23 April 2019

Sidley Environmental Trends

Topics discussed this week include:

  • EPA releases FY 2020-21 national program guidance.
  • Third Circuit denies Navy’s rehearing request for PFAS ruling.
  • State Attorneys General challenge EPA MATS proposed rule.
  • Fifth Circuit vacates 2015 EPA wastewater regulations.

EPA releases FY 2020-21 national program guidance. The U.S. Environmental Protection Agency (EPA) has released its FY 2020-21 national program guidance outlining budget plans for the following program offices: Air and Radiation; Enforcement and Compliance; Chemical Safety and Pollution Prevention; Land and Emergency Management; Water; Congressional and Intergovernmental Relations; International and Tribal Affairs. These guidance documents serve as preliminary planning tools for specific program commitments and activities. The Office of Enforcement and Compliance Assurance’s (OECA) program guidance document sets forth OECA’s key activities to promote compliance through cooperative federalism, meet strategic measure targets and review key programmatic activities. In FY 2020, OECA is also beginning a new four-year National Compliance Initiative cycle and is seeking comment on its implementation strategy, including decisions to move the following enforcement measures from the National Compliance Initiative to EPA’s core enforcement programs: prevention of animal waste from contaminating surface and ground water; reducing air pollution from the largest sources; and keeping raw sewage and contaminated stormwater out of our nation’s waters. The guidance is open for public comment until May 3.

Third Circuit denies Navy’s rehearing request for PFAS ruling. On April 18, the U.S. Court of Appeals for the Third Circuit denied a petition for rehearing filed by the U.S. Navy following an October 2, 2018 ruling by the same panel that allowed private citizens living near Navy installations and exposed to perfluorinated compounds (PFOA or PFOS) to bring medical monitoring claims against the federal government. In the underlying October 2 ruling, the Third Circuit found that these medical monitoring claims are not challenges under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) and not barred by the doctrine of sovereign immunity. The Third Circuit found that because medical monitoring claims are “best characterized as injunctive relief,” and the federal government has waived its immunity to such suits under the Resource Conservation and Recovery Act (RCRA) Section 6001(a), the claims are not barred. In its request for rehearing, the Navy argued that these claims do not satisfy RCRA’s limited waiver of sovereign immunity for control and abatement of solid or hazardous waste; however, the Third Circuit declined to consider it because the Navy failed to raise the argument in the prior proceeding. Due to the prevalence of these substances on Department of Defense installations, this ruling may open the federal government to significant financial liability.

State Attorneys General challenge EPA MATS proposed rule. On April 17, one day before the close of EPA’s public comment period, 21 state Attorneys General, along with a handful of local regulators, urged the EPA not to revise its 2016 finding that it is “appropriate and necessary” for the agency to regulate hazardous air pollutants (HAPs) from coal- and oil-fired power plants under Section 112 of the Clean Air Act. That finding came on the heels of Michigan v. EPA, whereby the Supreme Court held that EPA erred in not considering costs when promulgating such regulations. In its February 7 proposed rule, the Trump administration proposed reversing course and finding that it is no longer “appropriate and necessary” to regulate these HAPs, commonly known as the Mercury and Air Toxics Standards (MATS) technology-based emissions limits, because it determined that the cost of compliance does not outweigh the benefits of the associated regulations.

The state Attorneys General argue that rescinding the “appropriate and necessary” finding would be arbitrary and capricious because the record demonstrates that the public health and environmental benefits of MATS overwhelmingly outweigh the costs of compliance. The state Attorneys General also argue that rescinding this finding would be unlawful under the Clean Air Act because the agency is not proposing to delist power plants as a source category subject to regulation under Section 112. Should EPA adopt its proposed finding, we can expect these state Attorneys General, along with a number of others, to quickly file suit and challenge the agency’s finding.

Fifth Circuit vacates 2015 EPA wastewater regulations. On April 12, the U.S. Court of Appeals for the Fifth Circuit, through a unanimous decision, vacated a 2015 EPA rule setting “best available technology economically achievable” (BAT) mandates for coal-fired power plant wastewater systems. Pursuant to the Clean Water Act, EPA may promulgate and enforce “effluent limitation guidelines” to regulate power plant discharges into adjacent bodies of water. Environmental petitioners challenged two discrete waste streams evaluated in the 2015 EPA Rule — BAT determinations for legacy wastewater and combustion residual leachate. Petitioners argued that these BAT determinations were arbitrary and capricious because they adopted the decades-old method of impoundment as the applicable BAT method, which allows wastewater to accumulate in ponds so that pollutants can settle to the bottom through the force of gravity. The Fifth Circuit agreed with petitioners, finding that EPA’s selection of impoundments as BAT ignores the agency’s own findings that the method is “largely ineffective.” As a result of the ruling, EPA will have to revise its BAT determinations for these waste streams, likely requiring the use of newer, and more effective, methods of control.