Posted on August 14, 2012
On Friday, in Texas v. EPA, the 5th Circuit Court of Appeals vacated EPA’s decision rejecting Texas’s SIP revisions that would have implemented (and did implement, for 16 years) a Flexible Permit Program for minor NSR sources. While genuflecting at the altar of deference to agency decisionmaking, the Court concluded that EPA’s rejection was not based on either EPA factual determinations or on its interpretation of federal, as opposed to state, law. The Court also concluded that EPA had not in fact relied on the reasons given in its briefs, and refused to defer to EPA’s “post hoc rationalizations.” The Court thus gave essentially no deference to EPA’s decision.
The interesting part of the decision was the dissent by Judge Patrick Higginbotham, a Reagan appointee. Judge Higginbotham took the majority to task for “not faithfully applying the deferential arbitrary and capricious standard.” He then persuasively demonstrated why the Texas program, as written, did violate the Clean Air Act.
After dismantling the majority’s logic, he then addressed the practical heart of the case – EPA’s 16-year delay in rejecting the SIP revisions. While criticizing EPA for the delay, Judge Higginbotham pointed out that there is a statutory remedy for EPA’s failure to rule on the revisions – a suit under section 7604(a)(2) of the CAA – a remedy never pursued by Texas.
What’s important about this case is that is an excellent example of why judicial restraint is so often “more honor’d in the breach than the observance.” (It’s been a while since I’ve quoted Shakespeare.) When a federal agency unwinds state policy after a sixteen-year delay, it’s very tempting for courts to engage in judicial activism, if that’s what it takes to go upside the agency’s head. The harder course, requiring more discipline, is to remain true the ideal of judicial restraint – that a court is not to substitute its judgment for an agency acting pursuant to an act of Congress. Therefore, Judge Higginbotham’s conclusion seemed worth note:
"As so often with political debate in search of a legal forum, its utility lies largely in pleasure of expression. Angst over perceived federal intrusion into state affairs ought be eased by the reality that laws enacted by Congress are laws of the States. Congress passed the Clean Air Act and made it enforceable by the EPA. The State was represented in that decision by two senators and its thirty-two other elected members of Congress. It also bears mentioning that its former governor was resident in the White House for eight of the years in passage here. The Clean Air Act is not foreign law. I dissent."
Posted on August 10, 2012
“Let me be clear: EPA has never designated manure as a hazardous substance nor has the agency ever designated a farm a Superfund site and has no plans to do so.” So says Mathy Stanislaus, EPA Assistant Administrator, Office of Solid Waste and Emergency Response in testimony before the House Energy and Commerce Subcommittee on Environment and Economy on June 27, 2012. The subject of the hearing was a bill called the “Superfund Common Sense Act” (H.R. 2997), which seeks to clarify that livestock manure is not a hazardous substance, pollutant or contaminant for purposes of CERCLA response authority and EPCRA emergency reporting.
With such an unequivocal statement of agency intent, is this latest Congressional effort to ensure a “common sense” interpretation of CERCLA and EPCRA with respect to livestock waste simply an attempt by agricultural interests to create an unnecessary and unwarranted regulatory “free pass,” or a prudent effort to provide needed certainty to the regulated community?
EPA’s position appears to be that the proposed codification of Superfund “common sense” is an uncalled-for response to the concerns being voiced. Beyond his broad statement of agency interpretation and intent, Mr. Stanislaus argues that EPA’s 2008 final rule exempting animal waste at certain farms from air emissions reporting under CERCLA section 103 and EPCRA Section 304 further demonstrates that the agency is already exercising common sense in its regulation of livestock waste.
Notwithstanding these assurances, however, Mr. Stanislaus admits that this final rule is currently under EPA review to address various issues being raised by a range of stakeholders. He also references EPA’s ongoing efforts to develop emissions estimating methodologies to better quantify air releases at livestock operations, presumably for future regulatory purposes.
Needless to say, such statements offer little comfort to the bill’s sponsors and regulated community, which are similarly discomforted by other statements of Mr. Stanislaus. For example, Mr. Stanislaus testified that the Act would prevent EPA from responding under its CERCLA authority to “damaging” releases of hazardous substances associated with manure. Also, Mr. Stanislaus voiced the agency’s concern that the bill’s “common sense” provisions would prevent EPA from using CERCLA to issue abatement orders in response to releases presenting a substantial danger to health or the environment.
Proponents of the bill state that the Act is not about whether manure should be regulated, as animal feeding and other farm operations are already adequately regulated under the Clean Water Act, Clean Air Act and state-specific authorities. Rather, the issue is whether CERCLA’s environmental response provisions and requirements were intended to or should apply to manure management. Although recognizing that CERCLA has specifically exempted only the “normal application of fertilizer” from its definition of “release,” proponents argue that such definitional language is not dispositive of congressional intent with respect to the general characterization of manure as a CERCLA hazardous substance. They also point out that EPA has never issued guidance on what constitutes “normal application of fertilizer,” leaving that exemption and broader CERCLA issues to be resolved by the courts and agency.
Opponents argue that because constituents of manure, such as ammonia and hydrogen sulfide, are hazardous substances, there is no legal or scientific basis to totally exempt manure from the regulatory scheme of CERCLA and EPCRA. They also challenge the notion that CERCLA authority is unnecessary or duplicative by identifying gaps in the reach of other federal environmental laws, including authority to deal with natural resource damages and the recovery of response costs.
Whatever side of the fence you may be on, it does seem inevitable that, if the legal and scientific issues being debated are not addressed by Congress, they will almost certainly be considered and resolved in some fashion by EPA, state agencies and the courts. In light of this -- and notwithstanding EPA’s protests that codification of Superfund “common sense” is unnecessary because agency common sense already prevails -- is a legislative approach to clarifying these important issues preferable to the uncertainties of future agency rule making and the inconsistencies inherent in judicial rulings?
Posted on August 7, 2012
On July 30, the United States Court of Appeals for the Fifth Circuit Court of Appeals handed down an opinion finding that EPA was within its authority to approve in part and to disapprove in part the most recent revisions to the state implementation plan (“SIP”) that Texas submitted to EPA in 2006 [Luminant Generation Co. LLC v. EPA, No. 10-60934 (5th Cir. July 20, 2012)]. EPA's action, effective on January 10, 2011, allowed an affirmative defense for unplanned startup, shutdown, and malfunction (“SSM”) events, but it disapproved the portion of the SIP revision providing an affirmative defense against civil penalties for planned SSM events.
Several groups of Environmental Petitioners (including the Environmental Integrity Project, Sierra Club, Environmental Texas Citizen Lobby, Citizens for Environmental Justice, Texas Environmental Justice Advocacy Services, Air Alliance Houston, and Community In-Power and Development Association) challenged EPA’s partial approval of that part of the SIP which created an affirmative defense for unplanned SSM events. The State of Texas and several Industry Petitioners and Intervenors (Luminant Generation Company, Sandow Power Company, Big Brown Power Company, Oak Grove Management Company, Texas Oil & Gas Association, Texas Association of Business, Texas Association of Manufacturers, and Texas Chemical Council) challenged that part of EPA’s action which disapproved the creation of an affirmative defense against civil penalties for planned SSM events.
A three-judge panel of the Fifth Circuit determined that EPA's decision was valid unless "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." Applying that standard of review and citing myriad cases upholding the premise that a state is afforded "broad authority to determine the methods and particular control strategies [it] will use to achieve the statutory requirements," including consistency with the Clean Air Act and the attainment and maintenance of NAAQS of the Act, (referenced throughout the opinion as Chevron deference), the court found the EPA's administrative decision-making process had been "consistently formal and deliberative prior to and during its promulgation of final rules under the Act." In particular, the court cited the reasoning EPA set forth in the final rule to explain its decision approving the portion of the state's SIP which "squarely adheres to its past policy guidance" and observed that EPA’s decision was "the result of a formal and deliberative decision-making process." The court also found that the EPA's interpretation of the Clean Air Act was based on a permissible construction of the statute because the agency found: (1) the affirmative defense for unplanned SSM activity was narrowly tailored; (2) the affirmative defense did not interfere with the Act's requirement that a SIP's emission limitations be continuous or with the state's ability to enforce emission limitations; and (3) the affirmative defense did not interfere with any other applicable requirement of the Act, including the attainment of national ambient air quality standards (NAAQS). The court was not persuaded by Environmental Petitioners' arguments, in part because the wording of the affirmative defense excludes all emissions that could "cause or contribute to an exceedance of the NAAQS, PSD increments, or a condition of air pollution" and thereby was not inconsistent with EPA's past policy and guidance, referencing a 1999 Memorandum of Steven A. Herman relating to excess emissions during SSM events.
In evaluating the state’s and Industry Petitioners' arguments, the court – after applying virtually the same analysis and criteria – found that EPA had not been arbitrary or capricious in disapproving an affirmative defense for planned SSM events. In reaching that conclusion, the court relied in large part on the premise that such events and excess emissions from such events were "avoidable." Further, in upholding the disapproval and denying Texas’s and Industry Petitioners’ request for relief, the court observed that EPA's reasons provided for the disapproval "conform to minimal standards of rationality."
Posted on July 18, 2012
Yesterday, in American Petroleum Institute v. EPA, the D.C. Circuit Court of Appeals affirmed EPA’s revisions to the National Ambient Air Quality Standard for NOx. The revisions adopted, for the first time, an hourly NAAQS for NOx, in addition to the annual standard.
API made a number of assertions that EPA had been arbitrary and capricious in its review of the scientific evidence concerning potential short-term impacts. The most important were EPA’s reliance, in part, on a study which had not been the subject of peer review, and EPA's alleged failure to consider a study suggesting that short-term impacts had not been demonstrated.
The Court rejected both complaints. With respect to the first, API asserted that EPA violated its own requirements when it relied on an internal analysis that had not been peer-reviewed. The Court’s response was short, but certainly not sweet:
Perhaps the API should have had its brief peer-reviewed. In quoting the EPA’s Review Plan, the API omits the first and most relevant word of the following sentence: “Generally, only information that has undergone scientific peer review … will be considered.” Of course, “generally” here indicates the practice in question will not invariably be followed. A bad start for the petitioners.
To which I can only say, ouch. Significantly, the Court noted that EPA did have its internal analysis reviewed by the Clean Air Scientific Advisory Committee, and it stated that review by CASAC qualifies as peer review.
Regarding the second claim, the Court concluded that EPA had considered the skeptical study. Moreover, EPA gave reasons why it rejected the conclusions of the study. This was enough for the Court.
I have previously pointed out that the Court’s review of EPA’s NAAQS in recent years has pretty much made the CASAC the final arbiter of the validity of EPA NAAQS promulgations. If EPA’s decision is supported by CASAC’s review – as it was here – EPA’s NAAQS will be affirmed. If, on the other hand, as was the case with EPA’s PM2.5 NAAQS, EPA promulgates an NAAQS that ignores CASAC advice, EPA’s standard is not likely to survive judicial review.
Yesterday’s decision only confirms this analysis. CASAC did not merely review the one paper that API had challenged; it proposed a short-term standard that was similar to and certainly consistent with the standard that EPA ultimately adopted. I’m not sure that Congress meant to delegate to CASAC the determination whether NAAQS adopted by EPA are arbitrary and capricious, but I think that that is where we are today.
To which API can only say, ouch.
Posted on July 11, 2012
The Toxic Substances Control Act (TSCA) regulates chemicals. It also regulates chemicals in articles, a little known fact that gives rise to big headaches.
TSCA defines an article as a manufactured item that is formed to a specific shape or design. Articles include an enormous array of items, ranging from car bumpers to electronic devices. While the U.S. Environmental Protection Agency (EPA) has used its TSCA authority to regulate articles, it has done so sparingly.
As part of its Enhanced Chemical Management Program, EPA recently proposed Significant New Use Rules (SNUR) for five groups of chemicals (certain PBDEs, HBCD, benzidine-based chemical substances, a type of SCCPs, and DnPP). Three of the proposed SNURs would regulate the chemical substances and articles containing them.
Why is this big news? Well, when EPA issues a SNUR, it is designating a use of a chemical not already in commerce as “new” and subjecting that use to premarket EPA review. This means a manufacturer (including importers) wishing to make a product containing the SNUR substance must submit to EPA a significant new use notice (SNUN) at least 90 days before any commercial use. The uncertain outcome of any SNUN review is the bane of a company’s quest for commercial predictability. Reviews can take considerably longer than 90 days, and EPA’s TSCA authority can be expressed in the imposition of commercial restrictions or operating conditions, some of which may need to be communicated to downstream customers of the SNUN submitter.
There is also concern with the legal and policy implications of these proposals. The proposed rules would regulate SNUR chemicals in articles independent of whether any such article actually poses a risk. EPA notes its concern that if PBDEs contained in articles were exempt, there would be in increase in the amount of PBDEs in commerce in the United States without EPA review as to the implications. This observation, while accurate, falls short of describing any nexus between the presence of PBDEs in articles and risk.
EPA also places an enormous (and some would argue disproportionate) legal burden on commenters to explain existing uses, and to define terms and use applications with sufficient granularity to avoid being considered “new.” Given the complexity of imported articles, EPA’s “one size fits all” approach begs the question whether a more refined subset of articles, products that might actually pose risks, is a more fitting candidate for SNUR regulation.
Important threshold questions of whether EPA should even use its SNUR authority in this way, and the practical implications of doing so, are not framed in the proposals. Whether TSCA’s SNUR authority is the best or only way to address chemical risks, and whether all articles as defined in the proposals present risks worth regulating deserves greater stakeholder discussion. Comments on Federal Register notices that assume the legitimacy of EPA’s legal and policy approach are a poor surrogate for vigorous public debate.
Posted on June 22, 2012
If you have ever helped a client gain the enforcement protections available under the EPA Audit Policy, be concerned: EPA is reducing its Audit Policy work effort to a “minimal national presence”.
Why? Resources, of course. EPA has too much to do and too few people to do it. As part of the FY 2013 Office of Environmental Compliance Assurance National Program Manager Guidance (OECA NPM), EPA evaluated what it does in light of tightening budgets and overall agency priorities. The EPA Audit Policy came up short: it has resulted in a significant number of annual disclosures, but they are not in the areas of highest priority, and the agency believes traditional enforcement yields greater benefits.
EPA adopted the Audit Policy in 1995 and updated it in 2000. It incentivizes regulated entities to conduct audits, timely self-disclose violations, promptly correct, and put in place systems to avoid repeats. If you do that, any penalty EPA might otherwise apply – for the “gravity” of the violation, or to recover any “economic benefit” gained from noncompliance – can be forgiven. Everyone wins – EPA gets compliance and compliance evaluation systems that protect against future violations; the business gets the certainty and comfort of knowing that if it looks for and finds noncompliance, it won’t be harmed financially; and the public gets the benefit of the environmental improvements.
EPA solicited comments on draft OECA NPM Guidance through March 19, 2012. On April 30, 2012 EPA adopted the final FY 2013 OECA NPM, which included the following at page 15:
Audit Policy/Self-Disclosures: Since implementation of the Audit Policy began in 1995, EPA‘s enforcement program has increased its understanding of environmental compliance auditing, and believes that internal reviews of compliance have become more widely adopted by the regulated community, as part of good management. In addition, EPA has found that most violations disclosed under the Policy are not in the highest priority enforcement areas for protecting human health and the environment. EPA believes it can reduce investment in the program to a limited national presence without undermining the incentives for regulated entities to do internal compliance reviews to find and correct violations. As we reduce investment in this program, EPA is considering several options, including a modified Audit Policy program that is self-implementing.4(emphasis added)
4 Note: To meet the agency wide schedule, the final OECA NPM Guidance is being issued now, although we have not completed discussions on the content and schedule for the budget adjustments portion of the Guidance. Some of the budget adjustments outlined in this final guidance may be revised as we continue work on implementation plans.
I choose to read this to mean it’s not too late to let EPA know what we think. If the planned cutbacks are enacted, they will go into effect for FY 2013, i.e., on October 1, 2012. Creative ideas for ways EPA can address its resource issues and keep the Policy active and vibrant are needed now.
We all recognize the challenges of diminishing resources, changing priorities, and committed constituencies. Regardless, if you agree with me that the Audit Policy has been and should continue to be a valuable tool in the compliance toolbox – for industry, EPA and the public -- and want to let EPA know that, please contact me. Let’s see how ACOEL members can constructively contribute to this discussion.
Posted on June 12, 2012
Section 316(b) of the Clean Water Act requires that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact. EPA embarked on three rulemaking phases to implement the statutory requirements.
The latest rulemaking effort began on April 20, 2011 when EPA published a proposed rule to protect fish from being killed at water intake structures that withdraw at least 2,000,000 gallons of water per day from waters of the United States and use at least 25% of the water they withdraw exclusively for cooling purposes. The proposed rule resulted from a request by EPA to the Fifth Circuit to take back portions of its cooling water rule relating to existing facilities (ConocoPhillips v. EPA, 5th Circuit No. 06-60662, July 23, 2010). Pursuant to a Settlement Agreement with the environmental group Riverkeeper and other organizations, EPA is required to issue the revised rule by July 27, 2012.
EPA has just published notice in the Federal Register presenting a summary of the significant new information and data EPA has received since its April 20, 2011 proposal and a discussion of possible revisions to the final rule that EPA is considering that were suggested by the data and comments. 77 Fed. Reg. 34315 (June 11, 2012)
During the comment period on the April 20, 2011 draft rule, EPA received more than 1,100 comment letters. It also received more than 80 documents containing new impingement and entrainment data for possible use in developing the final impingement mortality limitations.
EPA has now made the submitted information available for public review and has offered a 30-day comment period on the new information the agency will consider in making its decision on the final rule. Comments must be received on or before July 11, 2012.
A second key part of the Section 316(b) rulemaking, scheduled for publication on June 12, is a Notice of Data Availability which summarizes from a stated preference survey conducted by EPA after the April 20, 2011 proposed rule was published. EPA likewise is expected to allow a 30-day comment period on the preference survey summary and results.
To quote from the pre-publication version of the Federal Register notice, “. . . a stated preference survey attempts to gauge the value of an item through questions designed to mimic consumer decision-making in actual markets. . . . The stated preference survey estimates the value held by the public for ecosystem improvements based on the choices the surveyed members of the public make between hypothetical policy options and current conditions.” EPA will solicit comment on all aspects of the study and the appropriate role, if any, the study should play in EPA’s Section 316(b) rulemaking proceeding. EPA asks for comments even though it has not yet completed its statistical analysis of the survey data and is not in a position to determine whether the results of the survey will play a role in the benefits analysis for the final rule.
Given these two federal notices and the 30-day comment periods ending in the second week in July, it is hard for me to understand how EPA is going to comply with the court-required issuance date of new rulemaking by July 27. Stay tuned.
Posted on May 8, 2012
Yesterday, the Chesapeake Bay Commission released a study showing that implementation of a nutrient trading system would dramatically reduce the cost to achieve nutrient reductions in Chesapeake Bay. Pardon me if I seem to be posting a lot of dog bites man stories recently.
Although it should not come as a surprise that a trading system would permit nutrient reductions to be attained most cost-effectively, the scope of the benefit is worth noting. If trading were allowed basin-wide, and among both point and agricultural non-point sources, costs are projected to decrease by about 50% of the non-trading compliance costs.
Since I have faced this issue in Massachusetts, I found it even more noteworthy that, if trading were expanded to include regulated urban stormwater sources, compliance costs are expected to be reduced by about 80% over the non-trading scenario. The report’s explanation is both simple and cogent:
Implementing urban stormwater BMPs tends to be a much less cost-effective way of reducing nutrient loads than agricultural BMPs.
To which I say, you could have knocked me over with a feather. I just hope that EPA does not limit its review of this report to the Chesapeake Bay itself, but considers its implications more broadly in the context of stormwater regulation in other areas.
Posted on April 17, 2012
On February 28 and 29, 2012, the U.S. Court of Appeals for the District of Columbia Circuit heard oral argument in Coalition for Responsible Regulation v. EPA, No. 09-1322 et. al., consolidated challenges to the U.S. Environmental Protection Agency (EPA) ’s greenhouse gas (GHG) regulations. These regulations are being challenged by a coalition of industry groups and some states (the Coalition). The Coalition argues that the EPA does not have the authority to regulate GHGs from stationary sources under the Clean Air Act (CAA)’s Prevention of Significant Deterioration (PSD) permitting program without Congress amending the law.
The Coalition is asking the Court to vacate EPA’s rules regulating greenhouse gases, including the so-called Tailpipe and Tailoring Rules, on the grounds that they are contrary to the Clean Air Act and deviate from the explicit emission permitting thresholds in the CAA. As Peter Keisler, a lawyer for the National Association of Manufacturers (NAM) argued, “the agency crossed the line from stationary interpretation to statutory revision” and violated the law by raising the emissions thresholds far above those provided for by Congress in the CAA in order to avoid issuance of an unmanageable number of PSD permits in the short term .
The PSD program applies to new major sources or major modifications at existing sources for pollutants where the area the source is located is in attainment or unclassifiable with the National Ambient Air Quality Standards (NAAQS). As Keisler explained to the court, 83% of the GHG emissions from stationary sources would be regulated if EPA addressed greenhouse gas emissions solely in permits for the larger sources already subject to PSD requirements based on their emissions of criteria pollutants.
As Keisler then explained, under EPA’s Tailoring Rule which requires permits based solely on greenhouse gas emissions, 86% of the GHG emissions from stationary sources would be regulated – “a very tiny increment of difference, but a huge difference” in the number of sources that would now be regulated. And this increment of difference between 83% to 86% would translate into stationary sources never before regulated and now required to meet all PSD requirements, including implementation of costly best available control technology (BACT).
A decision by the Court is expected this summer.
Having participated in oral argument preparation and having observed both days of the oral arguments, it is my impression that the NAM arguments against EPA's Tailoring Rule provide the Coalition with the best chance for victory. NAM’s sound interpretation of the CAA and Congressional intent, coupled with the "avoidance of absurd results" doctrine, would blunt EPA's quantum leap through the CAA to create non-statutory GHG emission thresholds capturing only an additional 3% of stationary sources that were previously unregulated and would now have to bear crippling air pollution control costs for no real environmental benefit. This is the real absurdity of EPA's Tailoring Rule that I hope the court's decision will remedy.
Posted on April 4, 2012
A Superfund cleanup project is, of course, an exercise in "greening" the environment, in that the remediation project is designed to remove contamination from the environment and return the affected property to beneficial use. With the February 2012 publication of EPA's "Methodology for Understanding and Reducing a Project's Environmental Footprint" report, EPA has begun to formalize a process for ensuring that the remediation itself is done as greenly as possible.
The methodology describes a total of 21 metrics by which the greenness of a cleanup can be measured across five core elements: air, water, energy, materials and waste, and land/ecosystems. The report contains planning checklists (warranted to be "user-friendly") and a series of spreadsheets (which are assuredly not user-friendly) illustrating formats for organizing raw data and quantifying impact estimates.
While the methodology will primarily be applied to future remediation projects, the techniques are already being tested at a few ongoing remediation sites that have "volunteered" to pilot the methodology. For example, at one site in the Midwest that is in the middle of long-term groundwater pump-and-treat, an EPA consultant examined the project to determine whether the carbon emissions associated with the electricity (generated by the local utility at a coal-burning power plant) needed to run the pumps and associated air strippers could be reduced.
No word yet on whether the next level of meta-analysis will require investigating how to minimize the resources used to analyze the footprint “greenity” of the underlying project itself.
Posted on March 22, 2012
The Supreme Court issued its long awaited decision in Sackett v. EPA. In a unanimous decision, the Court held that the Sacketts may bring a civil action under the Administrative Procedure Act to challenge EPA’s compliance order. The court rejected the government’s argument that EPA is less likely to use orders if they are subject to judicial review, saying that “[t]he APA’s presumption of judicial review is a repudiation of the principle that efficiency of regulation conquers all.” It will be important to see how EPA responds and what if any changes are made to EPA’s practice and procedure for issuing orders in wetlands and perhaps other matters. See link to the Sackett opinion.
EPA had issued a compliance order charging the Sacketts with filling in a wetland during construction of their home, in violation of the Clean Water Act, and requiring them to restore their property. The Sacketts argued that they were entitled to prompt judicial review because they faced severe penalties for noncompliance and disputed that their property is a wetland. The United States argued that the Sacketts could comply with the EPA order and submit an application for a wetlands permit or defend if EPA brings an enforcement action, but may not seek judicial review of EPA’s order. The tenor of the oral argument did not bode well for the United States, as previously reported. The Court’s unanimous opinion, reversing the Ninth Circuit, bears that out.
The court’s opinion, written by Justice Scalia, starts with the proposition that the APA provides for judicial review of “final agency action for which there is no other adequate remedy in a court.” 5 U.S.C. §704. The court concludes that EPA’s compliance order has all the hallmarks of APA finality: it required the Sacketts to restore their property according to an agency-approved plan, exposed the Sacketts to double penalties in future enforcement proceedings, and severely limits their ability to obtain a Section 404 permit from the Army Corps of Engineers. See 33 U. S. C. §1344; 33 CFR§326.3(e)(1)(iv). Rejecting the government’s argument, the court held that applying to the Corps of Engineers for a permit and then filing suit under the APA if that permit is denied does not provide an adequate remedy.
The Court also had little difficulty in disposing of the government’s argument that the Clean Water Act should be read as precluding judicial review under the APA, 5 U. S. C. §701(a)(1). The APA creates a presumption favoring judicial review of administrative action, and the Court concluded that nothing in the Clean Water Act’s statutory scheme precludes APA review. The court was similarly not persuaded that the issuance of a compliance order is simply a step in the deliberative process, given that EPA rejected the Sackett’s attempt to obtain a hearing, and the next step will involve judicial and not administrative deliberation. Justice Scalia’s opinion concludes that “there is no reason to think the Clean Water Act was uniquely designed to enable the strong-arming of regulated parties into ‘voluntary compliance’ without the opportunity for judicial review -- even judicial review of the question whether the regulated party is within the EPA’s jurisdiction.”
Justice Alito’s concurring opinion is of interest because of its emphasis on the fact that the “reach of the Clean Water Act is notoriously unclear.” Citing an amicus brief filed by the Competitive Enterprise Institute, Justice Alito cites EPA’s guidance advising property owners that jurisdictional determinations concerning wetlands will be made on a case-by-case basis. His opinion concludes that allowing property owners to sue under the APA is “better than nothing,” but only clarification of the reach of the Clean Water Act can rectify the underlying problem.
It will be important to see how EPA responds and what if any changes are made to EPA’s practice and procedure for issuing orders in wetlands and perhaps other matters. The Sackett decision will be relied upon by parties who are subject to orders under other statutes that EPA administers. For some of the reasons cited by Justice Alito, the Sackett decision also underscores the need for clarification of the reach of the Clean Water Act. Stay tuned.
Posted on March 14, 2012
Risk assessments carried out under EPA’s IRIS program have been the subject of critical notice in recent months. The human health risk assessments which EPA performs across a range of programs merit attention, given their broad impacts in practical contexts; for instance, they form the basis for Superfund cleanups and RCRA corrective actions. But because they constitute guidance, they are not subject to judicial review at the time they are published and have not received much scrutiny by lawyers. Here are four aspects of how EPA typically conducts human health risk assessments that deserve attention and reform:
1. Publication Bias. In conducting a human health risk assessment, EPA starts by conducting a literature search and assembling the scientific papers that report a chemical’s effects or lack of effects on humans and relevant animal species. This appears to be a fair way to review the scientific understanding of the chemical’s possible effects on humans and animals, but it fails to take account of publication bias. This well known phenomenon favors publication of studies finding “positive” results – an association between the chemical and a biological effect – over those that do not. In risk assessments, the determination of a dose below which there is no observable effect is very important. Reviewing the published literature can be highly misleading on that central issue. See, e.g., Sena et al., “Publication Bias in Reports of Animal Stroke Studies Leads to Major Overstatement of Efficacy,” PLos Biol 8(3) e1000344 (2010) (“published results of interventions in animal models of stroke overstate their efficacy by around one third.”). EPA needs to capture the results of research showing, at given doses, that a chemical has no effect on human or animal biological systems. A start in that direction would be to require researchers who receive government support to report such results.
2. Multiple Comparisons. A researcher on, say, the neurodevelopmental effect of a chemical on children or rats can have the treated subjects perform 20 different tests; at a 95% confidence level, the researcher finds one association which is written up and published without reporting on other tests that did not show an association. Having made 20 comparisons at the 95% confidence level, at least one association is likely to be spurious – the result of random chance. But if one does not know how many tests or comparisons were made, there is no basis for making a fair judgment as to the strength or value to give to the reported positive result. There is no requirement in law or custom that directs researchers to report the number of comparisons they made, and publication bias discourages the ambitious academic from reporting a large number of comparisons which would result in sober analysts putting lesser weight on the positive results reported. EPA needs to know how many comparisons a researcher made and what the results were. This could be achieved in large measure by requiring that government-supported researchers report such data; in addition, EPA could simply ask the researchers to provide this information before it relied on the published results in a weight-of-the-evidence review.
3. Meta analysis. In a weight of the evidence review, replication of results has great weight in persuading the reviewer that the results are sound; conversely, failure to replicate results detracts markedly from the weight that a study will be given. Being able to tell whether results are replicated or not replicated depends on having common metrics used in the studies; e.g., administering the same dose under the same conditions at the same age. This is very rarely done, thereby erecting barriers to accurate determination of the weight that should be given to experimental results. See, e.g., Goodman et al, “Using Systematic Reviews and Meta-Analyses to Support Regulatory Decision Making for Neurotoxicants: Lessons Learned from a Case Study of PCBs,” 118 Env. Health Perspectives 728 (2010). Again the federal agencies that support research financially should require that experiments be conducted and reported with sufficient common metrics to allow effective meta-analysis. Of course, this would not preclude measuring and reporting whatever else the authors chose.
4. Review of data relied on in critical studies. EPA typically relies on one or a few “critical studies” in performing its analysis and reaching conclusions as to the risks to human health that are presented by a chemical. EPA reviews the printed reports found in the peer reviewed journals carefully, but it very rarely asks to see the underlying data. To a lawyer, this seems perverse – a bias against examining the actual data that is said to support the Agency’s conclusion. With no falsification, there are a number of ways to present data that will affect such data’s ultimate implications. Statistical treatment is the most obvious example. Human health risk assessments are of major importance to the public health and frequently result in many millions of dollars of expenditure by companies guarding against the risks that EPA identifies. It is clearly important to make these judgments as accurate as possible. In these circumstances, at least for the critical studies, the Agency should routinely ask that the data underlying the printed article should be produced; it should then examine the data and the reported results should only be relied on where they are fully supported by the data.
Dealing with these four issues should contribute significantly to producing human health risk assessments that would command the respect of the knowledgeable public.
Posted on March 2, 2012
Attorneys, environmental professionals and regulators understand the importance of the Integrated Risk Information System, known as IRIS. In rule-making, permitting, or remediation, the IRIS provides the EPA’s assessment of the health effects possibly resulting from exposure to chemicals in the environment. Whether trying to determine the hazard index, reference dose, cancer slope factor, or other critical toxicological end-point, the IRIS assessment of a specific chemical constitutes an important first step. Currently, the EPA has completed risk assessments of approximately 550 chemicals in the IRIS, and reports that another 55 are on-going.
But there have been numerous, long standing and wide-ranging criticisms of the IRIS process. For example, the National Academy of Sciences criticized the EPA’s IRIS assessment for formaldehyde because it failed to explain its criteria for: identifying epidemiologic and experimental evidence, assessing the weight of the evidence, and characterizing uncertainty and variability. The NAS noted that these criticisms applied with equal force to other IRIS chemical assessments as well.
More recently, in December, 2011, the U.S. Government Accountability Office issued a report to a House subcommittee crediting EPA for making some improvements in the process since earlier criticisms by the GAO in 2008, but noting recurring and new issues remain. The GAO previously noted the IRIS data base faced a serious risk of becoming obsolete because EPA could not keep pace with the pace of needed assessments. Even now, the GAO reported, the IRIS continues to suffer from problems with timeliness and productivity and “issues of clarity and transparency.” The GAO called on EPA to develop a better system to apprise stakeholders of the status of IRIS assessments. As an example, the GAO suggested a minimum of a two year notice of intent to assess a specific chemical, coupled with annual Federal Register reports on the status of on-going and proposed assessments.
To improve the credibility of the risk assessments, the GAO recommended the agency heed the recommendations of the National Academies. The National Academies proposed improvements such as standardized approaches to evaluate and describe study strengths and weaknesses and the weight of the evidence. Additionally, to restore scientific and technical credibility, the National Academies suggested the agency should involve independent expertise like the EPA’s Board of Scientific Counselors.
The GAO reports EPA has been receptive to its constructive criticisms and suggestions. But the GAO and the trade press observe it is unclear how the EPA will actually implement the various suggestions from the GAO and the regulated community.
Posted on February 29, 2012
By Deborah Jennings and Andrew Schatz
In the wake of expected Greenhouse Gas New Source Performance Standards (NSPS) for Electric Generating Units pursuant to Section 111 of the Clean Air Act, Congress has shown some early resistance. On November 4, 2011, EPA submitted to the Office of Management and Budget (OMB) its proposed rule for regulatory review. The proposed rule would require new and modified electric utilities to meet potentially stringent performance standards and emissions guidelines for greenhouse gases at a level that has been “adequately demonstrated” by existing technology. 42 U.S.C. § 7411(a)(1). Although the stringency of such standards is uncertain, they could require installation of expensive technology controls for fossil fuel combustion power plants.
In response, a group of 221 Congressmen submitted a letter on February 23, 2012 to OMB urging the White House to bar EPA from issuing its proposed NSPS rule. The letter cited, among other things, concerns that the rules could require installation of costly technology, such as carbon-capture and storage, which they feared would increase electricity costs. The 221 figure is significant, because it constitutes a majority of the House of Representatives, who along with the Senate, could pass a resolution overturning the rule (with Presidential approval or Congressional override of a veto) under the Congressional Review Act (CRA), 5 U.S.C. §§ 801-808.
Yet, history suggests it is very unlikely that Congress will reverse an EPA climate change regulation using the Congressional Review Act. For starters, the CRA allows Congress to pass a disapproval resolution seeking to reverse a recently promulgated federal regulation by a simple majority vote (no filibusters) within 60 days of receiving the final rule or its date of publication in the federal register. Thus, Congress has a very short-time frame to pass such resolutions in both the House and the Senate. Moreover, the President can still veto the disapproval resolution. At that point, Congress would need a two-thirds majority to override the veto. In fact, Congress has only successfully used the CRA once, overturning a Department of Labor rulemaking on ergonomics passed in the waning days of the Clinton Administration.
Such a scenario could shape up this time around. EPA originally planned on issuing the proposed utility standards in July 2011 and the final standards in May 2012. Since EPA has yet to issue its proposed rule, a final rule may not be expected until late 2012 or early 2013, at the conclusion of President Obama’s first term.
Posted on February 8, 2012
Section 316(b) of the Clean Water Act is a model of statutory simplicity: “Any standard established pursuant to section 301 or section 306 of this Act and applicable to a point source shall require that the location, design, construction, and capacity of cooling water intake structures reflect the best technology available for minimizing adverse environmental impact.” The effort by EPA to implement rules to interpret Section 316(b) approaches the opposite extreme.
The latest rulemaking effort began on April 20, 2011 when EPA published a proposed rule to protect fish from being killed at water intake structures that withdraw at least two million gallons of water per day from waters of the United States and use at least 25% of the water they withdraw exclusively for cooling purposes.
Pursuant to a settlement agreement with the environmental group Riverkeeper and other organizations, EPA is required to issue the revised rule by July 27, 2012. In the proposed rule, EPA agrees to impose flexible technology standards to deal with fish trapped against intake structures or drawn into cooling water systems. The rule requires facilities to obtain an NPDES permit reflecting best available technology in the design, location and construction of cooling water intake structures to minimize impingement (trapping of fish against intake screens) and entrainment (drawing of fish into a cooling water system).
The proposed rule has been attacked by the Natural Resources Defense Council and Riverkeeper, among other environmental groups. The rule has also been criticized by industry.
On January 25, 2012, EPA submitted a draft notice of data availability that could lead to amendments of the proposed rule. Notwithstanding the fact the rule has yet to be adopted and EPA has acknowledged the draft may be amended prior to adoption this summer, EPA staff in Region 1 have sent detailed information requests to facilities in Maine concerning any cooling water intake structure at those facilities.
Given the status of the 316(b) rulemaking, why EPA is requesting such information at this time is unclear. Given the existence of the proposed rule, EPA’s acknowledgement that it may revise the proposed rule and the court-required issuance date of July 27, this rulemaking process bears close scrutiny.
Posted on January 20, 2012
My father introduced me to the big band sound he grew up with in the ‘20s, ‘30s and ‘40s. In addition to the musical skirmishes between the powerful brass and elegant woodwind sections that highlighted the genre, he was fond of the lyrics. One of his favorite ditties was a playful calypso tune written by Sy Oliver and Trummie Young, first recorded by Jimmie Lunceford in 1939. The enlightened refrain gives the recipe for being highly effective -- “Tain’t what you do, it’s the way that you do it – that’s what gets results.” At about the same time Lunceford was leading his show band, sociologist Robert J. Merton was focusing on avoiding the wrong results. He popularized the concept of “unintended consequences,” the gist of which is humans cannot fully control the outcome of their actions so be careful what you do and for what you ask. Seventy-five years later, EPA’s recent proliferation of regulations with short time fuses and no existing or foreseeable means of compliance demonstrates no such careful thought.
Merton’s analysis provided five causes for unintended consequences: ignorance, error, immediate interest, basic values and self-defeating prophecy. While these five causes could form the outline for comments on almost any rule, the one that might be most applicable to EPA’s recent flurry of regulatory activity is what Merton called “the imperious immediacy of interest” which refers to instances where the actor’s paramount concern with the immediate action excludes the consideration of further or other unforeseen consequences of the same act. The speed in which the recent rules have been promulgated, the leap in technology that they require, and the brevity of the time period by which compliance is required are unprecedented and seem destined to result in unintended consequences.
Examples of these rules include the corporate average fuel economy (“CAFE”) standards which EPA established in 2009. Under the CAFE standards, Model Year 2011 vehicles must achieve 27.3 mpg. The requirement is ratcheted up to 35 mpg by 2016, and a whopping 54.5 mpg by 2025. Those developing the standards were warned that the standards would result in the production of smaller, lighter and deadlier cars. The developers not only required increased mileage, they limited greenhouse gases (GHGs), including CO2 emissions, from motor vehicles – the first time that GHGs were regulated as air pollutants under the Clean Air Act. Standard developers also recognized that regulating GHGs as pollutants for mobile sources would also trigger regulation of GHGs from stationary sources under the Clean Air Act’s prevention of significant deterioration of air quality program. The latter was not an unintended consequence, but where such regulation might lead our economy and society is anyone’s guess. We need only look at the recent reports of spontaneous combustion of electric vehicles to get some idea.
Another example is EPA’s issuance of the cross-state air pollution rule which afforded electric generating facilities only four months between its promulgation and the date of compliance on January 1, 2012. EPA promulgated the rule amid warnings by states and others that the electric system reliability was jeopardized. Fortunately, the D.C. Circuit stayed the rule on December 30. Similarly, EPA pushed out the EGU MACT standard after allowing itself only a few months to consider tens -of -thousands of comments on the proposed rule. Such speed of promulgation without regard for unintended consequences has EPA staffers concerned about the quality of their work product. Perhaps it’s time to revisit the requirements for regulatory impact analysis to consider new rules in light of Merton’s five causes of unintended consequences and Lunceford’s catchy tune. The alternative may be to sing another tune Lunceford popularized -- Blue in the Night.