A Blueprint for a Resilient New York City

Posted on July 17, 2013 by Gail Port

Mayor Michael Bloomberg and the Special Initiative for Rebuilding and Resiliency recently promulgated a 438-page report titled “A Stronger, More Resilient New York” (the “Resiliency Report”) in the wake of Hurricane Sandy’s devastating destruction on October 29th, 2012. The Resiliency Report emphasizes the inevitable effects of climate change and rising sea levels, opening with a climate analysis conducted by the New York City Panel on Climate Change (“NYCPCC”). According to the NYCPCC, 25% of New York City’s land mass, home to 800,000, will be in the floodplain by 2050. The Resiliency Report is part of Mayor Bloomberg’s PlaNYC, an unprecedented program initiated in 2007, which currently has 132 initiatives to make New York City (“NYC”) more sustainable and adaptable to the effects of climate change. Given the historic impact of Hurricane Sandy and the concern that future weather events could be just as devastating—or even worse—the Resiliency Report was commissioned to build on the momentum of PlaNYC.

The Resiliency Report contains over 250 proposals, implementation of which is estimated to cost $19.5 billion. Approximately $15 billion has been or is expected to be appropriated from federal and city sources, but the remainder of the required funding may be dependent on whether further aid will be available from the federal or state governments. Among other things, the Resiliency Report calls for the restoration of dunes, widening of beaches, and erection of localized surge barriers, levees, and floodwalls in particularly vulnerable areas. The Report also calls for amendment of the Biggert-Waters Flood Insurance Reform Act, which currently only allows for premium reductions if the house is elevated, to allow for flood insurance premium reductions if the homeowner makes other flood-related improvements. Additionally, a Building Resiliency Task Force (established by the Mayor and City Council Speaker Quinn) recently issued a separate Building Resiliency Report, focusing in greater detail on building structural and infrastructure resiliency. The Building Resiliency Report has 33 specific recommendations based on four central themes: constructing stronger buildings, securing backup power, providing essential services, and developing building-specific emergency plans.

Numerous issues have already been raised regarding recommendations in the Resiliency Report. One such example is the controversial proposal of a SeaPort City, which has already spawned community resistance. SeaPort City would be an artificial expansion of the lower east side of Manhattan modeled after Battery Park City, which was highly successful in reducing flood-damage from Hurricane Sandy on the lower west side. Although it has been emphasized as a resiliency initiative, SeaPort City would serve the dual purposes of acting as a protective barrier and providing highly coveted residential and commercial real estate. Nearby South Street Seaport residents and businesses, which were devastated by Hurricane Sandy, argue that this massive landfill would harm wildlife and would have an adverse effect on preservation of the historic neighborhood. Since the plan for SeaPort City is still in its infancy, the costs for such a development have not been calculated into the already staggering $19.5 billion costs to implement the other Resiliency Report proposals.

The Resiliency Report opens with an invigorating foreword by Mayor Bloomberg, stating that “[w]e are a coastal city—and we cannot, and will not, abandon our waterfront.” In contrast, on the state level, Governor Cuomo’s floodplain buy-out program provides an incentive for private homeowners to relocate from the coastline. This $400 million purchase program offers to buy houses in flood-prone areas, specifically in Staten Island, with the value offered depending on the vulnerability of the particular neighborhood. The houses would be demolished and the properties would remain undeveloped to act as a natural buffer for future storms. Governor Cuomo stated that “there are some parcels that Mother Nature owns . . . and when she comes to visit, she visits.” Though the buy-out program still awaits federal approval, it has garnered substantial support from Staten Island representatives. The governor’s proposal is consistent with the views of members of the NYCPCC who have urged for a retreat from coastlines.

Regardless of methodology, all parties agree that some changes must be implemented soon to address the growing threat of climate change and rising sea levels. The success of the recommendations in the Resiliency Report and the continuing success of PlaNYC will hinge predominantly on the initiatives of Mayor Bloomberg’s successor. The Bloomberg administration has five months left to lay the foundation for these programs, but the responsibility to implement both the Resiliency Report recommendations and PlaNYC ultimately will fall on the next mayor. The incoming mayor must have the will, dedication, funding and community support to ensure the programs’ continued success. Will the new mayor be willing to commission studies of the SeaPort City proposal? Will the new mayor be able to secure the funding required to implement recommendations in the Resiliency Report? Will the new mayor build on the successes of PlaNYC? Will the new mayor become the flag-bearer for the adaptation of New York City and its coastal metropolitan areas to address growing environmental concerns? These and other questions have already become an important part of the campaign dialogue as voters form their positions for the upcoming mayoral election in November.

Agenda 21: A Guide for the Perplexed

Posted on March 27, 2013 by John Dernbach

At a local government meeting on a land use plan, officials hear opposition based on the claim that it is tainted by Agenda 21.  A state public utility commission considering smart meters hears similar claims.  They are confused: what is Agenda 21 and why does it matter?

A well organized campaign against Agenda 21, spread by the Tea Party, Glenn Beck, and the John Birch Society, exists well outside the realm of ordinary environmental law work.  But it is beginning to affect that work.  The real target of this campaign, moreover, is not Agenda 21 but sustainable development—a common sense approach to reconciling environment and development that provides the basis for our environmental and land use laws.  Environmental lawyers thus need a basic understanding of what Agenda 21 is and what it is not.     

Agenda 21 is a comprehensive public strategy for achieving sustainable development. It was endorsed by the U.S. (under the presidency of George H.W. Bush) and other countries at the U.N. Conference on Environment and Development in 1992.  Agenda 21 stands for two broad propositions: 1) environmental goals and considerations need to be integrated into all development decisions, and 2) governments and their many stakeholders should work out the best way to integrate environment and development decisions in an open and democratic way. 

Agenda 21 contains an almost encyclopedic description of the best ideas for achieving sustainable development that existed in 1992.  On land use, it specifically counsels respect for private property.    It contains a detailed description of the role that many nongovernmental entities, including business and industry, farmers, unions, and others, should play in achieving sustainability. 

Agenda 21 endorses, and to a great degree is based upon, ideas that were already expressed in U.S. environmental and natural resources laws.  Its core premise is espoused in the National Environmental Policy Act of 1969.  Long before Agenda 21, NEPA set out “the continuing policy of the Federal government” to “create and maintain conditions under which man and nature can exist in productive harmony, and fulfill the social, economic, and other requirements of present and future generations of Americans” (42 U.S.C. § 4331). 

Ironically, Agenda 21 was never taken seriously as such in the United States; there has never been much enthusiasm here for following international agreements.  It is not a legally binding treaty; it contains no provisions for ratification, for example.  Agenda 21 also says nothing about new ideas like green building, smart growth, and smart meters.  But sustainable development as an idea—achieving economic development, job creation, human wellbeing, and environmental protection and restoration at the same time—is gaining traction. 

In response, opponents are attacking sustainability by making false statements about Agenda 21.  They say that Agenda 21 is opposed to democracy, freedom, private property, and development, and would foster environmental extremism.  For many opponents, the absence of a textual basis in Agenda 21 for such claims (in fact, the text explicitly contradicts all of these claims) is not a problem.  First, they are attacking a document that is not well known, and so they count on not being contradicted.  Second, the false version of Agenda 21 fits a well known narrative that is based on fear of global governance and a perceived threat of totalitarianism, and on distrust of the United Nations.  Indeed, the absence of information to support such fears only deepens their perception of a conspiracy.  According to this view, moreover, people who talk about sustainable development without mentioning Agenda 21 are simply masking their true intentions.  

Far-fetched, you say?  Well, consider this: in 2012, Alabama adopted legislation that prohibits the state or political subdivisions from adopting or implementing policies “that infringe or restrict private property rights without due process, as may be required by policy recommendations originating in, or traceable to ‘Agenda 21’” (Ala. Code § 35-1-6).  This, of course, could chill a variety of otherwise ordinary state and local decisions.  Similar bills are pending in state legislatures across the country. 

In a variety of other places, elected officials and professional staff who have worked with stakeholders for years to produce specific land use and energy proposals find their work mischaracterized as the product of Agenda 21, even though they have never heard of it.   Agenda 21’s lack of direct relevance to the specific proposals should, but does not always, provide an answer to such claims. 

The campaign against Agenda 21 has no serious empirical or textual foundation.  But it can work against sustainability and good decisions—and cost time and money—when clients and their lawyers don’t recognize it for what it is.

UPDATE ON THE DEEPWATER HORIZON OIL SPILL AND RESTORATION OF THE GULF COAST ECOSYSTEM AND ECONOMY

Posted on December 28, 2012 by Jarred Taylor

By: Jarred O. Taylor II and Shannon K. Oldenburg

The Gulf Coast Ecosystem Restoration Council (the “Council”) held its first public meeting on December 11, 2012, in Mobile, Alabama, intended to introduce the Council to the public and to give the public feedback opportunity on the Council’s plans.  The Council, established by the Resources and Ecosystems Sustainability, Tourist Opportunities, and Revived Economies of the Gulf Coast States Act of 2012 (the “RESTORE Act”), is charged with developing and overseeing implementation of a comprehensive plan to help restore the ecosystem and economy of the Gulf Coast region in the wake of the Deepwater Horizon oil spill. 

The RESTORE Act will fund the Council’s work via a Trust Fund made up of 80 percent of all Clean Water Act administrative and civil penalties related to the oil spill:

• 35 percent of the money will be divided equally between the five Gulf States;
• 30 percent will be spent through the Council to implement a comprehensive plan;
• 30 percent will be used through States’ plans to address impacts from the oil spill;
• 2.5 percent will be used to create the Gulf Coast Ecosystem Restoration Science, Observation, Monitoring and Technology Program within the Department of Commerce’s National Oceanic and Atmospheric Administration (“NOAA”); and
• the remaining 2.5 percent will be used for Centers of Excellence Research grants, which will each focus on science, technology, and monitoring related to Gulf restoration.

Overarching themes of the comments from both the Council and the public in attendance at the meeting were that ideas for Gulf restoration should originate from the Gulf Coast, not from the federal government, and that the Gulf of Mexico Ecosystem Restoration Strategy developed by the Gulf Coast Ecosystem Restoration Task Force (“GCERTF”) should be used as a framework for the Council’s work.  To much approval from the audience, Rachel Jacobson, Principal Deputy Assistant Secretary for Fish and Wildlife and Parks, Department of the Interior (Ken Salazar’s designated representative on the Council), commented that the Council should incorporate the “four pillars” of the GCERTF strategy into the process and work of the Council in determining how the RESTORE Act funds should be distributed and used.  These four pillars are (1) restore and conserve habitat; (2) restore water quality; (3) replenish and protect living coastal and marine resources; and (4) enhance community resilience.  Notably, Jacobson and many of the other designated representatives to the Council served as members of the GCERTF and also act as Trustees for the Natural Resources Damage Assessment (“NRDA”) for the Deepwater Horizon oil spill.

The Council has only 180 days from passage of the RESTORE Act to publish: 1) procedures to assess whether programs and activities carried out under the Act are in compliance with the Act’s requirements; 2) auditing requirements for disbursing funds from the Trust Fund; and 3) procedures to identify and allocate funds for the expenses of administering the Trust Fund.  The Council will publish a “proposed plan” by the end of this year that will be the focus of public hearings in late January and early February 2013, likely to be in the style of the public “listening sessions” held by the GCERTF last year.  The Council also will release a “draft comprehensive plan” for restoration in Spring 2013, and publish a final plan on July 6, 2013, the anniversary of enactment of the RESTORE Act.

An incredible amount of work has already gone into Gulf restoration, but much work remains.  Only time will tell if these legislative acts and work will translate into true restoration in the Gulf area.

The Federal Trade Commission’s Green Guides – What is “Green” and what is merely gray

Posted on November 9, 2012 by Elliot Laws

We’ve all seen the advertisements. Products that are supposedly “recycled,” “environmentally friendly,” and “green,” with labels and commercials resplendent in shades of light green and yellow, seeking to evoke nature, sunlight, and a family-friendly, non-toxic product. But how “green” must a product be in order to rightfully proclaim itself to be so? The revised “Green Guides,” issued by the Federal Trade Commission (“FTC”) on October 1, 2012, propose to answer that very question.

Originally issued in 1992, and revised in 1996 and 1998, the FTC’s “Green Guides” offer guidance to marketers on how to properly use words of environmental attribution in describing products. The Guides are examples of environmental claims that the FTC might find deceptive under the FTC Act, § 5; they are neither rules nor regulations. The current version of the Guides was released in proposed form in 2010 and received several hundred unique comments. Beyond analyzing the comments, the FTC accumulated additional information based on three public workshops and a study designed to understand how consumers perceived environmental claims. The final version of the Guides, in addition to updating its original content, provided additional information on newer types of environmental claims.

The new sections in the Guides cover carbon offsets, certifications and seals of approval, “free-of” claims, non-toxic claims, and two claims relating to the manner and materials used in production: renewable energy claims and renewable materials claims. As an illustration of the new sections, the FTC addresses deceptive practices used to claim an emissions reduction through carbon offsets. Marketers should “clearly and prominently disclose if the carbon offset” does not provide an emissions reduction for over two years. Similarly, claiming that a carbon offset corresponds to an emissions reduction that is otherwise required by law is a deceptive practice.

Other sections are modified. For example, the Guides clarify that an unqualified degradable claim must be able to show that the entire product or package will break down completely within one year after disposal. Objects that are expected to go to a landfill, incinerator, or be recycled do not degrade within a year, and thus should not be linked to such a claim. In each of its 13 total sections, the FTC provides concrete examples of practices it terms deceptive.

The Guides recommend that some environmental claims not be used at all, such as “environmentally friendly” or “eco-friendly.” The consumer study performed by the FTC found that these terms indicate wide-ranging environmental benefits that few, if any, products may obtain. The Guides do not address “sustainable,” “natural,” and “organic” to avoid conflicting or duplicative advice from other agencies that have the purview of these terms.

In order to provide assistance to the general public in understanding the Guides, the FTC produced several educational and business resources, from summaries to a highlight video to relevant legal documents. These resources, in conjunction with the Green Guides themselves, provide protection to consumers, allowing us more transparency into just how “green” our products really are.

Quick Takes on Rio + 20

Posted on July 25, 2012 by Leslie Carothers

If the Rio Summit concluded last month met expectations, it’s because they were so low.  The 49 page document summarizing the agreement by the government representatives, The Future We Want, was largely stripped of strong language and substantive commitments.  From my perspective, two failures and one success in the agreement stand out.  First, the diplomats could not muster a firm commitment to the UN Secretary General’s goal of ensuring universal access to energy services and doubling the rate of improvement in energy efficiency and use of renewable energy sources by 2030.   Paragraph 127 on energy sources seems to give equal status to high and low carbon fuels, and earlier language endorsing reduction of environmentally and economically harmful subsidies was dropped. This was not an encouraging result for a summit focused on advancing a “green economy.”

Second, the final document also watered down statements of support for the rights of women to family planning services as well as ownership of various forms of property. Although 105 national science organizations joined many women’s groups in urging a strong stance on moderating population growth by providing reproductive health services wanted by women, objections by the Holy See (aka the Vatican) and backward members of the G-77 developing countries’ coalition caused numerous small changes in wording (e.g. promote vs. ensure) that ended up barely preserving existing UN commitments to rights to reproductive health services.  (See the analysis by Rebecca Lifton at the Center for American Progress) The brightest spot in the final agreement is a comparatively aggressive set of commitments to protect and restore oceans and marine resources.  Professor Ann Powers, oceans expert at Pace Law School, attended the summit and notes that 20 of the 238 paragraphs of the agreement dealt with oceans issues like plastic debris and fisheries management and included most of what ocean advocates sought.

The non-governmental attendees were far more successful in making commitments and connections.   Many members of the business community, for example, continued the tradition, begun in 1992, of active participation in the Rio meeting as an environmental trade fair in ideas, products, and contacts.   In one notable project, a consortium of 24 companies, collaborating with the Corporate EcoForum and the Nature Conservancy, has been working toward the goal of valuing natural resources used and saved by companies.  According to Neil Hawkins, Vice President for Environment, Health, and Sustainability at Dow Chemical, the goal of pricing ecosystem services to mobilize markets in advancing sustainable development was a major focus of events at the Rio summit. The meeting was a catalyst for making specific company commitments to develop and test valuation methodologies as well as an opportunity to educate a broader audience on progress being made.    

Finally, the legal profession sponsored a varied menu of law and governance programs. The World Congress on Justice, Governance and Law for Environmental Sustainability convened judges, prosecutors, practitioners, and auditors to debate how to make environmental law more effective and how to increase public access to legal remedies.  (See the Rio + 20 Declaration of the Congress). At a time when multilateral diplomacy cannot produce a binding agenda, lawyers are challenged to find new ways to secure commitments from parties willing to act to advance environmental progress.

WHY INSTITUTIONAL INVESTORS CARE ABOUT CORPORATE SUSTAINABILTY

Posted on July 13, 2011 by Christopher Davis

Institutional investors, including pension funds, insurance companies, foundations and university endowments, own about 70 percent of the stock of the world’s largest companies. As part of their fiduciary duty to maximize the long-term, risk-adjusted value of their investments, more institutional investors are becoming “active shareowners,” pressing companies whose shares they own to adopt sustainable business practices on a variety of environmental, social and governance (ESG) issues. This trend has important implications for corporate management and their advisors.

 

Recent events including the BP Deepwater Horizon oil spill, the Massey Big Branch mine explosion and the TEPCO Fukushima Daiichi nuclear power plant meltdown highlight the potential for poorly managed environmental and safety risks to result in destruction of shareholder value. By contrast, there is evidence from Sustainable Asset Management, and from investment consultant Mercer, that companies with superior ESG performance also have superior financial performance. Thus, how companies address these so-called “nonfinancial” business risks and opportunities is of increasing interest to investors.

 

Indications that institutional investors are paying greater attention to ESG factors include:

In recent years there has been a proliferation of research, data and ratings of companies’ ESG performance. One example is the scores that the Carbon Disclosure Project gives to companies based on their reporting and management of greenhouse gas (GHG) emissions. Financial data provider Bloomberg now offers ESG data on a wide range of companies on its terminals. Analysts at both socially responsible investment (SRI) funds and increasingly at mainstream investment firms analyze and report on companies’ ESG performance, and companies are ranked and selected for their ESG performance for indexes such as the Dow Jones Sustainability Index. The net result is that ESG factors are starting to be incorporated in corporate valuations, and this trend is likely to accelerate.

 

Given increasing investor interest in these factors, it behooves corporate management and boards to focus on, improve and report their ESG performance.

 

A company should communicate the “business case” for its sustainability strategy to shareholders, customers and other stakeholders with whom the company engages, as a key driver of the company’s competitive positioning, risk management, reputation and brand. Managing ESG risks and opportunities, on issues ranging from climate change to workforce diversity, should be integrated into companies’ business strategy, and not merely assigned to the environmental, human resources or corporate social responsibility (CSR) departments.

Institutional investors’ attention to these issues is likely to increase, as “sustainable” or “responsible” investment becomes more widely accepted as fundamental to the fiduciary duty of asset owners and investment managers. Counsel can add value by helping their corporate clients recognize this trend, better assess and manage their ESG risks and opportunities, and review and revisit their mandatory and voluntary disclosures of these issues.