the somewhat complicated siting rules are capable of reasoned and predictable application.  It is also clear that this case provides useful instruction for what will likely be required for approval in the subsequent applications.

Paper or Cyber? Protecting Confidential Information

Posted on November 9, 2017 by Ronald R. Janke

Equifax, Yahoo, South Korea – reports of the theft of computer-based information by known, suspected or unknown hackers have become commonplace.  A recent report of the hacking into a Securities and Exchange Commission database containing confidential information is of special interest to environmental lawyers, because it poses the question of how can regulated entities electronically submit confidential information to government agencies and be confident that such information will not be stolen through a breach of cyber security. Environmental lawyers are almost universally ill-equipped to answer that question. Even with the help of cyber security experts, the growing number of reported hacks of corporate and government networks provides little comfort for submitting confidential data electronically.

Currently, the best practice may be to submit any confidential information in hard copy.  In my experience, agencies protect such information by techniques such as storing documents with confidential information in separate, locked files, using a log to record when a document is removed and returned and who has taken it.  While a document with confidential information may be stolen from a file or erroneously filed with publicly-available documents, someone has to be physically present to obtain that document.  In contrast, documents stored electronically can be subjected to a cyber-attack by anyone located anywhere in the world.

Agencies may require or prefer to receive all information electronically.  Applicants for permits and other approvals may have little choice in such circumstances, but they can initiate a conversation with the agency employee responsible for receiving any confidential information.  Expressions of concern over cyber security may instill some sense of personal responsibility in the recipient for protecting the confidentiality of sensitive information by limiting how it is accessed and used.  While agency rules may apply equally to all confidential information, the duty to protect confidential information is more personal when it is in a document located in a file drawer maintained in one’s office than when information is stored electronically on a computer database, perhaps with thousands of other documents.   In the latter case, cyber security becomes ultimately the duty of information technology specialists who design and maintain the agency’s computer networks.