Source: http://washingtonpropertylawyer.typepad.com/
Timestamp: 2017-06-26 01:43:31
Document Index: 479794576

Matched Legal Cases: ['§173', '§173', '§174', '§179', '§179', '§179', '§ 173', 'arts 171', '§ 173', '§ 171', 'art 172', '§174', '§ 174', '§ 7475', '§130', '§1313', '§130', '§130', '§1313', '§130', '§3043', '§3043', '§3043', '§3044']

A proposed major oil terminal in southwest Washington has cleared one hurdle in obtaining state approval. A Washington State siting board has determined that the proposed project is consistent with local land use plans and ordinances. The determination moves the proposal along, but does not necessarily mean that it will receive state approval. That decision will be made after environmental review, and will likely not occur sooner than several months from now.
The Vancouver Energy Distribution Terminal is a proposed 44.9-acre oil terminal to be located on the Columbia River in Vancouver, Washington. The project sponsor is Tesoro Savage Petroleum Terminal LLC (Tesoro-Savage), a joint venture of Tesoro Corporation and Savage Companies. The proposed facility would receive crude oil by rail; much of which would be shipped from North Dakota's Bakken Field. The crude oil would not be refined at the terminal, but would be shipped by marine vessels to refineries in Washington and California. The terminal would be capable of receiving up to four unit trains per day, consisting of 100 to 120 tank cars, potentially receiving as much as 360,000 barrels of crude oil per day.
The proposed terminal must obtain a certification from the Governor of the State of Washington – essentially a license – who will make his certification decision after receiving a recommendation from the Energy Facility Site Evaluation Council (EFSEC). If the Governor approves the project, a Site Certification Agreement will be developed, describing the terms and conditions under which the project will operate.
On August 29, 2013, Tesoro-Savage submitted to EFSEC its application for certification. One of the hurdles that a certification applicant must overcome is to obtain a determination from EFSEC that the project is consistent with local land use plans and ordinances. (If EFSEC determines that a proposed project is not consistent with local land use plans and ordinances, it must decide whether it will recommend that the Governor preempt the local plans and ordinances.) EFSEC held a Land Use Consistency Hearing on May 28, 2014, the transcript of which may be read here. At the hearing, the City of Vancouver, and several others, urged EFSEC to defer making its land use consistency determination until after completion of an environmental impact statement under the State Environmental Policy Act (SEPA).
On August 1, 2014, EFSEC issued an order determining that the proposed oil terminal is consistent and in compliance with the City of Vancouver's land use plans and ordinances. The order may be read here. First, it rejected the requests that the land use consistency determination be deferred, stating:
The Council is not persuaded to defer its land use consistency decision until the SEPA process is complete or for other reasons suggested by those who have requested a delay. Our present task is to determine whether the Site is consistent with the pertinent portions of the City's land use provisions, not to decide whether the City of Vancouver might lawfully allow the terminal under its own authority or whether the Governor should ultimately approve or reject the Application. At this stage of the EFSEC process, it is not necessary to conduct a complete analysis of all possible environmental or other impacts potentially posed by the Application. Issues pertaining to the construction and operational conditions of the Facility will be addressed later through SEPA, during the adjudication, and through the environmental permitting process. Our land use consistency determination is a preliminary and very limited step that is proper to taken now, based on the limited sort of record that is obtained through the statutorily required public hearing.
Order p. 6. Turning to the merits of the consistency determination, EFSEC described the test for consistency as "whether the pertinent local land use provisions prohibit the Site expressly or by operation clearly, convincingly and unequivocally. If the Site is permitted either outright or conditionally, it is consistent and in compliance with the local land use provision." Order p. 12 (internal quotation marks omitted). Applying this standard, EFSEC reached its determination as follows:
The Site is consistent with the pertinent portions of the Plan and zoning ordinances because neither the pertinent portions of the Plan nor the pertinent portions of the zoning ordinances clearly, convincingly and unequivocally prohibit the Site. To the contrary, the Plan specifically allows the proposed use in the area where the Site is located. The Plan designates that area as "Industrial" and allows within it the "IH Heavy Industrial" subtype, which is generally intended for "[i]ntensive industrial manufacturing, service, production or storage often involving heavy truck, rail or marine traffic, or outdoor storage and generating vibration, noise and odors."
Similarly, the pertinent zoning ordinances do not clearly, convincingly and unequivocally prohibit the Site. The Site is zone "IH-Heavy Industrial," which is designated as appropriate for intensive industrial uses such warehousing, freight movement, and railroad yards. Proper activities in the IH zone include the use of raw materials, significant outdoor storage, and heavy rail traffic. Permitted uses include storage and movement of large quantities of materials or products outdoors and uses associated with significant rail traffic. The Site is permitted outright in the IH zone. The Site also meets the development standards associated with the IH-Heavy Industrial zone.
It follows that under the minimal threshold for determining land use consistency, the Site is consistent and in compliance with the City's land use provisions.
Order pp. 12-13.
The next step in the certification process are completion of the draft environmental impact statement, which will then be subject to public review, including comments and a public hearing. Posted by Mike Gillett on 08/21/2014 at 12:15 PM in Administrative Law, Crude-by-Rail, Energy Exports, Energy Facility Siting Evaluation Council, Environmental Impact Statements, Oil Terminals | Permalink
On July 29, the U.S. Court of Appeals for the District of Columbia held that requiring meat producers to affix country-of-origin labeling (COOL) to their product does not violate the producers' First Amendment rights. Earlier this year, a three-judge panel of the court had reached the same conclusion; however, the full court decided to rehear the case. The court's decision, including concurring and dissenting opinions, can be read here.
In 2009, the Agricultural Marketing Service (AMS) of the U.S. Department of Agriculture adopted a regulation requiring certain foods, including most meats, to be labeled with their country-of-origin. Meat derived from an animal that was born, raised and slaughtered in a single country would be labeled as a product of that country. If the meat was derived from an animal that was born in one country, then raised and/or slaughtered in a second country, the label would indicate that it is a product of both countries. Claiming that the regulation violated international trade agreements, Canada and Mexico filed a complaint with the World Trade Organization, which held in their favor. Thereafter, in 2013, the AMS issued a new COOL regulation. Among other things, the new regulation requires meat derived from an animal born in one country and raised and/or slaughtered in a second country to have a label that specifies in which country each of those production phases occurred. Concerned about cost and compliance issues, the meat industry brought a lawsuit to enjoin enforcement of the regulations. The trial court denied the industry's request for a preliminary injunction, holding that the industry was not likely to prevail on the merits. This blog discussed the trial court's decision in an earlier post, here. As noted above, a three-judge panel of the court of appeals agreed, but the case was then taken up by the full panel.
In the full panel decision, authored by Senior Judge Stephen F. Williams, the court held that the Supreme Court's decision in Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985) provides the applicable standard for determining whether a government-imposed disclosure requirement violates the First Amendment. Zauderer applies a fairly loose test, upholding a government regulation that requires disclosure of purely factual and uncontroversial information if disclosure is reasonably related to the government interest involved. In Zauderer, the state's interest was the prevention of consumer deception. The Zauderer test is certainly less stringent than the general standard for analyzing the constitutionality of government restrictions on commercial speech, laid down in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980). Central Hudson requires that such government restrictions, to be upheld, must to relate to a substantial government interest, must directly advance that interest, and must not be more extensive than necessary to serve that interest. As the court of appeals noted: "Zauderer applies to government mandates requiring disclosure of 'purely factual and uncontroversial information' appropriate to prevent deception in the regulated party's commercial speech. The key question for us is whether the principles articulated in Zauderer apply more broadly to factual and uncontroversial disclosures required to serve other government interests." Slip op., p. 6. The court found that "[t]he language with which Zauderer justified its approach ... sweeps far more broadly that the interest in remedying deception." Slip op., p. 7. Indeed, the court appears to have embraced the notion that Zauderer applies wherever a regulation mandates forced disclosures, as opposed to prohibitions on speech. Id. Indeed, this point is at the heart of Judge Judith W. Rogers' concurring opinion.
Adequacy of government interest in mandating country of origin labeling
The court was unsure whether Zauderer requires that the government interest involved to be a substantial interest, but did not reach this question because it found that country-of-origin labeling does, in any event, address a substantial interest:
But here we think several aspects of the government's interest in country-of-origin labeling for food combine to make the interest substantial: the context and long history of country-of-origin disclosures to enable consumers to choose American-made products; the demonstrated consumer interest in extending country-of-origin labeling to food products; and the individual health concerns and market impacts that can arise in the event of a food-borne illness outbreak. Because the interest motivating the 2013 rule is a substantial one, we need not decide whether a lesser interest could suffice under Zauderer.
Slip op., p. 9. As evidence of the federal government's substantial interest in country-of-origin labeling, the court pointed to 125 years of Congress imposing similar mandates, statements of support by members of Congress, anecdotes, public opinion surveys, and favorable comments in the rulemaking docket. Slip op., pp. 10-12. This seems to equate "substantial interest" with "a lot of interest," as opposed to, say, a "weighty interest." In any event, if this is the standard, then it significantly degrades a commercial entity's right against being forced to speak when faced with a popular – though perhaps misinformed – disclosure requirement. (Judge Brett M. Kavanaugh, concurring in the result, clearly rejects the notion that consumer curiosity alone may justify compelled disclosures. Instead, he takes the position that economic protectionism of American farmers and ranchers is a substantial interest for First Amendment purposes, even though the Government did not argue that this was an interest sought to be protected. Many who are familiar with the legislative process leading to the enactment of COOL legislation will agree with Judge Kavanaugh that protectionism was the core objective of its supporters.)
Relationship between government interest and means employed
If the court set a low threshold for judging the adequacy of the government interest, the test for determining whether there is an adequate nexus between that interest and the means of achieving it is positively self-fulfilling. "When the Supreme Court has analyzed Central Hudson's 'directly advance' requirement, it has commonly required evidence of a measure's effectiveness. But as the Court recognized in Zauderer, such evidentiary parsing is hardly necessary when the government uses a disclosure mandate to achieve a goal of informing consumers about a particular product trait, assuming of course that the reason for informing the consumers qualifies as an adequate interest." Slip op., p. 14 (citation omitted). "To the extent that the government's interest is in assuring that consumers receive particular information (as it plainly is when mandating disclosures that correct deception), the means-end fit is self-evidently satisfied when the government acts only through a reasonably crafted mandate to disclose 'purely factual and uncontroversial information' about attributes of the product or service being offered. In other words, this particular method of achieving a government interest will almost always demonstrate a reasonable means-ends relationship, absent a showing that the disclosure is 'unduly burdensome' in a way that 'chill[s] protected commercial speech.'" Slip op., pp. 15-16.
The upshot of the court of appeals logic, then, is that virtually any government regulation that mandates the disclosure of purely factual and uncontroversial information passes muster under the First Amendment. The government interest is sufficient, because it requires disclosure as opposed to restricting speech. And the means self-evidently achieve the end goal of disclosure. Particularly since the court reaches this point through its analysis of two critical Supreme Court decisions, it may not be too much to expect that the Supreme Court may wish to express itself on the question. Oral argument in early 2015, perhaps?
Potential effect of decision on proposed GMO-labeling laws
Over the last few years, opponents of the use of genetically-engineered crops, also known as genetically-modified organisms (GMOs), in the human food supply have sponsored initiative and lobbying campaigns in many states. Although the vast majority of scientists believe the use of GMOs in food products does not present any unique risk to human health, these campaigns suggest otherwise, implying that products using GMOs present major human health risks. Recently, the State of Vermont became the first – and thus far only – state to implement a GMO-labeling requirement. Not surprisingly, the food manufacturing industry has challenged the Vermont law in court. As discussed in an earlier article, here, one of the industry's arguments is that the GMO-labeling requirement violates the First Amendment. How will that argument stand in light of the court of appeals decision in the COOL case? If the trial court in the GMO case accepts the reasoning of the court of appeals in the COOL case, it is hard to imagine the First Amendment argument having any legs at all. Public opinion polls, word wars between competing advocates, and the sheer volume of cash being expended on initiative campaigns shows that there is "a lot of interest" in GMO labeling. If that is all that is needed to justify a regulation mandating commercial speech – as today's decision seems to say – then the First Amendment is not likely to provide any protection to the industry. Therefore, both sides of the GMO debate will be watching developments in the COOL case with great interest.
Posted by Mike Gillett on 07/29/2014 at 03:23 PM in Agricultural Law, Federal Courts, Food Labeling | Permalink
At approximately 2:00 a.m. PDT on July 24, less than 24 hours after the U.S. Department of Transportation announced proposed new regulations to improve the safety of crude oil being transported by rail, an oil unit train operated by Burlington Northern Santa Fe (BNSF) derailed in Seattle. The train reportedly has 102 tank cars, each with a 27,000-gallon capacity, filled with crude oil from the Bakken region of North Dakota. At least two, and possibly more, of the cars derailed, but it does not appear that any oil has leaked from the cars. No injuries have been reported. Local NBC affiliate King 5 News reports:
The train was on its way to the Tesoro refinery in Anacortes, some 80 miles north of Seattle. The derailment occurred in the Interbay area north of downtown Seattle, a mixed industrial and commercial area, underneath a heavily used commuter bridge. At the time of the derailment, the train reportedly was traveling at 5 mph. The tank cars are model CPC 1232s, which are considered safer than the vintage DOT 111 tank cars that have been involved in fiery derailments elsewhere in the United States and Canada.
Although the derailment does not appear to have resulted in any injuries or significant property damage, it is seen by some as a warning of potentially catastrophic events. The Associated Press here quotes Fawn Sharp, president of the Quinault Indian Nation, as saying: "It was sheer luck that the cars, carrying 100 loads of Bakken crude oil, didn't spill or even catch file. If that had occurred, the odds are it would have burned out of control for days and oil would have made its way into Puget Sound. People need to know that every time an oil train travels by this is the risk that is being taken."
As noted above, the derailment occurred just hours after the U.S. Department of Transportation announced its proposed new safety rules for unit trains hauling highly flammable liquids, including crude oil and ethanol. Those proposed rules are summarized in an article posted on this blog, which can be read here.
Posted by Mike Gillett on 07/24/2014 at 11:37 AM in Crude-by-Rail, Department of Transportation, Pipeline and Hazardous Materials Safety Administration | Permalink
On July 23, the Pipeline and Hazardous Materials Safety Administration (PHMSA), an agency of the U.S. Department of Transportation (USDOT), announced proposed new regulations to improve the safety of oil unit trains. The announcement came slightly more than one year after the fatal oil train derailment and fire in Lac-Mégantic, Quebec, described here, which took the lives of 47 people and caused millions of dollars of property damage. Although the proposed regulations would apply generally to oil and ethanol unit trains, much of the concern motivating USDOT appears to be crude oil from the Bakken Shale Formation, in the Williston Basin of North Dakota, Montana and Saskatchewan. A report issued by USDOT concludes that Bakken crude oil "is more volatile than most other types of crude – which correlates to increased ignitability and flammability." Operation Safe Delivery Update, here, p. 18. USDOT's press release, here, says:
The safety risk presented by transporting Bakken crude oil by rail is magnified both by an increasing volume of Bakken being shipped ... throughout the U.S. and the large distances over which the product is shipped. In 2008, 9,500 rail-carloads of crude moved through our country compared to last year, when there were 415,000 rail-carloads. Moreover, on average Bakken crude oil shipments travel over 1,000 miles from point of origin to refineries on the coast.
The proposed rule has important implications for the Pacific Northwest, which is seeing increasing amounts of crude oil being shipped by rail, in particular by unit trains hauling crude oil from the Bakken region. At present, this increased traffic is primarily due to the capacity needs of Washington State refineries. These refineries traditionally have been supplied substantially by crude oil from Alaska. The amount of available Alaskan crude, however, is diminishing; therefore, Washington refineries are turning to the Bakken region for new supplies. In addition, California refineries would like to replace foreign-sourced crude oil with less expensive crude from inland North American sources, including the Bakken region and Canadian oil sands. These supplies depend primarily on rail transportation, through the Pacific Northwest, to reach their California markets. A major oil terminal is proposed for Vancouver, Washington in large part to serve these markets. A lifting of the federal ban on export of crude oil, as many now advocate, could make the Pacific Northwest an attractive shipping point for Bakken crude destined for Asian markets.
In the notice of proposed rulemaking (NPRM) released on July 23, here, PHMSA proposes: (1) to require new specifications for oil and ethanol tank cars, and to phase out the use of older DOT 111 tank cars unless they are retrofitted to comply with the new standards; (2) require shippers to follow a written sampling and testing program for mined gases and liquids; and (3) require rail carriers to comply with new operational requirements for oil and ethanol unit trains. Once the proposed rule is published in the Federal Register, probably within the next few weeks, public comment will be accepted for 60 days.
New standards for tank cars
New tank cars. PHMSA proposes that tank cars used to transport crude oil or ethanol either be designed to the DOT 117 specification, or conform to prescribed performance standards. PHMSA seeks comments on three options. Option 1 is described as the PHMSA and Federal Railroad Administration designed car. Option 2 is based on the American Association of Railroad's recommended new tank car standard. And Option 3 is an enhanced jacketed CPC-1232 tank car standard. The three options include the following elements:
Thickness of plates. Under Options 1 and 2, the wall thickness after forming of the tank shell and heads must be, at a minimum, 9/16 of an inch AAR TC-128 Grade B. Under Option 3, the minimum wall thickness is 7/16 of an inch.
Tank head puncture resistance system. All three options require a tank head puncture resistance system. The full height head shields must have a minimum thickness of ½ inch.
Thermal protection systems. All three options require a thermal protection system designed in accordance with 49 CFR §173.18, including a reclosing pressure relief device in accordance with 49 CFR §173.31.
Jackets. All three options require that the entire thermal protection system be covered with a metal jacket of a thickness not less than 11 gauge A1011 steel or equivalent, and flashed around all openings so as to be weather tight. The exterior surface of a carbon steel tank and the inside surface of a carbon steel jacket must be given a protective coating.
Bottom outlets. If the tank car is equipped with a bottom outlet, all three options require that the handle be removed prior to train movement or be designed with protection safety system(s) to prevent actuation during train accident scenarios.
Top fittings protection. All three options require top fittings protection. Option 1 requires a top fittings protection system and a nozzle capable of sustaining, without failure, a rollover accident at a speed of 9 mph, in which the rolling protective housing strikes a stationary surface assumed to be flat, level, and rigid and the speed is determined as a linear velocity, measured at the geometric center of the loaded tank car as a transverse vector. Failure is deemed to occur when the deformed protective housing contacts any of the service equipment or when the tank lading retention capability is compromised (i.e., leaking). Options 2 and 3 require the tank car to be equipped per AAR Specifications Tank Cars, appendix E paragraph 10.2.1, but do not include the rollover protection requirements.
Update (7/24/2014) Braking. Under Option 1, the train must be operated in electronic controlled pneumatic (ECP) brake mode. Proposed 49 CFR §174.310(a)(5)(ii) (NPRM, p. 191).
Update (7/24/2014) Put another way, the difference between Option 1 and Option 2 is that the former requires rollover protection of the top fittings and the use of ECP braking, whereas the latter requires neither of these systems. The difference between Option 2 and Option 3 is that the former requires a 9/16 of an inch wall thickness, whereas the latter requires only a 7/16 of an inch thickness.
Update (7/24/2014): To meet the performance standards, a tank car, in addition to meeting the DOT 117 specifications for thermal protection systems, bottom outlets, and top fitting connections, must provide for puncture resistance. For a side impact (i.e., when impacted at the longitudinal and vertical center of the shell by a rigid 12-inch by 12-inch indenter with a weight of 286,000 pounds), the tank car must provide for puncture resistance at a minimum impact speed of 12 mph. For a head impact (i.e., when impacted at the center of the head by a rigid 12-inch by 12-inch indenter with a weight of 286,000 pounds), the tank car must provide for puncture resistance at a minimum impact speed of 18 mph. In addition, under the performance standards, an existing tank car may continue to rely on the top fittings protection equipment installed at the time of manufacture.
Proposed 49 CFR §179.202 (NPRM pp. 191-94), §179.203 (NPRM pp. 194-97), and §179.204 (NPRM pp. 197-200).
Existing tank cars. Unless upgraded to meet the standards applicable to new tank cars, the use of DOT 111 tank cars in high-hazard flammable trains (defined below) is proposed to be phased out as follows:
Class 3 flammable liquids in Packing Group I may not use DOT 111 tank cars after October 1, 2017
Class 3 flammable liquids in Packing Group II may not used DOT 111 tank cars after October 1, 2018
Class 3 flammable liquids in Packing Group III may not used DOT 111 tank cars after October 1, 2020
Proposed 49 CFR § 173.241 (NPRM pp. 187-88). Update (7/14/2014) The two-year phase-out of the use of DOT 111 tank cars for the most dangerous materials (i.e., those in Packing Group I) reflects PMHSA's understanding of the time it will take to manufacture improved replacement cars without causing a fleet shortage. NPRM, pp. 83-84.
Sampling and testing program for shippers
PMHSA proposes that all gases and liquids that are extracted from the earth (e.g., crude oil) and offered for rail transportation shall be classed and characterized in accordance with a written sampling and testing program that includes at least the following elements:
A frequency of sampling and testing that accounts appreciable variability of the material, including the time, temperature, method of extraction (including chemical use), and location of extraction;
Sampling at various points along the supply chain to understand the variability of the material during transportation;
Sampling methods that ensure a representative sample of the entire mixture, as packaged, is collected;
Testing methods that enable complete analysis, classification, and characterization of the material under the Hazardous Material Regulation, 49 CFR Parts 171-180.
Statistical justification for sample frequencies;
Duplicate samples for quality assurance purposes; and
Criteria for modifying the sampling and testing program.
The program must be in writing, and must be reviewed annually and updated as needed. A copy of the program must be maintained, and made available to the USDOT upon request. Proposed 49 CFR § 173.41 (NPRM pp. 185-86). Update (7/24/2014) The sampling and testing program does not apply to ethanol because it is a manufactured product with characteristics within defined parameters. By contrast, "organic materials from oil and gas production represent a unique challenge in regards to classification. Differences in the chemical makeup of the raw material can vary over time and geographical location." NPRM, p. 85.
New operational requirements for rail carriers
PHMSA proposes that each rail carrier operating a high-hazard flammable trains (HHFTs) must comply with several additional safety requirements with respect to such trains. A HHFT is defined as a single train carrying 20 or more carloads of a Class 3 flammable liquid (including Bakken crude oil and ethanol). Proposed 49 CFR § 171.8 (NOPR p. 184). Update (7/24/2014) According to PHMSA, "only crude oil and ethanol shipments would be affected by the limitations of this rule as they are the only known class 3 (flammable liquid) materials transported in trains consisting of 20 cars or more." NPRM, p. 71. The new requirements include the following:
Routing. Railroads would be required to select routes for HHFTs based on a routing analysis that considers 27 safety and security factors found in 49 CFR Part 172, subpart I.
Notification to SERCs of petroleum crude oil train transportation. Any railroad transporting in a single train 1 million gallons or more of certain Class 3 petroleum crude oil sourced from the Bakken shale formation in the Williston Basin must provide notification to the state emergency response commission (SERC), or other appropriate state delegated entities, in which it operates. This requirement is based on USDOT's emergency order issued on May 7, 2014. The notification must include the following information:
a reasonable estimate of the number of affected trains that are expected to travel, per week, through each county with the State;
a description of the petroleum crude oil and applicable emergency response information; and
at least one point of contact at the railroad (including name, title, phone number and address) responsible for serving as the point of contact for the SERC and relevant emergency responders related to the railroad's transportation of affected trains.
Railroads shall update such notifications prior to making any material change in the estimated volumes or frequencies of trains traveling through a county. Copies of the notifications must be made available to the Federal Railroad Administration upon request.
Speed restrictions. All HHFTs would be limited to a maximum speed of 50 mph. In addition, PHMSA proposes that under certain circumstances, trains that include a tank car not meeting or exceeding the DOT 117 standards shall be limited to a maximum speed of 40 mph. It is seeking comment on three options for when the 40 mph limitation should apply to such trains: (1) at all times; (2) while operating in an area, determined by census population data, that has a population of more than 100,000 people; or (3) while the train travels within the limits of high-threat urban areas. Furthermore, any train that does not comply with the braking requirements, described below, is limited to a maximum speed of 30 mph.
Braking. All HHFTs must be equipped and operated with either a two-way end of train device or a distributed power system. After October 1, 2015, under Option 1, a train comprised entirely of DOT 117 or upgraded DOT 111 tank cars, except for required buffer cars, must be operated in electronic controlled pneumatic (ECP) brake mode.
Proposed 49 CFR §174.310 (NPRM pp. 188-91).
New tank car standards for manufacturers and tank car owners
A tank car manufactured for use in a HHFT after October 1, 2015 must meet DOT 117 standards, and must be equipped with ECP bakes. Proposed 49 CFR § 174.310(a)(5) (NPRM p. 191).
Possible expanded oil spill response planning requirements
In addition to the proposed rule, PHMSA issued an advance notice of proposed rulemaking (ANPRM), here, seeking comments on possible revisions to oil spill response planning regulations applicable to oil unit trains. Current regulations, adopted in 1996, require railroads to have basic response plans in place for oil shipments that include tank cars with a capacity of 3,500 gallons or more. A more comprehensive plan is required for oil shipments that include tank cars with a capacity of 42,000 gallons or more. The typical oil tank car has a capacity of 30,000 gallons; therefore, basic response plans are generally required, but comprehensive plans are not. The current regulations were adopted before the advent of oil unit trains often consisting of more than 100 tank cars. PHMSA is seeking comment on whether it should require comprehensive planning for oil trains based on the capacity of the shipment (i.e., the entire train), rather than individual tank cars. This request for comments is based on a January 23, 2014 recommendation made by the National Transportation Safety Board. Among other things, PHMSA requests comment on what thresholds would provide the greatest potential for safety, and would be most cost-effective; what elements should be included in a more comprehensive response plan; and what costs might be incurred. ANPRM pp. 9-11.
Update (7/24/2014) Less than 24 hours after PHMSA announced the proposed new safety rules, a BNSF oil train traveling at 5 mph derailed in Seattle. It appears that the tank cars did not leak any oil. No injuries have been reported. For more, click here.
Posted by Mike Gillett on 07/23/2014 at 05:03 PM in Crude-by-Rail, Department of Transportation, Government Regulations, Pipeline and Hazardous Materials Safety Administration | Permalink
Washington Governor Jay Inslee has proposed, here, that Washington State water quality standards be based on the assumption that people consume 175 grams of fish per day – the equivalent of nearly one serving of fish per day. Fish consumption is one of several factors considered in setting water quality standards that protect human health. It reflects the fact that a pollutant in the water may accumulate in fish tissue, which is subsequently consumed by humans. Gov. Inslee's proposed fish consumption rate is about 27 times higher than the current rate of 6.5 grams per day. For several years, the U.S. Environmental Protection Agency (EPA) has been urging Washington to adopt a higher fish consumption rate, in order to better protect the health of higher-consuming individuals, such as members of Indian tribes, some immigrant communities, and sports fishermen. The Governor has instructed the Washington Department of Ecology to issue a preliminary draft rule with the increased fish consumption rate no later than September 30, 2014 – with final adoption to occur after the coming legislative session.
At the same time, Gov. Inslee proposes to relax another factor that goes into determining human health based water quality standards – the acceptable degree of risk, such as the increased risk of developing cancer. According to EPA, a water quality standard should ensure that a member of the general public have an increased risk of developing cancer over a lifetime that does not exceed a level ranging between one additional cancer per 100,000 people (10-5) to one additional cancer per 1,000,000 people (10-6). Currently, water quality standards in Washington are based on an increased cancer rate of 10-6. Gov. Inslee proposes that Washington's water quality standards be based on an increased cancer rate of 10-5, or 10 times lower than the current standard. Thus, under the Governor's proposal, it is estimated that out of one hundred thousand people who consume 175 grams of fish per day over the course of a lifetime, one person will develop a cancer as a result of that consumption.
Additionally, the Governor today proposed a toxic reduction package, including five elements, described as follows: Immediate action by the state departments of Health and Ecology to identify actions to combat PCBs, phthalate plasticizers, toxic flame retardants and zinc. Removal of toxic chemicals from consumer products where they are causing pollution and safer alternatives are readily available. Elimination of specific sources of problem chemicals in polluted watersheds. Investment in more monitoring and research related to improving how we identify pollution sources and development of new prevention and cleanup strategies and technologies. Accountability and transparency measures to ensure resources are being prioritized effectively and measurements of progress are reported to the public and Legislature. Posted by Mike Gillett on 07/09/2014 at 01:58 PM in Clean Water Act, Fish and Wildlife, Water Quality | Permalink
| | | | | 07/02/2014
Three environmental groups have filed a federal lawsuit against the owner and operator of a crude oil terminal in Clatskanie, Oregon. The lawsuit, Northwest Environmental Defense Center, et al. v. Cascade Kelly Holdings LLC (Dkt. No. 14-cv-01059) alleges that the terminal is operating in violation of the Clean Air Act because it commenced operations without having first obtained a preconstruction permit under section 165 of the Act, 42 U.S.C. § 7475. The complaint can be read here.
The Clatskanie facility was originally permitted by the State of Oregon as an ethanol plant, but has been converted to an oil terminal. Crude oil from North Dakota's Bakken region is brought into the plant by rail. The oil is transferred to storage tanks, and then to barges that transport the oil to West Coast refineries. The current permit allows it to accept 24 oil trains per month, with potential growth to 38 oil trains per month if it upgrades tracks running through the town of Rainier, Oregon. Recently, the plant owner was cited by the State for bringing in more oil than permitted, and has proposed a new permit to allow it to bring in 50 trains per month. The Daily News, Oregon officials say Clatskanie oil terminal violated permit (Mar. 4, 2014), here.
The environmental groups allege that the Clatskanie terminal is a major emitting source of volatile organic compounds (VOCs), a criteria air pollutant under the Clean Air Act. They argue that it is a new oil terminal, or, alternatively, a major modification of an existing facility. Either way, they claim that its construction, or modification, requires the issuance of a Prevention of Significant Deterioration (PSD) permit under the Act. They ask the court for injunctive relief, the imposition of civil penalties, and an award of attorneys' fees.
In addition to the Northwest Environmental Defense Center, the plaintiffs include the Center for Biological Diversity and Neighbors for Clean Air. They named as defendants Cascade Kelly Holdings LLC dba Columbia Pacific Bio-Refinery, and Global Partners LP.
Posted by Mike Gillett on 07/02/2014 at 03:55 PM in Air Quality, Clean Air Act, Crude-by-Rail, Federal Courts, Oil Terminals | Permalink
| | | | | Supreme Court will not review California’s Low-Carbon Fuel Standard - yet
On June 30, the U.S. Supreme Court denied petitions for certiorari filed by liquid fuel producers seeking review of the State of California’s Low-Carbon Fuel Standard (LCFS). The LCFS, adopted by the California Air Resources Board (CARB), requires fuel blenders and distributors in California to reduce the carbon intensity of the transportation fuel mix by 10 percent over a 10-year time period. It is part of California’s efforts to curb emissions of greenhouse gases.
The petitioners had asked the Court to review the decision of the federal Ninth Circuit Court of Appeals in Rocky Mountain Farmers Union v. Corey, 730 F.3d 1070 (9th Cir. 2013) (slip opinion here). Among other things, the court of appeals had considered arguments that the LCFS violated the dormant Commerce Clause. According to the court of appeals: “If a statute discriminates against out-of-state entities on its face, in its purpose, or in its practical effect, it is unconstitutional unless it serves a legitimate local purpose, and this purpose could not be served as well by available nondiscriminatory means. Absent discrimination, we will uphold the law unless the burden imposed on interstate commerce is clearly excessive in relation to the putative local benefits.” 730 F.3d at 1087-88 (slip op. p. 32) (citations, internal quotation marks, and brackets omitted). Applying these standards, the court of appeals held that the ethanol provisions of the LCFS do not facially discriminate against out-of-state fuel producers, and that the crude oil provisions are not discriminatory in purpose or effect. 730 F.3d at 1097 and 1100 (slip op. p. 51 and 57).
The Supreme Court’s denial of the petitions for certiorari means that the Ninth Circuit’s decision remains in effect. But it does not mean the challenges to the LCFS are over, nor that the Supreme Court will not review the case at a later stage. The court of appeals remanded the case to the district court for further consideration of the Commerce Clause issues. The court said:
We ... remand to the district court to consider whether the Fuel Standard's ethanol provisions discriminate in purpose or in practical effect. If so, then the district court should apply strict scrutiny to those provisions. If not, then the district court should apply the balancing test established in Pike v. Bruce Church, Inc., 397 U.S. 137, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970), to the Fuel Standard's ethanol provisions. The district court is directed to apply the Pike balancing test to the 2011 Provisions for crude oil. Id. To prevail under that test, Plaintiffs–Appellees must show that the Fuel Standard imposes a burden on interstate commerce that is “clearly excessive” in relation to its local benefits. Id. at 142, 90 S.Ct. 844.
730 F.3d at 1078 (slip op. pp. 12-13). On remand, the fuel producers are likely to argue that neither the ethanol nor the crude oil provisions can pass muster even under the Pike balancing test. Presumably, the argument would follow a track somewhat like this: Climate change is a global phenomenon. Emissions of greenhouse gases mix more or less uniformly throughout the atmosphere. To reverse the effects of climate change, or even to slow them down appreciably, will require significant reductions in greenhouse gas emissions in many countries. The emission reductions achieved by California’s LCFS are minor in relation to the reductions needed in order to affect climate change. Therefore, the local benefits are extremely small, and are clearly excessive in relation to the costs the standard imposes on out-of-state fuel producers.
Such an argument could prevail. Whether it does so or not, the issues would be more fully developed, and the Supreme Court might well grant review of the case once all issues on remand have been vetted and the case makes its way through the appellate system once again.
Posted by Mike Gillett on 07/02/2014 at 12:01 PM in Air Quality, Climate Change, Dormant Commerce Clause, Federal Courts, Greenhouse Gases, Low-Carbon Fuel Standard, U.S. Constitution | Permalink
The Center for Biological Diversity (CBD) has asked a federal court in Seattle to grant summary judgment on its claim that the U.S. Environmental Protection Agency (EPA) was arbitrary and capricious in approving lists of "impaired" waters submitted by the States of Washington and Oregon because those lists did not identify marine waters allegedly impaired by ocean acidification. UPDATE [8/20/2014]: CBD's motion can be read here. On August 15, EPA filed a cross motion for summary judgment, which can be read here.
Under section 303 of the federal Clean Water Act, each State is required to identify impaired waters within its boundaries, that is, waters for which technology-based effluent standards, which do not take water quality into consideration, "are not stringent enough to implement any water quality standard applicable to such waters." 40 CFR §130.7(b)(1)(iii); 33 U.S.C. §1313(d). In developing the list, a State is required to "assemble and evaluate all existing and readily available water-quality related data and information ...." 40 CFR §130.7(b)(5). It is not required to use all such data, but is required to provide to EPA its "rationale for any decision to not use any existing and readily available data and information ...." 40 CFR §130.7(b)(6)(iii). EPA must either approve or disapprove the State's list of impaired waters. 33 U.S.C. §1313(d). The agency may approve an impaired waters list only if the list meets the requirements under 40 CFR §130.7(b).
Oregon's current impaired waters list was approved by EPA on December 14, 2012, and Washington's was approved on December 21, 2012. In its review of the Oregon list, EPA evaluated comments and articles submitted by CBD with respect to impairment of coastal waters due to ocean acidification. EPA concluded: "White the EPA recognizes that ocean acidification has the potential to negatively impact aquatic life, based on the review of references submitted by CBD, and in accordance with the EPA's regulations and [guidance,] the EPA has determined that, at this time, there is not sufficient evidence demonstrating non-attainment of Oregon's marine pH criteria and/or state-wide narrative criteria related to aquatic life designated uses to warrant listing any coastal waters as impaired or threatened related to these [water quality standards] ...." Evaluation p. 1. Similarly, an enclosure to EPA's approval letter to Washington says that the State "has demonstrated that there is not currently enough evidence to identify Puget Sound or other Washington waters, including Willapa Bay, Gray's Harbor, the Strait of Juan de Fuca or Washington's Pacific Coast waters, on its 2010 303(d) list for not attaining Washington's marine pH, narrative criteria for aquatic life designated uses, or antidegradation requirements." Enclosure 2 p. 1.
CBD moves for summary judgment
CBD's motion asks the trial court to grant it summary judgment on its claim that EPA's approvals of Oregon and Washington's impaired waters lists were arbitrary and capricious. Summary judgment is appropriate where there are no disputes as to any material facts, and the moving party is entitled to judgment as a matter of law. CBD makes two arguments: (1) that EPA "disregarded an entire body of evidence showing that ocean acidification is currently harming marine life and violating water quality standards;" and (2) that it "failed to evaluate all available data as required under the Clean Water Act." CBD Motion p. 12.
First, CBD argues that EPA was arbitrary and capricious in approving the two states' impaired waters lists because "EPA (1) irrationally disregarded evidence of shellfish die-offs; (2) failed to adequately justify ignoring pH data; and (3) overlooked evidence that waters are corrosive to shell-building animals and thus violate narrative standards." CBD Motion p. 13. With respect to shellfish die-offs, CBD refers to: "evidence of decreased shellfish abundance in several Washington locations" (CBD Motion p. 14); "laboratory studies [that] indicate adverse impacts to native shellfish at levels of ocean acidification that are already common off the coasts of Washington and Oregon" (CBD Motion p. 15); and "evidence that Oregon marine waters had killed oysters in hatcheries" (CBD Motion p. 16). On the matter of pH, CBD claims that EPA disregarded evidence that pH levels in the Strait of Juan de Fuca declined more than 0.36 units, where the water quality standard allows for a human-induced variation in pH of less than 0.2 units. CBD Motion p. 19. And as for corrosivity, CBD claims that EPA failed to consider evidence "that waters off the coast of Washington and Oregon have become corrosive and harmful to shell-building animals." CBD Motion p. 21.
Second, CBD alleges that "EPA failed to analyze readily available data and information on ocean acidification and pH. Specifically, (1) EPA neglected available pH data in Washington that it obtained and evaluated for Oregon; and (2) EPA failed to evaluate relevant ocean acidification data that it knew about for Oregon and Washington." CBD Motion p. 25. CBD says that EPA reviewed pH data from state and federal databases with respect to Oregon, but that it "approved Washington's list without considering these readily available sources with respect to Washington's marine pH water quality standard. Nowhere in the decision document does it indicate that EPA examined these datasets, nor does the agency have a valid explanation for failing to evaluate such pH information." CBD Motion p. 27. Also, CBD challenges EPA for not evaluating data from sources that it had recommended states use in making assessments for marine pH and ocean acidification, as well as data from individual scientists. CBD Motion pp. 28-29.
For relief, CBD asks the court to remand the matter to EPA, "leav[ing] in place the current 303(d) lists while the agency reconsiders its decisions with regards to ocean acidification." Specifically, CBD asks the court to "direct EPA to disapprove Oregon and Washington's impaired waters lists and identify waters impaired by ocean acidification within 30 days of the disapproval, as required by Section 303(d) of the Clean Water Act." CBD Motion p. 30.
EPA files cross motion
UPDATE [8/20/2014]: EPA's cross motion for summary judgment asks the court to uphold EPA's approval of the States' impaired waters lists. EPA begins by acknowledging "that a growing body of research indicates the seriousness of global [ocean acidification] risks and the potential that conditions related to [ocean acidification] may have significant adverse impacts on aquatic life in the coastal waters of Washingon and Oregon, and elsewhere." But it also notes that "the science is complex - and experts agree that more research and analyses are needed to fully understand the sources, causes and impacts of [ocean acidification] in different aquatic environments." It characterizes the issue before the court as "the validity of EPA's 2012 decisions on the States' 2010 lists of impaired waters ... based on the information available at that time, as reflected in the administrative records presented to the Court." EPA Cross Motion p. 1. In its cross motion, EPA argues, among other things, that CBD relies on a single flawed and unrepresentative study of waters off Tatoosh Island in the Strait of Juan de Fuca (EPA Cross Motion p. 16-17), data-bare anecdotal evidence (EPA Cross Motion p. 18-19), and laboratory research rather than in-situ field studies (EPA Cross Motion p. 19-20). Given the highly technical, scientific nature of EPA's decisions approving the impaired waters lists, it argues that the court should afford those decisions "heightened deference." EPA Cross Motion p. 23. Finally, EPA says that even if the court were to grant summary judgment to CBD, it should not order EPA to disapprove the States' lists, but should merely remand the decision to EPA. "On remand, EPA would have the discretion to approve or disapprove the States' 2010 Lists consistent with the [Clean Water Act] and EPA regulations and any Order of this Court." EPA Cross Motion p. 29.
UPDATE [9/8/2014]: EPA's position is nuanced in a way that perhaps only a lawyer can appreciate. For example, popular northwest weather blogger Cliff Mass incorrectly claims here that EPA told the court that "the oyster/acidification scare was baseless in both fact and law." This understanding of EPA's brief could not be further from the truth. As noted above, EPA acknowledges that a growing body of research indicates that ocean acidification is a serious problem and may be having significant adverse impacts on aquatic life in the coastal waters of the Pacific Northwest. But EPA's brief, filed in 2014, is defending an EPA decision made in 2012 to approve impaired waters lists prepared by Washington and Oregon in 2010. It may unnerve many people, though few lawyers, to learn that in this case it is the state of science in 2010 - not current science - that governs the court's review. In the case of a fast-developing scientific field, such as ocean acidification research, four years can make a tremendous difference. Thus, it should not be surprising if EPA, as well as the two States, make quite different decisions when they next review and update the impaired waters lists. EPA suggests as much in its brief:
More information and data are available now than were available in 2010, the end of the reporting period for the water quality impairment listings submitted to EPA by Washington and Oregon, or in 2012 when EPA made the decisions challenged in this case. Research is continuing through a number of Federal, State, and private programs; thus, even more data are likely to be available when the States conduct and report on their next biennial reviews of impaired waters.
EPA Cross Motion p. 1.
CBD faces a difficult challenge in this lawsuit. Many of the issues are highly technical, and the causes and consequences of ocean acidification are not fully understood. CBD's motion refers to "substantial evidence," "powerful evidence," and "a scientific consensus." CBD Motion pp. 14, 17, 24. But none of these is enough to prevail on a motion for summary judgment. CBD must show that there is no material factual dispute; otherwise, the case proceeds to a full trial where experts from both sides will battle it out. Moreover, even if CBD succeeds in showing that EPA improperly failed to consider certain data, it must also show that such failure resulted in the exclusion of waters from the impaired waters list. See, Sierra Club v. Leavitt, 488 F.3d 904, 913 (11th Cir. 2007); Sierra Club v. Hankinson, 939 F.Supp. 865, 871 (N.D. Ga. 1996). These challenges might not be insurmountable, but they are substantial.
Posted by Mike Gillett on 06/27/2014 at 03:23 PM in Administrative Law, Aquaculture, Clean Water Act, Environmental Protection Agency, Federal Courts, Ocean Acidification, Water Quality | Permalink
On June 23, the U.S. Supreme Court issued its decision in Utility Air Regulatory Group v. EPA (Dkt. No. 12-114 Jun. 23, 2014), available here, upholding key portions, but not all, of the Environmental Protection Agency's controversial extension of greenhouse gas regulations to stationary sources.
EPA's general counsel, Avi Garbow, here declared that the "decision is a resounding win for EPA." Despite the triumphalism in that proclamation, the decision actually is, as many observers expected, a compromise. Moreover, Justice Anton Scalia, who wrote the Court's opinion, took time to school EPA in the limits of administrative power. The agency would be wise to reflect on those parts of the opinion.
In 2009, EPA adopted its first significant regulations under the Clean Air Act to limit greenhouse gas emissions, setting standards for certain mobile sources (automobiles and light-duty trucks). EPA also determined that, following its long-standing interpretation of the Act, once greenhouse gases from these mobile sources were regulated, the law requires regulation of the same pollutants from stationary sources (e.g., power plants, refineries and large manufacturing facilities) under the Prevention of Significant Deterioration (PSD) program and the Title V operating permit program. But this determination presented EPA with a problem. Under the statute, both the PSD and operating permit programs apply to stationary sources that emit 100 or 250 tons per year (tpy) of a pollutant. The purpose and effect of these thresholds is to limit regulation to very large emission sources.
In the case of greenhouse gases, however, even small facilities, such as schools, emit more than 250 tpy. To regulate all of these sources would expand the scope of the two programs exponentially, a result that EPA acknowledged Congress never envisioned. Therefore, EPA adopted threshold emission levels many times the levels prescribed in the Act. The petitioners argued that instead of unilaterally modifying specific numeric thresholds adopted by Congress, EPA should have reassessed whether these programs should even apply to greenhouse gases. Some petitioners suggested that, at the least, EPA should limit its regulation to requiring that stationary sources of other pollutants, above threshold levels, use best available control technology (BACT) to control greenhouse gas emissions as well. At oral argument, even the federal government lent credence to this position as a possible compromise result. (An earlier post on this blog reported on oral argument before the Court here.)
The compromise decision
The Supreme Court's decision adopted this compromise position. Five justices rejected EPA's ambitious rationale that the Clean Air Act compels it to regulate greenhouse gases under the PSD and Title V operating permit programs and allows it to tailor the statutory thresholds according to the agency's own judgment. Seven justices agreed, however, that EPA has the authority to apply the PSD program's best available control technology (BACT) requirements to regulate greenhouse gas emissions from sources that are regulated anyway due to emissions of other pollutants.
EPA may not regulate sources solely because of their greenhouse gas emissions
First, the Court turned to the expansion of the PSD and operating permit programs to cover sources solely based on their emissions of greenhouse gases, as well as EPA's efforts to tailor this expansion by adopting threshold emission levels different from those in the statute.
EPA thought its conclusion that a source's greenhouse-gas emissions may necessitate a PSD or Title V permit followed from the Act's unambiguous language. The Court of Appeals agreed and held that the statute 'compelled' EPA's interpretation. We disagree. The statute compelled EPA's greenhouse-gas-inclusive interpretation with respect to neither the PSD program nor Title V. ... The conclusion follows from the premises only if the air pollutants referred to in the permit-requiring provisions (the minor premise) are the same air pollutants encompassed by the Act-wide definition as interpreted in Massachusetts [v. EPA, 549 U.S. 497 (2007)], (the major premise). Yet no one – least of all EPA – endorses that proposition, and it is obviously untenable.
Slip op. pp. 10-11 (citation omitted). Noting that "where the term 'air pollutant' appears in the Act's operative provisions, EPA has routinely given it a narrower, context-appropriate meaning", Justice Scalia then jabbed: "It takes some cheek for EPA to insist that it cannot possibly give 'air pollutant' a reasonable, context-appropriate meaning in the PSD and Title V contexts when it has been doing precisely that for decades." Slip op. pp. 11-12. "In sum, there is no insuperable textual barrier to EPA's interpreting 'any air pollutants' in the permitting triggers of PSD and Title V to encompass only pollutants emitted in quantities that enable them to be sensibly regulated at the statutory thresholds, and to exclude those atypical pollutants that, like greenhouse gases, are emitted in such vast quantities that their inclusion would radically transform those programs and render them unworkable as written." Slip op. pp. 14-15.
Not only is EPA's interpretation of the not compelled by the text of the statute, the Court "conclude[d] that EPA's interpretation is not permissible." Slip op. p. 16. Justice Scalia was merciless in his attack on EPA's position its discretionary authority. "[A]n agency interpretation that is inconsistent with the design and structure of the statute as a whole, does not merit deference. EPA itself has repeatedly acknowledged that applying the PSD and Title V permitting programs to greenhouse gases would be inconsistent with – in fact, would overthrow – the Act's structure and design." Slip op. p. 17 (citation and internal quotation marks and brackets omitted). "A brief review of the relevant statutory provisions leaves no doubt that the PSD program and Title V are designed to apply to, and cannot rationally be extended beyond, a relative handful of large sources capable of shouldering heavy substantive and procedural burdens." Slip op. p. 18. The conservative philosophy of the five justices supporting this portion of the opinion comes through:
EPA's interpretation is also unreasonable because it would bring about an enormous and transformative expansion in EPA's regulatory authority without clear congressional authorization. When an agency claims to discover in a long-extant statute an unheralded power to regulate a significant portion of the American economy, we typically greet its announcement with a measure of skepticism. We expect Congress to speak clearly if it wishes to assign to an agency decisions of vast economic and political significance. The power to require permits for the construction and modification of tens of thousands, and the operation of millions, of small sources nationwide falls comfortably within the class of authorizations that we have been reluctant to read into ambiguous statutory text. Moreover, in EPA's assertion of that authority, we confront a singular situation: an agency laying claim to extravagant statutory power over the national economy while at the same time strenuously asserting that the authority claimed would render the statute unrecognizable to the Congress that designed it. Since, as we hold above, the statute does not compel EPA's interpretation, it would be patently unreasonable – not to say outrageous – for EPA to insist on seizing expansive power that it admits the statute is not designed to grant.
Slip op. pp. 19-20 (citations and internal quotation marks omitted).
Finally, the Court held that EPA's tailoring rule, by which it tried to make its regulation reasonable by adopting higher thresholds than those required under the statute, was invalid: "An agency has no power to 'tailor' legislation to bureaucratic policy goals by rewriting unambiguous statutory terms. ... It is hard to imagine a statutory term less ambiguous than the precise numerical thresholds at which the Act requires PSD and Title V permitting." Slip op. p. 21. In addition to EPA's disregard of statutory thresholds, the Court was also concerned about EPA's reservation that it might adopt progressively lower thresholds over time: "We are not willing to stand on the dock and wave goodbye as EPA embarks on this multiyear voyage of discovery. We reaffirm the core administrative-law principle that an agency may not rewrite clear statutory terms to suit its own sense of how the statute should operate." Slip op. p. 23.
EPA may require sources of other pollutants to also control greenhouse gas emissions
Up to this point, the Court was addressing EPA's regulation of stationary sources solely due to their emission of greenhouse gases – that is, sources that do not emit other pollutants at rates above the threshold levels. Now it turns to sources that are regulated under the PSD programs anyway because they do emit other pollutants above threshold levels. Specifically, "[t]he question before us is whether EPA's decision to require BACT for greenhouse gases emitted by sources otherwise subject to PSD review is, as a general matter, a permissible interpretation of the statute .... We conclude that it is." Slip op. p. 27. In this case, the "we" for whom Justice Scalia wrote represented a more liberal majority of seven justices.
The Court found that "[t]he text of the BACT provision is far less open-ended than the text of the PSD and Title V permitting triggers. It states that BACT is required 'for each pollutant subject to regulation under this chapter' (i.e., the entire Act), a phrase that – as the D.C. Circuit wrote 35 years ago – 'would not seem readily susceptible [of] misinterpretation.' Whereas the dubious breadth of 'any air pollutant' in the permitting trigger suggests a role for agency judgment in identifying the subset of pollutants covered by the particular regulatory program at issue, the more specific phrasing of the BACT provision suggest that the necessary judgment has already been made by Congress." Slip op. p. 27 (citation omitted).
Moreover, the Court did not find extending the BACT requirement to greenhouse gases a particularly alarming expansion of the scope of EPA's authority. "We are not talking about extending EPA jurisdiction over millions of previously unregulated entities, but about moderately increasing demands EPA (or a state permitting authority) can make of entities already subject to its regulation." Slip op. p. 28. "Our narrow holding is that nothing in the statute categorically prohibits EPA from interpreting the BACT provision to apply to greenhouse gases emitted by 'anyway' sources." Id.
Implications for future greenhouse gas regulations
With the Obama Administration laying out its proposals for controlling greenhouse gas emissions – especially for regulating emissions from new and existing fossil fuel power plants – much speculation is underway as to how these proposals will fare against the inevitable legal challenges that will be brought. Are the pages of Utility Air Regulatory Group tea leaves that may help predict the outcome of those future challenges?
EPA doesn't seem to think it will make much difference. General Counsel Garbow writes: "[I]mportantly, this decision in no way affects the Agency's ability to proceed under the Act to address carbon pollution from new and existing power plants." As Mr. Garbow notes, the power plant rules are proposed under section 111 of the Act, whereas Utility Air Regulatory Group deals with EPA's authority under sections 160-169 (PSD program) and sections 501-507 (Title V operating permits). But EPA should not be overly confident. As Adam Liptak of The New York Times writes: "[T]he combative tone of Monday's ruling, along with its rejection of one of the agency's principal rationales for the regulations under review [that is, its purported authority to "tailor" statutory requirements to accord with the agency's views], suggests that the road ahead may be rocky for other initiatives meant to reduce carbon emissions."
The Court also rejected EPA's rigid, agenda-serving view that the mere fact that greenhouse gases fall within the statute's general definition of "air pollutant" means that they are likewise captured within each use of the term in the operative provisions of the Act. If anything, Utility Air Regulatory Group makes it clear that any given operative part of the Act needs to be examined textually and contextually to determine whether greenhouse gases must – or even may – be regulated under that part. Just because this week's decision deals with different provisions of the Act from those under which the power plant rules are being advanced does not mean the decision provides no guidance as to the standards the courts will apply in reviewing those rules.
The majority's concern about whether EPA's regulation constitutes a significant expansion of its authority over the political and economic life of the nation absent clear Congressional authorization might cut either, or both, ways in a future section 111 challenge. On the one hand, fossil fuel power plants have been heavily regulated under the Clean Air Act since its earliest days; neither utilities nor independent power producers are unfamiliar with EPA's regulatory hand. On the other hand, critics of the proposed rules frequently argue that they would, nevertheless, create a radical reworking of our energy-intensive economy. Consider, for example, the claim that the Administration is waging a war on coal – our largest power plant fuel source. Are there five justices who may have sympathy for such an argument, and how long will they be sitting on the Court? If there are upcoming changes in the Court's composition, who will be the next president nominating the replacements? Which party will control the Senate and thus the confirmation process?
Utility Air Regulatory Group will undoubtedly play a large role in framing the issues that will be argued over in a future section 111 challenge, but it is a fool's game to pretend that the decision gives a clear indication of the outcome of such a challenge. Stay tuned. The ride should be interesting.
Posted by Mike Gillett on 06/24/2014 at 03:09 PM in Air Quality, Clean Air Act, Climate Change, Environmental Protection Agency, Federal Courts, Government Regulations, Greenhouse Gases | Permalink
On June 12, the Grocery Manufacturers Association (GMA) and three other trade associations sued officials of the State of Vermont to overturn Act 120, legislation adopted earlier this year that requires the labeling of foods containing genetically engineered (GE) crops, also known as genetically modified organisms (GMOs). Wikipedia's background article on genetically modified food can be read here. The lawsuit, Grocery Manufacturers Association, et al. v. William H. Sorrell, et al. (No. 14-cv-00117) was brought in the U.S. District Court for the District of Vermont. A copy of the complaint is available here.
Act 120 both mandates and prohibits certain information
GE foods must be labeled as such
Act 120, available here, requires the labeling of food "offered for retail sale in Vermont" if the food is "entirely or partially produced with genetic engineering." 9 VSA §3043(a); Act 120 p. 9. In the case of a raw agricultural commodity (e.g., fruits and vegetables), the food must be clearly and conspicuously labeled as "produced with genetic engineering." If the commodity is sold at retail in a package, the labeling requirement falls on the manufacturer. If it is not separately packaged at the point of retail sale, the retailer must post a label on the store shelf or bin in which the commodity is displayed. Processed food (defined as "any food other than a raw agricultural commodity") must be labeled by the manufacturer as "partially produced with genetic engineering" or "may be produced with genetic engineering," or "produced with genetic engineering." 9 VSA §3043(b); Act 120 p. 10.
GE foods may not be marketed as "natural"
The law prohibits a manufacturer from labeling (whether on the package, by signage, or in advertising) genetically engineered foods as "natural," "naturally made," "naturally grown," "all natural," or "any words of similar import that would have a tendency to mislead a consumer." 9 VSA §3043(c) (Act 120 p. 10). This prohibition does not apply to retailers.
A number of exemptions apply to the labeling requirements, including: food consisting entirely of, or derived entirely from, an animal which has not itself been produced with genetic engineering, but which was fed or injected with a GE product; food that was grown, raised or produced without the knowing or intentional use of GE food or seed; food otherwise subject to the law solely because it includes one or more processing aids or enzymes produced with genetic engineering; alcoholic beverages; food with no more than 0.9 percent GE material by weight; food not packaged for retail sale that is prepared and intended for immediate human consumption, or is served, sold or provided in a restaurant or other food establishment; and medical food. 9 VSA §3044 (Act 120 pp. 11-18).
The lawsuit claims that Act 120 violates the U.S. Constitution
The complaint asks the court to declare that Act 120 is entirely invalid and unenforceable, and seeks injunctive relief against its enforcement and implementation. Complaint p. 22. The bases for the suit are as follows:
The First Amendment claims are made separately for the GE label mandate and the natural foods marketing restriction.
With respect to the label mandate, the complaint notes that the First Amendment protects both the right to speak freely and the right to refrain from speaking at all. It argues that Vermont burdens speech based upon its content (the presence of GE ingredients) and the identity and viewpoint of the speaker (manufacturers – largely from outside the State – who disagree with the opinion required on the label). Such a burden on speech, say the plaintiffs, may only be justified if the State can demonstrate a sufficiently strong governmental interest justifying the intrusion on speech, which, they argue, Vermont is not able to do. First, the complaint claims that Vermont is not advancing a governmental interest, but is acting as a pass-through for private opponents of GE foods. Second, it claims that Act 120 does not advance these private interests because labeling of organic foods and the voluntary Non-GMO Project already allow consumers to act on a preference against genetic engineering. Third, it claims that the State did not employ a means of achieving the purported interest narrowly tailored to the outcome because it did not carefully calculate the costs and benefits. Finally, it claims that the State did not consider less burdensome alternatives. Complaint pp. 13-15.
Even if the GE label mandate is evaluated under the less demanding test for regulation of commercial disclaimers, the complaint argues that it fails constitutional muster. According to the complaint, the government may compel commercial disclaimers to combat the problem of inherently misleading commercial advertisements; the compelled disclaimers must be purely factual and uncontroversial, and may not be unjustified or unduly burdensome. But the complaint argues that the GE labels compel disclosures that are controversial, and that are both unjustified and unduly burdensome. Complaint pp. 15-16.
As for the restriction on marketing GE foods as "natural," the complaint says that such a restriction on commercial speech is not allowed unless it directly and materially advances a substantial governmental interest and is no more extensive than necessary. The plaintiffs question the State's purported interest in preventing consumers from being misled, pointing to the fact that Act 120's exemptions sometimes treat the same food product differently depending on whether it is sold in a supermarket or a restaurant. It also argues that the restriction does not have a reasonable fit with this purported interest. Complaint pp. 16-17.
The complaint argues that by prohibiting manufacturers from using "words of similar import" to "natural" on packages, signs or advertising of GE foods, Act 120 fails to give manufacturers reasonable notice of prohibited conduct, and opens the door to arbitrary enforcement. Therefore, the prohibition is void for vagueness. Complaint pp. 17-18.
The complaint argues that the cost of implementing Act 120 falls largely, if not entirely, on out-of-state companies who have no political representation in the State, that it will be necessary for these companies to establish Vermont-specific distribution channels or revise their labeling on a regional or nationwide basis, and that these companies will need to change their nationwide and regional advertising. These factors, claim the plaintiffs, constitute extraterritorial regulation beyond Vermont's authority to enact. Complaint pp. 18-20.
According to the complaint, Act 120 is "expressly preempted or conflict preempted" by a number of federal laws: the Federal Food, Drug, and Cosmetic Act, the Nutrition Labeling and Education Act, the Federal Meat Inspection Act, and the Poultry Products Inspection Act. Complaint pp. 20-21.
In addition to the GMA, the plaintiffs include the Snack Food Association, the International Dairy Foods Association, and the National Association of Manufacturers. The defendants are various Vermont officials: Attorney General William H. Sorrell, Governor Peter E. Shumlin, Department of Health Commissioner Harry L. Chen, and Department of Finance and Management Commissioner James B. Reardon.
Posted by Mike Gillett on 06/16/2014 at 07:57 AM in Agricultural Law, Federal Courts, Food Labeling, Genetically Modified Organisms, U.S. Constitution | Permalink
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