“This is not a ‘major rule’ but it is a “significant regulatory action”…. Really?!

Posted on March 30, 2017 by Donald Stever

On November 28, 2016, EPA released its somewhat euphemistically titled “Hazardous Waste Generator Improvement Rule” (81 Fed. Reg. 85732) which, in a whopping 97 pages of miniscule federal register text, revises the structure, and in some cases the substance of the rules that apply to generators of hazardous waste under RCRA. I have no space in a blog to detail the substantive changes, tweaks and repositioning to Parts 257, 260, 261, 262, 263, 264, 265, 268, 270 and 279, but I will mention some highlights. This is, of course, a major rule, but it is also an important rule in that it sensibly addresses a wide range of longstanding problems in both the organization and substance of the regulatory provisions that govern the conduct of entities that generate hazardous waste.

The largely needed and helpful changes made by the rule include (1) subtle modifications to the definitions of the three generator categories, (2) refinement of how accumulation of both hazardous waste and acutely hazardous waste is treated, (3) adding a definition of “central accumulation area, (4) adding a requirement that partial reclamation facilities and recyclers who receive manifested hazardous waste submit biennial reports, (5) and a substantial reorganization of § 262.10 by deleting and re-numbering several of its subsections while amending them in the process. In addition, EPA added new requirements for making hazardous waste determinations, attempts to define what “generator knowledge” means in connection with testing, changes certain recordkeeping requirements, and requires small quantity and large quantity generators to identify waste codes associated with their waste. The rule specifies procedures for counting hazardous waste, revises the mixture rule, amends the marking and labeling requirements by adding very specific requirements, adds not insubstantial new requirements for the use of satellite accumulation areas (my favorite sub-amendment is EPA’s effort to define the term “three days”), adds new closure requirements, revises the conditions for exemption from various requirements for all three generator categories, imposes a new “re-notification requirement” to obtaining an ID number, modifies the criteria for episodic generation events, and imposes new requirements for emergency planning,

There are other changes, a few of them, well, mystifying. My favorite is what appears to be a meaningless nomenclature change. From November 19, 1980 until November, 2016, if you generated 100 kg or less of hazardous waste or 1 kg or less of acutely hazardous waste you were called a “Conditionally Exempt Small Quantity Generator”.  After the effective date of the ‘Generator Improvement Rule” you are now called a “Very Small Quantity Generator”. EPA’s explanation for this change is truly wonderful - EPA felt that the term “conditionally exempt small quantity generator” was confusing because “all three categories of generators are conditionally exempt” from certain requirements. 82. Fed. Reg. 85740. Gee, I was never confused nor, to my knowledge, were any of my generator clients. I was also amused that EPA felt it necessary to try to define the term “three days” in connection with a provision pertaining to satellite accumulation.

Overall, however, this is a major, beneficial, rule. So what is the point of the heading to this blog? In the required boilerplate at the end of the preamble prior to the twenty-five pages of the actual rule, EPA concludes, as it must, that it is not required to subject the rule to scrutiny under the Congressional Review Act because the action is “not a major rule” as defined by 5 U.S.C. 804(2).  The Congressional Review Act?  Hmmm. Is that all?  No. In order to push this clearly beneficial rule out the door, not only did EPA employees have to generate 69 pages of notice-and-comment verbiage, but, in addition, also the Agency had to (a) submit the rule to OMB per Executive Orders 12866 and 13563 because though not “major”, it is a “significant regulatory action” in that it “may raise novel legal or policy issues arising out of legal mandates”, (b) satisfy the Paperwork Reduction Act by demonstrating that the rule is necessary, (c) satisfy the Regulatory Flexibility Act by demonstrating that the rule will not have a significant economic impact on small entities, and, in addition, also demonstrate that (d) it does not contain an unfunded mandate in violation of the Unfunded Mandates Reform Act, (e) it does not have “federalism implications” per Executive Oder 13132, (f) it does not have sufficient “tribal implications” to trigger review per EO 13175, (g) it does not present a disproportionate risk to children per EO 13045, (h) it does not significantly affect energy supply, distribution or use per EO 13211, (i) it does have environmental justice implications per EO 12898, and (j) it does not involve technology transfer.

Just think of the number of employee hours it took for EPA to make these largely sensible modifications to the RCRA generator requirements. If Mr. Pruitt gets his wish to shrink EPA staff by 30% how is the Agency going to get anything accomplished?

JERSEY PRAGMATISM

Posted on December 11, 2014 by Dennis Krumholz

A thought occurred to me recently, and not for the first time, about the decisions of the New Jersey state judiciary, including our Supreme Court, in the area of environmental law generally and site remediation particularly.  My realization was that those decisions are driven as much by a desire to facilitate the remediation of contaminated sites as they are by principled interpretation of statutes, regulations, canons of construction and the like.

Such an approach, of course, is understandable on one level, as New Jersey environmental statutes are ameliorative in nature, a cleaner environment is in the interest of everyone, and our fair state has suffered environmentally from its industrial legacy more than most jurisdictions.  But on a deeper level, courts are supposed to decide cases in accordance with law, and deciding cases with a particular goal in mind may result in an injustice to the litigants.  Moreover, fuzzy reasoning could provide inaccurate guidance to the bar and public.

In one recent case, for example, the Supreme Court of New Jersey was called upon to determine the degree of causation that the New Jersey Department of Environmental Protection (“NJDEP”) needed to establish in order to impose liability on a discharger of hazardous materials.  Rather than simply requiring proximate cause, the court hemmed and hawed its way along, formulating the appropriate standard at various points as a “real, not hypothetical” connection, and as a “reasonable nexus or connection” between the alleged discharger and the discharge. 

The Court ultimately held that the standard of causation needed to establish liability varies with the form of relief requested.  Unfortunately, the Court provided no support for this approach, which conflates the proof needed to establish liability with what is necessary to impose damages.  This leads to the conclusion that the Court was reluctant to impose a difficult burden of proof on the state and, presumably, private litigants which could result in judgments for defendants and hence, in the Court’s view, deter remediation of contaminated sites.

In another recent case, the Supreme Court had to determine the interplay between the jurisdiction of a state agency and state trial courts in adjudicating liability for site remediation.  The Court reversed the trial and appellate courts and held that a litigant could seek relief in court before the contours of the remediation had been firmly established. 

Undergirding the Court’s reasoning was pragmatism – the earlier we allow a contribution plaintiff to pursue other responsible parties, the more the defendants will be encouraged to participate in the remediation process, thereby facilitating more and faster cleanups.  While the result was correct as a matter of existing law, the reasoning was weighted far too heavily with an eye towards the result.

Finally, in a case that recently was argued and awaits adjudication, the Supreme Court was asked to determine whether a statute of limitations exists under the New Jersey Spill Compensation and Control Act, our state’s CERCLA analog, and, if so, how long it is and when it begins to run.  Implicit in many of the questions the Court asked the advocates was which resolution would facilitate the faster remediation of more sites – no statute of limitations at all, which would allow remedial claims to be brought at any time and not foreclose an action, or a limitations period which would incentivize the plaintiff and defendants to move forward more quickly to clean up sites.

Remediating the environment, and making sure responsible parties are held to their obligations, are plainly laudable goals.  But a little less focus on the ultimate environmental outcome and greater adherence to the principles of adjudication, statutory interpretation and the like would improve the quality of justice without sacrificing environmental protection.

Do Air Emissions Constitute Disposal of Solid Waste? The 9th Circuit's Answer is "No".

Posted on August 27, 2014 by Karen Crawford

On August 20, 2014 the 9th Circuit Court of Appeals issued its opinion in Center For Community Action and Environmental Justice; East Yard Communities For Environmental Justice; Natural Resources Defense Council, Inc. v. BNSF Railway Company; Union Pacific Railroad Company, No. 12-56086, D.C. No. 2:11-cv-08608-SJO-SS, determining that emissions of diesel particulate matter does not constitute "disposal" of solid waste under the Resource Conservation and Recovery Act (RCRA).  As a result, plaintiffs could not state a plausible claim for relief under RCRA’s Citizens’ Suit provision, 42 U.S.C. §6972(a)(1)(B). 

A number of environmental organizations had sought to enjoin the emission from defendants' rail yards of particulate matter found in diesel exhaust from locomotive, truck, and other heavy-duty vehicle engines operated on or near 16 rail yards in California.  Plaintiffs cited studies by both EPA and the state agency, which identified diesel particulate matter as a toxic air contaminant with the potential or likelihood "to cause cancer and other adverse health problems, including respiratory illnesses and increased risk of heart disease."  Plaintiffs contended that, while the particulate emissions were initially emitted into the air, they ultimately were deposited on land and water.  They argued that people inhale the exhaust while it is airborne and after deposition (because the particulates are "re-entrained" into the air by wind, air currents, and passing vehicles).  Defendants moved to dismiss arguing that RCRA only applies to air emissions from burning fuel which itself consists of or contains "solid" or hazardous" waste, i.e. a "discarded material."  Otherwise, emissions fall within the scope of the Clean Air Act, which, they argued, was inapplicable. 

The district court concluded that (1) any gap that might exist between the two regulatory schemes as they apply (or don't apply) to mobile sources of air pollution "was created through a series of reasoned and calculated decisions by Congress and EPA," and, independently, (2) plaintiffs failed to state a claim under RCRA because, even if RCRA does apply, diesel exhaust is not a "solid or hazardous waste." 

In affirming, the appeals court cited (and distinguished) prior case law, but for the most part relied on the plain language of the statutes and pertinent legislative history of Congressional actions (or intentional inaction) related to regulation of mobile sources of diesel exhausts and rail yards.  Relying on the principle of expressio unius est exclusio alterius (when Congress expresses meaning through a list, a court may assume that what is not listed is excluded), the court of appeals noted that "emitting" is excluded from the definition in RCRA of "disposal."  Citing §6903(3), the court of appeals added that the specific statutory text further limits the definition of "disposal" to "placement" of solid waste "into or on any land or water" and concluded that emitting the exhaust into the air does not equate to placing the exhaust into or on any land or water. The 9th Circuit concluded that to decide otherwise would be rearranging the wording of the statute which courts cannot do.  Specifically, the court of appeals held, "Reading §6903(3) as Congress has drafted it, ‘disposal’ does not extend to emissions of solid waste directly into the air." 

The 9th Circuit might have stopped there, but it did not  The Court of Appeals further supported its decision by (1) recognizing that the term "emitting" was used elsewhere in the statute and, therefore, was intentionally excluded from the definition of "disposal," and (2) reviewing the legislative history and determining that Congress had opted not to address diesel emissions from locomotives, heavy-duty trucks, and buses at various points in the history of the Clean Air Act amendments adopted in 1970. It also noted that a railroad emissions study required during the planning of a 1977 Clean Air Act overhaul (only one year after enactment of RCRA) omitted rail yards and mobile sources and resulted in a prohibition of federal regulation of "indirect sources" that included corridors attracting mobile sources, like roads or highways, leaving regulation of those sources entirely to the states. The opinion also discussed later amendments to the Clean Air Act, finding that in the 1990 Amendments to the Clean Air Act, Congress finally required EPA to promulgate regulations setting forth standards applicable to emissions from new locomotives and new engines used in locomotives and prohibited states from doing the same, but left the regulation of indirect sources including rail yards, exclusively to the states, noting that, once again, in 1990, RCRA applied to neither. 

The court  of appeals was not persuaded by plaintiffs' argument that the two statutes should be "harmonized" to fill any gaps, or that there was irreconcilable conflict between the two statutes, observing that in actuality no conflict existed because neither statute applied to rail yards' diesel exhausts.  But to put an exclamation point on its holding, the 9th Circuit added: “[H]owever, to the extent that its text is ambiguous, RCRA's statutory and legislative histories resolve that ambiguity.”

The 9th Circuit's straightforward analysis of the plain language of the statutes and the  statutory history of Congressional action in this opinion is a refreshing contrast to recent opinions in which courts have struggled to find justification for EPA's attempts to regulate in areas where Congress has clearly failed to take action. 

Virgin Petroleum Product Quandary in Rhode Island

Posted on May 22, 2014 by Richard Sherman

A case working its way through the Rhode Island state court system, Power Test Realty Co. Ltd. Partnership v. Sullivan, No. PC 10-0404 (R.I. Super. Ct. Feb. 19, 2013), poses a dilemma regarding the obligation to remediate releases of virgin petroleum product.

Under the Rhode Island equivalent of CERCLA, virgin petroleum product is exempt from the definition of hazardous substances. R.I.G.L. 23-19.14-3(c), (i). Releases of virgin petroleum product are therefore not subject to the imposition of joint, several, strict and retroactive liability. One would accordingly expect that any obligation to remediate virgin petroleum product releases would be based on causation. Rhode Island oil pollution statutes and regulations appear to impose liability based on causation only.

Nevertheless, the Rhode Island Department of Environmental Management and the Rhode Island Superior Court have taken the position that (1) the obligation of a current landowner to remediate a release of virgin petroleum product that occurred before acquisition of title arises on the theory that the term “discharge” under the state oil pollution statute includes “leaching” and (2) leaching of pre-acquisition petroleum product into the groundwater constitutes a passive and continuing discharge for which the current landowner is liable to remediate.

The Superior Court held that causation is irrelevant under the state oil pollution control statute and regulations. This ruling clearly contradicts the intent of the legislature to carve out virgin petroleum product from a no-fault liability scheme.

This case of first impression is now before the Rhode Island Supreme Court on a writ of certiorari, Docket No. SU-13-0076. Practitioners await with interest how the Court will work its way through this issue. Stand by for some tortured reasoning if the Superior Court ruling is upheld.

I Believe in Environmental Regulation, But….

Posted on June 10, 2013 by Seth Jaffe

I believe in governmental environmental regulation.  We have a complicated world and it is not surprising that many activities, including those generating greenhouse gases, cause negative externalities.  At the same time, however, I have spent more than 25 years representing regulated entities in negotiations with government regulators and it is impossible to do such work without obtaining an appreciation for the very significant costs that bureaucracies impose.

With all due respect – cue the upcoming diss – to my many friends in government, the absence of market discipline or the ability to fire nonpolitical bureaucrats often leads to street level bureaucrats operating under a law of their own devising.  Moreover, if a complex economy causes externalities requiring regulation, that same complexity should cause regulators to pause before imposing or revising complicated regulatory regimes.  Unintended consequences abound.

The genesis of these musings was the confluence of a number of otherwise unrelated recent regulatory developments.  The most significant was headline in the Daily Environment Report earlier this week noting that “EPA [is] Still Unable to Provide Time Frame For Revising Definition of Solid Waste Rule.”  RCRA is the perfect example. No one can really quarrel with the need for hazardous waste regulation, in order to prevent the creation of more Superfund sites.  However, if we’re still fighting over the definition of something as basic as solid waste more than 30 years after the inception of the program and EPA’s most recent efforts to update the definition remain fruitless after about five years of effort, then we have to acknowledge some serious implementation problems where the rubber is trying to hit the road.

I’ll also provide two recent examples from my home state of Massachusetts.  MassDEP has been engaged in a serious regulatory reform effort, which has earned deserved praise.  However, as NAIOP has recently noted in comments on the draft proposal to revise the Massachusetts Contingency Plan, MassDEP’s proposed Active Existing Pathway Elimination Measure Permit is “so cumbersome that it is not clear that a PRP or redeveloper would want to seek such a permit.”  This calls to mind MassDEP’s reclaimed water regulations, which were intended to encourage water reuse, but are so cumbersome that no one is applying for the permits.

Thus, the final caution.  The MassDEP example is extremely common – and extremely troubling.  Regulator gets great idea for innovative program. Prior to implementation, concerns are raised about what happens if….  More effort is put into avoiding the perceived downsides than in actually making the program work.  Program ends up being worse than nothing.

I believe in environmental regulation, but…

You Want to Preclude a Citizens' Suit? Pick Your Poison.

Posted on September 17, 2010 by Seth Jaffe

When clients are threatened with citizen suits – and particularly when the threatened litigation involves a matter where EPA or a state regulatory agency is heavily involved, the clients always want to know why they can’t somehow get rid of the citizen suit, given that EPA is on the case. The answer is that they can – but only in limited circumstances.

The recent decision in Little Hocking Water Association v. DuPont confirmed this answer in the context of RCRA. The Little Hocking Water Association provides public water to certain communities in Ohio, directly across the Ohio River from a DuPont plant which uses , also known as PFOA or C8 – also known as the contaminant du jour. According to the complaint, the Little Hocking wells have among the highest concentrations of C8 of water supply wells anywhere and its customers have among the highest C8 blood levels anywhere. Little Hocking Water Association thus sued DuPont under RCRA’s citizen suit provision, claiming that DuPont’s release of C8 had created an “imminent and substantial endangerment."

Section 7002 of RCRA contains provisions precluding such citizen suits if either EPA or a state “has commenced and is diligently prosecuting” an action under RCRA to abate the endangerment. In the DuPont case, releases of C8 from the DuPont facility had been the subject of at least two administrative orders on consent entered into by DuPont and EPA. However, consent orders aren’t the same as “an action” under § 7002 or § 7003 of RCRA – and they thus do not preclude a citizen suit.

DuPont tried the next best argument – that EPA had primary jurisdiction over the regulation of C8 – and that the existence of EPA’s regulatory authority and the issuance of the consent orders meant that the courts should defer to EPA. DuPont’s argument was that a court could not fashion a remedy in the case without essentially establishing a new cleanup standard for C8 and that doing so is the job of EPA, not the courts.

The Court gave the primary jurisdiction argument short shrift. As the Court noted, using the doctrine of primary jurisdiction in citizen suits would dramatically reduce the scope of such suits. Since Congress provided a citizen suit mechanism – and provided very specific, discrete, circumstances in which citizen suits are precluded – it doesn’t make sense to use primary jurisdiction to establish another defense, particularly where the defense would almost eliminate the remedy. 

The bottom line? If you don’t want to face a citizen suit (and you’re not in compliance), get yourself sued by EPA or your state regulatory agency. The mere existence of EPA or state regulation, even if requirements are embodied in a consent order, is not enough.

Just What We Need: More Community Engagement in Superfund Sites

Posted on May 26, 2010 by Seth Jaffe

Last week, EPA’s Office of Solid Waste and Emergency Response announced release of its Community Engagement Implementation Plan. Who could be against community engagement? It’s as American as apple pie. It’s environmental justice. It’s community input into decisions that affect the community. It’s transparency and open decision-making.

 

Call me a curmudgeon, but I’m against it. Study after study shows that, in terms of the actual risks posed by Superfund sites, we devote too many of our environmental protection dollars to Superfund sites, when we should be focusing on air and water. Why do we keep doing this? Because the community demands it. As Peter Sandman has noted, perceptions of risk are driven only partly by the actual hazard posed. To a significant degree, those perceptions are more driven by outrage over the situation. In some circumstances, what Sandman calls outrage management makes sense, but I’m skeptical that EPA’s community engagement initiative is really about outrage management.

 

In any case, here’s the public policy question of the day. Does it really make sense to spend scarce environmental protection resources, not to reduce risk, but to reduce outrage?

EPA Issues a New Policy on Superfund Negotiations: Time For Another Rant?

Posted on October 19, 2009 by Seth Jaffe

Late last week, Elliott Gilberg, Acting Director of EPA’s Office of Site Remediation Enforcement (OSRE) issued an Interim Policy on Managing the Duration of Remedial Design/Remedial Action Negotiations. Members of the regulated community may not be surprised by the contents of the memo, but they certainly will not be pleased. In brief, the memorandum fundamentally makes two points:

EPA wants to shorten the duration of RD/RA negotiation

EPA is going to use the heavy hammer of unilateral administrative orders, or UAOs, to keep PRPs’ feet to the fire and ensure that negotiations move quickly.

PRPs will likely agree that shortening the duration of negotiations would be a good outcome in the abstract – but achieving it by greater use of UAOs? I don’t think so.

I can only wonder if EPA has even considered the impact of the Burlington Northern decision here. Is this a perverse reaction from EPA? A metaphorical throwing down the gauntlet to PRPs? It certainly feels that way.

I have a different suggestion, if EPA truly wants to shorten negotiations. First, acknowledge Burlington Northern and compromise on the merits in those great majority of cases where there are legitimate divisibility arguments. Second, stop acting like the last bastion of command and control regulation. Set cleanup standards and then, to the maximum extent permitted by existing law, let PRPs clean up to those standards, without micromanaging every detail of the cleanup process.

A Rant Against Superfund

Posted on April 15, 2009 by Seth Jaffe

As some of my clients know all too well, I’ve been spending a lot of time on some Superfund matters recently. Although I can’t remember a period when I didn’t have at least one moderately active Superfund case, significant immersion in complex remedial decision-making and negotiations provides an unwelcome reminder just how flawed CERCLA is. Almost 20 years after the acid rain provisions of the Clean Air Act ushered in wide-spread acceptance of the use of market mechanisms to achieve environmental protection goals and the state of Massachusetts successfully privatized its state Superfund program, the federal Superfund program, like some obscure former Russian republic which remains devoted to Stalinism, is one of the last bastions of pure command and control regulation.

 

Can anyone tell me why the remedy selection process takes years and costs millions of dollars – before any cleanup has occurred or risk reduction been achieved? Can anyone tell me why, after the remedy has been selected, EPA has to spend millions of dollars – charged back to the PRPs, of course – to oversee the cleanup? Oversight costs can easily exceed 10% of cleanup costs, while oversight during the remedial design and feasibility study process sometimes seem to be barely less than the cost of actually performing the RI/FS.

While there are certainly a multiplicity of causes, there are two factors which greatly contribute to the problem. One was, coincidentally, highlighted in a post today by my friend Rob Stavins. As Rob noted, unlike the acid rain program, which was new at the time, the Superfund bureaucracy is well entrenched and there are a number of actors with a vested interest in maintaining the status quo

The second issue relates to the genesis of the Superfund program, as well as its continuing raison d’être. Whenever EPA has ranked relative risks from different environmental hazards, Superfund sites come in at the bottom. However, if you think back to Superfund’s origins, what comes to mind? Love Canal and the Valley of the Drums – and some concerned near-by residents who rallied around a cause to ensure that the problem would be addressed. As renowned risk communications expert Dr. Peter Sandman has noted, there is not necessarily a significant correlation between actual risk levels and public outrage, and it’s not possible to decrease outrage simply by providing accurate information about risks.

In short, the public is outraged by hazardous waste sites and does not trust PRPs to clean them properly. All of those EPA oversight costs are, in large part, intended not to decrease risk, but to lower outrage.  Outrage is understandable in some circumstances, and efforts to reduce it are laudable, but is it really an appropriate use of scarce environmental protection resources to spend the money that gets poured into Superfund sites?

There has to be a better way. Indeed, there is a better way. It’s called a privatized system in which PRPs have to meet well-defined cleanup standards, but are allowed to do so on their own, in whatever manner is most cost-effective, subject to audits by regulators. Privatized programs such as the one in Massachusetts are not perfect. However, their flaws – which largely stem from a failure to fully support privatization -- pale in comparison to the waste that is the federal program under CERCLA.

In other contexts, I’ve called on the Obama administration to embrace regulatory reform. Why not start with Superfund? Notwithstanding Rob Stavins’ point about the difficulty of overturning an entrenched status quo, if the states could do it, why not the federal government?

Besides, I have an entrenched personal reason for seeking Superfund reform. This stuff drives me nuts.