Law and the Environment : Environmental Lawyer & Attorney : Foley Hoag Law Firm : Boston, Washington D.C.

Attorneys who have litigated citizen suits under RCRA have often wondered if there is any possible risk that would not qualify as an “imminent and substantial endangerment,” thus subjecting the person who “contributed” to such endangerment to liability under RCRA.

In Scotchtown Holdings v. Town of Goshen, the District Court for the Southern District of New York earlier this month established at least some outer parameters for this seemingly boundless phrase. In Scotchtown Holdings, the owner of land allegedly contaminated by the defendant’s use of sodium chloride – also known as salt to the uninitiated – caused groundwater contamination that precluded development of the plaintiff’s property for residential use.

The court granted the defendant’s motion to dismiss on the ground that, because the property had not already been developed – and because the contamination meant that it would not be developed – there was no imminent and substantial endangerment.

It may be that this decision is obvious and unremarkable. It is certainly distinguishable from cases where at least a potential future exposure exists if no cleanup were to occur and current land uses remain unchanged.  In Scotchtown Holdings, no exposure would occur unless land use were to change.  Nonetheless, for those of us who thought that the presence of contamination almost meant that an imminent and substantial endangerment existed, QED, the decision is a breath of fresh air.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Recently, I posted about Governor Schwarzenegger’s efforts to suspend the California version of NEPA with respect to economic stimulus infrastructure projects. Today’s news concerning the impact of the current economic downturn on an ambitious environmental agenda comes from the other coast. Massachusetts has been attempting to rival California in its commitment to a green energy economy, but the Boston Globe today reported on concerns about the Commonwealth’s ability to achieve its green energy goals. My friend Rob Stavins of Harvard is quoted in the Globe as saying that the factors affecting the Commonwealth’s ability to achieve its goals -- including the depth of the downturn and the size and timing of the federal stimulus package -- are not within our control.

The tension is obvious from just one of the administration’s pet programs. Last November, the administration announced a plan for the installation of solar panels on the roofs of big box stores and other buildings with large flat roofs. However, if no new big boxes are being built because of the economy and if big box retailers are instead closely examining their operations and closing some stores, it’s going to be hard to persuade them to incur the up-front cost to install solar panels, even if there is a long-run return.

To throw in a mention of my pet peeve, such plans are particularly likely to stick in property owners’ collective craw when, at the same time, the administration has announced draft new stormwater rules that could impose substantial costs on anyone owning an impervious surface.

The administration’s goals are laudable, a lot of progress has been made, and it’s clear that some progress will continue. However, to suggest that there is no tension at all between environmental goals and economic development seems like a serious case of wishful thinking.

• Email This
• Print
• Comments
• Trackbacks (1)
• Share Link

Readers of a certain age will recall Chevy Chase’s Weekend Update segment during the first year of Saturday Night Live, when, for a number of shows, he would report that Francisco Franco was still dead. (And isn’t it great that there is actually a Wikipedia article on the subject of Franco still being dead!).

This segment was brought to mind by the report of this week’s decision out of the District Court for the District of Columbia, in the case of General Electric v. Jackson, affirming that EPA’s authority to issue unilateral administrative orders under § 106 of CERCLA had survived an as applied constitutional challenge brought by General Electric. Clients have been asking their lawyers whether CERCLA could possibly be constitutional ever since it was passed more than 28 years ago. Today, with this decision, I can report that CERCLA is still constitutional.

The same court had rejected a facial challenge to CERCLA’s constitutionality in 2005. In the recent decision, the court concluded that EPA’s “pattern and practice” in implementing § 106 also survived challenge. GE had raised two concerns. The first is that, under the decision in Ex Parte Young, EPA’s coercion of PRPs through its use of § 106 deprives PRPs of their due process rights. The court rejected this argument on the ground that the availability of the sufficient cause defense and the ultimate availability of judicial review meant that EPA’s issuance of § 106 orders is not unconstitutionally coercive.

Second, GE argued that EPA’s process for issuing § 106 orders deprives PRPs of a constitutionally protected property interest and that, in order to do so, EPA must provide more process, in particular a neutral decision-maker, prior to issuing orders. Here, while the court found that issuance of § 106 orders does deprive PRPs of a property interest, the balance of harms weighs in EPA’s favor and imposition of greater pre-issuance process would impose substantial costs on EPA without providing significant benefit to PRPs.

Francisco Franco is still dead. CERCLA is still constitutional. Plus ca change, plus c’est la même chose.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

President Obama continues to surprise some of his progressive backers. This time, it was his selection of Cass Sunstein to head the Office of Information and Regulatory Affairs at OMB. The Center for Progressive Reform called Sunstein’s views “conservative” and similar to those of the Bush administration.

How did the appointment of a known progressive annoy the progressives? Sunstein’s sin is the support of the use of cost-benefit analysis in regulatory decision-making. Sunstein also rejects the precautionary principle.

I truly hope that this is a Nixon in China moment for cost-benefit analysis. Given that Obama has already appointed an aggressive – and progressive – regulatory team, given that he has already signaled that EPA will reverse the Bush administration’s rejection of California’s waiver request, given that he has also signaled that EPA will probably move quickly to regulate CO₂ as a pollutant, perhaps he will have earned sufficient credibility with most progressives – if not the Center for Progressive Reform – to move to make regulation more efficient and to make better use of science in regulation.  This would include adoption of cost-benefit analysis as a cornerstone of analysis.

As long as Republicans push for cost-benefit analysis, it is easy to say it’s a tool of the devil. Professor Sunstein himself referred to environmentalists’ Manichaean view of the world. If President Obama supports cost-benefit analysis, will the same criticism stick? Let’s hope not. Perhaps this administration can indeed bring industry and environmentalists together, satisfying environmentalists with strong regulation and industry with the assurance that such regulations will be soundly grounded in science, including careful risk analysis and cost benefit analysis.

• Email This
• Print
• Comments
• Trackbacks (1)
• Share Link

While Congress considers climate change regulations, and states pursue regional cap and trade plans, it becomes apparent that the number of different ways to regulate carbon emissions is limited only by the creativity of those doing the regulating. Last week, the Minnesota Public Utilities Commission (PUC) issued a certificate of need for the construction of transmission lines necessary to carry power from a new coal-fired plant, known as Big Stone II, to be built in South Dakota.

The certificate of need includes several provisions affecting CO₂ emissions by the utilities. It requires that an older coal plant be closed by 2018 (though of course there is an exception if the plant is needed). The new plant must be constructed to be “carbon capture retrofit ready.” Finally, and most notably, the certificate provides that Otter Tail Power, which is one of the utilities building the new plant and which, because it is located in Minnesota, is subject to the jurisdiction of the Minnesota PUC, may not recover CO₂ emission control costs from the ratepayers to the extent those costs exceed $26/ton.

In fact, at this point, $26/ton seems like a high number. Environmental advocates had sought complete rejection of the certificate of need request and are not happy about the $26/ton cap. Nonetheless, the important story here is not the level at which the cap is set in this case. The important feature is the imposition of the cap as part of the certificate of need process. 

Today $26/ton. Tomorrow, who knows? Departments of public utilities could be the next front in the climate change battle.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Sometimes it seems as though the days for coal are short. With a new administration that seems truly committed to addressing climate change, it can be difficult to envision a long-run future. 

Other days, coal, like Citigroup, seems too big to fail. Today, I’m in the latter camp. Yesterday, Zurich Financial Group announced that it would provide insurance to cover risks associated with carbon capture and sequestration (CCS) projects. It’s one thing for Congress, where climate change advocates may need votes from coal-state legislators, to support CCS projects, but when the market starts suggesting that CCS projects are viable, it’s time to sit up and take notice.

Time will tell whether CCS really has a future as part of a climate change strategy, but certainly Zurich’s announcement is a positive one for coal.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

In a decision that could have significant impact on states’ efforts to limit cross-border pollution, Judge Lacy Thornburg of the District Court for the Western District of North Carolina issued an affirmative injunction against the TVA this week, requiring it to install pollution control equipment at its facilities located nearest to North Carolina and imposing specific emissions limits from those facilities. The basis for the injunction was a finding, after trial, that the facilities created a public nuisance as a result of the air pollution transported from those facilities to North Carolina.

The decision is notable for a number of the findings and holdings.

• Generally speaking, compliance with regulations does not preclude a finding that air emissions constitute a nuisance. (The Court applied the nuisance law of the states in which the plants were located.)
• Ozone and PM_2.5 can create adverse health impacts at concentrations below the National Ambient Air Quality Standards (NAAQS). This suggests that facilities contributing to concentrations of air pollutants can be subject to an injunction requiring the facility to decrease emissions, even if the area is in attainment of the NAAQS.
• The Court looked to survey data indicating that Blue Ridge Parkway visitors would pay $328 in annual taxes in order to improve visibility. As many readers will know, this kind of survey research is extremely controversial and may lead to some extraordinary damages findings.
• The Court declined to impose an injunction against TVA facilities that were not proximate to North Carolina, essentially on the ground their impacts on North Carolina were de minimis. The court found that those plants against which an injunction was entered contributed to somewhere between 5% and 10% of ambient contaminant concentrations. The other plants contributed less 0.1% of ambient concentrations.
• The Court imposed a stringent schedule by when pollution control equipment must be installed. The Court gave the TVA 27 months to install scrubbers and 21 months to install SCRs. This time frame was substantially shorter than that proposed by the TVA.

The one piece of good news for generating plants was the court’s causation analysis with regard to more distant plants. That analysis, if followed, suggests it would be extremely hard for a public nuisance plaintiff to prevail in a global warming case, since the causative contribution of any facility or even group of facilities to the global warming problem is almost certain to be even more attenuated than for those TVA plants distant from North Carolina.

The decision undoubtedly gives downwind states a substantial hammer against upwind sources of contamination (and could be applied to water pollution cases as well as air pollution). Indeed, in the current set of Congressional negotiations, industrial interests could conceivably be tempted to accept more stringent emissions limits in return for preemption of state nuisance laws. It will be interesting to see how this plays out in Congress.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Those of us who litigate know that, with all respect to our expert colleagues, pulling a necessary opinion out of an expert can be very difficult. Experts like adjectives and adverbs, particularly if those modifiers help the expert avoid saying anything meaningful. A recent decision from the Court of Appeals for the Fourth Circuit makes clear the limits of such timidity.

In Miller v. Mandrin Homes, the plaintiffs alleged that the defendants sold them a house that was subject to contamination. The plaintiffs brought several claims, including one under CERCLA, which they admitted was the crux of the case. As our readers know, one of the elements of a prima facie case under CERCLA is proof that there has been a release or threatened release of a hazardous substance. 

Unfortunately for the plaintiffs’, their expert only stated that contamination detected in a sump at the house was “indicative” of a release. The court found such testimony speculative, stating that this phrase “does not show that [the expert] … could testify that it was his scientific opinion that groundwater contamination existed. [The expert] stated his opinion in a passive manner that suggests his finding falls in the realm of the possible rather than the probable.”

The lesson here is critical, if basic. Know the elements of your case. If they are subject to expert opinion, make sure that your expert is willing to state that it is more likely than not that the relevant fact is true. I have often had the precise experience of working with experts to change their use of “indicates” to “demonstrates” or similar such language. If you are in litigation or at risk of litigation, ignore this issue at your peril.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

RGGI, Inc. announced today that its third auction of CO₂ allowances will be held on March 18, 2009, and will offer allowances from all ten states participating in RGGI -- Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island and Vermont. The sealed bid format and the reserve price of $1.86 remain the same as the previous two auctions, but one big change is in the works.

New for this auction:  the participating states will offer approximately 2.2 million allowances from vintage 2012, in addition to the 31.5 million CO₂ allowances from 2009. These 2.2 million allowances from 2012 comprise about 5% of that year's cap, and will be sold in a separate, but parallel offering from the 2009 allowances.  The offerings occur simultaneously from 9 AM to 1 PM on March 18, a bidding window that is 1 hour longer than in previous auctions. 

The sale of 2012 allowances could offer an interesting insight into how bidders perceive the future of carbon cap and trade and RGGI itself. Will the 2012 allowances go for a higher price than the 2009 vintage? On one hand, since RGGI allowances may be banked without limitation into future years, a 2009 allowance is arguably the most valuable of them all.  On the other hand, 2012 allowances are our first taste of allowances within RGGI's second three-year compliance period (2012-2015), a period which spans 2015, the first year that the RGGI cap decreases by 2.5%.  Then there’s the question of RGGI’s future amid federal legislation. We might have a national cap-and-trade system by 2012, or some other system entirely, and it might (or might not) allow for the exchange of RGGI allowances.

We shall see. RGGI, Inc. plans to announce the results of the third auction on March 20.

• Email This
• Print
• Comments (2)
• Trackbacks (1)
• Share Link

It’s now de rigueur to say that there is no conflict between a healthy economy and a healthy environment. President-elect Obama said so himself as recently as December 15, when he introduced members of his environmental and energy team. Certainly, in a perfect world, where information is free and everyone agrees on the economic value to be placed on protecting environmental interests, that would be true as a matter of definition.

Unfortunately, we live in the real world and in the real world, there are often trade-offs to be made between economic growth and environmental protection. This critical tension was brought home last week, when news broke that Governor Schwarzenegger was seeking to expedite, and have the authority to waive, certain environmental reviews for infrastructure projects deemed critical to economic stimulus efforts. Among other authorities, Governor Schwarzenegger – who has been a leading figure in state efforts to fight climate change – wants to exempt a dozen highway projects from environmental reviews and to create a three person “super-Cabinet” that would have authority to waive environmental reviews on other projects. He has also suggested that federal NEPA review be waived for any project funded as part of a federal stimulus package.

Environmentalists, of course, are having none of it. Tina Andolina, of the California Planning and Conservation League, called the Governor’s plan’s “ridiculous.” But are they? Anyone involved in any kind of development project, whether highway or mass transit or power generating – or even schools or low income housing – knows that environmental reviews can slow such projects by months or even years. In fairness to the environmental review process, that’s part of the purpose – to make certain that projects aren’t developed without careful consideration of their impacts.

However, everyone seems to agree that we are in the midst of an extraordinary time. President-elect Obama has himself said that prompt economic stimulus is critical, in order to avoid an even worse economic crisis. A substantial part of the stimulus plan is for infrastructure projects that every thinking person must acknowledge could conceivably have adverse environmental impacts. What if it simply isn’t possible both to thoroughly assess those impacts and get the projects started sufficiently quickly to have the stimulus that everyone agrees is needed?

Given the dire state of the economy, I’d certainly err on the side of facilitating projects, but I’m sure that some of my readers would disagree. 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

We have previously noted that efforts to achieve economy-wide reductions in greenhouse gas emissions will necessarily go beyond the electricity generating sector. One obvious target will have to be greenhouse gas emissions from buildings, which EPA estimates account for 17 percent of U.S. carbon emissions.

Although there have been efforts, particularly in California and Massachusetts, to use state NEPA analogues to control carbon emissions from new projects going forward, and there have been similar efforts to build energy efficiency into state building codes, existing buildings will inevitably become a focus, simply because their carbon emissions are too big to ignore.

Yesterday, EPA Region II and Cushman & Wakefield got out ahead of the curve, announcing a voluntary agreement pursuant to which Cushman & Wakefield agreed to reduce energy consumption from the 3,000+ buildings it owns or manages by 30 percent by 2012. There are other aspects to the agreement as well, such as a commitment to achieve LEED certification for new construction. 

The size of the reduction to which this agreement commits Cushman & Wakefield is notable, in that a 30 percent reduction by 2012 is more aggressive that the nascent regulatory schemes are envisioning. It certainly suggests, as environmentalists have argued for some time, that there is a lot of low-hanging fruit to be found in the energy demand management area.

This type of agreement is almost certain to become more common as the threat of mandatory regulation becomes more tangible. In fact, depending on the nature of greenhouse gas reduction regulations, such agreements could provide significant economic benefit to the Cushman and Wakefields of the world, if they are allowed to obtain early reduction credits or other economic recognition of the reductions achieved under the voluntary agreements.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The magnitude of the recent release of coal ash from the TVA dam is hard to fathom, though the pictures certainly give some sense of its magnitude. Now, as regulators and Congress attempt to get their collective arms around the import of the release, some of the regulatory implications of the release are starting to emerge. According to a report in yesterday’s Greenwire, Congressional hearings this week may include a discussion regarding whether coal ash should continue to be exempt from regulation as a hazardous waste under RCRA

The exemption of coal ash is critical to coal-fired power plants. According to the article, 130 million tons of fly ash were generated last year, 42 percent of which were beneficially reused. Moreover, there are approximately 600 landfills and containment ponds holding fly ash. Having helped a coal-fired power plant defend a law suit involving an on-site ash landfill some years ago, I can tell you from personal experience that placing fly ash within the ambit of RCRA hazardous waste rules would be a major headache for coal-fired power plants – and a major new weapon in the armory of those who want to shut down coal plants any way possible.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

While many economists are worried about the possibility of deflation in the current economic crisis, EPA still is concerned about inflation – specifically inflation in the amount of statutory civil penalties under statutes enforced by EPA. In a Federal Register notice dated December 11, 2008, EPA announced increases in its civil penalties. 

Some of the increases are not trivial. It is of course true that EPA rarely obtains, or even seeks, the maximum permissible penalty, but the maximum does set the boundary for negotiations with the agency. 

All joking aside, EPA has a statutory obligation under the Debt Collection Improvement Act of 1996 to review penalty amounts at least every four years and to adjust the penalties based on the provisions of the DCIA. Nonetheless, in the current situation, EPA’s sense of timing is impeccable.

• Email This
• Print
• Comments
• Trackbacks
• Share Link