Articles Posted in Environmental

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In the home stretch for 2015, Courts across the nation issued environmental decisions of note:

U.S. Supreme Court

Oral argument in the case of FERC v. Electric Power Supply Association green2was held in October of 2015, and a decision may be announced shortly. The controversy involves complex provisions in the Federal Power Act (FPA) and the Federal Energy Regulatory Commission’s authority under the law to regulate the practices of wholesale electricity markets, which have traditionally been considered to be reserved for state regulation. The Court of Appeals for the District of Columbia Circuit ruled against FERC, setting the stage for this appeal to the U.S. Supreme Court. Some of the limits placed on federal regulatory authority that were discussed in the recent decision of the Court in Michigan, et al., v. EPA figure prominently in the briefs filed with the Court. Continue Reading ›

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On December 29, 2105, the Pennsylvania Supreme Court issued a ruling that may be of considerable interest to oil and gas operators in Pennsylvania. In EQT Production Company v. Department of Environmental Protection of the Commonwealth of Pennsylvania, the Court considered the “whether a company threatened by an administrative agency with ongoing, multi-million-dollarmoney2 penalties per such agency’s interpretation of a statutory regime has the right, immediately, to seek a judicial declaration that the agency’s interpretation is erroneous.” Answering the question in the affirmative, the Court held that “the impact of the Department’s threat of multi-million dollar assessments against EPC was sufficiently direct, immediate, and substantial to create a case or controversy justifying pre-enforcement judicial review via a declaratory judgment proceeding, and that exhaustion of administrative remedies relative to the issues of statutory interpretation that the company has presented was unnecessary.”  The Court also confirmed that very large civil penalty assessments may be subject to pre-enforcement judicial review in Pennsylvania state courts and that the Pennsylvania Environmental Hearing Board (PEHB) may not have exclusive jurisdiction to review these proposed penalties.

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The U.S. Court of Appeals for the Eighth Circuit has distinguished decisions from the Fifth and Tenth Circuit that appear, at first blush, to be in conflict with its ruling that the Interstate Commerce Commission Termination Act, 49 U.S.C. § 10501(b) (ICCTA), preempts state law negligence claims. In the case of Tubbs, et al., v. Surface Transportation Board, et al., decided on December 28, 2015,flood the Court of Appeals denied a petition to review an administrative decision of the Surface Transportation Board (STB) in which the STB held that the ICCTA, preempts the plaintiffs’ state-tort law claims against the BNSF Railway Company for damage caused by the flooding resulting from the railroad’s maintenance of an earthen embankment that bisects the Tubbses’ their property on which BNSF operates a railroad track. There appears to be room for further development of the Court of Appeals’ thinking on this topic.

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In U.S. Repeals Longstanding Ban on Export of Crude Oil, my Pillsbury colleagues Dan LeFort, Paul Marston, Tom Campbell and I discuss the President’s recent signing of the Consolidated Appropriations Act, 2016, an Act that funds the Federal government through fiscal year 2016, and its repeal of the 40-year ban on the export of crude oil.

Addition Source:  Lifting of 40-Year Statutory Crude Oil Export Ban Signed into Law; Environmental and Regulatory Provisions in the Omnibus Appropriations Act of 2016

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The 2016 Consolidated Appropriations Act (H.R. 2822) is divided into several divisions, reflecting separate appropriations acts. A cursory reading of this massive legislation discloses a few environmental and regulatory provisions of interest:money

  • Almost all of these appropriations bills included language specifically forbidding the use of federal funds by the agencies to indirectly lobby the Congress on legislative actions;
  • $200,000,000 is appropriated to the Corps of Engineers for the administration of its permitting and regulatory programs regarding navigable waters and wetlands;

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On Friday, the Court of Appeals for the District of Columbia declined to entertain EPA’s argument that it could dictate venue for review of its decision by including within the decision that it would have “nationwide scope or effect.” Pursuant to Section 307(b)(1) of the CAA, venue over challenges to EPA actions lie exclusively with the Court of Appeals for the District of Columbia only if (1) the final action taken by EPA is “nationally applicable” or (2) EPA found that its final action was based on a determination of “nationwide scope or effect” and it published this finding. Ultimately, the Court of Appeals, in Dalton Trucking, Inc., et al., v. EPA, et al., held that venue was not proper in the District of Columbia and dismissed the petitions for review of EPA’s authorization of the California Air Resources Board (CARB) regulations.

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In their alert “Reverse CEQA” Reversed, California Supreme Court Rejects CEQA Analysis of Impacts of the Environment on the Project, Pillsbury attorney David Farabee discusses the California Supreme Court’s recent rejection of a requirement of so-called “reverse CEQA” analysis, concluding that “CEQA does not generally require an agency to consider the effects of existing environmental conditions on a proposed project’s future users or residents.” The case is California Building Industry Association v. Bay Area Air Quality Management District, Case No. S213478 (December 17, 2015).

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For several years, EPA has encouraged the regulated community to audit their facilities for compliance with environmental laws, and to self-disclose to EPA any violations noted in the audit to obtain reductions to or even eliminate altogether civil penalties if the report is made on a timely basis and demonstrates that the violations are being corrected promptly. epa web portalThese policies were announced in April 2000 with a special policy made available to small businesses (the Small Business Compliance Policy). In 2008, the benefits of the policy were extended to new owners to encourage them to undertake an environmental audit of the facilities they were purchasing to address and correct existing environmental violations and to take advantage of the opportunity provided by the Audit Policy to embark upon a “fresh start” with EPA. The result of these polices was to dramatically expand the scope of environmental auditing, which, EPA has concluded,  resulted in

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For contractors who often subject to one or more of federal environmental laws or regulations, below is a brief report on some the significant environmental law and administrative cases decided since late June of 2015 by jurisdiction:

District of Columbia

Energy Future Coalition, et al. v. EPA, et al., 793 F.3d 141 (D.C. Cir. July 14, 2015) — The U.S. Court of Appeals for the District of Columbia Circuit (DC Circuit) rejected a challenge to 2014 EPA rules regulating emission testing requirements for new motor vehicles, 40 C.F.R. § 1065.701(a), concluding that EPA’s rules were simply reflecting the statutory scheme enacted by the Congress.

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Developers subject to the Federal Power Act (FPA) should carefully consider the implications of the U.S. Court of Appeals for the District of Columbia Circuit’s recent opinion on the scope of the “municipal preference” under Section 7(a) of the FPA. The Court, in HydroelectricWestern Minnesota Municipal Power Agency, et al., v. FERC, recently considered the breadth of the “municipal preference” in Section 7(a) of the FPA, including the meaning of “municipality,” and declined to support the Federal Energy Regulatory Commission’s “geographic proximity test” for municipalities to qualify for the preference. Under the Court’s ruling, a municipality qualifies for the municipal preference regardless of their proximity to the location of the development. Developers may now be exposed to greater competition for developments with municipalities having a trump card because they qualify for the municipal preference.  As one would hope, the Court of Appeals restated the importance of the Court’s review FERC’s interpretation under the two-step framework of Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837, 842–43 (1984).  The opinion, of course, also reflects the Supreme Court’s use of Chevron in deciding a number of important cases the past two terms. This opinion may also result in FERC being more careful in the future.

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