Justice Scalia and Environmental Law, Part II: Takings and Administrative Law

Posted on June 9, 2016 by James May

Justice Scalia’s jurisprudence had a huge impact on environmental law. Part I focused on standing. This short piece addresses his impact on takings and Administrative Law.

Takings

Modern takings jurisprudence is also Justice Scalia’s handiwork. He, more than any other Justice, was inclined to find government regulation – particularly that which serves environmental ends – “goes too far” and thus constitutes a regulatory taking warranting just compensation. In Lucas v. South Carolina Coastal Council, he held for the majority that a state law designed to protect barrier islands constituted a compensable taking when it had the effect of depriving a developer of what he considered to be all economic use. And in Nollan v. California Coastal Commission, Justice Scalia—again for the majority—held that a requirement that a shorefront property owner maintain a public pathway to a public beach was “illogical” and constituted a compensable taking.

Justice Scalia’s jurisprudence makes policymakers think twice about regulating in the environmental realm.

Deference to Agency Rulemaking

Justice Scalia was consistently skeptical of environmentally-protective interpretations by federal agencies, especially those by EPA. In Rapanos v. EPA, writing for a plurality of the Supreme Court, he rejected the Army Corps of Engineers’ interpretation of the Clean Water Act’s term “navigable waters” to include temporally-saturated areas, instead insisting on a direct surface water connection to a water that is “navigable in fact.” Likewise, he joined the Court’s decision in SWANCC v. Army Corps of Engineers, holding that Congress did not intend to permit the Corps and EPA to regulate dredging and filling of isolated ponds and wetlands that are not adjacent to otherwise navigable waters, under what was known as the “migratory bird rule.” Most recently, in Michigan v. EPA, he wrote for the majority to invalidate EPA’s mercury and toxics rule, finding it unreasonable “to impose billions of dollars in economic costs in return for a few dollars in health or environmental benefits.” And shortly before he died, he joined four other justices to order a stay of EPA’s Clean Power Plan.

Yet Scalia was more inclined to defer to EPA interpretations that were less environment-minded. For instance, in Entergy v. Riverkeeper, he wrote on behalf of the majority to uphold EPA’s use of cost-benefit analysis in assessing “best technology available” for minimizing the adverse environmental effects of cooling water intake structures under section 316(b) of the Clean Water Act. Likewise, he dissented in EPA’s favor in Massachusetts v. EPA, voting to uphold the agency’s decision at that point that greenhouse gases are not “air pollutants” under the Clean Air Act.

Early during his tenure on the bench, however, Justice Scalia seemed more inclined to endorse the edict from Chevron U.S.A., Inc. v. NRDC, to defer to “reasonable” statutory interpretations from mission-oriented agencies. For example, in EDF v. Chicago, Scalia on behalf of the Court upheld EPA’s interpretation under the Resource Conservation and Recovery Act that “solid waste” includes ash from municipal waste incinerators. And then in dissent he decried the result in U.S. v. Mead Corp., where the Court strayed from the Chevron standard by granting only “power to persuade” as opposed to “reasonableness” deference to agency interpretations that are not the result of a deliberative process.

Last, Whitman v. American Trucking stands as a bit of an outlier to Scalia’s seeming antipathy to EPA’s reach, in which his majority opinion upheld as an “intelligible principle” under the non-delegation doctrine Congress having EPA establish national ambient air quality standards that are “requisite” to protect human health and the environment.

Justice Scalia’s views on deference to rulemaking gave agencies – except for EPA – more leeway. For further reading on these subjects, please see Principles of Constitutional Environmental Law.

Justice Scalia and Environmental Law, Part I: Standing

Posted on June 9, 2016 by James May

Justice Scalia’s jurisprudence had a huge impact on environmental law. Part I focuses on standing. Part II (a forthcoming post) then turns to takings and Administrative Law.

Standing 

Justice Scalia’s most lasting legacy on environmental law is how his jurisprudence makes it more difficult for environmental plaintiffs to demonstrate constitutional standing under Article III of the Constitution. Since at least Sierra Club v. Morton, plaintiffs needed to show that they possessed an “injury in fact,” which could be commercial, economic, aesthetic, or environmental. Raising the bar, Scalia stated that plaintiffs must demonstrate at an “irreducible minimum”: (1) imminent and concrete “injury-in-fact” that is (2) fairly “traceable” to the defendant’s actions, and (3) “redressible” by the court. Applying this standard, Scalia found standing lacking in Lujan v. National Wildlife Federation, because using land “in the vicinity of” affected federal land wasn’t sufficient, and in Lujan v. Defenders of Wildlife, due to the absence of what has come to be known as “tickets in hand” to return to the places of alleged injury. Dissenting in Defenders of Wildlife, Justice Blackmun, bemoaned Scalia’s new requirements as “a slash-and-burn expedition through the law of environmental standing.”

Justice Scalia then dissented in Friends of the Earth v. Laidlaw Environmental Services v. EPA, when the majority held that it is injury to the person, and not the environment, that matters in standing analysis. There, he complained that the majority had proceeded “to marry private wrong with public remedy in a union that violates traditional principles of federal standing—thereby permitting law enforcement to be placed in the hands of private individuals. I dissent from all of this.”

Justice Scalia was skeptical that the effects of climate change could ever support standing, even for states. Speaking from his dissent in Massachusetts v. EPA, Scalia would have found that petitioning states lacked standing to challenge the U.S. Environmental Protection Agency’s (EPA’s) failure to institute rulemaking to regulate greenhouse gas emissions from stationary sources, thereby rejecting that states are entitled to “special solicitude” in standing analysis.

Justice Scalia was more inclined to find standing when litigants challenged environmentally-protective agency action. For example, writing for a plurality, he found that alleged injury to economic interests to water districts and to corporate ranching and agricultural interests was sufficient injury in Bennett v. Spear. Moreover, he held that homeowners possessed both standing and a cause of action to challenge an EPA-issued but not enforced administrative compliance order in Sackett v. EPA.

Concur or not, Justice Scalia’s standing test took hold and stands firm. For further reading on this subject, please see Principles of Constitutional Environmental Law.

The Supreme Court Doesn’t Think Much of Paris in the Springtime

Posted on February 17, 2016 by William Session

            For us gray hairs, the phrase used to be “Dateline”, now it’s “Tweetline” . . .  Flash!. . . President Obama @POTUS “. . . Addressing climate change takes all of us, especially the private sector going all-in on clean energy worldwide."

            Apparently “all of us” didn’t include five Supreme Court Justices, led by its Chief Justice, John Roberts.  Indeed, it was SCOTUS going “all out” for climate change.  As in, going “all out” to frustrate one of the EPA’s and President Obama’s signature efforts to respond to and act upon climate change challenges to the global environment. What EPA and the President got (by a split decision) instead was a stay that some have characterized as the quashing of the biggest environmental regulatory change in United States history. 

            That body blow to regulatory appropriation of the climate change debate was instigated by the challenge of virtually every major coal power company to the EPA’s issuance of binding emission reduction requirements for existing domestic power plants.  The coal, fired power industry argued that EPA’s action was “draconian” and would cause the “shutting down or curtailing generation from existing plants and shifting that generation to new sources”.  That, of course, was the precise intent of POTUS and other signatories of the Paris climate change accord last year.

            SCOTUS’s stay was unprecedented and terse.  Not a word of explanation about why the stay was issued.  The proponents of the stay were modestly baffled.  In the words of Basin Power’s legislative rep, Dale Niezwaag, the decision came as a surprise . . . "The supreme court has never issued a stay on a rule that hasn't been ruled on by a lower court.  So this is precedent, setting from our point.  When we put it in, we figured it was going to be a long shot, so we were very surprised that the Supreme Court ruled in our favor”. 

            There are takeaways galore.  However, two are most intriguing to me.  Was this unprecedented stay an unwarranted and thinly disguised, reach into the realm of executive branch constitutional authority?  Second, did the Supreme Court simply muscle its way into a social and scientific debate that begs any legal or factual question of “irreparable harm” to either the power industry or the citizenry of the republic.  In short, was the stay an expression of SCOTUS climate change denial?

The stay makes EPA’s rules unenforceable and will undoubtedly limit their intended goal of achieving emissions cuts to (ostensibly) slow global warming.  More importantly, the ruling, in effect, invalidated POTUS’s pledge on climate agreement made in Paris last spring.  How should one construe the interjection of the Supreme Court into a case that would have, under normal circumstances, been taken up by the Court of Appeals for the District of Columbia Circuit as soon as early 2017?  Was a signal being sent to that court to heed the antipathy some believe certain SCOTUS justices have towards the global warming debate altogether? 

            In keeping with my “newsflash” metaphor, since I started writing this post, the country mourns the unexpected passing of Justice Antonin Scalia.  The lack of a tie breaker justice for the foreseeable future could throw the question of the right of the EPA to forge ahead on the POTUS’s climate change agenda into months or years of limbo.  Will the D.C. Circuit’s decision answer the question next spring?  Will certain senators relent and vote in a replacement for Justice Scalia this year?  Will the eight remaining justices do something other than call things a tie until they have a full complement on the bench? 

            Stay tuned to this blogspot for more breaking news.

Supreme Court Puts Clean Power Plan on Hold, but Clean Agriculture Can Move Forward

Posted on February 12, 2016 by Peter Lehner

The Supreme Court's unexplained stay of the clean power plan was "one of the most environmentally harmful judicial actions of all time," writes Michael Gerrard of Columbia Law School in a recent, excellent blog. Rather than venting outrage, Gerrard quickly moves on to explain that the Clean Power Plan isn’t the only way to cut carbon pollution.

Ramping up efforts like fuel efficiency standards for cars and trucks, and building efficiency standards, he notes, will also help reduce carbon pollution. Gerrard mentions a couple of points about agriculture, but often, this sector is overlooked when it comes to climate solutions. It’s worth taking a closer look at some of the opportunities to reduce climate pollution from our food system.

Food waste is the second largest component of most landfills. As it rots, it releases methane, a potent greenhouse gas. A recent report by the UN Conference on Trade and Development estimates that 2 percent to 4 percent of all manmade climate pollution arises simply from food rotting in landfills.

Keeping food waste out of landfills can help reduce methane pollution. Massachusetts, California, Connecticut, Rhode Island, Vermont, and some cities have enacted laws to manage organic waste disposal in landfills. The idea is to create incentives to reduce food waste and divert it to other purposes, such as animal feed or composting. Instead of being thrown away and becoming a source of pollution, this “waste” can be put to good use. Landfill gas collection systems can be further incentivized. And the nascent effort to reduce food waste from businesses and households can be significantly ramped up.

Another major source of greenhouse gases is the over application of fertilizer. Excess nitrogen fertilizer causes two big problems. The first is water pollution. Nitrogen that isn’t taken up by crops runs off farms and enters larger waterways, where it stimulates the growth of algae and creates “dead zones” deprived of oxygen. The second, and less frequently discussed issue, is the volatilization of nitrogen into nitrous oxide, a greenhouse gas about 300 times more potent than CO2.  The IPCC estimates that 12 percent of all non-CO2 greenhouse gas emissions come from synthetic fertilizer application.  

A number of techniques can reduce these emissions while also providing a cost benefit to farmers. Farm policies could encourage practices like cover cropping, which reduces the need for fertilizer by making soils more rich and fertile. Crop rotations can do the same, yet current crop insurance programs actually discourage the use of these practices. Precision application technologies for fertilizers are getting ever better, but their uptake on farms is slow.

Manure from animals, and the "enteric emissions" from cattle (more commonly thought of as belching) are two more significant sources of climate pollution. Enteric fermentation alone may account for as much as 40 percent of all non-CO2 greenhouse gas emissions, according to the IPCC. Changes in diet might help with these emissions, but this is an area that needs more research.

Some of the emissions from manure can be captured if manure lagoons were covered and better managed. As it stands, these pits are only slightly regulated and are major sources of water pollution sources as well as odor nuisances. An even better practice is to raise cows on rotating pastures, where their waste can enhance soils and help store carbon. And, of course, if Americans did shift to a diet lower in red meat, as per the recommendation of the Dietary Guidelines Advisory Committee, we could further reduce climate pollution from cattle.

Agriculture is one of our nation's most important economic sectors, and is especially vulnerable to the extreme weather impacts of climate change. Its product -- food -- is critical not only for our economy, but is an integral and uniquely personal part of our everyday lives. When we think about how to address climate change, it makes sense to think about food and agriculture. The food we choose to produce, and how we produce it, use it, and dispose of it, all have an impact on climate pollution—and therefore have the potential to become climate solutions. 

Unprecedented Program Leads To Unprecedented Response

Posted on February 11, 2016 by Andrea Field

I am a terrible predictor of what cases the Supreme Court will hear and what the Court will decide on those matters it chooses to hear.  For example, I wrongly predicted that the Supreme Court would never consider reviewing the D.C. Circuit’s decisions in cases involving other recent EPA regulations, but the Supreme Court chose to hear those cases, which led to its decisions in Utility Air Regulatory Group v. EPA and Michigan v. EPAAnd if asked to guess whether the Court would issue a stay of EPA’s Clean Power Plan under section 111(d) of the Clean Air Act, I might well have said that the odds were greatly against that happening – despite the merits of the arguments being raised by those seeking the stay. 

Perhaps, though, my poor predictive abilities are the result of my looking at each case in isolation instead of looking at them in combination and considering whether the Supreme Court’s February 9, 2016 stay decision is an outgrowth of the combined knowledge gained by the Court in its recent reviews of those other Clean Air Act cases.  Specifically, as pointed out by State Petitioners in their briefs in support of a stay of the Clean Power Plan (see here and here,) EPA has touted its Plan as being one that will completely transform the way energy is created and delivered in this country even though – argued State Petitioners – the plain statutory language (of Clean Air Act section 111(d)) does not authorize such Agency action, and the approach of the Clean Power Plan is at odds with EPA’s 45-year history of implementing section 111(d).  Maybe such claims struck a chord with the Court, which – in UARG – told EPA that the Agency cannot make “decisions of vast ‘economic and political significance’” under a long-extant statute, like the Clean Air Act, without “clear congressional authorization.” 

And then there was Michigan, where the Court determined that EPA had proceeded unlawfully in adopting another extensive and expensive Clean Air Act regulatory program.  State Petitioners in the Clean Power Plan litigation made sure that the Court was aware that by the time the Court issued its decision in Michigan – a case where the underlying rule was not stayed during the pendency of litigation – the affected parties had spent billions of dollars to meet the terms of the underlying, un-stayed rule.  In other words, justice delayed in Michigan was justice denied.

None of this is to say what the Court will or will not do if and when it reviews arguments on the lawfulness of the Clean Power Plan.  I make no predictions on that.  But I believe the Court acted appropriately in calling for the completion of litigation before requiring affected parties to make the massive, unprecedented, costly, and transformative changes to the energy industry that the Clean Power Plan demands.       

The Supreme Court Stay of the Clean Power Plan and the Paris Pledges

Posted on February 10, 2016 by Michael Gerrard

The Supreme Court’s unprecedented, unexpected and unexplained action yesterday staying implementation of the Clean Power Plan is one of the most environmentally harmful judicial actions of all time. However, the damage it does to the United States’ ability to meet its Paris pledge is less than it might seem. But that is not because the Clean Power Plan wasn’t important; it is because the Plan didn’t do nearly enough.

The Intended Nationally Determined Contribution (INDC) that the U.S. submitted in advance of COP21 reiterated the prior goal of achieving a 17% reduction below 2005 levels in 2020, and conveyed a new pledge of a 26% to 28% reduction by 2025. The INDC cited the Clean Power Plan as one of the actions being taken to meet those pledges, but did not present any numbers on what actions would lead to what reductions.

More detail was presented in the Second Biennial Report of the United States under the Framework Convention on Climate Change, submitted by the Department of State in January 2016. As the report makes clear, the Clean Power Plan’s actual emissions reductions do not begin until 2022, and thus have no bearing on achievement of the 2020 goal. From 2020 to 2025, the Report expects carbon dioxide emissions to fall from 5,409 to 5,305 MtCO2e (Table 4) with implementation of the Clean Power Plan, energy efficiency standards, fuel economy standards, and numerous other measures that are already on the books, and down to 5,094 in 2030.  (The report does not separately specify how much of this is due to the Clean Power Plan alone; the numbers result from a complex modeling exercise that included numerous interrelated actions.)

That is not nearly enough of a reduction to meet the 26% target (much less the 28% aspiration) for 2025.  Instead, a host of additional measures are also needed. The Biennial Report lists these as possibilities to reduce carbon dioxide emissions:

  • Full implementation of Phase II heavy-duty vehicle fuel economy standards.
  • Finalization of proposed, new, or updated appliance and equipment efficiency standards.
  • Increased efficiency of new and existing residential and commercial buildings.
  • Reduction in industrial energy demand in several subsectors.
  • Additional state actions in the electricity sector.
  • Enhanced federal programs that lead to greater efficiencies in industry and transportation, including greater biofuel deployment and commercial aviation efficiency.

To address other greenhouse gases, the Biennial Report lists these possible added measures:

  • An amendment (already in the works) to the Montreal Protocol on Substances that Deplete the Ozone Layer to phase down production and consumption of hydrofluorocarbons.
  • Measures to reduce methane emissions from landfills, coalmining, agriculture, and oil and gas systems.
  • More efficient nutrient application techniques that reduce nitrous oxide emissions

Even all of the above is not enough to meet the 2025 goals. The Biennial Report puts heavy reliance on the land-use sink – on the ability of forests and other vegetated areas to absorb a considerable amount of the greenhouse gases that are emitted. And even with an “optimistic sink” scenario and a number of other favorable assumptions, the key summary graph in the Biennial Report (Figure 6) shows a reduction of about 27% in 2025.

In sum, while the Clean Power Plan is the biggest game in town in terms of achieving the Paris goals, it is by no means the only game in town. While we express our justifiable fury over the Supreme Court’s action, we need to bear in mind that there are many other things that the U.S. must do in the next several years to control greenhouse gas emissions.

Sackett Redux?

Posted on December 17, 2015 by Patrick A. Parenteau

As Annette Kovar recently predicted in her blog, the Supreme Court granted cert in United States Army Corps of Engineers v. Hawkes Construction., Inc. (15-290) to resolve a split in the circuit courts on the question whether a jurisdictional determination (JD) under the Clean Water Act constitutes “final agency action for which there is no other adequate remedy in a court" and is therefore subject to judicial review under the Administrative Procedure Act.

In Hawkes , the Eighth Circuit held that the JD was a final agency action subject to the APA. The case arose after a company sought to mine peat from wetland property owned by two affiliated companies in northwestern Minnesota. The Corps’ JD found that the wetlands onsite were "waters of the United States" and were therefore subject to the permit requirements of section 404 of the CWA. This decision runs counter to the Fifth Circuit decision in Belle Co., LLC v. U.S. Army Corps of Eng’rs.

Both courts evaluated the reviewability of JD’s in light of Sackett v. EPA, which held that property owners may bring a civil action under the APA to challenge EPA's issuance of a CWA §309 compliance order directing them to restore their property immediately pursuant to an EPA work plan and assessing penalties of $37, 500 per day for failure to comply. The Fifth Circuit in Belle declined to apply Sackett on the ground that a JD does not have the same legal consequences as a 309 compliance order. The Eighth Circuit disagreed and held that a JD presents landowners with a Hobson’s choice requiring them “either to incur substantial compliance costs (the permitting process), forego what they assert is lawful use of their property, or risk substantial enforcement penalties.”  

In my view the Fifth Circuit has the better reading of Sackett and the governing law on what constitutes final agency action. The Supreme Court uses a two prong test to determine finality:  first the action must “mark the consummation of the agency’s decision making process;” and second “the action “must be one by which rights or obligations have been determined, or from which legal consequences will flow.” Bennett v. Spear There is no question that a JD satisfies the first prong. But a JD does not meet the second prong for at least three reasons. First, a JD does not determine the rights and obligations of the landowner for the simple reason that the statute has already done that. Section 301 of the CWA prohibits any discharge by any person to a water of the US without a permit.   The landowner’s legal obligations are exactly the same with or without the JD. 

Second, unlike the compliance order in Sackett, a JD does not compel the landowner to take any action at all. Nor does it expose the landowner to penalties, let alone the double penalties at issue in Sackett. The JD notifies the landowner that a permit may be required for discharging dredge or fill material into the wetland unless one of the statutory exclusions such as prior converted cropland apply.  However as the Fifth Circuit said, “even if Belle had never requested the JD and instead had begun to fill, it would not have been immune to enforcement action by the Corps or EPA.” 

Third, the Eighth Circuit was simply wrong to equate the practical consequences of a JD putting the landowner on notice that a permit was required with Bennett’s requirement that the action must have legal consequences. In Bennett the action at issue was a biological opinion issued under section 7 of the Endangered Species Act. The Court found that under the ESA “the Biological Opinion at issue here has direct and appreciable legal consequences;” namely, that it curtailed the authority of the Bureau of Reclamation to provide water for irrigators from federal reservoirs in order to protect endangered fish. Nothing remotely similar to that follows from the issuance of a JD.

Finally the Court ought to be leery of broadening the reach of the APA to include actions having practical effects but not actual legal consequences. That could sweep in a large number of federal actions that have never been thought of as justiciable controversies—for example notices of violations which arguably trigger even more immediate and serious consequences than JD’s. Regulated entities are not the only ones who might benefit from a relaxation of the APA’s finality requirement. Environmental plaintiffs would gain increased access to the courts as well.   

DUE PROCESS TRUMPS DEFERENCE? JURIDICTIONAL QUIBBLING?

Posted on December 10, 2015 by Annette Kovar

The U.S. Supreme Court will likely agree to review the decision of the Eighth Circuit Court of Appeals in Hawkes Co. v. U.S. Army Corps of Engineers. So said John Cruden, Assistant Attorney General for Environment and Natural Resources and College Fellow, to the 2015 National Clean Water Law Seminar. He described the Hawkes case as the second generation of the U.S. Supreme Court’s Sackett v. EPA decision in 2012.

As noted here, the Hawkes case is another wetlands case, this time about a Minnesota peat farming company that applied for a permit from the U.S. Army Corps of Engineers under the Clean Water Act to expand its peat mining operation. The Corps advised Hawkes that it had made a preliminary jurisdictional determination (JD) that the property on which the expansion was planned included regulated wetlands requiring a more extensive environmental assessment. Despite Corps staff attempts to dissuade continuing with the permitting process, Hawkes challenged the preliminary JD. The Corps subsequently prepared an Approved JD and ultimately issued a Revised JD after its own internal review raised issues of concern. The Eighth Circuit Court of Appeals held that the Corps JD was a judicially reviewable final agency action under the Administrative Procedure Act (APA). Previously, the Fifth and Ninth Circuit Courts of Appeal had ruled that a Corps JD was not a judicially reviewable final agency action. The Hawkes case sets up a split in the Circuit Courts making Supreme Court review more likely.

One might recall that the Supreme Court’s unanimous Sackett v. EPA decision held an EPA compliance order, alleging the Sacketts had violated the Clean Water Act by placing fill material on their property without a permit and requiring restoration of the property, was a final agency action and subject to judicial review under the APA. The Supreme Court concluded the Sacketts had no other adequate remedy at law and further stated that the APA creates a “presumption favoring judicial review of administrative action.” Justice Scalia, writing for the Court, said this “presumption of judicial review is a repudiation of the principle that efficiency of regulation conquers all.” He continued that nothing in the CWA can be read to enable or condone “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 EPA’s jurisdiction.” Clearly, principles of fundamental fairness and due process underlie the Sackett decision.

If one goes back to the Hawkes case, note that the Corps describes its preliminary and Approved JDs as tools-- i.e. guidance, to help implement the Clean Water Act, and not orders. JDs probably do streamline the permitting process because an applicant will know what the Corps’ position is before investing heavily in a permit process and may decide to abandon the project. But, there is a hint of “strong-arming” tactics in the Hawkes case that does not bode well for a deferential decision by the Supreme Court to the Corps. However, even if Corps’ JDs become subject to judicial review in the future, won’t a reviewing court still ascribe a certain amount of deference to the Corps’ expertise under APA standard of review precedents? Wouldn’t the Corps have to defend its JD at some point if challenged? Will the Corps really lose much by defending its JD sooner rather than later?

Deference to EPA on the Wane?

Posted on July 13, 2015 by Renee Cipriano

The Supreme Court’s latest opinion in an environmental rule challenge, this to the Mercury and Air Toxics Standard, or MATS, raises more questions than it answers.  As discussed on this blog site (see here, here and here,) the Court in Michigan v. EPA held that EPA had not reasonably considered costs when determining to regulate power plant mercury emissions.  EPA must factor cost into its initial determination that it is “appropriate and necessary” to regulate hazardous pollutants from power plants.  The Court passed no judgment on whether EPA can meet that burden. 

At the heart of the issue was Congress’ acknowledgement that the 1990 Clean Air Act Amendments would subject power plants to numerous controls to reduce sulfur dioxide, nitrogen oxides, and particulates.  Section 112 of the Act requires EPA to regulate power plants if “regulation is appropriate and necessary after considering the results of the study.”  Congress further acknowledged that these measures also might reduce hazardous air pollutants, and that no one knew at the time whether additional controls would be required to protect human health from air toxics emitted by power plants. 

To determine that, EPA was required to conduct a study.  In 1998, EPA’s study concluded that regulation of coal and oil fired power plants was “appropriate and necessary.”  EPA reaffirmed this finding in 2012, noting that mercury and other hazardous air pollutants were “appropriate” to regulate because they posed a risk to human health and the environment and that controls were available to reduce the pollutants.  EPA found that it was “necessary” to regulate because other pollutant emission limits and requirements did not eliminate the risks. 

The Court, in a 5-4 decision written by Justice Scalia, analyzed EPA’s action through the Chevron deference standard, determining that “EPA strayed far beyond those bounds when it read §7412(n)(1) to mean that it could ignore cost when deciding whether to regulate power plants.”  Ultimately, the Court held that “Chevron allows agencies to choose among competing reasonable interpretations of a statute; it does not license interpretive gerrymanders under which an agency keeps parts of statutory context it likes while throwing away parts it does not.”  Id. at 9.

The Court went on to reject EPA’s contention that it need not factor cost into its initial determination to regulate because the agency must take cost into consideration when later determining how much to regulate.  The Court colorfully remarked that:  “By EPA’s logic, someone could decide whether it is ‘appropriate’ to buy a Ferrari without thinking about cost, because he plans to think about cost later when deciding whether to upgrade the sound system.” The Court’s strong language cautioning EPA to use “reasoned decision making” and not “gerrymander” statutory requirements should give EPA pause as it is set to promulgate greenhouse gas reduction measures for power plants in its Clean Power Plan this summer.  Numerous comments filed in the so-called Clean Power Plan rulemaking docket have charged EPA with overstepping its statutory boundaries, and the Court seems to be signaling its disfavor of such action.

Since the decision, speculation as to whether and how EPA will fix MATS has been rampant. 

  • Will EPA abandon MATS completely, requesting vacatur?  Not likely.  In public remarks and testimony before a Congressional subcommittee during the week of July 6, Administrator Gina McCarthy cited the health benefits already achieved by the rule, indicating the agency would not back down.
  • Can EPA fix the rule based on the current administrative record?  Some believe that EPA can simply re-jigger its existing analysis and logic, fronting the cost issue in the “appropriate and necessary” finding, perhaps calling this a “technical amendment” to the rule. 
  • Will EPA seek a stay of the existing rule while it recalculates costs and re-proposes the rule?  Because the rule went into effect in April 2015, companies already have installed a range of controls from activated carbon injection to installation of flue gas desulfurization equipment.  Each type of control has costs and benefits, as well as impact on other pollutants.  Many of these controls may remain operational to comply with other CAA requirements; therefore, a stay may have disproportionate impacts on industry members as some cease to operate controls and others continue to operate them.
  • But could EPA’s re-proposal result in even more stringent emission limits?   Absolutely.  Would EPA be wise to lower the standards further?  Given the cost and disruption caused by MATS so far, absolutely not.
  • And how will any of these possibilities affect the “already regulated” argument that will be used to attack the Clean Power Plan?  Section 111(d), the basis for the Clean Power Plan, prohibits regulation (whether of the source or the pollutant remains to be decided) if a Section 112 standard exists.  So if MATS goes away, does the legal basis for the Clean Power Plan become stronger?

How the ongoing, never-ending EPA effort to achieve hazardous pollutant reductions from power plants will play out remains to be seen.  The Supreme Court’s close reading of the directives contained in the statute, coupled with its references to balanced costs and benefits, leaves the impression that any rule with wide reach better be well-reasoned and justified.  No doubt EPA is taking notice. 

WILL POWER PLANT HAZARDOUS AIR POLLUTION SURVIVE MICHIGAN V. EPA?

Posted on July 8, 2015 by Leslie Carothers

Twenty-five years in the making, the Environmental Protection Agency’s regulations to reduce emissions of mercury and other hazardous air pollutants (HAPS) from power plants recently ran aground in the Supreme Court.  As discussed in this blog site last week, (see here and here,) the majority opinion by Justice Scalia in Michigan v. EPA held that EPA erred in failing to consider cost when it made the threshold statutory finding that listing of power plants for regulation was “appropriate” under a special provision for power plants in the hazardous pollutant sections of the Clean Air Act. 

The dissenters, in an opinion by Justice Kagan, disagreed that costs had to be considered at the initial listing stage.  She contended that costs were properly addressed when specific standards and requirements were developed for various source categories in the course of the normal rulemaking process, and emphasized that a final cost-benefit analysis was conducted to evaluate and support the decisions made. 

Although Justice Scalia was at pains to say that the Court was not specifying the details of the cost analysis required, the majority was plainly troubled by the agency’s findings that the benefits of the mercury controls alone were valued at an annual value of only  $4-6 million compared to an annual cost of $9.6 billion.  However, mercury was not the only HAP controlled by the rule, and the co-benefits of incidental removal of other toxic fine particulate pollutants were estimated at $36-90 billion in EPA’s cost-benefit analysis.  Those big numbers reflect robust scientific evidence of the incidence of illness and death caused by particulate emissions. 

The majority did not address whether such co-benefits could be relied upon in a determination that the cost of the power plant rules was “appropriate.“ The D.C. Circuit will have to define the terms of EPA’s redo of the cost analysis.  We are likely to hear more about counting of co-benefits in cost benefit comparisons, an issue also presented in EPA’s proposed Clean Power Rule for power plant greenhouse gas emissions.  Reducing carbon emissions also reduces particulate emissions even more, and the monetized benefits of that effect exceed the harder to estimate benefits achieved in slowing global warming. 

Public Health and Environmental Consequences of the Decision

Despite the Supreme Court’s action, commentators on both sides of the issues agree that major benefits of the regulation will not be lost.  A trade publication estimated in May that half of the power plants subject to the rule have already installed the required emission control technology to meet multiple EPA air pollution rules, in addition to the hazardous pollutant rule.   Another 200 plants given an extra year to comply are installing and testing equipment.  Several dozen plants accounting for only 1% of industry capacity reportedly are the remaining uncontrolled sources that will continue to operate without controls or plans to install them until the Michigan case is concluded. 

Many companies that have complied with the rules are doubtless disappointed to see the perennial “free riders” get another reprieve; some intervened on EPA’s side in the Michigan case to complain about unfair competition from uncontrolled plants.  But the majority of power plants, to their credit, are already delivering the public health and environmental benefits of the rule for the community.  

Citizens unhappy with the continuing failure to regulate old coal plants may wish to support the divestment movement, recently joined by Georgetown University, in dumping coal company securities.  The day Michigan v. EPA was decided, the stock of three major coal producers rose about 10%.  If the price jump holds, now looks like a good time to sell.

Justices Agree Cost Matters, but Differ as to When

Posted on June 30, 2015 by Jonathan Z. Cannon

In Michigan v. EPA yesterday the Supreme Court held, 5-4, that EPA unreasonably declined to consider costs in deciding to regulate emissions of hazardous air pollutants (HAPs) from electric power plants.  At issue was the Agency’s interpretation of the Clean Air Act’s “appropriate and necessary” threshold for regulating emissions from power plants under Section 112.  The industry and state petitioners argued that the Agency could not reasonably interpret the phrase as excluding consideration of costs, whereas EPA contended that it could limit consideration of costs to a later phase of the regulatory process – i.e., the setting of emissions standards.

In Environment in the Balance: The Green Movement and the Supreme Court, I describe the competing cultural paradigms that orient us on environmental issues – paradigms immediately recognizable to anyone who works in environmental law and policy.  On the one hand, the new ecological model emphasizes the interconnectedness and fragility of natural systems and the importance of collective restraint in protecting those systems.  (Pope Francis’ Laudato Si embodies this model.)  On the other, the dominant social paradigm emphasizes individualism, entrepreneurial effort, and economic growth.  The postures of the justices in the Court’s environmental cases often reflect the influence of these paradigms.  Conservatives such as Chief Justice Roberts and Justices Scalia, Thomas and Alito tend to align in environmental cases with the dominant paradigm; liberals such as Justices Ginsburg, Kagan and Sotomayor with the ecological.  In the middle are Justice Kennedy, a conservative who has nevertheless been responsive to the ecological model in important cases, and Justice Breyer, a liberal who has expressed concern about extending environmental protections regardless of costs, as in his separate opinions in Whitman v. American Trucking Associations, Inc. and Entergy Corp. v. Riverkeeper, Inc. 

Consistent with these alignments, Michigan v. EPA revealed divergent responses among the justices to the economic burdens of environmental regulation.  Breyer held with his pro-environmentalist colleagues; Kennedy swung this time with the anti-regulatory faction; and the other justices lined up predictably according to their preferred worldviews.  But the divergence was less than it might have been, and the competing opinions reflected common ground among the justices on the importance of considering costs in environmental regulation to avoid “disproportionate outcomes.”  

Justice Scalia’s opinion for the Court argued that “reasonable regulation ordinarily requires paying attention to the advantages and disadvantages [i.e., costs] of agency decisions.”  (Scalia pointedly cites Breyer’s concurring opinion in Entergy here.)  Against a backdrop of the potential for burdensome and inefficient regulation, “appropriate and necessary” could not reasonably be read “as an invitation to ignore costs.”  That the agency did prepare and consider a cost-benefit analysis in the standard-setting phase did not salvage the validity of the threshold determination.  Costs were relevant at both stages.  As he did in his opinion for the Court in Entergy, Justice Scalia walked back the potentially expansive holding in American Trucking, which ruled that the Clean Air Act prevented consideration of costs in setting National Ambient Air Quality Standards; that decision, he wrote, stands only for “the modest principle” that EPA is not allowed to consider costs where Congress has used language that excludes them. 

Justice Kagan’s dissent (joined by Justices Ginsburg, Breyer and Sotomayor) agreed with the majority that rational regulation is generally not cost-blind: “absent a contrary indication from Congress” regulatory agencies must take costs into account.  But she differed from the Court in arguing that EPA’s consideration of costs in the standard-setting phase satisfied the requisites of reasonableness.  EPA’s cost-benefit analysis for the standards showed that the benefits (including the co-benefits of further reductions in particulate matter emissions) outweighed the costs by a factor of three to nine – a reasonable return indeed.  

Michigan v. EPA suggests a presumption, adhered to unanimously by the Court, that where Congress has not specifically addressed consideration of costs, agencies are required to consider them, because it would be unreasonable for them not to.  Only where Congress has evidenced its intent to preclude consideration of costs (the narrow niche to which American Trucking is now confined) are agencies free to ignore them.  Apart from the specific issues in the case, this is a significant development in the Court’s approach to regulatory review.  With both factions presuming that costs should be considered, the issue was not whether but when. 

Further Advice from Air Act Andy: What A Difference A Year – And a Broken Foot – Make

Posted on April 6, 2015 by Andrea Field

On March 25, 2015, the Supreme Court heard 90 minutes of argument in Michigan v. EPA, No. 14-46. Briefing and argument focused on one aspect of EPA’s Mercury and Air Toxic Standards (MATS) Rule: whether EPA unreasonably refused to consider costs in determining if it is appropriate to regulate hazardous pollutants emitted by electric utilities. If you were unable to attend the argument but want to know more about it than you can learn from the press reports, then this “Advice from Air Act Andy” column is for you.

Question: Based on questions asked by the Justices during argument, many predict this will be a 5-4 decision, with Justice Kennedy possibly casting the deciding vote. What do you think?

Air Act Andy: I will preface my answer with the disclosure that a year ago I told my client there was virtually no chance the Court would choose to hear the MATS case. With my prognostication credentials thus firmly established — and keeping in mind that it is unwise (and usually embarrassing) to predict what the Court will do based on the questions asked at oral argument — let me say only that I came away from the argument sensing a 4-3-2 split in the Court.  I leave it to you, gentle reader, to infer more.

Question: Did Justice Breyer and his clerks spend endless hours hypothesizing scenarios for how EPA might have taken costs into account in developing the MATS Rule?

Air Act Andy: Without speculating on how many hours Justice Breyer and his clerks spent thinking about this, I note that he arrived at argument armed with a long list of questions suggesting he was troubled by the idea that EPA might regulate hazardous air pollutant emissions from electric utilities without any consideration of costs. In particular, he asked whether costs had been, or could be, considered in the subcategorization of electric generating units, even if costs were not considered in EPA’s initial listing of those sources.

Question: What did the parties make of Justice Breyer’s focus on subcategorization?

Air Act Andy: I don’t have to speculate here. The government made enough of Justice Breyer’s questions that, one day after argument, the Solicitor General filed a letter with the Court to provide information relevant to “questions pertaining to how EPA assesses whether to establish subcategories of sources” under the pertinent provisions of the Clean Air Act.

Question: Isn’t it unusual to submit a post-argument letter to the Court?

Air Act Andy: The rules of the Court do not specifically cover this sort of filing, and only time will tell how helpful the filing was for the government. It is worth noting, though, that once General Verrilli filed his letter, other parties followed suit. In particular, petitioners’ counsel pointed the Court to specific language in the preamble to the final MATS Rule, 77 Fed. Reg. 9304, 9395 (Feb. 16, 2012), where EPA said it could not, and did not, consider costs during the subcategorization process:

Failing to demonstrate that coal-fired [electric generating units] are different based on emissions, the commenters turn to economic arguments, asserting that failing to subcategorize will impose an economic hardship on certain sources. Congress precluded consideration of costs in setting [technology standard] floors, and it is not appropriate to premise subcategorization on costs either.

Question: On a more personal note, was your trip to the Court less eventful than the last time you were there?

Air Act Andy: Ah, you are referring to my December 11, 2013 visit to the Court. On that snowy day, I arrived at the Court wearing a long, stylish gray cardigan sweater instead of a suit jacket. I was stopped by guards and politely told I would not be allowed to sit in the section reserved for members of the Supreme Court Bar unless I replaced my fashionable sweater with a suit jacket. Someone from the clerk’s office, acting like a fine restaurant’s maitre d’, swiftly provided me with a ladies suit jacket and allowed me into the courtroom. But when I returned to the Court last month to hear argument in Michigan v. EPA, I was not treated like a fashion felon. Instead, Court staff personally escorted me into the courtroom a half hour before anyone else from the public was allowed in the room, gave me a prime seat, and allowed me to sit quietly and take in the majesty of the room. 

Question: What is the reason for the different treatment?

Air Act Andy: Last month, I arrived wearing a foot cast instead of a gray cardigan. I had broken my foot the week before, and the Court’s wonderful staff gave me permission to arrive and get seated early.

Question: So, was it worth it to have a broken foot?

Air Act Andy: I wouldn’t recommend that you drop granite on your foot a week in advance of a trip to the Supreme Court, but being able to sit by myself in the courtroom for a half hour before others were admitted was pretty special.

Burlington Northern Continues to PERColate

Posted on January 26, 2015 by Robert M Olian

The Fifth Circuit has just weighed in with a significant interpretation of the Supreme Court’s landmark decision in Burlington Northern & Santa Fe Railway Co. v. United States, 556 U.S. 599 (2009). In a case involving “arranger” liability under CERCLA (the Comprehensive Environmental Response, Compensation and Liability Act), the Fifth Circuit on January 14 overturned a district court judgment that had held BorgWarner liable for leaks of perchloroethylene (PERC) from equipment sold by an affiliate of BorgWarner’s corporate predecessor. Vine Street LLC v. Borg Warner Corp., No. 07-40440 (Jan. 14, 2015)

The Fifth Circuit held there was no “intent” to dispose of PERC even though the dry cleaning equipment was designed with the knowledge that some PERC would inevitably be mixed in with the water that the system was designed to discharge. Because PERC was a useful product and the intent was to reclaim it rather than dispose of it, the Fifth Circuit strictly applied Burlington Northern’s holding that arranger liability requires an intent to dispose and remanded the case to the district court with instructions to enter judgment in favor of BorgWarner.

Vine Street usurps the Fifth Circuit’s earlier “nexus” test (the test in effect when the District Court issued its ruling), which was based on a totality of the circumstances, and gives further ammunition to those defending against CERCLA liability for releases incidental to the sale of a useful product. 

THE (NON)FINALITY OF SUPREME COURT OPINIONS

Posted on December 17, 2014 by Richard Lazarus

Last spring, as the Washington Post reported, I caught Justice Scalia in an embarrassing blunder that prompted the Justice to revise overnight the version of his dissenting opinion in EPA v. EME Homer City Generation, L.P. posted on the Supreme Court’s website. Scalia’s stumble? In his zeal to condemn EPA for what the Justice plainly considered to be an outrageous construction of Clean Air Act language in EME Homer, he somehow managed to get completely backwards what EPA had argued in Whitman v. American Trucking Ass’n.  And as the environmental law blogosphere cheerily trumpeted, what made the mistake especially “cringeworthy” was that Scalia himself had written the Court’s opinion in Whitman, so one was hard-pressed to blame just his law clerk.  (On the other hand, here at Harvard Law School, I was very much hoping it was not a Harvard clerk.)

However, what most fascinated me about the entire episode was not Scalia’s initial mistake, but the Court’s procedures for correction. The only reason the public knew about this particular correction was because Justice Scalia’s initial error had been so widely publicized, which was what in turn led me and others to spot the correction and publicize that as well. Otherwise, the correction was made entirely without the Court itself providing any notice. The slip opinion that appeared on the Court’s website was simply different from the one appearing the very next morning.

I was likely more focused on the Court’s process for correction because at that very moment, I had just completed a law review article on the Court’s longstanding, but wholly unappreciated, practice of revising slip opinions in just this kind of clandestine manner. And, not just dissenting opinions as in EME Homer, but also majority opinions of the Court.  The Court has literally always done this sort of thing, although no one had ever called them out on it.

I first became aware of the practice as a lawyer for the U.S. Department of Justice in 1987 when, at EPA’s prompting, we urged the Court to correct a “mistake” in its original slip opinion in International Paper Co. v. Ouellette, a significant Clean Water Act case, because of EPA’s concern that certain language in that opinion mischaracterized the role of citizen suits.  At our client’s urging, my then-boss, the Solicitor General, formally notified the Court of this “formal error” and the Court changed the language, precisely as we recommended, to eliminate the issue. As a result, the language appearing several years later in the bound volume of the U.S. Reports differed substantively from the original slip opinion language. No notice of this change was given, including to any of the parties in the case. The U.S. had participated as an amicus.

When this happened in 1987, I vowed someday to write on the topic.  It took me only about 27 years to do so, and the upshot appeared a few days ago in a lengthy article published in the December 2014 issue of the Harvard Law Review.  The article undertakes a full look at the Court’s practice, extending back to its earliest days until the present. (For example, Chief Justice Roger Taney added 18 pages to his opinion for the Court in Dred Scott v. Sandford in 1857, after the original opinion announcement.)

In my partial defense, not only did the necessary archival research require significant work over an extended time period, but the topic invariably took a backseat to other, seemingly more pressing, topics on which I was engaged.   In all events, the final article is now available here, and includes discussion of EME Homer, International Paper Company, and other environmental cases.

Don’t Even Try to Bring THAT Kind of Regulatory Takings Case

Posted on May 16, 2014 by Margaret (Peggy) N. Strand

In 2012 and 2013, the Supreme Court issued several decisions recognizing claims for regulatory takings that observers believed might indicate a shift toward greater protection of private property rights. In Arkansas Game and Fish Comm’n v. United States, 568 U.S. ___ (No. 11-597, Dec. 4, 2012), the Supreme Court upheld a claim for a temporary taking based on flooding associated with a Corps of Engineers project, discussed here. And in Horne v. Department of Agriculture, 569 U.S. ___ (No. 12-123, June 10, 2013), under very unusual circumstances, the Supreme Court allowed the takings claim to be presented as a defense to government regulatory action. The 2013 decision in Koontz v. St. Johns River Water Management District, 570 U.S. ___ (No. 11-1447, June 25, 2013), concerned mitigation requirements associated with land development in Florida, discussed here and here. Shift in judicial approach to greater protection of property rights? Maybe not. 

During the same time period, the Court of Appeals for the Federal Circuit held that a landowner could not claim a taking arising out of denial by the Corps of an application for approval of a wetland mitigation bank. Hearts Bluff Game Ranch, Inc. v. United States, 669 F.3d 1326 (Fed. Cir. 2012). This lesser-known decision addresses a fundamental aspect of takings law — what is the property interest that is protected by the takings clause? Apparently it matters whether you have a permit denial (and can seek compensation) or a denial of a government approval of a benefit (which confers no compensable property right). 

A wetlands mitigation bank is a property where wetlands have been enhanced or restored or otherwise improved. The mitigation bank credits generated by those efforts are available as compensatory mitigation for impacts authorized under Corps permits issued under Section 404 of the Clean Water Act. Unlike dredge or fill of wetlands or streams that require a Section 404 permit, the mitigation bank is not approved by permit. Rather, under regulations, the mitigation bank is reviewed by the Corps, EPA and other federal and state agencies, known as the Interagency Review Team (IRT). Subject to IRT review, the Corps and the mitigation banker sign a Mitigation Banking Instrument (MBI) that approves the mitigation bank. The MBI contains terms such as the size and nature of the wetland enhancement or restoration that will occur on the bank property. The MBI also establishes the credits for the bank, i.e., the marketable element that can be sold to a wetland permit applicant who needs to provide compensatory mitigation. 

Despite this seemingly complicated process, the situation can be simplified in this way:  Mr. Black, owner of Blackacre, wants to fill wetlands on his property to build homes. Mr. Black must obtain a Section 404 permit from the Corps and likely will need mitigation to offset what he fills. Ms. White, owner of Whiteacre, wants to restore and enhance wetlands on her property, and use that enhancement as a basis to offer credits for wetland compensation to those who need to mitigate their impacts to wetlands, like Mr. Black. Ms. White needs to go through the mitigation banking regulatory process for her approvals. Her MBI will authorize the planned “ecological development” of her property. 

Comparing the Hearts Bluff decision to more standard regulatory takings law, if Mr. Black’s application for a permit is denied, he may be able to sue the United States for compensation for the taking of his property. If Ms. White’s application for approval of the mitigation bank is denied, the Federal Circuit says she has no compensable property interest. 

Hearts Bluff sought approval for a 4000 acre mitigation bank in Texas. The land was located where the planned Marvin Nichols Reservoir might be sited, a proposed reservoir that has a long history in Texas. Hearts Bluff also sued in state court. After consulting with the state and evaluating the potential site, the Corps denied the application for mitigation bank approval, citing reasons that do not appear in the takings decisions. 

Any regulatory takings claim faces a number of hurdles. What is unusual about Hearts Bluff is that the court held that the company had no “cognizable property interest.” 

The Federal Circuit focused on its two-part test for evaluating takings claims.  “First, as a threshold matter, the court determines whether the claimant has identified a cognizable Fifth Amendment property interest that is asserted to be the subject of the taking. . . .Second, if the court concludes that a cognizable property interest exists, it determines whether that property interest was ‘taken.’” Id. at 1329. The court stopped at step one, finding that there was no property interest. 

The court adopted the government’s position that Hearts Bluff “was never entitled to operate a mitigation bank solely by virtue of its ownership of the land and that it did not have a property right in access to the mitigation banking program because the program is entirely a creature of the government and subject to pervasive and discretionary government control.” Id. at 1330. The mitigation banking program, said the court, “is run exclusively by the Corps, subject to its pervasive control, and no landowner can develop a mitigation bank absent Corps approval. Mitigation banking in its entirety would not exist without the enabling government regulations. Under our precedent, therefore, the Corps’ discretionary denial of access into the Corps program cannot be a cognizable property interest.” Id. at 1331.  

The court relied on precedent where the claimant owned property but not the particular right to use the property as it asserted. For example, in Air Pegasus of D.C., Inc. v. United States, 424 F.3d 1206 (Fed. Cir. 2005), the court had held that a helicopter operator had no takings claim when a federal “flight restriction” essentially destroyed its business. There are not many cases in this area, and many of them deal with personal property, rather than real property. These decisions do not turn on the distinction between a government permit and a government benefit, but rather delve into whether the claimant’s property carried with it the right to pursue the particular “end goal.”

In short, while Hearts Bluff certainly owned the real property, its ability to “develop” it as a mitigation bank was not a “right” that could be taken by the Corps’ denial of its application. It was not such a right because the government essentially created the end use (mitigation banking). 

It’s been a long time since my law school days, but the “bundle of sticks” that I was taught constitute real property rights should include the right to seek governmental approval for the owner’s preferred uses, regardless of whether the government program is new, old, established by regulations, or described in a statute.  The government does not always commit a taking by denying such uses, but it is troubling that property rights should depend on which government program is involved.

What Would Leon Billings Think?

Posted on March 7, 2014 by Richard Lazarus

Almost as soon as U.S. Supreme Court Justice Scalia joined the bench in the fall of 1986, he made clear his disdain for arguments that the meaning of statutory text could be gleaned from its legislative history. And advocates before the Court who made the mistake of equating “congressional intent” with a statement made by an individual member of Congress during a hearing or a colloquy on a chamber floor could expect a sharp rebuke from the Justice.

The debate at the Court about the proper role of legislative history in statutory construction was not fully joined, however, until 1994 when Justice Stephen Breyer joined the bench. From the outset, Breyer, a former Senate staffer, made equally plain his view that legislative history was both fair game and could be highly relevant.

Indeed, Scalia’s and Breyer’s contrasting views regarding textualism in both statutory and constitutional interpretation became so celebrated that they literally took their debate on the road. To be sure, theirs was a far cry from the Lincoln-Douglas Debates on slavery 150 years earlier, but for legal scholars and Supreme Court observers, it was High Court entertainment.

During the oral arguments last month before the Supreme Court in Utility Air Regulatory Group v. EPA, Justice Breyer managed to take the debate to yet a new level. The issue before the Justices concerned the lawfulness of EPA’s regulations applying the Clean Air Act’s Prevention of Significant Deterioration Program to the emissions of greenhouse gases from new and modified stationary sources. As the Justices struggled to decipher the meaning of statutory terms and phrases that befuddle even seasoned environmental lawyers, Justice Breyer made a surprising reference. He did not merely ask what Senator Edmund Muskie, the bill’s chief sponsor, might have been intending in drafting the language at dispute before the Court. He asked what “Mr. Billings, I think, is the staff person” would have intended if faced with the policy issue that EPA now faced in trying to apply the language he drafted to greenhouse gases.

The Supreme Court courtroom was filled to capacity for the argument. Yet, I can probably safely say that fewer than ten, and likely fewer than five people in the room had any idea to whom the Justice was referring. And those few most certainly did not include any of the Justice’s colleagues on the bench or any of the advocates before him.

But for a few of us, who thrive on environmental law’s history, it was a moment of glory. The Justice was referring, of course, to Leon Billings who was Senator Ed Muskie’s chief staffer for the drafting of almost all of the nation’s path-breaking environmental laws during the 1970s, including, as the Justice correctly surmised, the Clean Air Act of 1970. The statutes were revolutionary in their reach, as they sought no less than to redefine the relationship of human activities to the nation’s environment.

Not relying merely on the soaring rhetoric of a law like the National Environmental Policy Act, these new pollution control laws got into the nitty-gritty of lawmaking. They addressed the extent to which costs, benefits, risk assessment, scientific uncertainty, and technological availability should all be relevant in determining the pollution control standards. They brokered compromises across partisan divides and remained nonetheless exceedingly ambitious and demanding in their reach.

The nation, more than four decades later, has reason to be grateful for the work of former congressional staffers like Leon Billings. Their impressive work lies in sharp contrast to that of Congresses over the past twenty plus years, which have passed no comparably significant environmental laws and done little more than deepen partisan divides even further.  For that reason, the Supreme Court shout-out to “Mr. Billings” was a great moment at the Court. And the Justice’s question an apt one too.