Environmental Law Update – Fall 2018

On September 30, the Massachusetts federal District Court dismissed Toxics Action Center, Inc. v. Casella Waste Systems, Inc.,  a citizens suit under the Clean Water Act and RCRA alleging that discharges of leachate from Casella’s Southbridge landfill through groundwater had damaged surface water and contaminated private wells. The Court dismissed the RCRA counts, because additional Court action would be duplicative of  MassDEP’s enforcement actions and, therefore, not “necessary.” The Court acknowledged that “[t]he First Circuit has not addressed whether a discharge of a pollutant that moves through ground water before reaching navigable waters may constitute a discharge of a pollutant, within the meaning of the CWA.”  But the Court sidestepped the groundwater discharge issue as follows: “a landfill is not a point source within the meaning of the CWA, this Court will not reach the issue of whether the CWA extends liability to surface water that is polluted via hydrologically connected groundwater.”

On September 26, the Department of Public Utilities issued an Order providing for utilities to pay direct incentives to owners of new solar generating sources under the Solar Massachusetts Renewable Target (SMART) program.

On September 17, Massachusetts rolled out its first-in-the-nation 2018 State Hazard Mitigation and Climate Adaptation Plan which integrates climate change impacts and adaptation strategies with hazard mitigation planning.  The Plan qualifies the state for Stafford Act funds (per FEMA hazard mitigation grant criteria at 44 CFR § 201.4) and also complies with Executive Order 569.  The state will update the plan every five years, with continuous reviews, updates and revisions via the new Climate Change Clearinghouse.  To date, over 150 communities have performed vulnerability assessments and developed action-oriented resiliency plans under the Commonwealth’s Municipal Vulnerability Preparedness Program (MVP).  Certified MVP communities are eligible for MVP Action grant funding and other opportunities.

On September 4, the Supreme Judicial Court handed down New England Power Generators Association, Inc. v. Department of Environmental Protection rejecting the Power Generator’s challenge to MassDEP regulations requiring decreases in annual GHG emissions under the Global Warming Solutions Act (GWSA). Deferring to MassDEP’s interpretation of the Act, the Court ruled that the Department had the authority to impose annual declining emissions on the electric sector under Section 3 d of the Act, despite the existence of provisions in Section 3 c of the Act, which are specifically applicable to electric generating facilities.

On August 21, Governor Baker signed the $2.4B Environmental Bond Bill including provisions that put into law his 2016 Executive Order 569, establishing an integrated strategy for climate change adaptation discussed above.

On July 12, the EPA and Army Corps issued a Supplemental Notice of Proposed Rulemaking on their proposal to roll back the Obama-Era Waters of the United States (WOTUS) Rule defining the agencies’ Clean Water Act jurisdiction. The comment period ended on August 23, 2018.  Whatever the agencies ultimately decide, ongoing litigation is sure to continue to delay the clarity sought by so many in the regulated community over the breadth of the agencies’ jurisdiction.

In addition to EPA’s April 2018 proposed Strengthening Transparency in Regulatory Science rule, which would limit the scientific studies that the EPA could rely upon in evaluating new regulations, on June 13 the Agency issued an Advanced Notice of Proposed Rulemaking  to change the methodology used to calculate the cost and benefit of new environmental regulations.  Battle lines are being drawn over whether the EPA should continue to count so-called “co-benefits,” which take into account the indirect health benefits in addition to the direct benefits of a proposed new regulation. For example, in the case of the mercury air toxic rule, the EPA included $4-6M of direct health benefits from reduced mercury exposures and $80B in co-benefits attributable to the reduction of other pollutants, primarily particulate matter (PM).

In March, MassDEP promulgated a package of amendments to its air pollution control regulations at 310 CMR 7.00 across a wide array of topics, including a revamp of the rules governing appeals of air plan approvals, which had long been the source of legal uncertainty and litigation.

 

“SUPERFUND IS SEXY AGAIN.”

According to a senior US EPA official, “Superfund is sexy again.” Newly discovered health risks attributed to so-called “emerging contaminants” are causing federal and state agencies to revisit long closed Superfund sites and evaluate the environmental and human health risks at myriad new locations.  These ubiquitous environmental contaminants, including perfluoronated compounds and 1,4-dioxane, present a significant risk to human health at very low concentrations.  So much so, that US EPA Administrator, Scott Pruitt, recently held a Leadership Summit to discuss these new emerging contaminants and develop a coordinated response across EPA regions.

The US EPA and several state environmental agencies are establishing very low guidelines or standards for these contaminants.  They are also beginning to require responsible parties to test for these chemicals at existing (and in some cases closed) state and federal superfund sites, and, if present, to develop plans to address the attendant risks.  Eventually, the government will restrict the discharge of these contaminants in waste water and the air, which will pose another significant layer of compliance headaches and expenses.   While this may be good news for government regulators, environmental attorneys and consultants, this news is bad for landowners and developers.

One of these emerging contaminants is actually comprised of an entire class known as the per- and poly-fluoroalkyl (“PFAS”) compounds, such as perfluorooctanoic acid (“PFOA”) and perfluorooctane sulfonate (“PFOS”).  Until their use was phased out in the United States over the last two decades, manufacturers used these compounds in non-stick cookware, water repellent fabrics, firefighting foams and a variety of other applications.  PFAS are often found in elevated concentrations near military bases, airports, firefighting academies, metal plating plants, landfills and manufacturing facilities where they were used.   In a perfect storm of problems for responsible parties who have to deal with these emerging contaminants, they are highly persistent in the environment, expensive to monitor and test, difficult to treat and pose potential health risks at very low concentrations.  For example, the US EPA Lifetime Health Advisory for PFOA and PFOS is 70 parts per trillion (“PPT”).

Another emerging contaminant is 1,4-dioxane.  1,4-dioxane is often found along with other industrial solvents such as TCE, but it is also present in consumer products, such as shampoos and cleaning agents.  Because of their widespread consumer use, these compounds are found just about everywhere.  For example, 1,4-dioxane can be found in private septic systems and associated groundwater.  The MassDEP groundwater clean up standard for 1,4-dioxane is 300 PPT in potential or existing water supply areas.

To date, the US EPA has not set a Maximum Contaminant Level for PFAS under the Safe Drinking Water Act.  Thus, as far as the federal government is concerned, there is no enforceable standard.  However, as a result of a number of exceedances of the Lifetime Health Advisory level found by public water suppliers when they performed required monitoring for PFAS under EPA’s Unregulated Contaminant Monitoring Rule, those water suppliers have taken action to limit public exposure.  For example, the Towns of Westfield, MA, near Barnes Air Force Base, and Ayer, MA, have both stopped using public water supply wells where detections of PFAS exceeded the Lifetime Health Advisory.  The Town of Westfield has recently filed a lawsuit against the manufacturers of AFFF firefighting foam to recover damages.

The law and regulations governing site assessments and remediation for these contaminants is still “emerging.”  While some states, such as New Hampshire, have promulgated legally binding cleanup standards for certain PFAS, others, like Massachusetts, are still in the process of developing guidance and have not yet begun the official process of establishing a legally binding regulatory standard.  In early June, MassDEP issued “Final Recommendations for Interim Toxicity and Drinking Water Values” for testing as part of the Unregulated Chemical Monitoring program.  But this Interim Guidance does not establish clear enforceable standards.  Until standards are promulgated, the question of whether or not to test for these contaminants as part of a site assessment falls to the good judgment of the professional environmental consultant.  Thankfully, most environmental consultants are sufficiently knowledgeable about the potential presence of these contaminants to design an appropriate sampling and analytical program to protect their clients.

Because PFAS are not yet consistently regulated across the states and are not defined as a “hazardous substance” under the federal Comprehensive Environmental Response, Compensation and Liability Act, (CERCLA or “Superfund”) administered by the US EPA, regulatory authority to compel assessment and remediation of PFAS varies from state to state and from site to site.  According to Regional Administrator Dunn, the Agency is reading the language of individual Superfund consent decrees to determine whether the responsible parties agreed to reopeners for only “hazardous substances,” or also for other “pollutants or contaminants,” which would encompass PFAS.  She emphasized that, at sites where the EPA concludes it does not have the legal authority to compel responsible parties to take further response actions, the relevant state may have authority to take such action.  She indicated that there has been some discord between the federal and state governments over this issue.

PFAS can be in solid waste.  The federal Resource Conservation and Recovery Act currently does not include PFAS within the definition of a hazardous waste.  Currently, only Vermont and New York states reportedly regulate PFAS as “hazardous wastes” under their parallel state programs.  Conceivably, this means that in all other 48 states, an industrial or other waste generator is not required to evaluate whether or not its waste streams contain PFAS, or make any special arrangements for storage, transportation or disposal of those wastes (such as using a RCRA permitted hazardous waste facility).  This challenges solid and hazardous waste disposal companies with the question of whether they want to handle wastes which may have PFAS, and expose themselves to the potential future worker exposure or environmental release liability that may ensue.

To make matters even more difficult, most states have not adopted surface water quality criteria, discharge or other limits, on the emissions of PFAS to water bodies, or to the air.  A few states, such as Vermont, have established policy limits on the concentrations of PFAS, which can be in landfill leachate discharged to a waste water treatment facility, but this is the exception to the rule.

These emerging contaminants present a real challenge on a number of fronts.  Because of the potentially very high cost of monitoring and remediation, prospective purchasers should first obtain clear environmental consulting guidance whether emerging contaminants should be tested for in a site assessment.  Second, in the process of performing environmental due diligence in a corporate transaction, attorneys and consultants may need to advise their clients that new site assessments be performed, including this testing, to avoid reliance on reports that pre-date the emergence of these contaminants and testing protocols.  Third, if emerging contaminants are found to have caused a very significant impact, such as loss of a water supply, consider whether or not the costs can be recovered.

Franklin’s adage that “an ounce of prevention is worth a pound of cure,” certainly applies to emerging contaminants.  Until the science is settled and the regulations are clear, there is simply too much uncertainty about the environmental and public health risks, potential liability and costs to remain ignorant about the possible presence of PFAS in whatever environmental media you are dealing with.

 

Environmental Law Update – Fall 2017

On October 19, 2017, NH DES released a letter to Responsible Parties, Owners and Permittees of certain classes of properties to conduct testing for Per- and Poly-flouroalkyl substances (PFAS).  “Landfills (lined, unlined, active, and/or closed) that are subject to groundwater monitoring requirements” are identified as sites where NH DES will require the initial screening.  As noted in the letter, NH DES “strongly encourages stakeholders to sample and analyze, at a minimum, for the expanded list of nine PFAS analytes outline in the Guidance” provided by NH DES.

On October 18, 2017, the Rhode Island DEM established a 70 parts per trillion Groundwater Quality Standard for PFOA, PFOS or any combination of these compounds in groundwater classified as GAA or GA (groundwater suitable for drinking water use without treatment). Read More → “Environmental Law Update – Fall 2017”

POTUS Has Trumped WOTUS Before SCOTUS

In our Spring and Fall 2015 Newsletters, we predicted a growing morass of litigation challenging the EPA and Army Corps’ Clean Water Rule (the “Rule”). The Rule sought to codify the criteria the agencies have applied on a case-by-case basis using the three alternative tests announced by the Supreme Court of the United States (“SCOTUS”) in Rapanos v. United States, 547 U.S. 715 (2006) to define the jurisdictional scope of Waters of the United States (“WOTUS”) under the Clean Water Act. As we predicted, industry groups, 30 states and environmental groups challenged the extension of EPA jurisdiction in federal district and appellate courts.  The U.S. Court of Appeals for the Sixth Circuit issued a nationwide stay of the Rule, and later agreed with the federal government that the Rule was reviewable exclusively in the circuit courts of appeal.  The SCOTUS agreed to resolve the jurisdictional fights over which federal court should hear challenges to the Rule.  Thus, the Sixth Circuit stayed the litigation over the merits of the WOTUS Rule until the SCOTUS decides the narrow jurisdictional question of which courts have jurisdiction to hear substantive challenges to the Rule.  SCOTUS arguments are scheduled for April with an expected June decision.  On April 3, 2017, SCOTUS denied POTUS’ request to stay hearing on the venue for the WOTUS review.

During the campaign, Donald Trump pledged to “eliminate the unconstitutional” Rule and to “direct the Army Corps of Engineers and EPA to no longer use this unlawful rule and related guidance documents in making jurisdictional determinations.”  The SCOTUS grant of review gave the POTUS time to decide how to eliminate the Rule.  On February 28, 2017, the POTUS decried the Rule as a “massive power grab” and signed an Executive Order to direct EPA Administrator Pruitt to begin the legal process to dismantle the Rule and to Attorney General Sessions to ask the court to delay a decision until a new regulation is released.  The process for withdrawing the Rule is lengthy, will require justification, be subject to public comment, and potential challenge in new lawsuits which may end up in the SCOTUS, that will include the POTUS’ newly appointed justice, Neil Gorsuch.  The Republican Congress could also scuttle the Rule legislatively.  (A non-binding resolution was introduced in the House of Representatives that supports the Executive Order.)  Congress could also defund EPA wetlands activities.

The Pruitt EPA will likely be less aggressive in enforcing Clean Water Act violations.  Massachusetts may not be as affected because it has a strong Wetlands Protection Act and many municipalities have Home Rule Wetlands Protection laws.

Until SCOTUS addresses the new Rule years from now, EPA and the Corps presumably will make WOTUS determinations using the Rapanos tests.  A Corps’ Jurisdictional Determination will in turn be subject to judicial review as “final agency action” under the SCOTUS decision in U.S. Army Corps of Engineers v. Hawkes Co., Inc., 101 S. Ct. 1807 (2016).  Lawyers for industry, public interests, conservationists and environmental organizations will be fully employed for the next decade.

The Demise of the Stream Protection Rule

The Republican Congress and the POTUS have stricken the Interior Department’s Stream Protection Rule that protected waterways from coal mining that was eight years in the making.  The rule would have imposed stronger requirements for avoiding coal mining practices that pollute streams and sources of drinking water, for restoring streams, and for reclaiming and replanting mined lands.  Testing and monitoring of streams near coal mines before, during and after mining were required.  On February 2, 2017, Congress employed a little-used tool called the Congressional Review Act to block the rule with a simple majority vote (House 228-194 and Senate 54-45).  On February 16, 2017, the POTUS became the first president in 16 years to sign a regulatory repeal resolution.  The rule would have protected 6,000 miles of streams and 52,000 acres of forest in Appalachia.

Environmental Law Update – Summer 2016

In June, President Obama signed into law a revised version of the Toxic Substances Control Act (TSCA).  Originally passed in 1976, TSCA was designed to have EPA evaluate chemicals to determine if their use required further regulatory control.  As TSCA was implemented it came under considerable criticism because it required the government to have evidence that a chemical posed a risk before it could require testing which could result in greater regulatory control. The new TSCA changes this approach and mandates a review of chemicals in commerce and a requirement that all new chemicals must be assessed against health-based standards – rather than under a cost-benefit standard in the original legislation.  On June 29, 2016, EPA released its First Year Implementation Plan under the revised TSCA.  The aggressive plan includes a timeline for establishing new rules under the legislation including regulations for setting criteria to identify high priority chemicals and an “Inventory Rule”, that would require industry to report the chemicals it manufactured or processed in the previous ten years.  The First Year Implementation Plan also set a schedule for the continuation of on-going projects to identify risks from TCE and chemicals involved in paint removing applications, especially the chemicals methylene chloride (MC) and methylpyrrolidone (NMP).

One of the few times that the Obama administration and Congress were able to find common ground last year resulted in a dramatic increase in fines under federal environmental statutes.  The Bipartisan Budget Act of 2015 included a provision to amend the Federal Civil Penalties Inflation Adjustment Act of 1990 (Sec. 701 of Public Law 114-70).  The amendment included a “catch-up” provision that enabled agencies to adjust their penalties to account for inflation since the date the specific penalty was enacted or previously adjusted.  There was a 150% cap placed on the rate of increase, but many of the penalties under the environmental statutes administered by EPA increased dramatically.  For example, penalties under the Clean Water Act for permit violations under § 1319(d) increased from $25,000 per day of violation to $51,570.  Similarly, administrative penalties under CERCLA increased from $25,000 to $53,907 and from $75,000 to $161,721 respectively.  On July 1, 2016, EPA released the Interim Final Rule that includes the Table that will be incorporated in 40 C.F.R. § 19.4 with a complete rundown of the environmental statutes and fees.  Going forward we will likely see continued increases because the Act implements annual reviews of statutory civil penalties and allows agencies to make annual adjustments without going through the rulemaking protocols of the Administrative Procedures Act.  We will also see settlements demands dramatically increase in NPDES citizen suits under the CWA.

This Spring, Governor Baker announced that he is directing MassDEP to proceed with the steps to have the state administer the National Pollutant Discharge Elimination System (NPDES).  Massachusetts is one of just four remaining states that do not administer the federal NPDES program at the state level.  Taking over the local administration of the NPDES program will be a multi-year process, but MassDEP has started the process.  Hopefully more local control will lead to more responsive interactions between the regulators and the regulated community, as the state and industry work together to implement best stormwater management practices for the benefit of our water resources.

In May, the Supreme Judicial Court reviewed the state’s compliance with the requirements of the Global Warming Solutions Act (GWSA) in Kain v. DEP.  The SJC held that MassDEP failed to implement the GWSA because the agency did not “promulgate regulations that address multiple sources or categories of sources of greenhouse gas emissions, impose a limit on emissions that may be released, limit the aggregate emissions released from each group of regulated sources or category of sources, set emissions limits for each year, and set limits that decline on an annual basis.”

In August, MassDEP released proposed draft revisions of the Air Regulations at 310 CMR 7.00.  The topics addressed by these proposed regulations include: (a) establishing thresholds for greenhouse gas emissions that will require a Plan Approval; (b) requiring Plan Approvals for non-major modifications of existing Prevention of Significant Deterioration (PSD) permits; (c) updates to Reasonably Available Control Technology (RACT) requirements for volatile organic compounds; and (d) revised procedures for administrative review of an air permit issued by MassDEP.  The comment period on the proposed regulations closes on Monday, September 26, 2016.

Environmental Law Update – Fall 2015

In our Spring 2015 Environmental Law Update we predicted that there would be judicial and legislative challenges to the EPA and Army Corps’ new Clean Water Rule expanding the scope of jurisdictional waters of the United States.  The Rule seeks to codify existing criteria that EPA and the Corps have been applying on a case-by-case basis using the three alternative tests announced by the U.S. Supreme Court in Rapanos v. United StatesEven before the Rule was to take effect on August 28, 2015, 27 states filed federal lawsuits challenging the regulation.

On October 9, 2015, the U.S. Court of Appeals for the Sixth Circuit stayed the Rule nationwide.  The morass of litigation prompted EPA to move to centralize pretrial proceedings in the District of Columbia.  On October 13, 2015, the United States Judicial Panel on Multidistrict Litigation issued an Order denying transfer because the various lawsuits will involve very limited pretrial discovery as the cases will be decided on the administrative record and will turn on questions of law on alleged exceedances of statutory and constitutional authority in promulgating the rule.  The EPA and the Corps have resumed nationwide use of the prior regulations by applying case law, policy and the best science and technical data on a case-by-case basis in determining which waters and wetlands are protected under the Clean Water Act.  On the legislative front, on November 4, 2015, over the threat of a Presidential veto, the U.S. Senate approved a resolution to nullify the Clean Water Rule.  “The more things change, the more they stay the same.”  Stay tuned.