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

New MassDEP Commissioner Ken Kimmell has launched a regulatory reform effort at DEP. As everyone knows, Ken did an outstanding job as EEA General Counsel and I expect he will be an outstanding DEP Commissioner. I hope he succeeds and I fully support the regulatory reform initiative. However, he does have one major problem – his staff, other than his senior staff, doesn’t believe in it. Street level bureaucracy is not an abstract intellectual concept; it’s something the regulated community deals with every day. When the Commissioner starts rolling out reform initiatives, even if they are protective of the environment, will his staff be on board? I’m skeptical, as everyone who represents clients before DEP has reason to be.

For today’s cautionary tale about how DEP really operates, I’m going to have to disguise a few facts in order to protect the innocent; reprisals against my clients are not good for business. However, here are the basics.  The client has a 21E site, a state superfund site. They are operating a small treatment system in a residence to ensure that the residence is not impacted by a source area plume. The site has a temporary solution and as recently as 2008 DEP agreed that the site posed no significant risk. Notwithstanding the review in 2008 and the absence of any changes since then, DEP conducted an audit in 2011.

The treatment system off-gases small amounts of VOCs. DEP guidance – argh, guidance alert – states that off-gas treatment is not required if emissions of VOCs will be less than 100 pounds per year. Analysis of site data indicates that the system here releases less than a tenth of a pound per year – less than a thousandth of the threshold.  DEP’s response? They still want an assessment of the potential risks associated with emissions from the treatment system. The results? Both the non-carcinogenic Hazard Index and the carcinogenic excess lifetime cancer risk are more than four orders of magnitude – that’s a factor of 10,000 – below the no significant risk threshold. 

I love anecdotes; it’s one of the beautiful freedoms of blogging that we get to pick and choose our data. However, I am quite confident that every one of my readers in the private sector will have at least five stories of their own that are equally horrific. Moreover, while this is just one story, it does exemplify several aspects of the street level bureaucracy problem.

Guidance only works one way. Regulated entities are bound by it, but the agency feels free to require additional work, even if what the regulated party has done complies with the guidance.

MassDEP employees don’t trust their own system. Even though there was no hint of a risk here, the agency just couldn’t quite believe it. They are so concerned about being blamed for false negatives that they will do anything to eliminate them, regardless of the cost of false positives or the cost of the additional work that they require.

Which brings me to the last problem – DEP routinely assigns a value of $0 to costs that will be borne by the regulated community. Why not require a little more testing in order to provide an extra level of comfort that things are really, really, really, really (one “really” for each order of magnitude) safe?

Until these issues are addressed – and doing so in the face of civil service requirements is a Sisyphean task – regulatory reform is something of a quixotic ideal – though one still worth pursuing.

Good luck, Ken.

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There are not too many areas of environmental law where practice intersects frequently with academic theory. One such area is whether agencies should use notice and comment rule-making any time they want to set forth policy or whether they should instead be permitted to use flexible guidance documents. The real issue from the practitioner’s point of view is the extent to which use of guidance permits street level bureaucracy a degree of unfettered discretion that is truly scary. Like Judge Roy Bean, these bureaucrats are the law West of the Pecos – or at least outside agency headquarters. The flip side of the debate is the notion that modern environmental law is simply too complicated to specify all rules through notice and comment rule-making. Agencies need, as a practical matter, the flexibility to operate through informal guidance.

The debate is illustrated by two D.C. Circuit Court of Appeals decisions. First, in Appalachian Power v. EPA, issued in 2000, the Court struck down EPA use of a guidance document. The Court nicely summarized the issue:

The phenomenon we see in this case is familiar. Congress passes a broadly worded statute. The agency follows with regulations containing broad language, open-ended phrases, ambiguous standards and the like. Then as years pass, the agency issues circulars or guidance or memoranda, explaining, interpreting, defining and often expanding the commands in the regulations. One guidance document may yield another and then another and so on. Several words in a regulation may spawn hundreds of pages of text as the agency offers more and more detail regarding what its regulations demand of regulated entities. Law is made, without notice and comment, without public participation, and without publication in the Federal Register or the Code of Federal Regulations. … The agency may also think there is another advantage--immunizing its lawmaking from judicial review.

The Court dismissed EPA’s contention that the document was not binding, and said this in response to EPA’s reference to its boilerplate statement that the guidance created no rights: 

“[R]ights” may not be created but “obligations” certainly are…. The entire Guidance, from beginning to end – except the last paragraph – reads like a ukase.

Haven't all our clients felt what it is like to be under agency ukase?

Unfortunately for those who liked the outcome in Appalachian Power, it seems to have been the high-water mark for those wanting to circumscribe agency use of guidance. More recently, the D.C. Circuit refused to review EPA guidance as though it were a rule. In Cement Kiln Recycling Coalition v. EPA, responding to an Appalachian Power-type challenge, the Court concluded that EPA had not treated the guidance at issue as binding and noted that, in response to Appalachian Power, EPA had edited the guidance to make it look less binding. The Cement Kiln plaintiffs thought this was evidence of subterfuge; the Court did not buy it. The Court did acknowledge that an agency assertion that guidance is non-binding “will not make it so where there is evidence —or practice – to the contrary."

The immediate context for this post is efforts by the Massachusetts Environmental Policy Act, or MEPA, office to take a second look at its greenhouse gas (GHG) policy in light of the legislative passage of the Global Warming Solutions Act. The work group (of which I am a member) reviewing this issue has been considering whether it is better to leave aspects of the policy as guidance or whether to put them in regulation.

As you can probably tell from the start of this post, my gut reaction is always to make the agency put its rules into notice and comment regulation. I’ve had too many experiences of street level bureaucrats who take advantage of the “flexibility” of agency guidance documents to become their own version of Roy Bean.

However, my friend Sam Mygatt, whose judgment I trust, has strongly endorsed the approach of leaving many of these issues to guidance. After puzzling over this for some time – How could Sam be right and I be wrong? – I realized what the answer is:

The size of the bureaucracy matters. 

The rules -- or guidance -- at issue here are promulgated by the MEPA office.  This is also the agency Sam deals with most frequently (he did run it at one time, after all). The MEPA office has a handful of reviewers. The consultants, such as Sam, who have large MEPA practices deal with the MEPA reviewers repeatedly. They are able to build relationships of confidence and trust; it is very difficult for these reviewers to see Sam as the devil, merely looking to desecrate the environment to benefit his client. 

Larger bureaucracies are different. Street level bureaucrats have inherently more autonomy in larger bureaucracies. Moreover, while we may all get to know some staffers at DEP or EPA, it is impossible to build the same type of relationships as is possible with the MEPA office.

At a casual empirical level, this distinction seems to have substantial force. For smaller bureaucracies, stick with guidance; with larger bureaucracies, make them issues rules.

Your take?

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