Category: Environmental Law

Court Strikes Down EPA Overreaching – Again

An article by Robert M. Stonestreet of Dinsmore & Shohl LLP regarding the EPA recently appeared in The National Law Review:

 

For the third time in the past 10 months, a federal court has declared that the Environmental Protection Agency (EPA) has violated the law through its efforts to impose additional restrictions on coal operations in the Appalachian States. On July 31, 2012, the federal District Court for the District of Columbia struck down EPA’s “guidance memorandum” for coal-related water permitting actions. The guidance purports to establish a number of “recommendations” and “suggestions” for the Corps of Engineers and State agencies like the West Virginia Department of Environmental Protection (WVDEP) to “consider” when processing applications for mining related permits. One of the recommendations is that permits should place limitations on conductivity levels in discharges from mining operations to ensure compliance with “narrative water quality standards,” such as the requirement that discharges into State waters do not cause a “significant adverse impact” to aquatic ecosystems. Conductivity is a measurement of how well water conducts electricity and is considered to be a rough surrogate for the concentration of total dissolved solids (TDS) present in water. Neither EPA nor the Appalachian States have adopted a water quality standard for conductivity. Nonetheless, for more than two years the State agencies have been effectively prevented from issuing new water discharge permits for mining-related projects unless they included conditions that implemented the views expressed in EPA’s “guidance.”

The National Mining Association and the States of West Virginia and Kentucky sued EPA on the grounds that EPA’s “suggestions” and “recommendations” were effectively binding obligations, and therefore constituted a rulemaking action that EPA undertook without following the procedures required by law for issuing new regulations. U. S. District Court Judge Reggie Walton agreed. “Review of the Final Guidance itself and of the post-implementation evidence before the Court makes clear that the Final Guidance, whether intentionally or not, has caused EPA field offices and the State permitting authorities to believe that permits should and will be denied if its ‘suggestions’ and ‘recommendations’ are not satisfied.” Judge Walton further found that the guidance improperly interjected EPA into the permitting process for “dredge and fill” permits issued by the Army Corps of Engineers under Section 404 of the Clean Water Act, as well as the mining-related permits issued by State agencies like WVDEP, which have obtained federal approval to administer those permitting programs.

Judge Walton’s decision invalidating EPA’s guidance is only the latest in a string of court defeats for the EPA. In October 2011, as part of the same lawsuit, Judge Walton declared that EPA’s efforts to develop a new procedure for processing and evaluating “dredge and fill” permit applications for coal mining projects in Appalachia exceeded EPA’s authority under the Clean Water Act. Following that decision, federal Judge Amy Berman Jackson, an Obama appointee, ruled on March 23, 2012 that EPA violated the Clean Water Act in January 2011 by attempting to retroactively “veto” a permit that was granted to Mingo Logan Coal Company in January 2007.

What does this latest decision mean for the coal industry in West Virginia?

The upshot is an affirmation that the Corps of Engineers and WVDEP are the lead regulatory agencies responsible for determining the terms of mining-related permits. More importantly, Judge Walton’s decision invalidating EPA’s guidance should mean that WVDEP is free to interpret and apply West Virginia law to determine the appropriate terms to include in mining-related permits, including what requirements are necessary to ensure compliance with West Virginia’s narrative water quality standards. Earlier this year, the West Virginia Legislature passed a bill making clear that WVDEP has the authority to interpret and apply those standards, and established a number of specific factors for WVDEP to consider. Through its guidance, EPA had effectively arrogated to itself the role of interpreting and applying the narrative water quality standards in West Virginia and the other Appalachian States.

The practical effect of the decision may be negligible, or at least short-lived. EPA has a right to review and comment on all proposed water discharge permits issued by WVDEP. EPA can formally object to those permits, and if the grounds for those objections are not resolved to its satisfaction, EPA can prevent WVDEP from issuing the permits. EPA could undertake the required rulemaking process to formally implement the invalidated guidance. EPA is also in the process of developing a water quality standard for conductivity that could potentially be forced on the States. That would present a substantial regulatory burden on all West Virginia businesses because virtually all industrial discharges, particularly from publicly owned water treatment plants and any activity entailing even temporary earth disturbance, have conductivity levels in excess of background levels, and treatment is very expensive. Right now, EPA’s focus is on the coal industry. But other industries beware. You could be next.

© 2012 Dinsmore & Shohl LLP

D.C. Circuit Court Vacates EPA’s Cross-State Emissions Rule

GT Law

In a 2-1 decision issued today, the U.S. Court of Appeals for the District of Columbia Circuit ruled in EME Homer City Generation, L.P v. EPA, that the U.S. Environmental Protection Agency exceeded its statutory authority in adopting the Cross State Air Pollution Rule (CSAPR or Transport Rule).  The D.C. Circuit found that EPA’s Transport Rule exceeded the agency’s authority on 2 separate grounds, both of which violated the Clean Air Act and required that the Rule be vacated.

Led by Texas, various States, local governments, industry groups and labor organizations had challenged the Rule, which was a significant air policy regulation of the Obama administration.  Acknowledging the complexity of the facts,  Judge Brett Kavanaugh, writing for the majority, noted that “the legal principles that govern this case are straightforward : Absent a claim of constitutional authority (and there is none here), executive agencies may exercise only the authority conferred by statute, and agencies may not transgress statutory limits on that authority.” The Court went on to note that its decision should not be viewed as a comment on the Rule’s wisdom or underlying merits but rather “to ensure that the agency stays within the boundaries Congress has set.”

©2012 Greenberg Traurig, LLP

D.C. Circuit Vacates CSAPR, Instructs USEPA to Continue Administering CAIR

Schiff Hardin LLP‘s Environmental Group recently had an article regarding CSAPR published in The National Law Review:

 

In a 2-1 decision, the Court of Appeals for the D.C. Circuit vacated the United States Environmental Protection Agency’s (“USEPA”) Cross-State Air Pollution Rule (“CSAPR” or the “Transport Rule”), USEPA’s attempt to “fix” the Clean Air Interstate Rule (“CAIR”) to regulate downwind state air pollution under the Clean Air Act (“CAA”). EME Homer City Generation LP v. EPA, D.C. Cir. No. 11-1302 (Aug. 21, 2012). In 2008, the D.C. Circuit struck down and remanded CAIR, with instructions to USEPA to continue administration of the CAIR until the replacement rule was implemented. Here, in light of the vacatur of the CSAPR, the D.C. Circuit has instructed USEPA to “continue administering CAIR pending [USEPA’s] promulgation of a valid replacement.”

By way of background, USEPA promulgated the Transport Rule in August 2011 in response to the court’s order in North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008) remanding the CAIR, and to address the 2006 24-hour national ambient air quality standard (“NAAQS”) for fine particulate matter. The Transport Rule established an interstate program to require power companies in 28 “upwind” states to reduce emissions of sulfur dioxide (“SO2”) and nitrogen oxides (“NOx”) to enable downwind states to achieve and maintain NAAQS for ozone and fine particulate matter. Following challenges by affected states and industry, the D.C. Circuit stayed the Transport Rule on December 30, 2011. The stay remained in effect until today’s decision on the merits, where the D.C. Circuit provided two independent grounds for vacatur.

First, the court found that USEPA exceeded its statutory authority granted under Section 110(a)(2)(D), the so-called “good neighbor” provisions of the CAA, by potentially requiring an upwind state to reduce emissions in excess of its contribution to a downwind states exceedance of air quality standards. In so ruling, the court explained that USEPA may require an upwind state to “eliminate only its own ‘amounts which will . . . contribute significantly’ to a downwind State’s ‘nonattainment,'” and “may not require any upwind State to ‘share the burden of reducing other upwind states’ emissions.'” Moreover, while the court acknowledged that USEPA may consider the cost of pollution reductions to lessen the burden upon an upwind state, it may not, as the court found USEPA did in establishing emission reductions under the Transport Rule, use cost considerations to impose pollution reduction obligations above and beyond what was necessary for downwind states to meet air quality standards.

Second, the D.C. Circuit struck USEPA’s decision to require that each state comply with a federal implementation plan (“FIP”) to implement the emission reductions mandated by the Transport Rule rather than allowing each state to determine how best to achieve the reductions within the state, i.e., the FIP-first approach included in the Transport Rule. By imposing a FIP prior to allowing states to implement their own plans, USEPA had usurped a role that was clearly designated by statute to the states. With regard to the “good neighbor” provision, the court held that USEPA must first inform states of their reduction obligations and then provide the states time to develop and submit SIPs, just as it does for new NAAQS. USEPA may not impose a FIP that directs each state on how to achieve the requirements of the Transport Rule without first providing each state a “reasonable time to implement that requirement [under a state implementation plan] with respect to sources within the State.”

The D.C. Circuit advised that its “decision … should not be interpreted as a comment on the wisdom or policy merits of EPA’s Transport Rule” and that USEPA should “proceed expeditiously” to promulgate yet another replacement for CAIR consistent with this decision and, presumably, with the North Carolina decision. The decision in this case further clarifies USEPA’s role and obligations regarding identifying states’ air quality impacts on downwind states. It also emphasizes that the cooperative federalism concept embodied in the CAA is vital to successful implementation of the Act.

© 2012 Schiff Hardin LLP

DC Appeals Court Upholds EPA’s Greenhouse Gas Rules

Timothy J. Lundgren of Varnum LLP recently had an article regarding EPA’s Greenhouse Gas Rules, published in The National Law Review:
Varnum LLP

The U.S. Court of Appeals, D.C. Circuit, upheld the EPA’s greenhouse gas (GHG) regulations against a challenge brought by business interests and the attorney generals of a number of states seeking relief from EPA’s new GHG regulations. As a result, EPA’s GHG regulations remain effective, and PSD and Title V permits must continue to include BACT limits on GHG emissions. Barring a reversal by the Supreme Court (which seems unlikely at this point) or action by Congress, the inexorable processes of the CAA will likely lead to further and more restrictive regulation of GHGs by EPA going forward.

The regulations grow out of an earlier case decided at the Supreme Court, in 2007,Massachusetts v. EPA, which determined that GHGs are an “air pollutant” for purposes of the Clean Air Act, and so are subject to regulation. Since that 2007 decision, the EPA has taken a number of steps related to GHG regulation, including issuing an Endangerment Finding (that GHGs may “reasonably be anticipated to endanger public health or welfare”), setting emission standards for cars and light trucks (the “Tailpipe Rule”), and establishing construction and operating permits for major stationary sources of GHGs. These permits would require implementation of the best available control technology (“BACT”) to limit GHG emissions.

The various Petitioners raised numerous substantive and procedural challenges to EPA’s findings, including claims that the bases for EPA’s Endangerment Finding and Tailpipe Rule were improper, that the scientific record was inadequate or improperly addressed, and that the requirements of the Administrative Procedures Act (“APA”) had not been met during the development of these regulations, among other claims. The court upheld EPA’s review of and reliance on the scientific record it had compiled, as well as its compliance with the APA. The court also rejected challenges to major source permitting requirements, largely based on the statutory language of the Clean Air Act. Given the court’s heavy reliance on the Clean Air Act and the Supreme Court’s 2007 decision, a reversal seems unlikely without some change in direction by the high court.

© 2012 Varnum LLP

Air Quality Alert: EPA Proposes Stricter Particulate Matter Standard

An article by Environmental Law Department of Barnes & Thornburg LLP, Air Quality Alert: EPA Proposes Stricter Particulate Matter Standard, was featured in The National Law Review:

On June 15, 2012, U.S. EPA proposed stricter standards to the National Ambient Air Quality Standards (NAAQS) under the Clean Air Act for fine particulate matter. The proposed rule, which is the result of a lawsuit in the U.S. Court of Appeals in the Washington D.C Circuit brought by environmental groups and certain states, proposes to tighten the annual standard for particulate matter under 2.5 microns (PM 2.5) from 15 micrograms per cubic meter (ug/m3) (the 2006 standard) to between 12 and 13 ug/m3. The rule also proposes a new separate standard for improving visibility in urban areas of either 28 to 30 “deciviews,” a measurement of visibility. The proposed rule and “fact sheets” provided by the Agency make clear that EPA is not proposing a change to the existing 24-hour and secondary standards for fine and course particulate matter set in 2006.

EPA claims that the new standard will come at an annual cost of between $2.9 million and $69 million (depending upon a final standard of 12 or 13 ug/m3), but claims these costs are outweighed by alleged health benefits of $220 million to $5.9 billion. EPA is also claiming that all but six counties in the United States should be able to meet the new standards without additional action. However, San Bernadino and Riverside Counties in California, Santa Cruz County in Arizona, Wayne County in Michigan, Jefferson County in Alabama, and Lincoln County in Montana – are all expected to need to reduce fine particulate emissions to attain the new standards.

Under state and federal Clean Air Act regulations, counties that are out of attainment with the NAAQs can be subject to special “Retro-active Control Technology” (RACT) requirements, and new sources of fine particulate emissions will need to obtain “offsets” prior to construction among other requirements.

In addition to the new proposed standards, EPA is also proposing changes to monitoring requirements for fine particulate matter including the addition of fine particulate ambient air monitors especially along urban highways.

EPA’s proposed rule comes during an election year and is expected to draw broad criticism from Republicans and industry groups. Environmental groups are already praising the new proposed lower standards. The new proposed rule has not yet been published in the Federal Register. Comments on the new proposed rule are due within 63 days of publication in the Federal Register and can be submitted through http://www.regulations.gov. The proposed rule and related fact sheets can be viewed at http://www.epa.gov/pm/actions.html.

© 2012 BARNES & THORNBURG LLP

Federal Court Approves Plan to Drill Off Alaska’s North Shore

GT Law

On May 25, the Ninth Circuit Court of Appeals issued adecision upholding theBureau of Ocean Energy Management’s (BOEM) approval of Shell Oil Company’s plan for exploratory drilling in Alaska’s Chukchi Sea. Two Alaskan Inupiat groups and ten environmental groups, including Greenpeace and the Sierra Club, brought the appeal challenging BOEM’s August 2011 approval of the drilling plans. The environmental groups claimed that BOEM erred in approving the plan because (1) the plan did not adequately inform BOEM about its oil spill response plan, and (2) the seven-paragraph description of the well-capping stack and the containment systems was incomplete. However, the court deferred to BOEM’s technical expertise in evaluating the adequacy of the oil spill response plan and found that BOEM had complied with applicable statutes and regulations in approving the plan.

The court’s deference to BOEM’s approval of well-capping technology is significant because it opens a gateway through which other drilling efforts in the Arctic can get approval. Well-capping, the same technology that BP used in containing the Deepwater Horizon spill, had never before been approved for use in Alaska or in Arctic drilling conditions. The opinion also marks a victory for Shell, which has been trying to get approval for the exploratory drilling project since 2005, when Shell purchased a lease portion in Alaska’s continental shelf from the Minerals Management Service.

Other appeals are still pending in the Ninth Circuit, including one challenging the approval of federal air quality permits for the project. Unless that litigation disrupts the project, the Chukchi Sea drilling operations will commence early next month.

From Chelsae Johansen, summer associate, of GT Tampa:

©2012 Greenberg Traurig, LLP

Dept of Energy Liable for $150 Million Because It Has Not Built a Nuclear Waste Facility

GT Law

On May 18, in Yankee Atomic Elec Co. v. United States, the Federal Circuit affirmed a damages judgment of $142.6 million, and added $17.0 million to the judgment by granting a cross-appeal, in a breach of contract action against the government arising from the Department of Energy’s failure to remove spent nuclear fuel from three reactor sites in New England.  The decision came in three consolidated cases from among the 55 that have been filed in the Court of Federal Claims as a result of DOE’s breach of contracts it has with all nuclear utility companies under which the agency was required to begin removing spent fuel from reactor sites in 1998.  Due to chronic delays with the DOE program, including controversy over the proposed Yucca Mountain, Nevada, repository DOE has never commenced any performance.  The utilities have therefore been required to license and construct on-site storage facilities for the nuclear waste, the substantial cost of which constitutes the bulk of the damages claimed in the breach of contract actions.

Beginning in 2004 the government began settling some of these contract cases, and in recent years the pace of settlements has increased following utility victories on most contested issues.  Settlements to date are estimated to exceed $2 billion, and only about 20 of the contract cases remain pending.  However, separate litigation has arisen in the D.C. Circuit over DOE’s proposal to formally cancel work on the Yucca Mountain repository, and also seeking to relieve the utilities of the obligation to pay ongoing fees to DOE under the spent fuel contracts, fees that collectively cost the industry about $750 million per year.

Yankee Atomic was the first of these spent fuel damages cases filed, in 1998, and GT lawyers have represented Yankee Atomic as well as the other two companies involved in the May 18 decision, Connecticut Yankee Atomic Power Company and Maine Yankee Atomic Power Company, throughout the litigation, which has involved two trials and three appeals.

For the Legal Times of Washington’s take on this opinion, click here.

©2012 Greenberg Traurig, LLP

FERC Rules on Several Core Reliability Compliance Issues: New Orders Address Cybersecurity, Registration, and Contingency Planning

The National Law Review published an article recently by Stephen M. Spina, J. Daniel Skees, and John D. McGrane of Morgan, Lewis & Bockius LLP regarding New FERC Rules on Reliability Compliance:

At FERC’s open meeting on April 19, 2012, FERC approved several orders addressing core aspects of Reliability Standards compliance, including cybersecurity Reliability Standards, compliance registration, and contingency planning issues. The newly approved cybsersecurity Reliability Standards significantly increase the scope of facilities subject to those requirements, the compliance registration decisions clarify the jurisdictional boundary between distribution and transmission facilities, and the planning orders represent a rejection of NERC’s approach to planning for firm load loss following a single contingency.

Cybersecurity: FERC Approves Version 4 CIP Reliability Standards

In Order No. 761, FERC approved Version 4 of the Critical Infrastructure Protection (CIP) Reliability Standards. Under Version 4, the risk-based assessment methodology previously used to identify the Critical Assets that must be protected under the CIP Reliability Standards is replaced with a list of “bright-line” criteria for identifying Critical Assets, contained in Attachment 1 to CIP-002-4. These criteria, FERC concluded, “will offer an increase in the overall protection for bulk electric system components that clearly require protection, including control centers.” In the order, FERC established a deadline of March 31, 2013, for NERC to submit the Version 5 CIP Reliability Standards, which will address the remaining directives from Order No. 706, in which FERC approved the original CIP Reliability Standards. The project site for the Version 5 CIP Reliability Standards is located online.

Compliance Registration: FERC Addresses Distribution/Transmission Distinction

In City of Holland, 139 FERC ¶ 61, 055 (2012), FERC rejected the City of Holland, Michigan, Board of Public Works’ appeal of NERC’s decision to register the City of Holland as a Transmission Owner and Transmission Operator. In reaching this decision, FERC rejected the City of Holland’s assertion that its facilities are distribution facilities, and therefore not part of the definition of “Bulk Electric System” and not subject to registration. FERC explained that the City of Holland’s facilities perform a transmission function, transporting power from the City of Holland’s generation facilities or importing power from other sources over high-voltage lines before stepping the voltage down for distribution to end users. In reaching this decision, FERC also thought it relevant that the facilities at issue do not serve load from a single transmission source, can experience bi-directional flows, and are above the voltage level generally considered distribution voltage.

Commissioner Cheryl A. LaFleur dissented on the grounds that this order depends on the fundamental, yet unsettled question of what facilities are considered “local distribution” under Section 215 of the Federal Power Act (FPA) and therefore outside of FERC’s jurisdiction. As explained in Commissioner LaFleur’s dissent, FERC has in the past identified the criteria for identifying local distribution facilities under Section 201(b) of the FPA, which uses language identical to Section 215, but FERC chose not to apply the Section 201(b) criteria in addressing the City of Holland’s appeal. Commissioner LaFleur asserted that if FERC believes that Congress intended to create different classes of local distribution facilities, FERC has the “burden of demonstrating that this is a reasonable interpretation of the statute.”

In U.S. Department of Energy, Portsmouth/Paducah Project Office, 139 FERC ¶ 61,054 (2012), FERC granted the Portsmouth/Paducah Project Office’s appeal of its registration as a Load-Serving Entity (LSE). FERC had previously remanded this registration, and in ruling on NERC’s subsequent decision upholding the registration, concluded that NERC had failed to support registration as an LSE because NERC had not shown that the lessees and contractors working at the Portsmouth/Paducah Project Office are separate end-use customers to whom the Portsmouth/Paducah Project Office provides electricity. FERC explained that the Ohio Valley Electric Corporation, which sells to the Portsmouth/Paducah Project Office under a state retail tariff, is the appropriate LSE.

Contingency Planning: FERC Demands Stringent Criteria for Planned Load Loss Following a Single Contingency

In Order No. 762, FERC rejected NERC’s proposed revisions to “Note b” in TPL-002-0b, which explains when a Transmission Planner or Planning Authority can plan for the interruption of firm load to meet system reliability requirements following a single contingency. Under NERC’s proposal, these entities could plan for load shedding following a single contingency so long as they documented such planning and considered alternative solutions in an open and transparent stakeholder process. FERC concluded that the proposal failed to satisfy FERC’s earlier directives on this issue and did not present an “equally effective and efficient alternative.” According to FERC, the proposed Note b process “is vague, potentially unenforceable and may lack safeguards to produce consistent results.” The parameters for the proposed stakeholder process, FERC concluded, do not provide a meaningful limitation on the ability to curtail firm load following a single contingency. Furthermore, the conditions under which such interruptions are appropriate remain undefined, threatening the basic system performance objectives of the NERC Transmission Planning Reliability Standards, risking system reliability.

In Transmission Planning Reliability Standards, Notice of Proposed Rulemaking, 139 FERC ¶ 61,059 (2012), FERC proposed to remand NERC’s proposal to combine the four current Transmission Planning Reliability Standards into a single new standard, TPL-001-2. According to FERC, footnote 12 to Table 1 in this proposed standard, which governs planning for the interruption of firm load following a single contingency, presents the same concerns as the Note b issues that led FERC to reject a similar proposal in Order No. 762 (described above). This footnote, which only requires a documented plan developed through an open and transparent stakeholder process that considers alternatives, does not define the parameters governing the decision to plan for the loss of firm load following a single contingency. While FERC noted several improvements in the standard, because of concerns with footnote 12, FERC proposed to find that TPL-001-2 does not meet the statutory criteria for approval. Comments will be due 60 days after the Notice of Proposed Rulemaking is published in the Federal Register. In the Notice of Proposed Rulemaking, FERC requested comments on several transmission planning issues in addition to the core concern regarding planned load curtailments.

Copyright © 2012 by Morgan, Lewis & Bockius LLP

More Wisconsin DNR Permit Streamlining: Piers, General Navigable Waterway Permits, and Environmental Permit Notice Procedures — Governor Walker Signs 2011 Wisconsin Act 167

On April 2, 2012, Governor Walker signed into law 2011 Wisconsin Act 167 (the Act), the latest legislative effort to streamline the Wisconsin Department of Natural Resources (DNR) permitting process. The Act’s primary focus is on the substance and procedures of navigable waterway permitting under Wis. Stat. ch. 30, especially piers, with additional revisions to the public notice procedures of the air, wastewater, solid and hazardous waste, and remedial action statutes.

The revisions made by the Act take effect on August 1, 2012 for all but a few of the pier provisions which are effective immediately upon publication (noted below).[1]

A. Chapter 30 Navigable Waterway Permitting

These amendments fall into four broad categories: piers, grading permit exemptions, general permits and individual permits.

1. Piers

The DNR’s regulation of piers on navigable waterways has been a matter of controversy and legislative attention for many years. Act 167 is the latest installment.

In 2004, Wisconsin enacted a major legislative reform package called the “Jobs Creation Act”, making significant revisions to the sections of Wis. Stat. ch. 30 that govern permits for activities affecting navigable waterways. The Jobs Creation Act formalized three permit categories: exemptions, general permits, and individual permits; and established related time frames, hearing and appeal procedures. To implement these legislative directives, the DNR embarked on a major rulemaking effort to adopt general permits and establish the criteria and procedures for issuance of individual permits. Significant revisions to the rule addressing piers, NR 326, were proposed but not enacted with the remainder of the rules due to public controversy over the proposed revisions. See our Client Alert on the Jobs Creation Act.

The DNR continued its efforts to revise and update NR 326 with respect to piers and pier standards, but to no avail. Ultimately, the Legislature stepped in and enacted 2007 Wisconsin Act 204, resolving the debate by exempting smaller piers from the need to obtain a permit and creating a cut-off date and pier registration process for larger piers. These larger piers could also be exempt from the permit requirement if they were placed before February 6, 2004 (i.e., they were “grandfathered”) and registered with the DNR by April 1, 2011. 2011 Wisconsin Act 25 subsequently extended the registration date to April 1, 2012.

Effective immediately,[2] Act 167 has eliminated the February 6, 2004 “grandfathering” date and the entire pier registration process for the larger piers.[3]The existing exemption for smaller piers is maintained with minor clarifying revisions to the language.

As a result of Act 167, the following piers are exempt from the requirement to obtain a permit:

  1. The pier meets the following criteria:

a. No more than 6’ wide and extends no further than to a point where the water is 3’ deep or deep enough to moor a boat;

b. No more than two boat slips for the first 50’ of riparian owner’s shoreline footage and no more than one boat slip for each additional 50’ of footage; and

c. A loading platform may be more than 6’ wide if the surface area of the platform is no more than 200 sq. ft.[4]

  1. The pier does not meet the criteria listed under sub. 1, but is an existing pier (i.e., was placed on the bed of the waterway before April 17, 2012[5]) regardless of whether or not it has been registered, UNLESS:

a. The DNR notified the riparian owner before April 17, 2012[6] that the pier is “detrimental to the public interest”; or

b. The pier “interferes with the riparian rights of other riparian owners.”[7]

Further, the DNR is prohibited from taking enforcement action against the riparian owner of any pier if the DNR issued either a permit or a written authorization for the pier and the pier is in compliance with that permit or authorization,[8] and a pier owner may relocate or reconfigure the pier so long as the pier is not enlarged.[9]

2. Grading permit exemption

Act 167 has also eliminated the need to obtain duplicative state permits to move dirt on the bank of a navigable waterway. Wis. Stat. s. 30.19 regulates grading activities on the waterway bank. Wis. Stat. ch. 283 regulates the management of stormwater from land disturbing activities (e.g., construction). Both of these provisions are directed at protecting water quality from dirt that is disturbed and can run off as a result of site work.

Effective August 1, 2012, land grading activity on the bank of a navigable waterway is exempt from the requirement to obtain a s. 30.19 permit if it is authorized by a stormwater discharge permit issued under s. 283.33. If the land grading is authorized by a county permit issued under its shoreland zoning ordinance, it is similarly exempt from the requirement to obtain an s. 30.19 grading permit from the DNR.[10]

3. General permits

If a regulated project or activity is not exempt from the requirement to obtain a permit, it must be authorized by either a general permit or an individual permit. General permits are written to cover any number of projects or activities that can meet a standardized set of criteria, whereas an individual permit is written specifically for that project. As a result, general permits are ultimately time savers. Changes made in Act 167 maximize the DNR’s authority to issue general permits under ch. 30 and streamline the process for doing so.

The Act maximizes the DNR’s authority to issue general permits by expanding the universe of activities for which the DNR can issue general permits to include any activity regulated under ch. 30.[11] The Act streamlines the process for doing so by exempting general permits from the definition of “rule”,[12] eliminating the lengthy and cumbersome procedure for adopting rules, and replacing that procedure with a public comment period and a newly-created legislative committee review process.[13]

Any general permit must contain requirements and conditions that assure the activity being authorized “will cause only minimal adverse environmental impacts, will not materially interfere with navigation, and will not have an adverse impact on the riparian property rights of adjacent riparian owners.”[14]

Once a general permit is issued, the process works like this: If you believe your activity meets the eligibility criteria you apply to the DNR for “coverage” under the general permit no less than 30 days before beginning the activity. If the DNR does not request more information or otherwise inform you that your activity does not qualify for the general permit within that 30-day period, the activity is considered authorized and you are legally free to proceed. The DNR may make one request for additional information during that 30-day time period; if the DNR does so, the time it takes you to provide that information is added to the 30 days the DNR has to respond to your application.[15]

Once issued, a general permit is valid for five years. Regardless of the expiration date of a general permit, an activity authorized under a general permit remains authorized for five years from the date of coverage or until it is complete, whichever occurs first. The DNR is authorized to renew, modify and revoke general permits following the same procedures used to issue the general permit initially.[16]

The net effect of these revisions is to invest the time initially in developing and issuing the general permits so that as many activities as possible can be authorized using these streamlined procedures. For activities that don’t meet the general permit criteria, an individual permit option remains available.

4. Individual permits

Act 167 makes a few revisions to the procedures for issuance of individual permits, also designed to tighten up the timelines. The primary revisions conform these procedures to the procedures included in the recently-enacted Wetlands Reform Bill (2011 Wisconsin Act 118) so that the procedures for navigable waterway permits issued under ch. 30 and for wetland water quality permits issued under ch. 281 are the same.

Here is how it all works:[17]

a. Within 30 days of receipt of the individual permit application, the DNR determines if the application is complete/incomplete:

  • If complete, THE DNR notifies the applicant and the date of that notification becomes the “date of closure”; the date of closure drives subsequent deadlines as described below.
  • If incomplete, the DNR notifies the applicant of the deficiency/ies within the same 30-day time period; the DNR is limited to one request for additional information within the same 30-day time period; within 10 days of receipt of the requested information, the DNR notifies the applicant if the application is complete/incomplete (if still incomplete, the DNR and applicant can agree to additional information the applicant will provide); the date of this second notification becomes the date of closure.
  • If the DNR fails to meet this 30-day or 10-day time period, the date of closure becomes the last day of either the 30-day or 10-day time period.

b. Within 15 days of the date of closure, the DNR issues the public notice of pending application.

  • The notice may include notice of a public hearing if the applicant requests it.
  • If not, any member of the public may request a public hearing within 20 days of issuance of the public notice; or with or without a request, the DNR may decide to hold a public hearing if it determines “there is significant public interest” to do so.
  • The DNR must issue a public notice of the hearing within 15 days of receipt of a hearing request or its own decision to hold a hearing; the public comment period closes 10 days after the hearing is held.

c. Within 20 days after the public comment period has ended if a hearing is held, or within 30 days after the public comment period has ended if no hearing is held, the DNR issues its decision to either issue or deny the permit.

d. If the DNR fails to comply with these time periods, the permit is considered to be issued and the activity may proceed, although the DNR may impose terms and conditions on the permit “that are consistent with the applicant’s basic proposal.”[18]

The DNR’s decision to issue or deny the permit is subject to challenge in either or both an administrative contested case hearing under ch. 30 and judicial review under ch. 227. The ch. 30 contested case procedures were significantly revamped in the Jobs Creation Act (2003 Wisconsin Act 118). Those procedures remain intact under Act 167[19] and are summarized in our Client Alert on the Jobs Creation Act.

B. Public Notice Procedures for Ch. 30 and Other Environmental Statutes

Act 167 also brings the DNR’s public notice procedures into the digital age by requiring the DNR to:

  1. Create an electronic notification system to provide public notice;[20]
  2. Post public notices on the DNR website;[21]
  3. Post on the DNR website any navigability determinations DNR makes – which may be relied upon;[22]
  4. Post (to the greatest extent possible) the current status of any application for a permit under chs. 30, 281 to 285, or 289 to 299, and any hearings scheduled on the application.[23]

Importantly, the Act also specifies that the date on which the DNR first posts the public notice on its website is the date the notice is considered to be issued, for purposes of permits to be issued under ch. 30,[24] Wisconsin Pollutant Discharge Elimination Systerm permits to be issued under ch. 283,[25] air construction and operation permits to be issued under ch. 285,[26] solid and hazardous waste facility approvals to be issued under chs. 289 and 291,[27] and remedial actions to be authorized under ch. 292.[28]

C. Other revisions

  1. Act 167 makes other revisions which address:
  2. Repair of boathouses[29]
  3. Expedited procedures for approval of low hazard dams[30]
  4. Bridge standards[31]
  5. Use of air dispersion modeling for minor source determination[32]

The DNR staff will use the time between now and August 1 to create application forms, internal procedures and guidance, and otherwise prepare to implement these statutory directives. For more information, please contact the author of this client alert.


[1] Section 131 of the Act provides that the Act is effective on the first day of the forth month after publication, with the exception of certain provisions involving piers which become effective the day after publication. Publication is expected to be April 16, 2012. Thus the majority of the Act will be effective August 1; those limited pier provisions are expected to be effective on April 17, 2012.

[2] See Endnote 1

[3] s. 30.12(1k)(b) as amended

[4] s. 30.12(1g)(f)

[5] See Endnote 1

[6] See Endnote 1

[7] s. 30.12(1k)(b)1m. and 2.

[8] s. 30.12(1k)(cm)

[9] s. 30.12(1k)(e)2.

[10] s. 30.19(1m)(f) and (g)

[11] s. 30.206(1)(am)

[12] s. 227.01(13)(rt)

[13] s. 30.206(5m)

[14] s. 30.206(1)(am)

[15] s. 30.206(3)(a)

[16] s. 30.206(1)(b)

[17] s. 30.208(2)-(4)

[18] s. 30.208(2)(d)

[19] s. 30.209

[20] s. 30.206(2b)(a)

[21] s. 30.206(2b)(a)

[22] s. 30.102(1)

[23] s. 30.102(2), 299.l7

[24] s. 30.206(2b), 30.208(5)(bm)

[25] s. 283.39(lm), 283.63(1)(a)

[26] s. 285.61(5)(c), 285.62(3)(c)

[27] s. 289.25(3), 289.41(1m)(g)1., 291.87(3)

[28] s. 292.31(3)(f)

[29] s. 30.121

[30] s. 31.12(5)

[31] s. 84.01(23)

[32] s. 285.63(11)

© MICHAEL BEST & FRIEDRICH LLP

U.S. Announces Innovative Clean Air Agreement For Industrial Flares With Marathon Petroleum Company

Recently The National Law Review published an article by the U.S. Environmental Protection Agency regarding a New Clean Air Agreement:

The U.S. Environmental Protection Agency (EPA) and the Department of Justice today announced an innovative environmental agreement with Ohio-based Marathon Petroleum Company that already has significantly reduced air pollution from all six of the company’s petroleum refineries. In a first for the refining industry, Marathon has agreed to state-of-the-art controls on combustion devices known as flares and to a cap on the volume of waste gas it will send to its flares. When fully implemented, the agreement is expected to reduce harmful air pollution by approximately 5,400 tons per year and result in future cost savings for the company.

“Today’s agreement will result in cleaner air for communities across the South and Midwest,” said Cynthia Giles, assistant administrator for EPA’s Office of Enforcement and Compliance Assurance. “By working with EPA, Marathon helped advance new approaches that reduce air pollution and improve efficiency at its refineries and provide the U.S. with new knowledge to bring similar improvements in air quality to other communities across the nation.”

“This agreement is a great victory for the environment and will result in cleaner and healthier air for the benefit of communities across the country in Illinois, Kentucky, Louisiana, Michigan, Ohio and Texas,” said Ignacia S. Moreno, assistant attorney general for the Environment and Natural Resources Division of the Department of Justice. “By spurring corporate ingenuity, this settlement will dramatically reduce emissions from all 22 flares at Marathon’s six refineries.”

The settlement is part of EPA’s national effort to reduce air pollution from refinery, petrochemical and chemical flares. A flare is a mechanical device, ordinarily elevated high off the ground, used to combust waste gases. The more waste gas a company sends to a flare, the more pollution occurs. The less efficient a flare is in burning waste gas, the more pollution occurs. EPA wants companies to flare less, and when they do flare, to fully combust the harmful chemicals found in the waste gas.

A consent decree filed today in the U.S. District Court in Detroit resolves Marathon’s alleged violations of the Clean Air Act. As part of the effort to reach this agreement, Marathon, under the direction and oversight of EPA, spent more than $2.4 million to develop and conduct pioneering combustion efficiency testing of flares and to advance the understanding of the relationship between flare operating parameters and flare combustion efficiency.

In addition, beginning in 2009, Marathon installed equipment, such as flow monitors and gas chromatographs, to improve the combustion efficiency of its flares. To date, Marathon has spent approximately $45 million on this equipment and projects, and plans to spend an additional $6.5 million. Marathon also will spend an as yet undetermined sum to comply with the flaring caps required in the consent decree.

At the same time, Marathon indicates that the equipment it already has installed is saving it approximately $5 million per year through reduced steam usage and product recovery. Marathon also projects additional savings through the operation of the equipment to be installed in the future.

From 2008 to the end of 2011, the controls Marathon installed eliminated approximately 4720 tons per year of volatile organic compounds (VOCs) and 110 tons per year of hazardous air pollutants (HAPs) from the air. An additional 530 tons per year of VOCs and 30 tons per year of HAPs are projected to be eliminated in the future.

Under the agreement, Marathon will also implement a project at its Detroit refinery to remove another 15 tons per year of VOCs and another one ton per year of benzene from the air. At an estimated cost of $2.2 million, Marathon will install controls on numerous sludge handling tanks and equipment.

Marathon’s six refineries are located in: Robinson, Ill.; Catlettsburg, Ky.; Garyville, La.; Detroit; Canton, Ohio; and Texas City, Texas. Together, the refineries have a capacity of more than 1.15 million barrels per day.

Marathon, headquartered in Findlay, Ohio, will pay a civil penalty of $460,000 to the United States.

The consent decree is subject to a 30-day public comment period and final court approval.

More about the settlement: http://www.epa.gov/compliance/resources/cases/civil/caa/marathonrefining.html

More about EPA’s civil enforcement of the Clean Air Act: http://www.epa.gov/compliance/civil/caa/index.html

More about EPA’s refinery initiative: http://www.epa.gov/compliance/resources/cases/civil/caa/oil/

© Copyright 2012 United States Environmental Protection Agency