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Federal government records, including business records submitted to the government, are subject to disclosure under the federal Freedom of Information Act (FOIA). However, FOIA exempts nine categories of government records from this disclosure obligation. A May 9 ruling by the U.S. Court of Appeals for the District of Columbia in AquAlliance v. U.S. Bureau of Reclamation discusses the scope of Exemption 9. Exemption 9 provides that there is no duty to disclose “geological and geophysical information, data, including maps, concerning wells.”

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Company records and communications are typically subject to disclosure in government investigations. They may be protected from disclosure if they are protected by the attorney client privilege or attorney-work product doctrine. However, invocation of these privileges is not automatic, as confirmed in a May 4 ruling by the U.S. States Court of Appeals for the Fifth Circuit. In EEOC v. BDO USA, LLP, the Court of Appeals issued a ruling clarifying the use of a privilege log to invoke the protections of the attorney-client privilege when responding to an agency’s request for documents as part of an investigation of employment discrimination claims.

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iStock-519917363-coastal-real-estate-300x203Climatologists predict that sea levels will continue to rise in the coming years and that temperatures will increase, causing the frequency and intensity of hurricane-like storms to grow. These scenarios present challenges for waterfront buildings and residences—both existing and new construction.

New properties are still being built along coastal areas. Some developers are marketing homes and buildings that are designed to withstand major storms. Property owners are taking costly measures to protect existing properties. In fact, in the wake of Superstorm Sandy, numerous companies now offer various flood protection measures for both residential and commercial buildings, such as paneling, barrier systems, gates, removable stop logs and raised foundations. Continue Reading ›

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The Consolidated Appropriations Act of 2017 authorized appropriations for the Fiscal Year 2017. This large and copious bill provides funding for all Federal agencies for this fiscal year. The Congressional committees included many environmental policy statements and directives to these agencies.

Section II, Division G—The Departments of the Interior, the Environment and Related Agencies

Within 60 days, the Department of Interior (Interior), Environmental Protection Agency (EPA) and U.S. Forest Service (Service) are directed to provide the House and Senate Committees on Appropriations with a detailed Equal Access to Justice report which will make their litigation costs transparent.

Regarding new Executive Order 13783, the Committees expect Interior and EPA to keep the committees fully appraised of any actions taken to comply with this new Order affecting domestic energy resources.

The Committees expect the departments and agencies to provide their Inspectors General with timely access to all appropriate agency records as needed.

The departments and agencies are reminded that there can be no lobbying of Congress with appropriated funds.

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The California Contractors State License Board issued notice of its upcoming Legislative Committee Meeting:

Friday, May 19, 2017, 10:00 a.m. – 11:30 am
(or until the conclusion of business)
Contractors State License Board HQ, John C. Hall Hearing Room
9821 Business Park Drive, Sacramento, CA 95827

At the meeting, the CSLB is expected to discuss:

  1. A.B. 710 (Wood) Department of Consumer Affairs: Board Meetings
  2. A.B. 996 (Cunningham) Contractors Licensing Board Web Site: Search Function
  3. A.B. 1005 (Calderon) Professions and Vocations: Fines: Relief
  4. A.B. 1070 (Gonzalez) Contractors (“solar energy system disclosure document”)
  5. A.B. 1162 (Bocanegra) Electrical Contractors: Local Permits
  6. A.B. 1190 (Obernolte) Department of Consumer Affairs: BreEZe System
  7. A.B. 1278 (Low) Contractor Licensing: Final Judgments
  8. A.B. 1357 (Chu) Home Inspectors: Roofing Contractors: Roof Inspections
  9. S.B. 27 (Morrell) Professions and Vocations: Licenses: Military Service
  10. S.B. 486 (Monning) Contractors State License Law: Letter of Admonishment
  11. S.B. 715 (Newman) Regulatory Boards: Removal of Board Members
  12. S.B. 721 (Hill) Contractors: Decks and Balconies: Inspection
  13. S.B. 800 (Business, Professions & Economic Development) Professions & Vocations

This meeting will be open to the public except when specifically noticed otherwise. Members of the public are permitted to address the Committee during the public comment session; however, the total time allocated for public comment may be limited at the discretion of each Committee Chair.

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Though Brexit may seem far removed from the strategic concerns of many of those in the construction and real estate industries, for those large construction operations, developers and suppliers that are either already in the UK/EU or expanding their operations into those areas, every development is worth tracking. In Next Steps toward Brexit, The EU sets out its stall for the looming withdrawal negotiations with the UK, Pillsbury attorney Tim Wright discusses the European Commission’s recent publication of its Brexit mandate, which indicates a clear focus on “citizens’ rights, the financial settlement and new external borders” and the Commission’s chief Brexit negotiator’s plan to “pay great attention to Ireland during the first phase of negotiations.” The EC’s mandate is just one of the many Brexit developments that global players in all industries will need to keep an eye on as the situation unfolds.

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I recently wrote here about the use of UPREITs, a form of real estate partnership combined with a real estate investment trust, to create liquidity for high net worth real estate investors while allowing them to defer taxable gains on highly leveraged and appreciated real property.

Another tax deferral strategy that’s growing in popularity again because of higher tax rates is the use of 1031 exchanges. Named after the Internal Revenue Code section authorizing these transactions, they are also known as “like-kind” exchanges.

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iStock-520129622-umbrella-300x247There are two reasons why borrowing has become the tax-preferred method of financing a sophisticated real estate investment portfolio.

First is the ability to finance improvements with debt, which offers depreciation deductions. Second is the ability to make leveraged distributions through refinancing without paying immediate tax on the proceeds. The tax basis of assets steps up to fair market value at the time of the holder’s death, eliminating the deferred gain, so the income tax deferral upon a refinancing is even more attractive for heirs.

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In a very complex, hard-fought case, U.S. District Judge David Hittner discusses how the Texas Commission on Environmental Quality’s (TCEQ) regulatory affirmative defenses to alleged Clean Air Act (CAA) violations will be viewed by the courts, if not the regulatory agencies. Environment Texas Citizen Lobby, Inc., et al., v. ExxonMobil Corp., et al. involves the complex regulatory regime that any large industrial facility must follow—whether it is a chemical plant, a refinery, steel mill, automotive assembly plant— if they have air emissions that must be regulated. In addition, these facilities must adhere to strict reporting rules, where evidence of non-compliance can often be found by litigants without a lot of hard work. A defense to some of these complaints lies in the fact that regulatory authorities will exercise prosecutorial discretion—by rule—when no one can control emissions during an unplanned upset (i.e., accident, natural disaster, etc.) or a planned shutdown for plant maintenance. ExxonMobil’s “Act of God” defense might have worked, it seems, if Texas had properly incorporated that state requirement in its federal State Implementation Plan (SIP). It should be noted that large scale construction projects necessitate many state and federal permits, and now there are federal laws and regulations to expedite the federal review—and new Executive Orders to reinforce that policy.

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Will the U.S. Constitution’s Commerce Clause always insulate interstate commerce from the imposition of state and local taxes? Not always, as the Texas Supreme Court recently confirmed, when it agreed with the Court of Appeals for the First District of Texas, that Texas counties are permitted to levy property taxes on natural gas held in storage in Texas while awaiting future resale and shipment to out-of-state consumers. The case is ETC Marketing, Ltd. v. Harris County Appraisal District. Affirming the Court of Appeals, the Court rejected the argument that taxing the temporary storage of natural gas conflicts with the Commerce Clause in the U.S. Constitution. Continue Reading ›