Environmental Litigation: Impact of Deadline Suits on EPA's Rulemaking Is Limited
Released: 2015-01-14T00:00:00

Letter

Background

For the purposes of this report, we use the term deadline suit to mean a lawsuit in which an individual or entity sues because EPA has allegedly failed to perform any nondiscretionary act or duty by a deadline established in law. A nondiscretionary act or duty is an act or duty required by law. This report examines deadline suits that seek to compel EPA to either (1) issue a statutorily required rule when that rule has a deadline in law or (2) issue a statutorily required rule or make a determination that issuing such a rule is not appropriate or necessary pursuant to the relevant statutory provision, when issuing that rule or making that determination has a deadline in law. For example, a deadline suit may involve a person suing EPA because EPA failed to issue a rule by a date established in statute. Similarly, a person may sue EPA because it missed a recurring deadline to review and revise, as necessary or appropriate, an existing rule. In August 2011, we reported that the number of new environmental litigation cases—of all types—filed against EPA each year from fiscal year 1995 through fiscal year 2010 averaged 155 cases per year.

Before filing a deadline suit, a person generally must file a Notice of Intent to Sue (NOI) with EPA. Among other things, a NOI generally must identify the provision(s) of the law that requires EPA to perform an act or duty and a description of the action taken or not taken by EPA that is claimed to constitute a failure to comply with the provision. Sixty days after filing the NOI, the filer may initiate a deadline suit seeking a court order requiring EPA to complete the statutorily required action.

A settlement takes the form of either a settlement agreement or a consent decree. For purposes of this report, the term settlement refers to both settlement agreements and consent decrees. Both are negotiated agreements between EPA and the plaintiff. A settlement agreement is not subject to court approval but can result in a stay of the lawsuit. If EPA fails to meet the terms of the settlement agreement, then the plaintiff can ask the court to lift the stay in order to proceed with the lawsuit. A consent decree is entered as a court order. If EPA fails to meet the terms of a consent decree, the court can enforce or modify the consent decree, including citing EPA for contempt of court.

Unless a more specific statute governs, when EPA or any other federal agency promulgates a rule, whether or not in conjunction with a deadline suit, it generally follows procedures prescribed in the Administrative Procedures Act (APA). Among other things, the APA governs the process by which federal agencies develop and issue regulations. It includes requirements for publishing notices of proposed and final rules in the Federal Register and for providing opportunities for the public to comment on notices of proposed rulemaking. Many rules promulgated under the authority of the Clean Air Act do not follow the procedures prescribed in the APA, but rather follow similar but more specific procedures set forth in the act.

Key Environmental Laws Allow Deadline Suits and EPA Considers Several Factors in Responding to Those Suits

GAO identified seven key environmental laws that allow individuals to file a deadline suit to compel EPA to issue a statutorily required rule, or perform a statutorily required review of a rule to determine whether to revise the rule. EPA works with DOJ to consider several factors in determining whether or not to settle the deadline suit and the terms of any settlement.

Key Environmental Laws Allow Citizens to File Deadline Suits to Compel EPA Rulemaking

GAO identified seven key environmental laws for which EPA has primary regulatory authority that allow citizens to file a deadline suit. Table 1 lists the seven laws.

With the exception of the Emergency Planning and Community Right-to- Know Act (EPCRA), the key environmental laws allow citizens to file deadline suits to compel EPA to perform any act or duty required by the respective law, including issuing any required rules. For example, the provision in the Clean Air Act states: “ny person may commence a civil action on his own behalf - … against the Administrator where there is alleged a failure of the Administrator to perform any act or duty under this chapter which is not discretionary with the Administrator.” The provision in EPCRA that allows citizens to file deadline suits is different from the other key environmental laws because citizen suits may only be filed to compel certain actions listed in the law.

EPA and DOJ Consider Several Factors in Deciding Whether to Settle Deadline Suits

Within EPA, the Office of General Counsel is responsible for handling deadline suits. It works with the appropriate program offices in EPA, such as the Office of Air and Radiation (OAR) or the Office of Water, when negotiating settlements for deadline suits. EPA’s Office of General Counsel also coordinates with DOJ’s Environmental and Natural Resources Division.

According to EPA and DOJ officials, when a deadline suit is filed, the agencies work together to determine how to respond to the lawsuit, including whether or not to negotiate a settlement with the plaintiff or allow the lawsuit to proceed. In making this decision, EPA and DOJ consider several factors to determine which course of action is in the best interest of the government. According to EPA and DOJ officials, these factors include: (1) the cost of litigation, (2) the likelihood that EPA will win the case if it goes to trial, and (3) whether EPA and DOJ believe they can negotiate a settlement that will provide EPA with sufficient time to complete a final rule if required to do so. EPA and DOJ officials told us that they often choose to settle deadline suits when EPA has failed to fulfill a mandatory duty because it is very unlikely that the government will win the lawsuit. In many such cases, the only dispute is over the appropriate remedy, i.e., fixing a new date by which EPA should act. Additionally, in such cases, officials may believe that negotiating a settlement is the course of action most likely to create sufficient time for EPA to complete the rulemaking if it is required to issue a rule. EPA and DOJ have an agreement under which both must concur in the settlement of any case in which DOJ represents EPA.

See 28 C.F.R. §§ 0.160-0.163. duty. Thus, in general, this policy restricts DOJ from entering into a settlement if it commits EPA to take an otherwise discretionary action, such as including specific substantive content in the final rule unless an exception to this restriction is granted by the Deputy Attorney General or Associate Attorney General of the United States. According to EPA and DOJ officials, to their knowledge, EPA has been granted only one exception to the general restriction on creating mandatory duties through settlements—a 2008 settlement in a suit related to water quality criteria for pathogens and pathogen indicators. The Meese memo also provides that DOJ should not enter into a settlement agreement that interferes with the agency’s authority to revise, amend, or promulgate regulations through the procedures set forth in the APA.stated that they have not, and would not agree to settlements in a deadline suit that finalizes the substantive outcome of the rulemaking or declare the substance of the final rule.

Settlements Resulting in Major Rules Included Rulemaking Schedules, and EPA Received Public Comments on Drafts of Most Settlements

The terms of settlements in deadline suits that resulted in EPA issuing major rules in the last 5 years established a schedule to either promulgate a statutorily required rule or to promulgate a statutorily required rule or make a determination that doing so is not appropriate or necessary pursuant to the relevant statutory provision. EPA received public comments on all but one of the draft settlements in these suits.

Settlements in Deadline Suits Established a Schedule for Issuing Rules

EPA issued 32 major rules from May 31, 2008 through June 1, 2013 (see app. II). According to EPA officials, the agency issued 9 of these rules following settlements in deadline suits. They were all Clean Air Act rules. The 9 rules stem from seven settlements. Two of the settlements established a schedule to complete 1 or more rules, and five established a schedule to complete 1 or more rules or make a determination that such a rule was not appropriate or necessary in accordance with the relevant statute. Some of the schedules included interim deadlines for conducting rulemaking tasks, such as publishing a notice of proposed rulemaking in the Federal Register. Appendix III provides information on the schedules contained in each settlement.

In addition to schedules, the seven settlements also included, among other things, provisions that allowed deadlines to be modified (including the deadline to issue the final rule) and specified that nothing in the settlement can be construed to limit or modify any discretion accorded EPA by the Clean Air Act or by general principles of administrative law. Consistent with DOJ’s 1986 Meese memorandum, none of the settlements we reviewed included terms that required EPA to take an otherwise discretionary action or prescribed a specific substantive outcome of the final rule.

The seven settlements, committing EPA to issue the 9 statutorily required rules, were finalized between about 10 months and more than 23 years after the applicable statutory deadlines. For each of the 9 rules, figure 1 shows the date the regulation was due, the date the settlement was filed with the court, and the date the final rule was published in the Federal Register.

EPA Received Public Comments on Drafts of Most Settlements in Deadline Suits

The Clean Air Act requires EPA, at least 30 days before a settlement under the act is final or filed with the court, to publish a notice in the Federal Register intended to afford persons not named as parties or interveners to the matter or action a reasonable opportunity to comment in writing. EPA or DOJ, as appropriate, must then review the comments and may withdraw or withhold consent to the proposed settlement if the comments disclose facts or considerations that indicate consent to the settlement is inappropriate, improper, inadequate, or inconsistent with Clean Air Act requirements. The other six key environmental laws with provisions that allow citizens to file deadline suits do not have a notice and comment requirement for proposed settlements. According to an EPA official, with the exception of the agency’s pesticide program, EPA generally does not ask for public comments on defensive settlements if the agency is not required to do so by statute.

The 9 major rules EPA issued from May 31, 2008 to June 1, 2013 following seven settlements in deadline suits were Clean Air Act rules. For each settlement, EPA published a notice in the Federal Register providing the public the opportunity to comment on a draft of the settlement. EPA received between one and 19 public comments on six of the draft settlements. No comments were received on one of the draft settlements. Based on EPA summaries of the comments, the comments concerned the reasonableness of the deadlines contained in the settlements or supported or objected to the settlements. For example, some comments supported the deadline or asserted that the deadlines should be accelerated, others comments stated that EPA would have difficulty meeting the deadlines. EPA determined that none of the comments on any of the draft settlements disclosed facts or considerations that indicated that consent to the settlement in question would be inappropriate, improper, inadequate, or inconsistent with the act. Table 2 shows the number of public comments EPA received on each draft settlement.

According to EPA Officials, Settlements in Deadline Suits Primarily Affect Rulemaking Priorities in a Single EPA Office

According to EPA officials, settlements in deadline suits primarily affect a single office within EPA—the Office of Air Quality Planning and Standards (OAQPS)—because most deadline suits are based on provisions of the Clean Air Act for which that office is responsible. According to EPA’s Office of General Counsel, provisions in the Clean Air Act that authorize the National Ambient Air Quality Standards (NAAQS) program and Air Toxics program account for most deadline suits. These provisions have recurring deadlines requiring EPA to set standards and to periodically review—and revise as appropriate or necessary—those standards. OAQPS sets these standards through the rulemaking process. For example, the Clean Air Act requires EPA to review and revise as appropriate NAAQS standards every 5 years and to review and revise as necessary technology standards for numerous air toxics generally every 8 years.

The effect of settlements in deadline suits on EPA’s rulemaking priorities is limited. OAQPS officials said that deadline suits impact the timing and order in which rules are issued by the NAAQS program and the Air Toxics program, but not which rules are issued. The officials also noted that the impact of deadline suits on the two programs differs because of the different characteristics of the programs.

Regarding the NAAQS program, the Clean Air Act requires EPA to review and revise as appropriate the NAAQS standards for six pollutants—called criteria pollutants—at 5-year intervals. NAAQS standards limit the allowable concentrations of criteria pollutants in the ambient air. There is more than one standard for each criteria pollutant. EPA establishes the required standards through the rulemaking process and recently conducted seven NAAQS reviews to review the standards and revise as appropriate. According to an OAQPS official, prior to 2003, EPA did not review NAAQS on a regular cycle. Beginning in 2003, EPA faced four deadline suits for failure to complete NAAQS reviews for the six criteria pollutants. EPA settled two of these suits and was subject to a court order regarding the other two suits after it failed to successfully negotiate settlements with the plaintiffs. The settlements and court orders led EPA to perform the statutorily required reviews of the NAAQS standards for the six criteria pollutants and to promulgate seven rules—one for each NAAQS review. The last of these seven rules was promulgated in April 2012. According to officials, the deadline suits addressing the NAAQS standards did not affect which NAAQS standards were reviewed since EPA reviewed all of the standards. According to officials, the deadline suits did affect the timing and order in which EPA conducted the reviews to accommodate the time frames in the settlements and court orders. Additionally, according to officials, as a result of the experience in responding to the deadline suits, the agency is striving to maintain the 5- year statutory review cycle for criteria pollutants going forward. However, officials noted that it is difficult for EPA to complete its NAAQS reviews every 5 years. From April 2012 through September 2014, EPA has promulgated one rule following a NAAQS review after it settled a deadline suit and has missed the statutory deadline for reviewing the standards of two other criteria pollutants, one of which EPA is under court order to complete by October 2015 following a deadline suit.

Regarding the Air Toxics program, OAQPS officials said that the impact of deadline suits on the Air Toxics program is different from that of the impact on the NAAQS program because of the large number of rules that the Air Toxics program promulgates. For example, the Clean Air Act establishes a schedule under which EPA established 120 standards to reduce the emissions of 187 hazardous air pollutants. These National Emission Standards for Hazardous Air Pollutants (NESHAP) apply to certain categories of sources of these pollutants, such as cement manufacturing, municipal solid waste landfills, and semiconductor manufacturing. Generally, the act requires EPA, no less often than every 8 years, to review the standard, and revise as necessary. It makes any necessary revisions through the rulemaking process. The review must take into account developments in practices, processes, and control technologies. For sources subject to Maximum Achievable Control Technology (MACT) standards promulgated pursuant to section 112(d)(2) of the Clean Air Act, EPA must also conduct a residual risk assessment within 8 years after the initial promulgation of the standard. EPA refers to these two reviews together as the risk and technology review (RTR). As of October 2014, EPA has completed 28 RTRs (27 of these reviews following deadline suits) and has not completed 57 RTRs for which the statutory deadline has passed and 36 RTRs for which the statutory deadline has not passed. Additionally, officials report that, currently, most of the resources available to complete RTRs are focused on a 2011 settlement. This settlement listed 27 NESHAPs for which RTRs were overdue. OAQPS officials said that they have been unable to meet all of the time frames contained in the 2011 settlement and, as a result, have negotiated amendments to the settlement extending the time frames. Officials said that they intend to complete all of the overdue RTRs but are focused on fulfilling the terms of the 2011 settlement and several other settlements to which EPA has entered into that address a smaller number of reviews. Additionally, in September 2013, EPA received a NOI concerning 43 additional NESHAPs for which a RTR is overdue. EPA officials said that they are engaged in settlement discussions over one of these reviews for which EPA has been sued.

Additionally, we discussed with EPA budget officials the potential impact of budget allocation decisions associated with deadline suits on EPA offices that are not subject to deadline suits. According to the budget officials, EPA accounts for anticipated workload arising out of litigation in its budgeting cycle for affected programs but does not make changes in existing budget allocations specifically to address settlements in deadline suits. Thus, according to the official, the resources available to EPA offices not subject to these settlements are not directly impacted by the settlements.

Agency Comments

We provided a draft of this report to EPA and DOJ for review and comment. In written comments from EPA, reproduced in appendix IV, the agency generally concurs with our analysis and states that the report accurately describes EPA’s approach to deadline suit litigation brought against it. EPA also provided technical comments, which we incorporated as appropriate. In addition, in an e-mail received November 24, 2014, the DOJ Audit Liaison stated that the DOJ concurs with our report and has no additional comments.

As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies to the appropriate congressional committees, the Attorney General, the Administrator of the EPA, and other interested parties. In addition, the report will be available at no charge on the GAO website at http://www.gao.gov.

If you or your staff members have any questions about this report, please contact me at (202) 512-3841 or gomezj@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff members who made major contributions to this report are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

The objectives of this report are to examine (1) key environmental laws that allow citizens to file deadline suits that may compel the Environmental Protection Agency (EPA) to conduct a rulemaking and the factors EPA and the Department of Justice (DOJ) consider in determining whether or not to settle these lawsuits, (2) the terms of settlements in deadline suits that led EPA to promulgate major rules in the last 5 years and the extent to which the public commented on the terms of the settlements, and (3) the extent to which settlements in deadline suits have affected EPA’s rulemaking priorities.

To examine the key environmental laws that allow citizens to file deadline suits that may compel EPA to conduct a rulemaking, we identified through legal research nine key environmental laws for which EPA has primary regulatory authority. Through additional legal research, we determined that two of these laws do not include provisions that permit citizens to file deadline suits. These laws are the Federal Insecticide, Fungicide, and Rodenticide Act and related provisions of the Federal Food, Drug, and Cosmetic Act. To understand the factors that EPA considers in determining whether or not to settle deadline suits, we held discussions with officials from EPA’s Office of General Counsel and DOJ because both agencies are involved in making these determinations. We also discussed the processes and procedures that EPA follows when settling citizen deadline suits.

To examine the terms of settlements in deadline suits that led EPA to promulgate major rules in the last 5 years, we developed a list of major rules EPA issued from May 31, 2008 through June 1, 2013 by searching a database that GAO maintains to help implement the Congressional Review Act. We determined that the data were sufficiently reliable for the purpose of identifying major rules issued by EPA. EPA officials then identified which major rules EPA issued following a settlement in a deadline suit. We relied on EPA because neither EPA nor DOJ maintains a database that links settlements to rules, and there is no comprehensive public source of such information. For the purposes of this report, we use the term deadline suit to mean a lawsuit in which an individual or entity sues because EPA has allegedly failed to perform any nondiscretionary act or duty by a deadline established in law. A nondiscretionary act or duty is an act or duty required by law. This report only examines deadline suits that seek to compel EPA to either (1) issue a statutorily required rule when that rule has a deadline in law or (2) issue a statutorily required rule or make a determination that issuing such a rule is not appropriate or necessary pursuant to the relevant statutory provision, when issuing that rule or making that determination has a deadline in law. We did not review other types of suits against EPA. We obtained the settlements by accessing court records through the Public Access to Court Electronic Records. We then analyzed the content of each settlement and summarized the results.

To examine the extent to which the public commented on the terms of the settlements, we obtained from EPA legal memoranda summarizing the number and content of public comments EPA received on drafts of the settlements. Because each of the major rules issued following settlements in deadline suits were Clean Air Act rules, EPA solicited public comments on drafts of the settlements as required by the Clean Air Act. The act also requires EPA or DOJ to consider any public comments provided on settlements and authorizes them to withdraw or withhold consent to the proposed settlement if the comments disclose facts or considerations that indicate consent to the settlement is inappropriate, improper, inadequate, or inconsistent with the Clean Air Act requirements. EPA made these determinations and documented its decisions in legal memoranda that it provided to us. We analyzed the contents of these memoranda to determine the extent and nature of the public comments EPA received on draft settlements.

To examine the extent to which settlements in deadline suits have affected EPA’s rulemaking priorities, we obtained from EPA’s Office of General Counsel data on deadline suits it had settled from January 2001 through July 2014 and the EPA office(s) responsible for implementing the terms of the settlements. We assessed the reliability of the data by interviewing agency officials knowledgeable about the data. We determined that the data were sufficiently reliable for the purposes of this report. The data showed that one office was responsible for implementing the terms of most of the settlements. We spoke with officials from this office to understand the extent to which settlements in deadline suits had affected the timing and order of the rules they promulgated, as well as which rules they promulgated. We also spoke with EPA budget officials to understand the extent to which settlements in deadline suits affected budget allocation decisions for EPA offices not subject to settlements in deadline suits.

We also interviewed individuals from academia, an environmental group, industry, and a state official from Oklahoma, to obtain their perspectives on deadline suits. We chose these individuals because they had experience or knowledge related to deadline suits and could provide the perspective of different stakeholder groups. For example, one interviewee provided legal representation for an environmental group that filed a deadline suit, and another interviewee authored a report critical of how EPA responds when faced with a deadline suits. The views of these individuals cannot be generalized to those with whom we did not speak.

We conducted this performance audit from September 2013 to December 2014 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Appendix II: Major Rules Issued by EPA from May 31, 2008 to June 1, 2013

The Environmental Protection Agency (EPA) issued 32 major rules from May 31, 2008 to June 1, 2013. According to EPA officials, the agency issued 9 of these rules following settlements in deadline suits and issued 5 of the 32 rules to comply with court orders following deadline suits in which plaintiffs and EPA were unable to reach a settlement. The remaining 18 rules, according to agency officials, were not associated with a deadline suit. Table 3 lists the 32 major rules EPA issued from May 31, 2008 to June 1, 2013.

Appendix III: Contents of Settlements Following Deadline Suits That Compelled EPA to Issue 9 Rules from May 31, 2008 to June 1, 2013

The Environmental Protection Agency (EPA) issued 9 major rules from May 31, 2008 to June 1, 2013 following seven settlements in deadline suits. Each of the seven settlements established a schedule to either issue a statutorily required rule or make a determination that such a rule is not appropriate or necessary pursuant to the relevant statutory provision. EPA negotiated extensions to the deadlines to issue the final rules in five of the seven settlements. Table 4 summarizes the contents of the seven settlements.

Appendix IV: Comments from the Environmental Protection Agency

Appendix V: GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the individual named above, Vincent P. Price, Assistant Director; Rodney Bacigalupo; Elizabeth Beardsley; John Delicath; Charles Egan; Cindy Gilbert; Tracey King; and Kathryn Smith made key contributions to this report.