USEPA - Real Property & Environmental Law Alert

In Clean Water Act Case, Three Justices Invite Future Challenge to Rule of Deference to Agencies in Interpretation of Their Own Regulations

Paul M. Hauge — Wed, 08 May 2013 11:19:49 -0500

A victory in the Supreme Court is generally welcome news for the U.S. Environmental Protection Agency (EPA). But, the Court’s decision last month in a Clean Water Act case may foreshadow a sweeping change in administrative law that would certainly not please EPA or other agencies: the end of a long-standing rule of judicial deference to agencies in the interpretation of their own regulations.

It is well established that when they interpret statutes, federal agencies are accorded substantial deference, such that a court must uphold an agency’s reading of an ambiguous statute as long as it is a plausible, reasonable reading. This is known as Chevron deference.

The Court has long applied the same rule when agencies interpret their own regulations. Beginning with Seminole Rock in 1945, the Court laid down the rule that an agency’s interpretation controls, even it is not the best or most natural reading, as long as it is not “plainly erroneous or inconsistent with the regulation.” This is often called Auer deference, after the 1997 case that reaffirmed the principle.

]]>A seed of doubt about the continued viability of Auer deference was planted in the Court’s recent decision in Decker v. Northwest Environmental Defense Center. At issue was whether the Clean Water Act required a permit for stormwater discharges from some logging roads in Oregon. The statute requires a permit for any discharge from a “point source,” but exempts from the permit requirement most “discharges composed entirely of stormwater.” That exemption does not apply, however, to stormwater discharges “associated with industrial activity.”

EPA promulgated detailed regulations to implement the statutory language. Its regulatory definition of a “silvicultural point source” clearly included logging activities, but what about the statutory exemption for many stormwater discharges? And what about the “exception to the exemption” for stormwater discharges associated with industrial activity?

EPA’s stormwater rule said that a discharge was “associated with industrial activity” when it was “directly related to manufacturing, processing or raw materials storage areas at an industrial plant.” The rule also specified that facilities covered by the Standard Industrial Classification that included logging activities would be considered as engaging in industrial activity. But despite the inclusion of logging activities in that classification, the agency read its stormwater rule as covering only “traditional industrial sources such as sawmills.” It pointed to the rule’s references to “facilities” and “industrial plant[s]” in support of its interpretation of the rule as excluding stormwater discharges from logging activities. The Court, citing Auer, upheld EPA’s reading of its regulation as a permissible one, neither plainly erroneous nor inconsistent with the regulation.

In a lone dissent, Justice Scalia disagreed with EPA’s reading of its regulation, and, more significantly, openly called for an end to Auer deference. Ironically, Justice Scalia himself authored the opinion (for a unanimous Court) in Auer.

The reasons for Chevron deference, said Justice Scalia -- an implied grant of discretion from Congress when it enacts an ambiguous statute, and the pragmatic benefit of avoiding prolonged periods of uncertainty over the statute’s meaning if Congress failed to act quickly to eliminate the ambiguity -- do not support Auer deference. There is no grounds for presuming that Congress impliedly granted the agency the power to resolve ambiguities in its own regulations, especially where it would place the power to write a law and the power to interpret it in the same hands, thus violating “a fundamental principle of separation of powers.” “Auer is not a logical corollary to Chevron,” said Justice Scalia, “but a dangerous permission slip for the arrogation of power” and an invitation to write vague regulations that can later be interpreted in any number of plausible ways. And an agency need not wait for Congress to clarify an ambiguous regulation -- it can do so itself. Indeed, in the case before the Court, EPA had done just that, amending its regulation, three days before oral argument, to clarify that the stormwater rule did not cover logging activities. (Given its holding on the “old” rule, the Court did not need to decide whether the original rule or the amended rule applied.) As for the argument that an agency would have some special insight into the meaning of its own regulations, Justice Scalia dismissed it for the same reason he is notoriously suspicious of legislative history -- because with both statutes and regulations, “we are bound by what they say, not by the unexpressed intention of those who made them.” Finally, while the special technical expertise of agencies might be a good reason for having agencies (and not courts) make regulations, it does not give agencies any special advantage in interpreting a rule that has already been promulgated -- the core judicial function to “say what the law is.”

Justice Scalia’s dissent did not attract the votes of any of the other Justices, but in a concurring opinion, joined by Justice Alito, Chief Justice Roberts signaled that he might be prepared to reconsider the principle set forth in Auer “in an appropriate case,” that is, one “in which the issue is properly raised and argued.” Noting that the issue is “a basic one going to the heart of administrative law” that comes before the Court “as a matter of course on a regular basis,” the Chief Justice invited future challenges, as “[t]he bar is now aware that there is some interest in reconsidering” Seminole Rock and Auer. With at least three votes for granting certiorari on the issue, we can anticipate an explicit call to overturn Auer in the near future.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

Vapor Intrusion Guidance Continues to Take Form With the Release of EPA's Final Draft Guidance

Sandro G. Ocasio — Fri, 26 Apr 2013 08:40:19 -0500

The United States Environmental Protection Agency (“EPA”) recently released its long-awaited final vapor intrusion draft guidance (“Final VI Guidance”). The nearly 200-page document establishes a complex framework for assessing vapor intrusion from analyzing key factors; making risk management decisions; and implementing, monitoring and terminating mitigation strategies and is intended to be used at any site that is being evaluated under CERCLA, RCRA, EPA’s brownfield grantees, or state agencies with delegated authority. The Final VI Guidance supercedes all prior EPA guidance documents addressing vapor intrusion assessment and mitigation including the 2002 Draft Vapor Intrusion Guidance, but takes into account the public comments submitted from 2002 through 2012 and the recommendations of the Office of Inspector General (OIG).

In addition to the Final VI Guidance, which applies generally to petroleum hydrocarbons, EPA released its companion Guidance For Addressing Petroleum Vapor Intrusion At Leaking Underground Storage Tank Sites (“PVI Guidance”), which focuses specifically on petroleum hydrocarbons released from underground storage tanks. For these situations, the guidance recommends that owners and operators assess any immediate threat to safety, conduct a site characterization and develop a conceptual site model, delineate a lateral inclusion zone, identify preferential transport pathways within the inclusion zone, sample if light non-aqueous phase liquid (“LNAPL”) exists within 15-feet of an underlying building, and mitigate as appropriate.

“When final, these guidance documents will help ensure vapor intrusion exposure assessment and mitigation actions to protect human health are undertaken in a technically, scientifically and nationally consistent manner,” stated Richard Kapuscinski, a senior official in EPA’s Office of Superfund Remediation and Technology Innovation, in a memorandum announcing the Final VI Guidance release.

]]>The public’s reaction to the new guidance documents remains to be seen. Some early responses have raised concerns about escalating costs relating to the extensive testing required by the new guidance. Others have questioned EPA’s ability to reopen old sites where remediation has been deemed complete, but were evaluated under methods made defunct by the new guidance.

EPA is seeking public comment on the drafts, which may be submitted here until May 24, 2013. To date, over 81 public comments have been posted to the website relating to VI guidance. Other EPA technical documents relating to vapor intrusion, including the Vapor Intrusion Screening Level (“VISL”) Calculator and the Superfund Five-year Review Guidance may be found at the Office of Solid Waste Emergency Response website.

State practitioners should also be mindful of the federal guidelines. New Jersey recently issued new vapor intrusion screening levels to reflect the changes in the federal VISL. Thus, changes in the federal guidance may trigger changes in the state guidance. This blog will certainly comment on any new developments.

*Photo courtesy of epa.gov

Sandro G. Ocasio is an Associate in the Gibbons Real Property & Environmental Department.

Action Required: NJDEP Implements New Vapor Intrusion Screening Levels

Sandro G. Ocasio — Thu, 24 Jan 2013 13:29:10 -0500

The New Jersey Department of Environmental Protection (“NJDEP”) recently issued new vapor intrusion screening levels (“VISL”) and related guidelines, which will have an immediate impact on existing remediation sites. The screening levels were updated to reflect the changes in toxicity values and risk-based equations set forth in the United States Environmental Protection Agency’s (“USEPA”) most recent Regional Screening Level (“RSL”) Tables. NJDEP implemented the new VISL as of January 16, 2013. Parties conducting remediations and their Licensed Site Remediation Professionals will need to analyze how these new screening levels impact their sites.

The procedures and associated timeframes in which to conduct a site evaluation based on the new VISL varies as follows:

Unrestricted use final remediation documents for ground water issued prior to January 16, 2013 require no further investigation for the vapor intrusion (“VI”) pathway.
Restricted use final remediation documents for ground water issued prior to January 16, 2013 require an evaluation of the VI pathway as part of the biennial certification; an assessment of the order of magnitude changes using the new VISL; and, based on this information, implementation of additional remediation as required.
Remedial Action Workplans for ground water issued prior to January 16, 2013 require a review of existing data for order of magnitude changes using the new VISL and, based on this information, implementation of additional remediation as required.
If none of the aforementioned scenarios exist, there is a 90 day period to evaluate all existing site conditions and data using the new VISL. The 90-day review period terminates April 16, 2013.

A VISL implementation flowchart is available here.

]]>As a result of the new VISL, the screening levels for some compounds, including tetrachloroethene, have increased while five others, including 1.3-dichlorobenzene, have been eliminated completely. In addition, the new VISL tables contain two new compounds: naphthalene and 2-methylnaphthalene. Accordingly, under the new VISL, certain cases may no longer meet the criteria as an Immediate Environmental Concern or Vapor Concern and may be reclassified where appropriate.

The new NJDEP master table of VISL is available here.

NJDEP will host a session on the new VISL on Wednesday, January 30th, from 1:00 - 3:00 PM in the DEP Public Hearing Room, in Trenton, New Jersey. The seminar will also be available via webinar.

Sandro G. Ocasio is an Associate in the Gibbons Real Property & Environmental Department.

A Super Step in Superfund Regulation? Time Will Tell: EPA Releases Guidance on Negotiation of RD/RA at Superfund Sites and a Revised Settlement Approach for Alternate Sites

Sandro G. Ocasio — Mon, 14 Jan 2013 09:22:48 -0500

In the controversial area of Superfund regulation, the United States Environmental Protection Agency (“EPA”) appears to be making steps toward more successful and more efficient negotiation of remedial design (“RD”)/remedial action (“RA”) settlements in Superfund cases. EPA recently released its Revised Policy on Managing the Duration of Remedial Design/Remedial Action Negotiations (“the Negotiation Policy”) and Transmittal of Updated Superfund Response and Settlement Approach for Sites Using the Superfund Alternative Approach (“Alternative Approach”).

The Negotiation Policy supercedes portions of the July 17, 1999, Negotiation and Enforcement Strategies to Achieve Timely Settlement and Implementation of Remedial Design/Remedial Action at Superfund Sites that relate to requests for approval to continue RD/RA negotiations beyond the 120-day negotiation moratorium under Section 122 of the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”) and supercedes the September 30, 2009 Interim Policy on Managing the Duration of RD/RA Negotiations in its entirety. It also addresses issues raised in the May 2012 Results of the Evaluation of the 2009 Interim Policy on Managing the Duration of Remediation Design/Remedial Action Negotiations (“May 2009 Results”).

The Negotiation Policy includes a lengthy negotiation template that emphasizes “dialogue” over the paperwork-intensive approvals that are required when Potentially Responsible Parties (PRPs) seek extensions of the 120-day negotiation moratorium. To achieve its goal, the Negotiation Policy sets forth a schedule of status conferences with various agency representatives including the Office of Regional Counsel, Program Offices, the Office of Site Remediation Enforcement, and the Department of Justice. The Negotiation Policy also stresses “more aggressively utilizing [EPA] enforcement tools,” including bifurcation of the RD/RA to help start work sooner, fund lead or enforcement-leverage options including mixed funding and mixed work, and use of unilateral administrative orders (UAOs) for all or a portion of the work.

]]>The Negotiations Policy will apply to RD/RA negotiations moving forward. While any proposal that attempts to facilitate the negotiation process should be viewed positively in the first instance, the proposal is painfully detailed and only time will tell how the new policy plays out. Although the Negotiation Policy demonstrates EPA’s preference to reach a settlement, the guidance makes clear that there is no EPA policy or statutory requirement for continuing the moratorium of enforcement actions beyond 120 days. Indeed, the policy states that PRPs, “should know during negotiations that EPA is willing and ready to issue a UAO if they unreasonably delay settlement.” PRPs should be mindful of the 120-day RD/RA negotiation benchmark and continue to make all efforts to reach a settlement within that time frame.

The Alternative Approach supercedes the 2004 Revised Response Selection and Settlement Approach for Superfund Alternative Sites. The Alternative Approach addresses the use of Superfund Alternative Approach agreements (“SAAs”) at sites that are eligible to be listed on the National Priorities List (“NPL”), but are not listed. The Alternative Approach purports to make the use of SAAs at those sites consistent with the practices normally followed at NPL sites including response techniques, standards and guidance, community engagement and achieving comparable cleanup levels. While the fact that the Alternative Approach mirrors the approach for NPL sites does not seem like a huge win, the added benefit of not being listed on the NPL is still a plus.

*Photo courtesy of Marcia Wright - Wikimedia Commons.

Sandro G. Ocasio is an Associate in the Gibbons Real Property & Environmental Department.

USEPA Grants Technical Assistance to Coopers Ferry Partnership to Study SMART Initiative in Camden, N.J.

Susanne Peticolas — Thu, 26 Jul 2012 08:22:29 -0500

On July 19, 2012, Coopers Ferry Partnership was one of 17 community partners selected by the U.S. Environmental Protection Agency (“EPA”) to receive technical assistance as part of its 2011 strategic agenda to renew support for green infrastructure and promote its effective implementation. The Coopers Ferry Partnership will receive $70,000 to advance projects aimed at reducing water pollution in Camden, New Jersey.

EPA’s technical assistance will help Coopers Ferry Partnership evaluate the benefits of the Camden Stormwater Management and Resource Training (SMART) Initiative. The SMART Initiative is a public/private collaboration between the City of Camden, Camden County Municipal Utilities Authority, Cooper’s Ferry Partnership, Rutgers Cooperative Extension Water Resources Program, New Jersey Tree Foundation, NJ Department of Environmental Protection, community organizations, and Camden residents to restore and revitalize Camden neighborhoods. The objective of the Initiative is to develop a comprehensive network of green infrastructure programs and projects for the City of Camden.

Urban run-off of stormwater from roofs and roadways is a serious problem across the country. Large volumes of polluted stormwater degrade the country’s rivers and lakes. Cities, faced with aging and inadequate stormwater infrastructure are increasingly turning to green infrastructure solutions. Green infrastructure, such as rain gardens, green roofs and permeable pavement, uses vegetation and soil to manage rainwater where it falls. By weaving natural processes into the urban environment, green infrastructure provides not only stormwater management, but also flood mitigation, air quality management, and much more. In Camden, four rain gardens were built on the site of an abandoned gas station. Thus, in addition to the stormwater and flood mitigation, the neighborhood traded in a blighted eyesore for a lovely and and productive park. According to EPA, “At a time when so much of our infrastructure is in need of replacement or repair and so few communities can foot the bill, we need resilient and affordable solutions that meet many objectives at once. Green infrastructure is one solution.”

]]>Camden SMART, in the first year, has built eleven raingardens and introduced rain barrels, designed to capture, treat and infiltrate over 800,000 gallons of stormwater in a year. It has plans to build 20- 40 more rain gardens. In addtion, it has organized and hosted educational programs and information sessions on sound stormwater management practices.

The EPA technical assistance will enable Coopers Ferry Partnership to assess the water quality, air quality, brownfield remediation benefits and flooding mitigation potential of the SMART Initiative. The information developed from the SMART experience can provide guidance to other cities faced with urban runoff problems.

* Photo courtesy of FreeDigitalPhotos.net

Susanne Peticolas is a Director in the Gibbons Real Property & Environmental Department.

Texas Federal Court Splits Environmental Claims: CERCLA Claims Remain in Federal Court, State Claims are Remanded to State Court

John H. Klock — Fri, 29 Jun 2012 09:19:57 -0500

The United States District Court for the Southern District of Texas in May v. Apache Corporation, 2012 WL 156547 (S.D.Tex. May 1, 2012) issued an interesting decision on the relationship between federal and state environmental claims and where they can be heard. The case has some parallels to a case pending in the New Jersey State court captioned the New Jersey Department of Environmental Protection v. Occidental Chemical Corp., et als.

In the May case, plaintiffs had filed various state law claims and a jury demand that lingered for four years in the Texas state court arising out of drilling for and production of oil and gas on the plaintiffs’ property. On the eve of trial, plaintiffs amended their pleadings to advance CERCLA causes of action based on alleged groundwater contamination. The defendants promptly removed the entire case to federal court.

On the remand hearing, the federal court held that CERCLA is an exclusive federal jurisdiction matter and claims brought under CERCLA could not be remanded. Plaintiffs, perhaps regretting the assertion of their CERCLA claims, back-tracked, arguing that their federal causes of action were premature. Premature or not, since they did not dismiss the federal claims, the Court held that those claims had to remain in the federal court.

]]>The next issue was what to do with the state law claims. If the claims were so related to the federal CERCLA claims that they formed a part of the same case or controversy under Article III analysis, the court would have supplemental jurisdiction. If not, then the court would have to sever and remand the state claims under 28 U.S.C. § 1441(c)(2).

The court determined that the claims were sufficiently intertwined for supplemental jurisdiction, but noted that if the State claims raise a novel issue of state law, or the state claims substantially predominate over the federal claims, or the state claims are dismissed or such other exceptional circumstances exist, the court could decline jurisdiction under its analysis of 28 U.S.C § 1367(a).

In reviewing the factors, the court found that the key factor was that the state claims were subject to a jury trial and the federal claims to a bench trial. As a result, the court remanded the state claims. In contrast, in the New Jersey case which was also removed to federal court, the federal court noted that NJDEP had amended its pleadings and pled around CERCLA. See New Jersey Department of Environmental Protection et als. v. Occidental Chemical Corp., et als, docket No. 2006 cv 00 401 (Jan. 27, 2006). In cases where the plaintiff has cast its claims as state claims, the federal court only has very narrow grounds for jurisdiction over removed state claims. The New Jersey federal court determined that unless CERCLA completely preempted the state claims, it did not have jurisdiction. Further, the federal court determined that CERCLA did not completely preempt state law and accordingly, remanded the entire action to the state court.

Both the May case and the Occidental Chemical case illustrate the importance of careful drafting of an environmental complaint.

John H. Klock is a Director in the Gibbons Real Property & Environmental Department.

Industry Report Criticizes EPA Fracking Study for Poor Design, Insufficient Data

Paul M. Hauge — Wed, 23 May 2012 15:01:58 -0500

As we reported this past December and January, last year the U.S. Environmental Protection Agency (EPA) released a draft report that linked contamination found in wells near Pavillion, Wyoming to the practice of hydraulic fracturing, or fracking. A report prepared for an oil and gas industry group, however, says the EPA study was deeply flawed.

The new report, prepared for the Washington-based Independent Petroleum Association of America by S.S. Papadopulos & Associates, Inc. of Bethesda, Maryland, concludes that EPA provided neither “sufficient data nor analysis to support most of the report’s conclusions.” It criticizes EPA’s study design, notes to a lack of background and baseline data for many key parameters, and points to analytical concerns that undermine the data cited in EPA’s report. All of the “lines of evidence” that EPA cited to support its findings -- including the conclusion that fluids used in the fracking process have affected the area’s groundwater -- can be explained with alternative hypotheses, according to the Papadopulos report.

Fracking involves the pumping of pressurized water, sand, and chemicals into underground rock formation (such as the Marcellus Shale formation in Pennsylvania and New York) that contains natural gas. The high-pressure fluid creates cracks, or fractures, in the rock, allowing the trapped gas to escape, flow into the well and up to the surface.

]]>The public comment period for EPA’s report, originally set to close in January and later extended to March 12, has been extended through October 2012. EPA is also delaying the convening of a peer review panel until the results of additional sampling done in conjunction with the U.S. Geological Survey are made public.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

Unanimous Supreme Court Allows Pre-Enforcement Review of Clean Water Act Compliance Orders

Paul M. Hauge — Mon, 26 Mar 2012 11:30:35 -0500

The U.S. Supreme Court unanimously held on March 21 that an Idaho couple who had received a compliance order from the U.S. Environmental Protection Agency (EPA) for allegedly illegal filling of wetlands could directly challenge the order in court, and did not have to wait until EPA filed a lawsuit to enforce the order in court before obtaining judicial review of its validity. The opinion completely changes the rules of the game in EPA’s enforcement of the Clean Water Act, and gives landowners a powerful new tool to dispute what they see as erroneous EPA determinations.

The Idaho landowners, Michael and Chantell Sackett, received a compliance order after filling a portion of their residential lot near Priest Lake in preparation for the construction of a home. According to the order, EPA had concluded that their property contained wetlands protected by the Clean Water Act, and that they had violated the statute by filling wetlands without a permit from the Army Corps of Engineers. It also ordered the Sacketts immediately to restore the site. Believing that their lot did not, in fact, contain any protected wetlands, the Sacketts sought a hearing with EPA, but their request was denied. They then filed a lawsuit in federal district court challenging the order as “arbitrary and capricious” under the Administrative Procedure Act (APA). The district court dismissed their suit, and the Ninth Circuit affirmed the dismissal.

Writing for the Court, Justice Scalia needed just ten pages to conclude that the EPA’s issuance of the compliance order was a final agency action reviewable under the APA. It was clearly final, he wrote, because it determined the Sacketts’ rights and obligations and because legal consequences flowed from it -- including, importantly, a doubling of the penalties they could face in a future EPA enforcement action from as much as $37,500 per day (for violating the statute) to as much as $75,000 per day (for violating the statute and the order as well). The order also made it more difficult for them to obtain an “after-the-fact” permit for their activities. It did not matter, Justice Scalia continued, that the order invited the Sacketts to engage in “informal discussions” of its requirements and to point out any inaccuracies. EPA had no obligation to reconsider its original findings, which were, for all intents and purposes, final.

]]>The Court also rejected various arguments raised by the government that the Clean Water Act impliedly precluded judicial review of compliance orders. (Some other environmental statutes, such as CERCLA, expressly bar pre-enforcement review of EPA orders.) One factor cited by EPA -- that allowing pre-enforcement review of compliance orders will make EPA less likely to use them, and thus make enforcement work more cumbersome -- is an inevitable result, said Justice Scalia, of the APA’s presumption of judicial review, which is “a repudiation of the principle that efficiency of regulation conquers all.”

The Sackett decision throws open the courthouse doors for landowners who, like the Sacketts, believe that the EPA has acted arbitrarily, capriciously, or illegally in issuing a Clean Water Act compliance order. The specific finding that the Sacketts wanted to challenge -- that the property in question contained wetlands that fell within the agency’s Clean Water Act jurisdiction -- is likely to be controversial in many cases, given the failure of Congress, the agencies, and the Supreme Court itself to fashion clear rules for deciding whether particular wetlands are “wetlands” for purposes of the Clean Water Act. Now, landowners who believe they have been incorrectly cited for violating the statute need not wait for EPA to drop the other shoe by filing its own lawsuit, all the while accumulating thousands or millions of extra dollars in additional civil penalties. As Justice Alito put it in his concurring opinion, “In a nation that values due process, not to mention private property, such treatment is unthinkable.” After Sackett, it is no longer unavoidable.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

EPA Seeks Outside Reviewers for Draft Report That Showed Groundwater Contamination from Fracking

Paul M. Hauge — Thu, 19 Jan 2012 09:19:02 -0500

In December, we reported on the release of a draft report from United States Environmental Protection Agency’s (EPA) Office of Research and Development on a possible link between groundwater contamination in some Wyoming wells and hydraulic fracturing (“fracking”) activity in the area. Now, as promised, EPA is initiating an independent assessment of the report by outside peer reviewers.

The EPA report garnered intense attention from both proponents and opponents of fracking, which extracts natural gas from underground rock formations through the pumping of a pressurized mixture of water, sand, and chemicals that creates cracks, or fractures, in the rock, allowing the trapped gas to escape, flow into the well and up to the surface. Concerns over groundwater contamination could delay or limit fracking in New York, Pennsylvania, and a number of other states.

EPA published a Federal Register notice on January 17, 2012 that seeks nominations for experts to review the draft report as well as all public comments received during a comment period that will close on January 27. An EPA peer review contractor will select five to seven outside reviewers from among those nominated.

The agency is looking for recognized experts in a variety of fields (e.g., petroleum engineering, hydrology, geophysics, and water quality) who have no financial conflicts of interest or whose position would otherwise create an appearance of a lack of impartiality. Nominations (preferably via e-mail) must be submitted by February 17.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

US EPA Issues National Standards for Mercury Pollution from Power Plants

Susanne Peticolas — Thu, 22 Dec 2011 09:20:55 -0500

On December 21, 2011, the United State Environmental Protection Agency (EPA) announced that it had issued the first ever national standards for mercury emissions and other air pollutants from power plants. The regulations were mandated by the 1990 Clean Air Act Amendments. EPA estimates that the new standards will make a major contribution to public health by preventing 11,000 premature deaths and 4,700 heart attacks annually, as well as 130,000 cases of childhood asthma symptoms and about 6,300 cases of acute bronchitis among children each year.

EPA Administrator Lisa P. Jackson stated, "The Mercury and Air Toxics Standards will protect millions of families and children from harmful and costly air pollution and provide the American people with health benefits that far outweigh the costs of compliance." According to EPA, the standards rely on widely available pollution controls that are already in use at more than half of the nation’s coal-fired power plants.

Sources will have three years to achieve compliance, with a fourth year available from state permitting authorities for technology installation. In developing the final rules, EPA consulted with State, local, and tribal officials in and also worked with industry groups, unions and other stakeholders. It reviewed over 900,000 comments. Critics of the regulations assert that they will result in job loss because older coal fired plants may be required to close. EPA counters that society as a whole will benefit because prevention of asthma, heart attacks, bronchitis and other illnesses attributable to air toxics will save $37 billion to $90 billion in health care costs each year by 2016.

Susanne Peticolas is a Director in the Gibbons Real Property & Environmental Department.

EPA Report Points to Fracking as Possible Source of Groundwater Contamination

Paul M. Hauge — Wed, 14 Dec 2011 11:23:45 -0500

A draft report from United States Environmental Protection Agency’s (EPA) Office of Research and Development has tentatively pointed a finger at hydraulic fracturing (“fracking”) as a cause of groundwater contamination detected in a number of wells near the town of Pavillion, Wyoming. The report, which has not yet undergone outside peer review, is likely to set off alarm bells among both proponents and opponents of fracking, including those in eastern states like New York, New Jersey, and Pennsylvania.

Fracking involves the pumping of pressurized water, sand, and chemicals into underground rock formation (such as the Marcellus Shale formation in Pennsylvania and New York) that contains natural gas. The high-pressure fluid creates cracks, or fractures, in the rock, allowing the trapped gas to escape, flow into the well and up to the surface. Eastern states have adopted a variety of policies toward fracking, ranging from Pennsylvania’s enthusiastic promotion to New York’s temporary moratorium and ongoing effort to promulgate protective regulations to New Jersey’s attempted legislative prohibition that was vetoed in favor of a temporary ban.

Whether fracking may contaminate groundwater is a critical question facing policy makers across the country. The EPA study, conducted in response to complaints from residents about objectionable taste and odor problems in water drawn from the drinking water wells after fracking in nearby gas production wells, concludes, based upon both data and complex scientific reasoning, that fracking has caused impacts to ground water in the Pavillion area. EPA also noted certain limitations of the study: its purpose was “to determine the presence, not the extent, of ground water contamination in the formation,” and the results are specific to the Pavillion area, where fracking occurs in and below a drinking water aquifer and near drinking water wells, unlike production practices in many other parts of the country.

]]>The EPA report drew sharp criticism from the company that is conducting fracking in the area, and praise from opponents of fracking. It is certain to cause additional controversy in the months ahead. As we noted in a recent post, fracking also raises complex legal issues.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

EPA Issues Final Chemical Data Reporting Rule

Susanne Peticolas — Mon, 12 Sep 2011 08:03:52 -0500

On August 16, 2011, the United States Environmental Protection Agency (USEPA) issued its final rule on chemical reporting which will apply to the next reporting period running from February 1, 2012 through June 30, 2012. Adopted pursuant to section 8(a) of the Toxic Substances Control Act (TSCA), the rule increases the type and amount of information USEPA will collect on commercial chemicals from chemical manufacturers, including importers, allowing USEPA to better identify and publish information on the manufacturing, processing, and use of commercial chemical substances and mixtures on the TSCA Chemical Substance Inventory (TSCA Inventory).

The new rule, referred to as the Chemical Data Reporting Rule (CDR), amends and renames the existing Inventory Update Rule. The rule requires more frequent reporting of critical information on chemicals and requires the submission of new and updated information relating to potential chemical exposures, current production volume, manufacturing site-related data, and processing and use-related data for a larger number of chemicals. Instead of reporting every five years, the reporting period returns to a four year cycle.

]]>Among the changes required under the new rule, manufacturers, including importers, must:

Report if the production volume of a chemical substance meets or exceeds the 25,000 lb threshold during the principal reporting year (i.e., calendar year 2011).
Report processing and use information of all reportable chemical substances manufactured (including imported) at 100,000 lb or more, unless otherwise exempted
Provide upfront substantiation for data claimed as confidential business information. Submitters cannot claim those data elements as confidential when they are identified as “not known to or reasonably ascertainable by.”
Submit their reporting electronically via e-CDRweb, EPA’s electronic reporting tool.

The new rule also modified reporting thresholds, updated definitions, revised industrial classifications and modified situations in which confidentiality may be claimed. Guidance documents are available on-line.

Although electronic reporting for the 2012 CDR is not yet available, EPA will be hosting an instructional webinar to demonstrate e-CDRweb on September 23, 2011. Those interested will be able to test the tool during the following week, although the test version will not be usable for actual 2012 submissions.

Additional requirements will be phased in for the 2016 reporting period. These include:

A reporting requirement if, in any calendar year since the last principal reporting year, a chemical substance was manufactured (including imported) at a site in production volumes of 25,000 lb or greater.
A requirement to report the production volume for each of the years since the last principal reporting year.
The reporting threshold for processing and use information will be reduced to 25,000 lb.
The reporting threshold will be 2,500 lb for certain chemical substances that are the subject of a proposed or promulgated TSCA rule under section 5(a)(2)(Significant New Use Rule), section 5(b)(4) (Chemical of Concern List), or section 6 (unreasonable risk finding), an order issued under TSCA section 5(e) or 5 (f), or the subject of relief granted under a civil action under TSCA section 5 or 7.

EPA expects the new electronic reporting requirement and limits on confidentiality claims will strengthen the agency’s chemical management program and increase the transparency of critical information on chemicals.

* Image created by Ian Britton - www.freefoto.com.

Susanne Peticolas is a Director in the Gibbons Real Property & Environmental Department.

U.S. EPA Issues New Rule to Curb Interstate Air Pollution

Paul M. Hauge — Fri, 15 Jul 2011 08:31:45 -0500

The U.S. Environmental Protection Agency (EPA) on July 7 finalized a new rule aimed at reducing interstate air pollution across the eastern half of the country. The Cross-State Air Pollution Rule (CSAPR) requires reductions in power plant emissions in 27 states that cause or contribute to ozone and/or fine particulate pollution in other states.

The development of the CSAPR required EPA to analyze a bewildering array of linkages between sources and downwind states in which the same state could be both a source and a receptor. New Jersey, for example, is affected by particulate emissions from Pennsylvania, but also contributes to ozone levels in Connecticut. The new rule replaces the 2005 Clean Air Interstate Rule, which was the subject of a 2008 court decision that left the old rule in place but, because of its many flaws, required EPA to replace it with a new rule implementing the Clean Air Act’s requirements regarding interstate air pollution.

The CSAPR will require reductions in sulfur dioxide emissions as early as January 1, 2012 and nitrogen oxide emissions by May 1, 2012. By 2014, it is anticipated that sulfur dioxide emissions will be reduced by 74% and nitrogen oxide emissions by 54% from 2005 levels in the affected region. According to EPA, the CSAPR will prevent over 13,000 premature deaths each year, at a cost that will be dwarfed by the benefits of the rule.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

Supreme Court Closes Door on Global Warming Suits Based on Federal Common Law

Paul M. Hauge — Thu, 30 Jun 2011 15:39:39 -0500

Reversing the Second Circuit, the Supreme Court on June 20, 2011 held, in American Electric Power Company v. Connecticut, that the Clean Air Act, along with EPA regulatory action that it authorizes, displaces any federal common-law right to seek abatement of emissions of greenhouse gases (GHGs) from power plants. The Court’s decision means that for the foreseeable future, the debate over the proper scope of federal GHG regulation will take place in the executive and legislative branches and not the courts. It also leaves unanswered the question whether traditional state common-law remedies still have a role to play in GHG regulation.

The case began as two separate lawsuits filed in the Southern District of New York by eight States and the City of New York, and by three nonprofit groups, against five power companies that, according to the complaints, are the five largest emitters of carbon dioxide in the country. The plaintiffs sought injunctive relief in the form of orders to cap and reduce the emissions, invoking both the federal common law of interstate nuisance and state common law. The district court dismissed both actions as presenting non-justiciable political questions, but the Second Circuit reversed. The appellate panel (which included then-Circuit Judge Sonia Sotomayor) held that the suits were not barred by the political question doctrine, that the plaintiffs had standing to bring their claims, and that the Clean Air Act did not displace federal common law. Recognized that EPA has the authority under the Clean Air Act to regulate carbon dioxide as an air pollutant, and the principle that federal common law is displaced when Congress has spoken directly to a particular issue, the appellate court held that at least until EPA takes some specific regulatory action -- beyond its then proposed (but not final) finding that greenhouse gases endanger public health and welfare, the statute does not regulate greenhouse gas emissions, or does not regulate such emissions from stationary sources. Subsequent to the appellate decision, in December 2009, EPA issued its final GHG Endangerment Finding, identifying six GHGs in the atmosphere to be a threat to public health and welfare of current and future generations. Although the Endangerment Finding does not impose any requirements on industry, it is a prerequisite to such regulation.

]]>On the threshold questions of justiciability and standing, the Supreme Court affirmed the Second Circuit’s exercise of jurisdiction by an equally divided court. (Justice Sotomayor did not participate, but in future cases it is likely that she would provide the fifth vote to affirm similar determinations). Proceeding to the merits, the Court, in an 8-0 opinion written by Justice Ginsburg, acknowledged that it had upheld the application of “specialized federal common law” to claims of interstate pollution, but did not decide whether it was appropriate to do so in this instance, for it found that any federal common-law claim would be displaced by the Clean Air Act, which authorizes EPA to regulate GHG emissions.

The Court built upon its 2007 holding in Massachusetts v. EPA, which held that carbon dioxide, the principal GHG, is an air pollutant subject to EPA regulation under the statute. After outlining the authority granted to EPA by the Clean Air Act, as well as a pending rulemaking procedure under §7411 of the statute to set standards for power plant emissions of GHGs, the Court concluded,

The Act itself . . . provides a means to seek limits on emissions of carbon dioxide from domestic power plants -- the same relief the plaintiffs seek by invoking federal common law. We see no room for a parallel track.

Significantly, the Court explained put that it was the authority granted to EPA by the Clean Air Act, and not EPA’s exercise of that authority, that caused the displacement of federal common-law. “Indeed,” wrote Justice Ginsburg, “were EPA to decline to regulate carbon-dioxide emissions altogether at the conclusion of its ongoing §7411 rulemaking, the federal courts would have no warrant to employ the federal common law of nuisance to upset the agency’s expert determination.” She hastened to add, however, that EPA’s decision would be subject to judicial review, and sent an unmistakable signal to the agency that any decision not to regulate GHG emissions would be closely scrutinized.

The Second Circuit never considered the plaintiffs’ state-law claims, because it held that federal common law governed. Nor did any of the parties brief or otherwise address before the Supreme Court the applicability of state common law to the issue of GHG emissions, or whether it is preempted by the federal statute. Those issues will need to be considered on remand.

All eyes will now be on Congress and EPA. The new Republican majority in the House of Representatives -- and a failure to pass climate-change legislation even when the Democrats controlled both chambers -- make significant congressional action unlikely in the foreseeable future. But EPA will decide whether and how to regulate power plant emissions by May 2012. And the parties in American Electric Power will be briefing and arguing the issue of federal preemption of state common law. So it is likely that the Supreme Court will have another climate-change case on its docket before long.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

Six New Jersey Communities Will Share $3.4 Million in EPA Brownfield Grants

Paul M. Hauge — Mon, 20 Jun 2011 13:34:42 -0500

The EPA has announced that six different New Jersey communities will receive a total of $3.4 million under the agency’s brownfield grant program in FY 2011. The grants will fund assessment and cleanup efforts at contaminated sites so that the sites can be returned to productive use. The grant program, part of EPA’s larger brownfield efforts, will award some $76 million in grants this year, and has awarded over $800 million since its inception. New Jersey’s grants will fund activities at thirteen sites or areas in Newark, Jersey City, Trenton, Elizabeth, Mantua Township, and Maurice River Township.

At the state level, government funding for brownfield revitalization in New Jersey has virtually dried up. As reported on this blog earlier this month, New Jersey’s Brownfield Reimbursement Program has run out of money and is temporarily shut down.

Paul M. Hauge is an Associate in the Gibbons Real Property & Environmental Department.

David A. Brooks to Moderate Panel at 2011 New Jersey Environmental Law Forum

Gibbons P.C. — Tue, 07 Jun 2011 12:18:31 -0500

On Friday, June 24, 2011, David A. Brooks, Counsel to the Gibbons Real Property and Environmental Department, will moderate a panel, “Vapor Intrusion: Old Problems - New Rules” at the 2011 Environmental Law Section Forum Weekend presented by the New Jersey State Bar Association and the New Jersey Institute for Continuing Legal Education and co-sponsored by the New Jersey Corporate Counsel Association. This full weekend program presents an annual update on environmental law in New Jersey and will also include panels discussing funding for remediation projects, New Jersey’s licensed site remediation professional program, litigation related to the remediation of urban river systems, the role of non-governmental organizations, renewable energy and climate change, and ethical issues.

The conference will be held at the Golden Inn in Avalon, New Jersey from June 24, 2011 through June 26, 2011. Please click here to register.

Vapor Intrusion: Opportunity for Comment with EPA

David A. Brooks — Tue, 26 Apr 2011 07:59:56 -0500

Last month, the Environmental Protection Agency published a notice for “Public Comment on the Development of Final Guidance for Evaluating the Vapor Intrusion to Indoor Air Pathway From Contaminated Groundwater and Soils (Subsurface Vapor Intrusion Guidance)” in the Federal Register. The draft of the Subsurface Vapor Intrusion Guidance was initially released for comment during 2002 and the EPA is planning on issuing final guidance by November 20, 2012.

More recently, the EPA published a Review of the Draft 2002 Subsurface Vapor Intrusion Guidance which summarized portions of the 2002 guidance requiring update. In general, the EPA noted the observed complexity and variables impacting the migration of volatile organic compounds since issuance of the initial 2002 guidance.

Comments must be submitted to the EPA by May 14, 2011. However, the EPA anticipates making another draft of the guidance available for public comment during the Spring of 2012.

David A. Brooks is Counsel to the Gibbons Real Property & Environmental Department.

Paper Companies That "Created, Mobilized and Profited From" PCBs Must Bear 100% of Cleanup Costs in Fox River CERCLA Case, But May Not Be Liable for PCBs in Waste Paper Sold to Recyclers

John H. Klock — Mon, 21 Mar 2011 09:50:35 -0500

The other shoe dropped on February 28 in the closely watched CERCLA case involving PCB contamination of the Fox River in Wisconsin. District Judge William C. Griesbach, who had previously ruled that the paper companies that made and discharged PCBs to the river could not seek contribution from recycling mills that unknowingly bought PCB-laden waste paper, called “broke,” and also discharged PCBs, held that those companies must reimburse those comparatively innocent companies for 100% of the costs they have incurred for most of the polluted river. But he held that it was too early to say whether the paper companies knew, and did, enough, to make them liable for “arranging for” disposal of the PCBs that ended up in the recycling mills’ discharges to an upstream stretch of the river.

In his recent decision, Judge Griesbach considered arguments concerning two separate stretches of the Fox River Superfund Site in Wisconsin, which the U.S. Environmental Protection Agency has divided into five operable units (OUs). The plaintiff paper companies discharged PCBs into OU2, and the PCBs flowed downstream to OUs 3,4, and 5. The recycling mills discharged PCBs to all five OUs, including OU1, which is upstream from all of the others. (Another decision in the Fox River case was the subject of an earlier blog post.

]]>The defendants sought contribution from plaintiffs Appleton Papers Inc. and NCR Corp., which themselves or through their predecessors made carbonless copy paper using a coating that contained PCBs. Waste paper from the manufacturing process was sold to the recyclers, whose manufacturing process also discharged PCBs. In December 2009, Judge Griesbach had determined that the plaintiffs could not receive contribution from other parties because they knowingly took the risk that the product they made, sold, and mobilized would harm the environment. Their fault, said Judge Griesbach, outweighed all other equitable factors in his determination of how cleanup costs should be allocated for OUs 2 through 5. He used the same analysis in his recent decision to find that the paper companies must reimburse the defendants for their costs in these areas, stating:

Although the Defendants may have discharged roughly half of the PCBs into OU2-OU5, and although some of them may have polluted the river in other ways,” he wrote, “they do not share any of the culpability for the PCB pollution that gave rise to this CERCLA action.

The plaintiffs did manage to salvage a partial victory with respect to OUs 2 through 5. Many defendants had received payments from insurers regarding their cleanup activities in those areas. The court determined that there should be no windfall and that the amounts some insurers paid to some of the defendants would subject to the collateral source rule and the plaintiffs were entitled to discovery on the issue.

OU1, the upstream stretch, presented a different situation. The paper companies’ discharges to OU2 could not have caused the PCB contamination there (because the river flows in only one direction), so they could bear CERCLA liability for cleanup costs at OU1 only if they could be said to have “arranged for” the disposal of PCBs there within the meaning of CERCLA Section 107(a)(3). In its 2009 opinion in Burlington Northern and Santa Fe Ry. Co. v. United States, the Supreme Court held that “arranger” liability required an intent to dispose of the material in question. Here, while the paper companies clearly wished to get rid of the waste paper, they sold it (rather than paying someone to haul it away). In addition, the record was not clear as to whether they had sufficient knowledge that the PCBs in the waste paper would end up in the river. Such unresolved fact questions, said Judge Griesbach, were enough to require denial of the defendants’ motion for summary judgment as to OU1.

It was a split decision from Judge Griesbach for the plaintiff paper companies -- a loss (albeit with some limited success) on OUs 2 through 5, and a win on OU1. But their win was only temporary, and given Judge Griesbach’s past decisions, it seems clear that they are still swimming against the current.

John H. Klock is a Director in the Gibbons Real Property & Environmental Department. Paul M. Hauge, an Associate in the Gibbons Real Property & Environmental Department, co-authored this post.

Muddied Waters - EPA's Stormwater Rules for Construction Projects

John H. Klock — Mon, 01 Nov 2010 11:01:51 -0500

Roman lawyers were timed by water clocks which they realized could be slowed by the addition of dirt or sand and thereby gaining more time to argue. Hence lawyers are often cited for “muddying the waters.” In the case challenging the US Environmental Protection Agency’s stormwater rules for construction sites, it is the court that has muddied the waters. By holding the suit in abeyance, but keeping the problematic standard in place, the Seventh Circuit Court of Appeals has managed to confuse all of the parties.

The USEPA issued construction stormwater rules in December 2009, which were immediately challenged by the National Association of Home Builders and Wisconsin Builders Association in the Seventh Circuit as concerns the numeric turbidity value. The rules were scheduled to go into effect on February 1, 2010. EPA then filed an unopposed motion to vacate the numeric limitation pending a study to issue a new rule in November 2012. The Seventh Circuit essentially denied the motion as to vacating the numeric turbidity standard but apparently agreed to hold the suit in abeyance until February 2012 by granting the EPA’s motion “to the extent that the case is remanded to the EPA for further proceedings.” Thus, the numeric limitation stands: it is enforceable even though EPA has admitted in its brief that the process by which it was developed was flawed. A truly muddy situation.

John H. Klock is a Director in the Gibbons Real Property & Environmental Department.

USEPA Issues Plan for Encouraging Reuse of Land Fills and Mines for Renewable Energy Development

Susanne Peticolas — Wed, 20 Oct 2010 21:45:46 -0500

On October 15, the United States Environmental Protection Agency (“USEPA”) released a draft plan addressing its RE Powering Americas Land Initiative. The Initiative is designed to encourage development of renewable energy projects on current and formerly contaminated land and mine sites. The plan focuses on providing useful resources for communities, developers, industry, state and local governments or anyone interested in reusing such sites for renewable energy development.

The tools on the USEPA website include mapping and fact sheets for sites where USEPA and the U.S. Department of Energy National Renewable Energy Lab are analyzing the potential for wind, solar, or small hydro development. The mapping tool provides USEPA’s site name and identification information, the program managing the site; a link to the site's cleanup status information; and specific acreage and renewable energy resource information. Another interactive map offers information on the various federal and state incentives available for such projects.

As part of the plan, USEPA will reach out to prospective developers and investors though meetings and webinars. The first such webinar is scheduled for October 21, 2010, at 3:00 pm EDT. It will provide an overview of how siting renewable energy on brownfields benefits communities and how local governments can strategically plan for renewable energy siting on contaminated sites. Speakers will discuss their experiences on siting renewable energy project on contaminated sites, including challenges and advantages associated with using contaminated land.

]]>Over time, hundreds of thousands of properties and millions of acres across the country have been damaged by pollution. Reusing these properties for renewable energy could allow these unproductive properties to be returned to sustainable and beneficial uses that are protective of health and the environment.

Susanne Peticolas is a Director in the Gibbons Real Property & Environmental Department.