The Struggle Between Conservation and Exploitation in Napa Valley

Posted on March 8, 2018 by Ridgway Hall

Book Review

Your favorite wine regions? Napa Valley is probably somewhere on your list. Ever since at least 1976, when Napa chardonnay and cabernet sauvignon won a blind taste testing in Paris, Napa’s vineyards have been producing large quantities of these and other wines, and business has been booming. The number of wineries in the roughly 25-mile-long Napa Valley, once just a handful, is now over 400. This is because the climate, soil and weather are uniquely suited to the production of wine grapes. In 1968, recognizing the importance of protecting the character of the valley, the county established the first agricultural preserve in the country, restricting the land use to farming and related activities.

But bucolic places where money can be made are attractive. Located northwest of San Francisco between two sets of mountains and bisected by the Napa River, Napa Valley has experienced rapid development and new building. This has resulted in habitat destruction, such as the cutting of thousands of century-old oaks, erosion, and pollution of the river (once home to salmon and steelhead, but no more) and the traffic, noise and dust of construction. Development is proceeding at a rate that threatens to destroy the natural beauty of the area that brought people there in the first place.  Not surprisingly, there has been pushback from conservationists and other residents who are not part of the wine industry.

This struggle between developers and those who want to preserve the valley’s pastoral charm is the subject of an excellent new book by James Conaway entitled Napa at Last Light: America’s Eden in an Age of Calamity (Simon & Schuster, 352 pages, $26). (Disclosure: I read and provided comments on an early draft of the book). This is the third book in a trilogy which began in 1990 with Conaway’s Napa: The Story of an American Eden, a New York Times best seller describing the 19th century origins of winemaking in the Napa Valley and its rediscovery starting in the 1960s.  This was followed in 2003 with The Far Side of Eden: New Money, Old Land and the Battle for Napa Valley.  It described the growing conflicts between winery owners, some of them by now-absentee corporations and investors eager to reap profits, and the local citizens and environmentalists who were becoming increasingly upset by the destructive results.

Napa at Last Light recaps the past and then brings this struggle current, including a hotly contested vote on a proposed woodland protection ordinance on the county ballot for June.  Conaway has traveled throughout the Napa region for more than 30 years getting to know the people, their values and concerns. As a result, the book is far more than just a chronology of events.  You get to know several generations of grape growers and winemakers along with the county officials and a variety of other residents and their families, the circumstances that brought them there, their hopes for the future and their interactions.  You meet winery owners who care a lot about preservation, have donated funds to protect fragile land and carried out streambank restoration efforts.

What is going on in the Napa Valley is a microcosm of conflicts over land use that are being played out across the country. The corrosive influence of money, and the power and abuses it brings, is never far from the surface. Nor is the philosophic struggle between those who believe they should be able to do whatever they want with their land, and those who believe they are part of a community in which what one person does with his or her land may adversely affect others.  It’s freedom vs regulation. Napa at Last Light is a timely and thoughtful portrayal of critical issues we are familiar with and will be dealing with for the foreseeable future. It’s also a great read.

 

Note: Ridge Hall has written a more extensive review of this book in the March-April issue of The Environmental Forum published by the Environmental Law Institute.

Takings Math for Dummies: When 1+1=1

Posted on March 7, 2018 by Mary K. Ryan

One benefit of preparing an annual review of last year’s important cases, as I just did for MCLE, is that you may have missed a significant case when it came out. That’s why I’m writing now about Murr v. Wisconsin, 137 S. Ct. 1645, decided on June 5, 2017. Murr, which incorporates the mathematical conundrum in the title, expands the Supreme Court’s regulatory takings jurisprudence by asking a preliminary question—what parcel or parcels of land are at issue? The Court held that this question must be answered before reaching the ad hoc case-by-case analysis established by Penn Central Transportation Co. v. New York City, Lucas v. South Carolina Coastal Council, and Palazzolo v. Rhode Island which examines the economic impact of the challenged regulation, the investment-backed expectations of the landowner, and the character of the government action.

Murr involved the owners of two adjacent waterfront properties on the St. Croix River in Wisconsin which, given their location, were subject to numerous regulations, including a one acre buildable lot requirement. The properties lost their original grandfathered protection from that regulation when they were put into common ownership. The county denied requests for variances and the owners filed a regulatory takings claim, which they lost at the state level.

In a 5-3 opinion written by Justice Kennedy, the Court developed a new, three-factor test for determining the “denominator” in the regulatory takings analysis—in other words, the unit of property against which a court must assess the effects of the challenged governmental action. First, courts must assess the treatment of the land under state and local law, in particular how state law bounds and divides the land. Second, courts must look at the physical characteristics of the landowner’s property, e.g., whether the land is subject to further environmental or land use regulations due to the nature of the land or adjacent natural resources. Third, courts must consider the value of the property under the challenged regulation. Under this test, there was no regulatory taking. The Court rejected the bright line tests offered by the state (state law controls) and the landowners (lot lines define the relevant parcel) as too easily subject to manipulation. The Court defined the relevant parcel as a single combined lot based on several factors:  (1) that merger as a result of common ownership is a reasonable and usual zoning and land use control and there was a voluntary merger; (2) riverside property is often subject to restrictions on development; and (3) treatment as one lot did not substantially diminish the value of the land without the regulation.    

Murr may be an example where the “no harm, no foul” rule led to the right result. But generally speaking, the government’s defenses just got better, and the landowner’s burden tougher, in regulatory takings cases. And while there were three dissenters (Justice Gorsuch did not participate in the case), without two more votes, Murr will be the law for the foreseeable future.

The Power of Pension Funds: How to Win Friends and Influence Others

Posted on March 6, 2018 by Gail Port

While both tout their desire to reduce the State’s carbon footprint and address climate change,  New York Governor Andrew Cuomo and State Comptroller Thomas DiNapoli have  their differences when it comes to  New York State pension fund’s fossil fuel investments.   

The New York state pension fund (known as the New York State Common Retirement Fund) is the third largest pension fund in the United States, with an audited value as of March 2017 of $192.4 billion in assets.  The pension fund holds and invests assets of over one million state and local government employees, retirees, and beneficiaries. At issue are holdings of at least 50 oil and gas companies with significant carbon-intensive operations.  Comptroller DiNapoli is the sole trustee of the pension fund, and is advised by several independent advisory committees.

DiNapoli is under pressure from Cuomo, State Senator Liz Krueger, and certain environmental groups to divest the pension fund from fossil-fuel investments.  DiNapoli has pushed back on immediate divestment on several grounds, most importantly, that as a fiduciary his first priority is to earn a good return for the approximately 1.1 million New Yorkers who rely on the state pension system for their retirement security.  While recognizing that the effects of climate change represent a systemic risk to the returns of the pension fund, the economy and the welfare of the people of the State, DiNapoli believes that he can be more effective in managing those systemic climate change risks by the use of the significant power of the pension fund to influence the policies of oil and gas companies.  That includes shareholder activism (i.e., filing shareholder resolutions), voting proxies, investor collaborations and corporate engagement programs.

On the latter point, Comptroller DiNapoli has cited ExxonMobil’s agreement to implement a shareholder proposal, co-filed by the state pension fund and the Church of England, which caused ExxonMobil to agree to assess how it might be impacted by the Paris Agreement goals to reduce global warming. Duke Energy has responded to a similar shareholder resolution seeking to require it to analyze how the Paris Agreement will impact its business and plans to produce a climate risk assessment in the first quarter of 2018. DiNapoli asserts that because these oil and gas companies will not go out of business as a consequence of divestment of the pension fund’s holdings, he can be more effective by having a seat at the table as a shareholder to influence companies’ actions and disclosures.  Critics of this view, including State Senator Krueger, believe the shareholder influence is limited and that divestment sends a stronger message than does the Comptroller’s more nuanced and varied approach. 

Another investment strategy recently employed by the Comptroller was to double the pension fund’s investment-- to $4 billion-- in a low-emissions index designed by Goldman Sachs Asset Management.  That index is more geared toward stocks, such as Apple Inc. and Microsoft Corp., than higher carbon-emitters, such as ExxonMobil and Chevron.  DiNapoli has said that since 2016 the Goldman Sachs designed index has delivered returns comparable to the Russell 1000, thereby yielding strong investment returns with the benefit of significantly reducing the carbon footprint associated with that investment.

Although DiNapoli has expressed reservations about allowing pension fund investments to be influenced by political forces, he recently agreed to join forces with Governor Cuomo and others on decarbonization strategies for the pension fund investment portfolio.  While there are no immediate plans to divest the energy holdings of the pension fund, DiNapoli and Cuomo have agreed to create an independent advisory committee to develop a low carbon future roadmap for the fund.  In his January 2018 State of the State Address, Cuomo called for an end to fossil fuel related activities in the pension fund and stated his intent to work with DiNapoli so New York can “put our money where our mouth is.” Cuomo then asked for a round of applause for Comptroller DiNapoli and his efforts.

Regardless of whether DiNapoli takes immediate moves to decarbonize the portfolio, the movement towards divestment is gaining momentum. California ended its pension fund investments in coal companies in 2015 and is facing pressure to decarbonize its portfolio. On January 10, New York City Mayor Bill de Blasio and Comptroller Scott Stringer announced that NYC plans to divest its five pension funds from fossil fuel investments, which will be the largest divestment of any municipality to date. Stringer stated, “[T]his a first-in-the-nation step to protect our future and our planet – for this generation and the next. Safeguarding the retirement of our city’s police officers, teachers, firefighters and city workers is our top priority, and we believe that their financial future is linked to the sustainability of the planet.” De Blasio and Stringer were praised by environmental activists after the announcement and by State Senator Kruger who continued her call for State Comptroller DiNapoli to follow suit with respect to the New York State pension fund investments.

Lots of good intentions, lots of ideas and a bunch of strange bedfellows--only time will tell if these investment (and divestment) initiatives will continue to gain traction and make a difference. And what about us-- shouldn’t we too be employing low-emissions/decarbonization investment strategies with our portfolios?

Border Wall Waivers—A Continuing Problem

Posted on March 5, 2018 by Robert Uram

In January 2017, I warned that it was not too soon to begin thinking about reining in the Trump administration’s ability to use the waiver authority that the Congress adopted in 2005 to carry out its program to build new border facilities.  The 2005 waiver authority allows the Secretary of the Department of Homeland Security to unilaterally waive the federal government’s obligation to comply with any law that he feels will get in the way of building border walls. The grant of the waiver authority was a mistake. It is an affront to the rule of law, treats the residents of border areas as second-class citizens, and undermines the environmental laws that have been so successful in making America a great place to live.

My warning has not been heeded. The waiver authority issue has been lost in the raucous debate over immigration and border walls. None of the bills that were considered in the Senate during the week of February 12-16 proposed to change or reduce the waiver authority. Republicans in the House are actually seeking to expand the waiver authority. Democrats seem incapable of making the waiver issue a part of the conversation. This is inexcusable.

 Dozens of laws have been waived since 2005. These include waivers of the National Environmental Policy Act, the Clean Air Act, the Clean Water Act, the Endangered Species Act, and laws that protect national parks and wildlife refuges.   The Trump administration continues to assert the right to exercise the 2005 waiver authority including waivers for walls near San Diego and for walls in New Mexico near the Texas Border.  Additional waivers are planned for the Rio Grande Valley in Texas, most likely including a wall through Santa Ana Wildlife Refuge. Established in 1943, the Refuge provides important habitat for more than 400 species of birds and would be devastated by a wall through its boundaries.  

I have practiced environmental law for more than 40 years. I know first hand that the environmental laws are not perfect, but there is no question that they are effective. Our air is cleaner and the water quality in our rivers and streams is vastly better. We are no longer creating toxic wastes sites and old dumps have been remediated. We have protected wildlife and ensured the continued existence of many species that would have been forever lost. We have saved billions of dollars on health problems that have not occurred because we have cleaner air, water, and land.  We have done all of this and have continued to prosper economically.  You only have to read the reports of air and water pollution in countries like China and India to appreciate how much our environmental laws have benefitted us. Application of the full suite of environmental laws to any new border facilities that may be built is needed to ensure that their environmental effects will be properly identified and addressed. 

New border walls and conversion of existing vehicle barriers to border walls will cause local residents grave economic, environmental, and social harm.   Border walls have divided farms and ranches, caused flooding in Texas and Arizona, and destroyed sensitive habitat for endangered species and other wildlife.  More than 90 endangered and threatened species including jaguars, ocelots, snowy plovers, pygmy owls, and the rare Mexican gray wolf use habitats on both sides of the 2,000-mile border. Without the protection of the Endangered Species Act, these species will be much more likely to become extinct.

Lawsuits now pending before Federal Judge Curiel in San Diego have been the only tangible effort to stopping the use of the 2005 waiver authority. The lawsuits challenge three waivers on a number of grounds, including arguments that the waiver authority has expired, that its use does not apply to the work covered by the waiver, and that the waiver is unconstitutional. Because the Congress has severely restricted judicial review of waivers, these kinds of lawsuits are difficult to win. On February 27, 2018, Judge Curiel rejected the challenge to three waivers.

Judge Curiel’s decision will likely be appealed. But it is more likely than not that litigation will be unable to block waivers. The Congress will have to act to rein in waivers.  A responsible Congress would address this issue decisively and head on. If the waiver remains on the books, it will not only lead to harm to border communities and the environment, it will also be a precedent to excuse compliance with other laws for other reasons. Protecting our legal system should be of bipartisan concern. The Congress is likely to return to the border issue in the weeks ahead. When it does, the Congress should set aside its past mistakes and revoke use of the waiver for any future repair or construction of border facilities of any kind and should decline to repeat its mistake with new, additional executive branch waiver authority.  

If Jimmy Fallon Was an ACOEL Member, Here is What He’d Sing

Posted on March 1, 2018 by Jeff Thaler

While many in Philadelphia were in the streets after the end of Super Bowl LII, and New Englanders promptly went to bed after the last pass hit the Minneapolis turf, the Doppelgänger of a native-born Minnesotan made a national appearance in the middle of that long, cold night.

By now, many have seen the 2018 version of “The Times They Are a-Changin,’” performed by someone born 10 years after the original version was created—one Jimmy Fallon. According to my consultation with Dr. Google, the only time Mr. Fallon has talked about environmental issues was back in May 2016 when he did a segment on Sarah Palin, climate change and climate scientists.

Therefore I think it is time that ACOEL commissioned Mr. Fallon to perform an updated version of that and another Dylan song, ones many of us could probably sing by heart (with a refresher class) even though written in the early ‘60s—that pre-NRDC/CAA/CWA/ESA/et.seq. classic, “Blowin’ in the Wind.” The original lyrics for both songs need to be refreshed, as do all of us who were alive and kicking back then, so here they are:

The Times They Are A-Changin'

Come gather ’round people                                                       

Wherever you roam                                                                           

And admit that the waters                                                               

Around you have grown                                                               `                   

And accept it that soon                                                                     

Under water will be our coast and flood zones                       

If our kids’ future to you is worth savin’                                   

Then you better start swimmin’                                                  

or you’ll sink like a stone                                                              

For climate times they are a-changin’

 

Come federal and state legislators

Please heed the call

Don’t stand in the doorway

Don’t block up the hall

For those who should be ashamed

Will be those who have stalled

Weather extremes are outside and they’re raging

Floods, fires and storms will break down your walls

For climate times they are a-changin’

 

Come bloggers, reporters, and skeptics

Throughout the land

Please don't criticize

What you refuse to understand

Rising CO2 levels and temperatures

Are getting beyond our command

Your old fossil-fueled road is

Rapidly agin'.

Please embrace a clean energy new one and

Vote out of office resisting government hands

For climate times they are a-changin'.

 

Blowin’ in the Wind

How many droughts & fires must the world endure                                  

Before we know they are a warning?

Yes and how many seas must flood our shores                        

Before we seek a solution?                                                           

Yes and how many times must the fake news fly                     

That climatic disruption is not real?                                                

The answer my friend is blowin' in the wind                              

The answer is blowin' in the wind.                                                    

 

How many years will our beaches and airports exist

Before they are washed into the sea?

Yes and how many years can the glaciers survive

Before they are just memories?

How many heads must be buried in the sand

So that people can deny what should be seen?

The answer my friend is blowin’ in the wind

The answer is blowin' in the wind

 

How many more years must we create greenhouse gases

Such that too many species can’t survive?

Yes and how many times will clean energy projects be held up

Before too many people have died?

How can we power our cars, lights and heat pumps

Without harming the world for our kids?

The answer my friend is blowin' in onshore winds

The answer is blowin' in offshore wind.

 

So break out your harmonicas and guitars, and we will sing the songs of climate changes while working to change our laws and policies for the benefit of all.

The Future of State Environmental Funding: Is the Sky Falling?

Posted on February 28, 2018 by Ed Tormey

When I attend conferences and introduce myself as an official with Iowa’s environmental agency, people often ask me why Iowa does not have the federal hazardous waste program. I am always happy to explain why as I think the answer is a fairly practical one. But it is an answer that highlights funding concerns that state agencies face now and will likely face even more in the future. 

In 2007, several years after Iowa had returned the hazardous waste program back to EPA, Iowa DNR approached EPA about what it would take to become re-authorized for RCRA Subtitle C.  EPA explained that there were two fundamental requirements: (1) the state would be required to provide a 25% match on funding the program and (2) Iowa would be required to adopt all current federal hazardous waste rules.  In crunching numbers on what it actually would take to run the program, Iowa DNR determined that rather than the minimum 25% match, the state would need to fund 50% to 60% of the total program’s budget. This would require the Iowa DNR approaching stakeholders about a new fee. 

Here is where things got real interesting.  The common notion is that state stakeholders will always want the state to run a federal program in lieu of EPA.  But during a meeting with Iowa DNR on August 29, 2007, Iowa’s business and industry stakeholders made clear to the department that it would not support Iowa becoming a delegated state.  The main reason was fees.  EPA had been running the RCRA Subtitle C program in Iowa for years without requiring anyone to pay fees.  These stakeholders did not see enough value with Iowa becoming authorized to justify their financial support of a state program. Iowa DNR RCRA C Hazardous Waste Program Feasibility Study Report. Iowa would therefore remain one of two states without the RCRA C program (Alaska being the other).

The funding of state environmental programs is indeed an issue.  This funding is characterized as a three-legged stool where the three legs are (1) federal grants; (2) state funding, mostly general fund; and (3) state fees.  Many of the federal programs require states to provide a mandatory match, ranging from 25% to 50%, in order to run a delegated federal program.  The assumption years ago was that EPA would fund the remainder of the program.  In 1986, for example, federal funding comprised 58% of state environmental program funding. 1999 ECOS article. Unfortunately, today, it makes up only 27% and it may shrink even more in the future. Weblink.

State general fund support currently funds 12% of state environmental programs.  This is by far the smallest of the three legs.  In Iowa, for example, the Iowa DNR’s general fund allocation has decreased from $21,994,799 in State Fiscal Year 2009 to $11,299,811 in State Fiscal Year 2018, a 51.4% decrease. 

So, we are left with fees.  The concept of “polluter pays” resonates with a lot of people, and it is logical that fees represent one leg of the three-legged stool.  In fact, fees make up 62% of state environmental budgets.  These fees include user and permit fees.  States have also established fees to collect revenue based on the amount of pollution or waste generated or tonnage of waste landfilled.  With the progress of waste reduction in our country, these fees are shrinking.  Regulated industry is hesitant – if not offended – that they should pay more when they believe they have done their part to reduce their emissions or generation.   If new fees have to be established, who will be required to pay, and what will the fees be based on?   

Is the sky falling for state environmental agencies?  Not yet.  According to the Environmental Council of the States (ECOS), states are still handling 96% of the federally delegable programs.  But Iowa’s RCRA Subtitle C story is worth remembering.  There may be a limit to the funding support a state agency may receive.

And the Regulatory Reform Caravan Keeps Moving on Down the Road

Posted on February 26, 2018 by Donald Shandy

On January 25, 2018, The EPA published a guidance memorandum withdrawing the “once in always in” policy for the classification of major sources of hazardous air pollutants under section 112 of the Clean Air Act. This new EPA guidance allows stationary sources of hazardous air pollutants (HAPs) that are classified as “major sources” to limit their HAP emissions to below major source thresholds and thereby be reclassified as “area” sources at any time. As Bill Wehrum, assistant administrator of EPA’s Office of Air and Radiation, puts it, “It will reduce regulatory burden for industries and the states, while continuing to ensure stringent and effective controls on hazardous air pollutants.” I agree.

A major source is one that emits or has the potential to emit 10 tons per year of any single HAP or 25 tons per year of combination of HAPs. For the last 20 years, once a source became subject to a MACT it remained in that status even if it reduced emissions below the major source threshold(s).

The new policy follows a similar theme emerging from the Pruitt EPA: legally speaking, the once in always in policy was not supported by the language of the Clean Air Act. Under this new policy, a source can voluntarily accept limitations (even after previously triggering major source status) and avoid major source requirements. This would eliminate some of the resource intensive burdens of MACT such as recordkeeping and reporting requirements.

In 2007, the Bush EPA proposed a rule that would have replaced the historic policy. After taking comment on the proposal, the EPA never took a final action and it has never been withdrawn. Based upon the new guidance, EPA intends to revive the pending rulemaking consistent with the Wehrum guidance document. 

This new policy is a significant incentive for major sources to take efforts to reduce emissions on an actual or potential basis and fall below the triggering thresholds. As such, this new policy is good for business and the environment.

Massachusetts Brownfields Update—Appeals Court Holds Nonprofits May Receive Tax Credits, With No Deference to Agency’s “Incorrect Statutory Interpretation”

Posted on February 22, 2018 by Ruth H. Silman

The Massachusetts Brownfields Tax Credit program allows individuals and businesses a credit against their state personal income tax or corporate excise liability for a percentage of the costs incurred for environmental response actions that result in either a “permanent solution” or “remedy operation status” under the Massachusetts remediation regulations.

As enacted in 1998, the Brownfields Tax Credit program excluded non-profits because they would have no income tax liability.  But in 2006, the Legislature amended the program to allow taxpayers to transfer the Brownfields Tax Credits and so non-profits were added, enabling those entities with insufficient tax liability to benefit from the program in the same manner as for-profit companies and other taxpayers.  Importantly, the 2006 amendment made all recipients of tax credits eligible for a percentage of response costs incurred retroactively to August 1, 1998.

The program thrived between 2006 and 2012, but this activity drew the attention of politicians due to the significant drain on the budget.  In late 2012, the Massachusetts Department of Revenue (MassDOR, the agency administering the Brownfields Tax Credits program) received applications from three local colleges—Northeastern University, Boston University, and Wellesley College.  These three applications totaled almost $20 million.  This proverbial straw across the camel’s back caused MassDOR to reevaluate the program. 

In 2013, MassDOR abruptly changed its practice. It issued a “clarification” known as Directive 13-4 “Guidance with Respect to Brownfields Tax Credit Applications”.   Directive 13-4 stated that a non-profit organization may receive a credit based upon documentation of a permanent solution or a remedy operation status submittal only for taxable years that commenced on or after June 24, 2006, the date that non-profits were added to the program.  Furthermore, MassDOR would apply Directive 13-4 to all pending and future applications.  Relying on Directive 13-4, MassDOR denied the claims from the three universities.

The three universities (along with a private party) sued MassDOR.  In 2016, the trial court ruled for the plaintiffs, holding that Directive 13-4 was “unreasonable” and that MassDOR’s “denial of the applications based on that directive was unlawful”, based on the unambiguous and explicit language of the statute.  On December 28, 2017, the Massachusetts Appeals Court affirmed the trial court’s decision, holding that if the Legislature had intended to limit the timeframe for eligibility of nonprofit organizations’ applications, “it certainly knew how to do so.”  In the absence of direct language in the statute supporting the agency interpretation, the Appeals Court found that MassDOR’s interpretation in Directive 13-4 was entitled to no deference due to its “incorrect statutory interpretation.” 

MassDOR has applied for further appellate review by the Supreme Judicial Court, but it appears that MassDOR is now busy processing all of the nonprofit applications that have been languishing since 2013.  Perhaps the colleges, universities, hospitals, and other nonprofits will finally receive the equal treatment that they so rightly deserve.

More Guidance on Guidance: DOJ Will Not Enforce “Improper” Agency Guidance Documents

Posted on February 21, 2018 by Seth Jaffe

In November, Attorney General Sessions issued a memorandum prohibiting DOJ from issuing regulations disguised as guidance.

Folders with the label Regulations and Guidelines

Now, DOJ has taken the prohibition a step further.  It will no longer rely on guidance issued by other agencies when taking civil enforcement action.  The memorandum has made the regulated community and the NGO community sit up and take notice.

I am sympathetic to the concerns raised in the Sessions memo.  I hate circumvention of notice and comment rulemaking by guidance.  However, as I noted when the memo was released, the problem with guidance documents is not how they are drafted; it’s how they are implemented.

For example, the new memorandum states that:

The Department may continue to use agency guidance documents for proper purposes in such cases.  For instance, some guidance documents simply explain or paraphrase legal mandates from existing statutes or regulations.

Well, but in the first instance, who decides whether a guidance document “simply explains or paraphrases legal mandates” or whether it instead “purports to create rights or obligations binding on persons or entities outside the Executive Branch”?

The agency does, of course – perhaps aided by its counsel, DOJ.

This will particularly be an issue where guidance has been in place for many years and has been relied on by both an agency and the regulated community as accurately describing what the law actually is.  Take, for example, the New Source Review Workshop Manual.  The Manual is not only not a regulation; it’s been in draft for 28 years.  Nonetheless, it’s been relied on as the bible for practitioners since then.  It might be exempt from this policy, which makes clear that it does not apply to internal training materials.  However, when internal training materials are used to say what the law is, that sounds like regulation masquerading as guidance to me.

Here’s another issue.  What are the implications of this guidance memorandum for cooperative federalism?  In a delegated program, what happens if states continue to rely on guidance documents in enforcing federal obligations?  Are we going to have one interpretation under federal law and another interpretation under state law?  Can you say “forum shopping”?!

Finally, I cannot resist pointing out the irony inherent in the AG issuing two separate guidance documents on the proper – and improper – use of guidance documents.

“It’s What We Know for Sure That Just Ain’t So”

Posted on February 16, 2018 by Paul Seals

In his current bestseller, 12 Rules for Life: An Antidote to Chaos, Jordan B. Peterson, a clinical psychologist and University of Toronto professor of psychology, quotes Mark Twain in discussing the potential consequences of our conventional assumptions regarding nature and the environment. Mark Twain once said, “It’s not what we don’t know that gets us in trouble. It’s what we know for sure that just ain’t so.” In our current period of environmental regulatory conflict and chaos, Dr. Peterson’s rules could be fruitful in thinking more critically about “what we know for sure” and in advancing the sort of discourse that can help us find our way to a more rational and orderly regulatory consensus.

Dr. Peterson presents informative, fascinating, and often humorous prescriptions on how we should approach the disorder and tumult in the world in order to achieve meaning in our lives. His provocative and controversial assertions are woven through essays on each of his twelve rules:

  1.  Stand up straight with our shoulders back.
  2.  Treat yourself like someone you are responsible for helping.
  3.  Make friends with people who want the best for you.
  4.  Compare yourself to who you were yesterday, not to who someone else is today.
  5.  Don’t let your children do anything that makes you dislike them.
  6.  Set your house in perfect order before you criticize the world.
  7.  Pursue what is meaningful (not what is expedient).
  8.  Tell the truth—or, at least, don’t lie.
  9.  Assume that the person you are listening to might know something you don’t.
  10.  Be precise in your speech.
  11.  Do not bother children when they are skateboarding.
  12.  Pet a cat when you encounter one on the street.

We could use a little of Rules 7, 8, and 9 as we grapple with the significant environmental regulatory controversies that we face. We have competing facts and assumptions to support our contentions. We are in our separate corners armed with our arguments and beliefs, with little room for honest debate, dissent, or compromise. Too often, we become the conscious or unconscious proxies of ideological tyranny. Orthodoxy, dominance, and power are more important than advancing our knowledge to further effective and appropriate public health and environmental regulations.

We need to do a little more listening combined with a humility that what we know for sure may not be so. The challenge is great. We must overcome the straightjacket of our ideology and follow Rules 7, 8, and 9—beginning with the assumption that the person you are listening to might know something you don’t.

Prizes for Progress with a Caveat: DOE Offers $3 Million Incentive

Posted on February 15, 2018 by Irma S. Russell

The U.S. Department of Energy (DOE) recently announced a $3 million prize competition for solar energy manufacturing innovations.  The American Made Solar Prize, seeks to encourage innovation in solar manufacturing in the private sector.  Given the urgency of the threat of climate disruption, incentives for a green energy industry are definitely a good thing.  

In 2017 the U.S. Global Change Research Program Climate Science Special Report reported key findings, including stronger evidence of “rapid, human-caused warming of the global atmosphere and ocean,” and observable changes in the planet have made the scientific consensus about climate disruption clear as glaciers shrink, oceans and rivers warm, and coast lines recede.  A draft report by agencies such as NASA and the National Oceanic and Atmospheric Administration released late last year states that the world “has warmed by about 1.6 degrees Fahrenheit over the past 150 years and that human activity is the primary cause for that warming.”   It seems clear that rewards for innovation to combat climate disruption are worth the effort and worth the money if they produce progress in sustainable energy.  Despite such promise, however, DOE and community oversight groups should use caution in this new prize enterprise. 

Entrepreneurs have a played a dramatic role in historic energy discoveries of the past.  For example, the discovery and development of fossil fuel was driven by the private energy sector.  A recent example is the rocket launch by Elon Musk in February or 2018.  Likewise, DOE’s laboratories, university researchers and other energy researchers have a proven track record of progress in energy research.  Moreover, private investment seems posed to spur renewable energy technologies.  Venture capital investments needed to take ideas and turn them into marketplace reality seem likely to support private innovations, particularly when those innovations have the endorsement of the DOE. These factors suggest optimism about the result of this prize and others like it. 

So what’s the caution and why?  In an article forthcoming in the UMKC Law Review Green Economy Symposium later this spring, I survey current-day green economy sector jobs and other efforts to build markets to help encourage sustainable practices.  The article describes natural incentives to promote an all-hands-on-deck approach to addressing climate disruption and argues for the use of ex post rewards for innovations, like the award now offered by DOE.  Caution: it won’t work toward environmentally positive outcomes if, rather than creating incentives for real innovation, it is an excuse for a give-away. 

However, Concerns that ex ante rewards may confer unfair benefits to inventors turns a blind eye to the risks accompanying the failure to attract innovations to solve the global climate problem and other environmental problems.  Government support should encourage the progress that a modern-day Edison, Tesla or Jonas Salk might make with true break-through advances.  In such cases, governments should mobilize to support inventions even when the government did not foresee such developments.

The possibility that the reward program will advance new and robust solar energy manufacturing innovations makes it worth pursuing.  The risk, however, that the program will fail to advance the science of solar energy is real. It is again that some wasted funding is likely.  And distinguishing between an incentive for innovation and a reward for being part of the energy structure can be difficult.   For example, last year Secretary of Energy Rick Perry announced payments to nuclear and coal companies for their status as sources of power based on the rationale that such payments serve as insurance against a compromise of the energy grid in the future.  The plan did not include payments to renewable energy companies, however, causing some to speculate that the payments had a political purpose rather than the stated purpose of insuring an uninterrupted energy supply. 

The answer to whether the DOE program is worth pursuing hinges not on the ultimate result but on the good faith nature of the incentive and the effectiveness of the efforts of those monitoring the implementation of the reward.    The use of government incentives, including prizes, presents a potentially fertile avenue for progress.  While risks exist, the possibility of progress is alluring.  So long as the rewards serve to stimulate new ideas rather than simply rewarding existing players to continue business as usual, the expenditures are justifiable and, ultimately, justified because of the possibility of new.   Discovering innovation that moves the country toward a carbon-neutral economy is a goal worth funding – even when the success of such research is not assured.  In fact, this is the nature of research itself.  

Statutory Deadlines Matter—EPA Gets Taken to the Woodshed

Posted on February 14, 2018 by Seth Jaffe

Last week, EPA was ordered to take final action on a Clean Air Act § 126(b) petition filed by the State of Connecticut, which asserted that emissions from the Brunner Island Steam Electric Station in Pennsylvania contribute to nonattainment in Connecticut.  

EPA did not dispute liability; it had clearly missed the original statutory deadline. The case was all about the remedy. EPA asked to be given until December 31, 2018 to respond. Plaintiffs said EPA could respond within 60 days.

Noting the “heavy burden” EPA bears in trying to demonstrate that it cannot comply with the congressionally mandated timeline, the Court ordered a response within 60 days, concluding that:

Defendants’ proposed schedule contravenes the congressional intent that EPA “act quickly on a Section 126(b) petition.”

I noted last spring that we are likely to see more of these cases. And I think we’re also going to see increasing judicial impatience with agency delay. I also wonder if this case might be the first bit of evidence that Scott Pruitt’s order precluding the notorious—if mythical—practice of “sue and settle” may have come back to bite EPA.

EPA had to know it was going to lose this case. In bygone days—meaning 2016—EPA would have negotiated for the best schedule it could have gotten. If EPA had told the plaintiffs it would respond to the petition within 90 or even 120 days, my guess is that the plaintiffs would have accepted such a proposal. Given the Pruitt memorandum, that was not possible. The outcome? The worst possible result for EPA.

Just wonderin’.

(Full disclosure: Foley Hoag has represented Talen Energy, owner of Brunner Island, on matters unrelated to Brunner Island. We take no position on the merits of the underlying § 126(b) petition.)

Fast & Furious: 21 Superfund Sediment Sites Targeted for “Immediate, Intense Action”

Posted on February 13, 2018 by Mark W. Schneider

On December 8, 2017, U.S. Environmental Protection Agency Administrator Scott Pruitt designated 21 Superfund sites for “immediate, intense action”. It’s an open question whether this effort will be more successful than many of EPA’s previous failed efforts to comply with its policies for contaminated sediment sites.

EPA has not met many of its prior commitments regarding sediment sites. On July 25, 2017, EPA’s Superfund Task Force identified 42 recommendations intended to, among other things, “evaluate and expedite NPL sites to completion”, “encourage and facilitate responsible parties’ expeditious and thorough clean-up of sites”, “create oversight efficiencies for PRP lead cleanups”, and “promote redevelopment/reuse of sites by encouraging PRPs to invest in reuse outcomes”. Since that time, some stakeholders have sought action from EPA based on the principles set forth in Task Force recommendations. In response, some have received commitments from EPA headquarters to seriously consider the requests, but the promises made by Headquarters often have not been turned into constructive action consistent with the recommendations.

Last year, EPA’s Office of the Land and Emergency Management (OLEM) issued Directive 9200.1.130 (Jan. 9, 2017), which identified 11 recommendations “based on current best practices for characterizing sediment sites, evaluating remedial alternatives, and selecting and implementing appropriate response actions”. OLEM directed the regions to, among other things, “develop risk reduction expectations that are achievable by the remedial action”. Unfortunately, just two days earlier, EPA issued a Record of Decision for the Portland Harbor Superfund Site that, in direct conflict with the OLEM Directive, established cleanup goals that are unachievable.

And these are just EPA’s recent promises. In 2002, EPA identified 11 principles in its Principles for Managing Contaminated Sediment Risks at Hazardous Waste Sites (OSWER Directive 9285.6-08). EPA announced that, among the key principles, it was important to “control sources early”, “ensure that sediment cleanup levels are clearly tied to risk management goals”, and “design remedies to minimize short-term risks while achieving long-term protections”. Similar principles were articulated in EPA’s 2005 Contaminated Sediment Remediation Guidance for Hazardous Waste Sites (OSWER Directive 9355.0-85). Unfortunately, many of EPA’s decisions regarding sediment contamination sites have been made without consideration or application of these principles.

Will things be different for the 21 sites targeted by Administrator Pruitt for “immediate, intense action”? Unlike earlier pronouncements by the agency, which established program-wide recommendations to be implemented at all applicable sites, the list of actions for the 21 sites sometimes are specific and measurable, e.g., “initiate and complete negotiations to begin implementation of early actions” at the Anaconda Co. Smelter. It’s possible that, where the recommendations are specific and measurable, EPA will be able to take action to advance progress at a particular site. On the other hand, some of the actions proposed for other sites on the list are so general, e.g., “resolve issues expeditiously” at Allied Paper, Inc./Portage Creek/Kalamazoo River; “initiate actions to allow revitalization of the site” at Des Moines TCE (aka Dico Company, that it will be difficult to measure success.

Who Goes First? What Happens When Two Federal Mineral Lessees Clash Over The Same Acreage

Posted on February 7, 2018 by Tom Sansonetti

In January, the Wyoming Supreme Court declined to play umpire in a dispute between two federal mineral lessees. The decision merely defers an issue of first impression: what rules apply when competing mineral lessees occupy the same leasehold?

The Berenergy Corporation produces oil from several sites in Wyoming’s mineral rich northeast corner. Berenergy obtained its oil leases from the Department of the Interior’s Bureau of Land Management in the 1960s. Berenergy’s nine wells are spaced laterally on an east-west axis.

Peabody Powder River Mining extracts coal from several mines in the same area. Peabody also obtained its coal leases from the BLM, but in the 1970s. Peabody plans to mine the coal in a south to north direction for the next forty years.

Peabody’s mine is now within a mile of Berenergy’s wells. Peabody offered to pay Berenergy the fair market value of its wells. In response, Berenergy demanded a sizeable multiple of the appraisal value of the wells in order to get out of Peabody’s way. Not surprisingly, the parties could not reach an agreement and litigation ensued.

First, Berenergy sued Peabody in Wyoming state court claiming that its earlier-issued leases gave it priority on a “first in time is first in right” theory. Berenergy sought to require Peabody to mine around its wells if Peabody was unwilling to pay up.

Next, Peabody sued Berenergy in Wyoming federal court claiming that since both parties were federal mineral lessees with a common BLM lessor, the decision on priority should be made by a federal judge based on a doctrine of accommodation. Peabody argued that factors such as the number of jobs at stake, the amount of royalties paid to the government, the value of the respective minerals, and the ability to maximize production of both minerals should be used to decide if Peabody could mine through Berenergy’s wells or be made to mine around the wells. The latter decision would require Peabody to leave the bypassed coal in place forever as the mine proceeds in its northerly direction.

The Obama-era BLM declined to take a stance as to which lessee should prevail. Even though the BLM was a common lessor, the federal government declined to intervene or be impleaded as an indispensable party in either lawsuit.

In June 2014, the federal district judge remanded the case to the state district court for resolution under state law while dismissing the federal action for lack of federal question jurisdiction.

Following a weeklong bench trial, the state district judge, while acknowledging that the case was without precedent and one of first impression, issued an order in October 2016 rejecting Berenergy’s “first in time” argument and utilizing the doctrine of accommodation. The court’s ruling would allow Peabody to mine through if it paid Berenergy the full appraised value of its wells. Berenergy appealed the order to the Wyoming Supreme Court.

On January 4, 2018 the Wyoming Supreme Court vacated the state district judge’s order, declaring that there was no state law that applied to two federal mineral lessees in conflict with one another. Berenergy Corp. v. BTU Western Resources, Inc., 2018 WY 2, 408 P.3d 396 (Wyo. 2018).

The Court noted that the Berenergy wells had been valued at less than a million dollars while Peabody’s mining of the coal in question would create many jobs and generate tax revenues that dwarfed the revenues produced from Berenergy’s aged and nearly depleted wells.

But the Court stated that it was the BLM’s duty to resolve the conflicts between its two lessees.  Thus, the Court remanded the case to the state district court judge with instructions to dismiss the case unless the BLM agreed to be joined as a party.

By the end of 2018, the coal pit wall will contact the first of Berenergy’s oil wells. Peabody plans to pull the drilling pipe and store it for future use along with all of the associated oil field equipment. The well hole would be plugged as Peabody’s huge drag lines mine through the area.

No doubt temporary restraining orders will then abound. But where will they be filed? The federal district court has already decreed that the conflict is not a federal issue. As of January 4th, the Wyoming state district courts have been instructed to stay out of the conflict since state law does not apply.

So who does get to go first? Will the Trump-era BLM decide to get involved? And if so, under what rules? Stay tuned.

Troubled Waters – Blue Lakes Turning Green From Toxic Algal Blooms

Posted on February 6, 2018 by Virginia C. Robbins

Frank DeOrio knows a lot about protecting drinking water.  For more than 25 years, Frank was Director of Utilities for the City of Auburn located in the pristine Finger Lakes region of Upstate New York.  He was responsible for the water supply drawn from Owasco Lake and the protection of the lake’s watershed.  During Frank’s tenure, the City won awards for the best water in the state and the U.S. 

Frank and I recently discussed his concerns about the potential impacts to drinking water from summer algal blooms in our region’s lakes.   Algal blooms can occur when spring rains flush nutrients, for example, phosphorous, into waterbodies.  Summer temperatures raise water temperatures, creating optimum growth conditions.    

Owasco Lake, September 18, 2017

Owasco Lake, September 18, 2017

Summer algal blooms now occur in more lakes, their duration has increased, and they are producing toxins that pose health risks to the public when ingested or during recreational contact.  These toxins are not easily treated by water suppliers because the technology to treat one toxin may not be effective for another.  And unlike bacteria, boiling water does not remove these toxins. 

In 2017, harmful algal blooms (HAB) occurred in all 11 of the Finger Lakes, reportedly for the first time.  Blue-green algae are cyanobacteria and they can produce several species of cyanotoxins.  What is disturbing about the recent HAB outbreaks is that some classes of these cyanotoxins (e.g., microcystins), are particularly toxic.  If present at high concentrations, they can be difficult or impossible to treat using the technology of most public water systems.  One of these is Microcystin-LR, a liver toxin that is considered one of the more toxic.  These toxins can also cause skin, digestive system and other health issues.

Mycrocystin-LR has been identified in raw water drawn from Owasco Lake and Skaneateles Lake, both jewels of the Finger Lakes.  And Owasco Lake provides drinking water to more than 50,000 customers.  In 2016, the City of Auburn was using filtration to treat its raw water.  When the level of Mycrocystin-LR increased, the City considered moving the location of its water intake away from the area of the lake containing the toxin.  But would the new intake remain safe if the toxin shifted location?  The City decided against moving the intake and instead added carbon filtration. 

Skaneateles Lake is the primary water supply for the City of Syracuse and surrounding communities.  The water authority operates under a “filtration avoidance” authorization.  After a severe storm on July 1, 2017, phosphorous levels in the lake rose, resulting in algal blooms, and Microsystin-LR was then detected in the raw water pumped from the lake.  The levels were low enough that treatment was not required and the toxin was not identified in the water that reached customers.  Nonetheless, the presence of this toxin in the raw water is a disturbing development. 

These examples are lakes in my area.  But similar algae toxins and blooms are occurring in New England states, including New Hampshire and Maine. 

The broader challenges?  The science around algae toxins is emerging.  Further, there are no federal or state drinking water standards for microcystins (though there are health advisory guidelines published by USEPA and some states).  Water treatment plants are generally designed to avoid taste and odor concerns and to manage the most commonly tested algae toxins.  The next generation of plants will need to have more flexible designs to accommodate advanced treatment technologies.  And water authorities will need to consider spatial needs, hydraulics, connections, utilities and process control for these technologies. 

Frank’s concerned.  So am I.  It may get worse before it gets better.  While we wait for science, regulatory efforts and focused treatment technology to develop, at least municipalities can take steps to control the potential for toxic algal blooms by a combination of runoff control, nutrient reduction and stream-bank restoration.  Why wait to build that bridge from troubled waters to cleaner lakes?

With the Stroke of a Pen…or a Tweet?

Posted on February 1, 2018 by JB Ruhl

John Milner’s recent post on executive orders, memorandums, and proclamations taps into something that is quite new and different for environmental lawyers—a president who uses these and other “direct actions” to shape environmental policy from day one, and who is doing so largely by undoing his predecessor’s direct actions.  

I’ve recently completed two empirical studies of presidential direct actions from FDR through the first year of the Trump Administration. In one paper we look at what topics presidents have focused on overall through time and then drill down on environmental (and energy) policies. In the other paper we examine the practice of presidents revoking predecessor direct actions (through yet another direct action).

Despite what you may read in the media, President Trump is by no means unlike other presidents in using direct actions, and lots of them, to steer policy early in his term, or in revoking predecessor direct actions to get the job done. What sets him apart is how early in his term he focused on environmental and energy policy, and how aggressive he has been in revoking President Obama’s direct actions in those fields. And then there’s…the tweets. Let’s take these one at a time.

Direct Actions and the Environment: There is a rich history of presidents using the big four direct actions—executive orders, memorandums, proclamations, and determinations—to shape policy straight from the White House, but environmental policy has not played a big role. Once you take out public lands policy, including the Antiquities Act, environmental policy has been a small component of direct action activity. Energy policy has been more prominent, however, and to the extent the two fields are increasingly merging, one does see more presidential attention going their way, but not usually concentrated at the beginning of a term. President Trump is quite different in this respect, using direct actions to dramatically change environmental and energy policy right out of the gate. 

Revoking Direct Actions: Presidents have revoked predecessor direct actions throughout history, and with great frequency. Here President Trump is no different, except that he is the first to bear down so much on environmental and energy policy. Part of the reason, of course, is that President Obama used direct actions to shape much of his administration’s environmental and energy policy, meaning President Trump could not advance his policies without negating President Obama’s actions. But he has gone further than that. For example, while not completely unprecedented, his orders “shrinking” existing national monuments established by Presidents Clinton and Obama have, for the first time, called into question whether a president has the power to do so.  

Tweets as Direct Actions: The rising use by politicians of social media as a channel of communication has raised questions regarding the status of President Trump’s frequent “tweets” as official policy. If the pen is mightier than the sword, is a tweet from the President even mightier?

Until recently, no one could be blamed for thinking a tweet is just a tweet—but they warrant their own treatment (tweetment?) given how important a role they have come to play in the Trump Administration. For example, former White House Press Secretary Sean Spicer somewhat circularly explained the status of President Trump’s tweets, stating that “The President is the President of the United States, so they're considered official statements by the President of the United States.” CNNPolitics, White House: Trump’s Tweets are “Official Statements." Ninth Circuit Court of Appeals apparently took him at his word when ruling on the so-called “travel ban,” pointing to a Trump tweet as tantamount to an official presidential “assessment.” Hawaii v. Trump, No. 17-15589, n. 14 (9th Cir., June 12, 2017). Indeed, the Department of Justice recently declared in litigation that Trump’s tweets are “official statements of the President of the United States.” James Madison Project v. Dep’t of Justice.  It’s not entirely clear where we are supposed to go with that—are tweets truly direct actions, or just official statements, and what’s the difference?

Presidents through time have shaped policy through direct actions, revoked predecessor direct actions, and, more recently, tweeted. For environmental lawyers, though, President Trump has done all three in ways that seem to be changing the rules of the game. Stay tuned for more?  How can you not?

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.