Inside, Outside: Perspectives On Environmental Regulatory And Litigation Issues

Transcription

1 Inside, Outside: Perspectives On Environmental Regulatory And Litigation Issues PRESENTED BY Kevin J. Bruno, Blank Rome LLP Steven Cook, LyondellBasell The Lineup The Good: Taking on EPA Sackett v. EPA Texas v. EPA EME v. EPA The Bad: CERCLA - Out Of Sight But Certainly Not Out Of Mind Revenge of the CERCLA Re-Opener Clause CERCLA River & Lake Sediment Projects What You Don t See Will Hurt You Air Emission Data: Who s Watching & Why 1

2 Sackett v. EPA Residential land near (but not on) lake with interstate reach in Idaho Placed dirt & rocks on land to build home EPA Determination Placement constituted discharge to navigable waters because adjacent to Lake Admin Compliance Order issued to Sacketts to remove & restore Made subject to $75,000 per day penalties Sackett v. EPA: The Ruling Trial Court & Court of Appeals denied right to hearing regarding ACO until USEPA sued Supreme Court reversed: CWA does not expressly preclude right to preenforcement review Pursuant to the Administrative Procedures Act, the Court determined the ACO constituted final agency action for which there is no other adequate remedy in a court. ACO determined rights & obligations, imposed legal requirements and subjected Sacketts to legal consequences (penalties and no permit allowed) 2

3 Sackett v. EPA Justice Alito s Concurrence: A Shared View of EPA? The position taken by the [USEPA] would have put the property rights of ordinary Americans entirely at the mercy of [USEPA] employees. In a nation that values due process, not to mention private property, such treatment [by EPA] is unthinkable. Sackett v. EPA The Implications Promote greater advance review of ACOs by DOJ? Does ruling apply retroactively to other CWA ACOs? Does ruling apply to other programs? RCRA language similar to CWA same result? CAA allows limited judicial review but courts have held admin orders not subject to judicial review. CERCLA contains explicit pre-enforcement enforcement bar Will due process challenge work? What is to be made of Court s denial of cert. in GE UAO case 3 months before Sackett ruling? 3

4 Texas v. EPA: The Facts Texas submitted Flex Permit Program in 1994 Allowed minor modifications if emissions stay within overall emissions cap CAA requires EPA action w/18 months Industry sued in 2008 to compel action EPA disapproved Flex Program in July year delay Unraveled ~140 permits Required multi-step de-flexing process Texas v. EPA: Ruling & Implications Fifth Circuit vacated EPA s disapproval of program Main issue: Did program language not limit its scope to the Minor New Source Review (NSR) program? Held EPA s disapproval was based on demands for language and program features of the EPA s choosing, without basis in the Clean Air Act ( CAA ) or its implementing regulations. Clearly l annoyed with EPA s16 year delay Upset at different treatment of similar GA program Clear trend to enforce EPA s ministerial role in reviewing SIP for consistency with the CAA 4

5 EME v. EPA: Background CAA Good Neighbor Provision State s SIP must prevent emission activity from contributing significantly ifi to nonattainment, t or interference with maintenance of NAAQS, of another State 2008: DC Circuit Court struck down Clean Air Interstate Rule ( CAIR ) Cannot use cost to lower an upwind State s obligation; must ensure upwind reductions are sufficient Note: Court invalidated CAIR because rule was not protective enough EME v. EPA: The Facts Transport Rule promulgated to replace CAIR in response to 2008 decision; finalized in August 2010 First used modeling to determine whether upwind State contributed significantly to downwind State s NAAQS nonattainment Next, applied cost-based standard without regard to size of a particular State s contribution NOx: $500/ton threshold S02: $500/ton for 7 States $2,300/ton for 16 States 5

6 EME v. EPA EPA s Determination Set emission limits based on how much pollution 28 upwind States could eliminate if power plants applied all controls available at or below a given cost EPA s economic justification : Estimated Transfer Rule would reduce S02 and NOx emissions by 50% Estimated cost to industry would be $800M, while benefit would be health care savings of $280B annually and prevent 30,000 premature deaths Implementation done through FIPs, and not left to States through new or revised SIPs EME v. EPA: The Ruling DC Circuit Court Invalidated Transport Rule and directed EPA to revise rule again; CAIR remains Held new rule resulted in emission limits that exceeded statutory requirements Not based on downwind contribution EPA s authority ends when downwind State achieves attainment Also held new rule did not adequately consider and give due deference to State programs Use of FIPs not justified 6

7 Implications Of EME Decision Court s emphasis on cooperative federalism is reason for hope in other challenges (Mercury Rule) and perhaps for other State-delegated t t d programs Impact of decision subject to debate because States will eventually have to address cross-boundary emissions Some impacts will not be welcome Will affect EPA re-designation of certain areas as attainment for ozone based on anticipated reductions from Transport Rule Fear Of The Unknown: Revenge of the CERCLA Re-Opener Clause Used since inception of the CERCLA program Non-negotiable: Take it or leave it language Example of standard language can be found at: cleanup/superfund/rdra-2012-amd.pdf 7

8 CERCLA Re-Opener Clause Notwithstanding any other provision of this Consent Decree, the United States reserves, and this Consent Decree is without prejudice to, the right to institute proceedings in this action or in a new action, and/or to issue an administrative order, seeking to compel Settling Defendants to perform further response actions relating to the Site and/or to pay the United States for additional costs of response if, (a) prior to Certification of Completion of the Remedial Action, (1) conditions at the Site, previously unknown to EPA, are discovered, or (2) information, previously unknown to EPA, is received, in whole or in part, and (b) EPA determines that these previously unknown conditions or information together with any other relevant information indicates that the Remedial Action is not protective of human health or the environment. CERCLA Re-Opener Clause Potential Triggers You Might Not Expect What constitutes previously unknown conditions? Advances in lab technology provides lower detection limits Advanced tools of investigation can locate contamination in areas not previously investigated When is a completed remedial action no longer protective of human health and the environment? Subsequent adoption of lower quality standards for soils, groundwater and/or surface water Advances in remediation technology improves level of protectiveness 8

9 Why Worry? The Numbers Are Not In Our Favor CERCLA program cost since inception: $56 billion Includes EPA costs, PRP costs and cost recovery efforts Yet zero balance in trust fund since ,000 sites in EPA database and slated for review 11,500 removal actions at 8,400 sites 1,714 NPL sites listed, deleted or proposed 1,127 NPL sites have remedy completed Required 5 year review following completion of remedy to evaluate remedy s effectiveness Where Does That Leave Us? Increased Use of Unilateral Admin Orders? No longer just for recalcitrant PRPs EPA avoids costly PRP searches and delays Eliminates need/opportunity to negotiate Pressure to Comply $37,500 per day penalties Treble damages Favorable Track Record for EPA ELI study: 1,700 UAOs issued to 5,400 PRPS 95% of recipients complied 9

10 What You Don t See Will Hurt You CERCLA River/Sediment Projects NY Times Science Section August 13, 2012 Superfund Cleanup Stirs Troubled Waters CERCLA River/Sediment Projects Staggering Numbers New Bedford Harbor Site, MA Added to NPL in 1983 Initial remedy: dredge 900,000 cubic yards After 30 years, EPA now believes will take another 40 years and cost $1.2B Lower Fox River Site, Wis Remedy: dredge several million cubic yards Estimates cost of $1 Billion 10

11 CERCLA River/Sediment Projects More Staggering Numbers GE Hudson River Site, NY Remedy: dredging of 2.6 million cubic yards 40 mile stretch of river Estimated cost of $2 Billion Lower Passaic River, NJ First Phase Dredge 2 million cubic yards PCB/dioxin Next phase requires study of 17 miles Possible early action on lower 8 miles Air Emission Data: Who s Watching & Why Increasing use and sophistication of remote measurement technologies Infrared Beam: Maximum path 500 meters Light Energy (DIAL/LIDAR systems): Maximum path 3000 meters Laser: Maximum path 1 km Ultraviolet (UV): Maximum path 10 km (and portable) Use not restricted to government agencies NGO s monitoring CAA compliance Plaintiff s counsel and/or competitors next? 11