Real Property & Environmental Law Alert Blog

U.S. Supreme Court Remands Clean Water Act Case to the Fourth Circuit for Further Consideration in Light of “Functional Equivalent” Test from County of Maui

U.S. Supreme Court Remands Clean Water Act Case to the Fourth Circuit for Further Consideration in Light of “Functional Equivalent” Test from County of Maui

The effects of the recent U.S. Supreme Court decision in County of Maui v. Hawaii Wildlife Fund have begun to ripple out. In County of Maui, the Court held that the Clean Water Act requires a permit where there is a “functional equivalent of a direct discharge” from a “point source” into “navigable waters.” The Court acknowledged the “difficulty with this approach” in dealing with the “middle instances,” and provided a non-exhaustive list of seven factors that may be considered in determining whether a “functional equivalent of a direct discharge” exists in a particular circumstance. “Time and distance will be the most important factors in most cases, but not necessarily in every case,” the Court guided. In Kinder Morgan Energy v. Upstate Forever, a Clean Water Act case seeking certiorari of a decision from the Fourth Circuit, the Supreme Court followed County of Maui by issuing an Order granting certiorari, vacating the Fourth Circuit’s decision, and remanding the case to the Court of Appeals for “further consideration in light of County of Maui.” In Kinder Morgan Energy, two environmental groups argued that Kinder Morgan was illegally discharging pollutants into navigable waters without a permit under the Clean Water Act. Similar...

Who’s in Charge Here?: Third Circuit Holds That Government Was Not an “Operator” of Jersey City Chromium Facility for Purposes of Superfund Liability

Who’s in Charge Here?: Third Circuit Holds That Government Was Not an “Operator” of Jersey City Chromium Facility for Purposes of Superfund Liability

Federal courts have long struggled to determine the shape and boundaries of the wide liability net cast by the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as the Superfund law. In its recent decision in PPG Industries Inc. v. United States, the Third Circuit applied circuit and Supreme Court precedent to hold that the government’s influence over a chromite ore processing plant in Jersey City during World War I and World War II was not pervasive or intrusive enough to make the government a past “operator” of the plant and thus liable for cleanup costs. Prior to PPG’s 1954 acquisition of the plant (which it continued to operate until 1963), Natural Products Refining Corporation (NPRC) operated the plant, which processed chromite ore into various chromium chemicals, including sodium bichromate. During both World War I and World War II (when it designated the plant’s output as critical war materials, i.e., products manufactured for direct military use), the government regulated the production of chromium chemicals. Through a variety of price, labor, and production controls, the government sought to encourage increased production of these key chemicals. Those efforts, however, did not extend to direct control over day-to-day operations or to...

SCOTUS Creates “Functional Equivalent” Test to Determine Whether Point Source Dischargers Are Subject to the Clean Water Act

SCOTUS Creates “Functional Equivalent” Test to Determine Whether Point Source Dischargers Are Subject to the Clean Water Act

The U.S. Supreme Court recently handed down a decision in the most prominent Clean Water Act (CWA) case since its 2006 plurality decision in Rapanos v. United States. In County of Maui v. Hawaii Wildlife Fund, the Court interpreted the landmark statute to require a permit where there is a “functional equivalent” of a direct discharge from a “point source” into “navigable waters.” The likely impact of this holding for the parties is to subject the County of Maui to the statute’s permitting requirements for its discharges of treated wastewater through wells to groundwater that eventually reach the ocean. Beyond the parties, environmental groups are likely to cheer this decision while the regulated community, and lower courts, will likely be wary of the Court’s multifactor test. The CWA prohibits the “addition” of any pollutant from a “point source” to “navigable waters” without a permit from the Environmental Protection Agency (EPA). The County of Maui came before the Court as the operator of a wastewater reclamation facility in Maui, Hawaii. That facility collects sewage, partially treats it, then pumps that water into four underground wells. The effluent then travels about a half mile through groundwater to the Pacific Ocean. For nearly...

“Cooperative Federalism” or “Paternalistic Central Planning”?: U.S. Supreme Court Agrees That State Courts Can Hear Claims Over Adequacy of CERCLA Cleanups Under Certain Circumstances, But Limits Plaintiffs’ Options

“Cooperative Federalism” or “Paternalistic Central Planning”?: U.S. Supreme Court Agrees That State Courts Can Hear Claims Over Adequacy of CERCLA Cleanups Under Certain Circumstances, But Limits Plaintiffs’ Options

The federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), also known as the Superfund law, prescribes a careful process for making decisions on how to remediate contaminated sites. To avoid delay, the statute also divests federal courts of jurisdiction to hear most challenges to the selected remedy. In its recent opinion in Atlantic Richfield Co. v. Christian, the U.S. Supreme Court agreed that CERCLA does not bar state courts from hearing claims grounded in state law that go beyond claims for money damages and seek a cleanup that goes beyond what EPA requires. The case arose in Montana, where the Anaconda Copper Smelter operated for over a century and contaminated an area of over 300 square miles with arsenic and lead. Atlantic Richfield Company acquired the financially troubled smelter in the 1970s but could not reverse its decline, and closed it by 1980. Three years later, EPA named it one of its first official Superfund sites, and since then Atlantic Richfield has spent over $450 million on a cleanup that is expected to continue until 2025. The Superfund site that Atlantic Richfield has been remediating includes numerous residential properties. The owners of 98 of those properties sued Atlantic Richfield...

NJABC Issues Order Extending 2019-2020 License Term

NJABC Issues Order Extending 2019-2020 License Term

The Division of Alcoholic Beverage Control (the “Division”) issued an order on April 13, 2020, extending the 2019-2020 license term for all municipally-issued and state-issued licenses until September 30, 2020. Under the Alcoholic Beverage Control Act (the “Act”), local governing bodies (known as local issuing authorities) have the authority to issue and renew retail licenses. These retail licenses are in effect for a one-year term, beginning on July 1 of each year. In certain instances, the licenses can also be extended by the Division through ad interim permits. The licenses for the 2019-2020 term were set to expire on June 30, 2020. The Division, rather than local issuing authorities, issues and renews wholesale and manufacturing licenses and associated permits, known as State-issued licenses, which have the same license term as retail licenses. These State-issued licenses include, but are not limited to, Plenary, Limited, and Restricted Brewery Licenses and Plenary, Limited, and Craft Distillery Licenses. Some associated State-issued permits include, but are not limited to, Special Concessionaire Permits, Sampling Permits, Consumer Tasting Permits, and Off-Premise Storage of Records Permits. These State-issued licenses and permits were similarly set to expire on June 30, 2020. Due to the COVID-19 crisis and its associated...

Navigating the Impact of Executive Orders on Shore Rentals and Hotels

Navigating the Impact of Executive Orders on Shore Rentals and Hotels

With prom season and summer approaching, the COVID-19 pandemic has created challenges and confusion for shore rentals and hotels. Unlike the regulation of most other businesses during the pandemic, the regulation of short-term lodging and hotels has been delegated to municipalities and counties by the state. As a result, there now exists a patchwork of varying regulations on a county-by-county and town-by-town basis. Those who own hotels or rental properties, and thwarted travelers looking for remedies, must undertake a careful evaluation of municipal and county directives in effect for the relevant locations. Executive Orders No. 107 and No. 108 and Administrative Order No. 2020-8 Executive Order No. 107, entered March 21, 2020, expressly closed all “non-essential retail businesses” and all recreational and entertainment businesses. In an effort to standardize restrictions throughout the state, Executive Order No. 108, entered on the same day, invalidated any existing or future restriction by a county or municipality that “in any way will or might conflict with any of the provisions of Executive Order No. 107, or which will or might interfere with or impede its achievement, or the achievement of Administrative Orders issued as authorized by [the Governor’s] Executive Orders.” Executive Order No. 108,...

COVID-19 – The “Real World” Market Impact We See To Date

COVID-19 – The “Real World” Market Impact We See To Date

Over the last several weeks, our phones have been ringing – a lot. Landlords and tenants want to know what lease obligations they can temporarily forego and what rights they do or do not have, given all that has been wrought by COVID-19, including mandatory closures, suggested closures, social distancing, and the inability to access government offices or courts, to travel, to obtain inventory, supplies, or materials, and, generally, to conduct business and meet responsibilities as contemplated when the governing document was signed. In the last four weeks, there has been much written about the lease clauses and avenues to pursue that are the most relevant to a technical analysis of the questions posed – the force majeure (a/k/a impossibility of performance) clause; the long-shot condemnation clause; the equitable theories based on impossibility, mutual mistake, or simple fairness; insurance recovery; and bankruptcy. So what’s happening in the “real world”? Here’s what we are seeing in our practice. 1. Everyone is nervous. Although this anxiety is, in large measure, due to the facts that we know, it is also clearly driven in large measure by having to plan for the unknown – how bad, how long, what does the “recovery” look...

IRS Extends Deadlines for Section 1031 Exchanges and Investments in Qualified Opportunity Funds

IRS Extends Deadlines for Section 1031 Exchanges and Investments in Qualified Opportunity Funds

In response to the challenges faced by taxpayers as a result of the COVID-19 pandemic, the IRS issued Notice 2020-23 on April 10, 2020, which extends many tax filing and payment due dates to as late as July 15, 2020. Notably, this guidance includes deadlines associated with like-kind property exchanges under Section 1031 and investments in Qualified Opportunity Funds (QOFs) under the Qualified Opportunity Zone (QOZ) regime. A like-kind exchange is a tax-deferred transaction that allows for the disposal of an asset, typically real property, and the subsequent acquisition of another similar asset without generating capital gains tax liability from the sale of the initial asset. QOFs allow taxpayers to invest qualified capital gains into real property or businesses located in QOZs, and to defer and partially reduce taxation on the original capital gain while potentially eliminating all taxation on appreciation while in the QOF. Under Notice 2020-23, any person with a specified federal tax payment obligation or a federal tax return or other form filing obligation that would otherwise be due to be performed (originally or pursuant to a valid extension) on or after April 1, 2020 and before July 15, 2020 is deemed to be an affected taxpayer...

Relaxation of Notary Rules Allows Remote Notarization in New Jersey and New York

Relaxation of Notary Rules Allows Remote Notarization in New Jersey and New York

With some banks and municipal offices closed to walk-ins, non-essential employees working from home, and social distancing requirements in place, the ordinarily mundane task of having documents notarized has become much more challenging. The very act of taking an acknowledgment requires that the notary personally interact with the signatory, verify identity, and witness document execution. This, of course, is wholly inconsistent with the COVID-19 world in which we find ourselves. Although electronic (rather than pen and ink) notarization has become more common in many jurisdictions, few states permit online or webcam notarization where the person signing a document is not in the physical presence of the notary. As a result of COVID-19, the rules have been relaxed in New Jersey and New York in order to permit video notarization in some instances. New Jersey New Jersey is utilizing a legislative process to amend the Notaries Public Act of 1979 (the “Act”). A bill designated as A-3903 was signed into law on April 14, 2020, as P.L. 2020, ch. 26. It takes effect immediately and will remain in effect for the duration of the COVID-19 emergency as declared by the Governor in Executive Order 103. It provides that a notary appointed...

U.S. EPA and New York ESD Provide Updated Guidance Regarding Environmental Work Permitted for During COVID-19 Pandemic

U.S. EPA and New York ESD Provide Updated Guidance Regarding Environmental Work Permitted for During COVID-19 Pandemic

Within the past several days, both the U.S. Environmental Protection Agency (EPA) and the New York Empire State Development Corporation (ESD) have provided updated guidance clarifying the standards for deciding what types of work may proceed at hazardous waste sites during the COVID-19 pandemic. EPA Interim Guidance on Site Field Work Due to Impacts of COVID-19 EPA’s April 10, 2020 interim guidance supplements the previously-issued March 19, 2020 guidance from the Office of Land and Emergency Management. It applies to response actions at cleanup and emergency response sites where EPA is the lead agency or has direct oversight or responsibility for the work, including response action work that may be conducted by states, tribes, other federal agencies, and potentially responsible parties (PRPs). At these sites, EPA will continue to make decisions on a case-by-case basis regarding ongoing site activities, with top priority given to protecting the health and safety of the public and maintaining the health and safety of EPA personnel and other on-site cleanup partners. The guidance also directs Regions to consider other important priorities, such as whether local officials have made specific requests to suspend work, whether on-site workers have tested positive or shown symptoms of COVID-19, and...