US EPA Publishes Proposed List of National Enforcement Initiatives for FY2017–19
By Alexander J. Bandza
On September 15, 2015, US EPA’s Office of Enforcement and Compliance Assurance published a proposed list of national enforcement initiatives (NEIs) for fiscal years 2017–19. This latest NEI list includes NEIs from the last round (FY2014–16) as well as three new potential NEIs that US EPA is considering.
OSHA Proposes 10-Fold Reduction in Beryllium Workplace Exposure Limit
By Allison A. Torrence
On August 7, 2015, the Occupational Safety and Health Administration (OSHA) published a proposed rule in the federal register that would reduce exposure limits for occupational exposure to beryllium. Beryllium is a strong but lightweight metal (it is stronger than steel, but lighter than aluminum) used primarily in the aerospace and defense industries and is classified as a strategic and critical material by the U.S. Department of Defense. OSHA estimates that approximately 35,000 workers are potentially exposed to beryllium in approximately 4,088 establishments in the United States.
State Department Approves Two Cross-Border Pipelines
By E. Lynn Grayson
Presidential permits are required for cross-border pipeline projects, and the State Department recently approved transferring ownership of two existing cross-border pipelines.
Cross-border pipelines have been the subject of much controversy, primarily related to the highly-publicized Keystone pipeline. Despite a flurry of legislative activity earlier this year, the fate of the Keystone pipeline that would expand Canadian oil distribution to the U.S. remains uncertain.
The State Department approved the transfer of ownership of the Express Pipeline to Spectra Energy Partners. This pipeline runs from Hardisty, Alberta, Canada to Casper, Wyoming. The permit allows Spectra to connect, operate, and maintain the existing pipeline facilities at the U.S.-Canada border to transport crude oil.
The State Department also approved the transfer of ownership of a pipeline running from El Paso, Texas to the Rio Grand River on the U.S.-Mexico border to Magellan Pipeline Company. The permit allows Magellan to connect, operate, and maintain existing pipeline facilities at the U.S.-Mexico border to transport liquid petroleum products.
In addition to the Keystone pipeline controversy, cross-border pipelines in general are the subject of significant public and regulatory scrutiny. Another recent example is the Alberta Clipper pipeline from Hardisty, Alberta, Canada to Superior, Wisconsin, where the State Department was accused of accelerating pipeline approval from Enbridge Energy—facts now at issue in litigation filed by a coalition of environmental groups opposed to the pipeline.
Corporate Environmental Lawyer celebrates five years of blogging with a new design!
In honor of the fifth anniversary of our entry into the blogosphere, we are excited to announce a major revamp of the Corporate Environmental Lawyer’s design. In addition to the blog’s sophisticated new look, our readers will enjoy:
Mobile and tablet responsive technology
A trending-categories cloud list
Easy-to-use social sharing buttons
Streamlined navigation menus
Access to all five years of posts
In the five years since our Environmental and Workplace Health & Safety (EHS) practice created the Corporate Environmental Lawyer, we have written more than 500 posts, provided critical updates and insights on issues across the EHS legal sectors, and been ranked among LexisNexis’s top 50 blogs. As we wish to continue to grow the blog and provide our readers with the information they want to know, Corporate Environmental Lawyer editors, Steven M. Siros and Genevieve J. Essig, encourage you to participate by suggesting new topics. We look forward to continuing to provide content covering the issues that are driving changes in environmental law.
EPA Revises Its Regulatory Agenda, A Flurry of Activity Expected in the Next Few Months
By Alexander J. Bandza
Last week, the EPA-specific listing on the website of the Office of Information and Regulatory Affairs was updated with timelines on the EPA’s regulatory efforts. Of potential interest, in chronological order of expected release, are the following rules:
New Jersey Assembly Unanimously Passes Bill Broadly Allocating Liability and Damages for Hazardous Substance Discharges from Offshore Drilling Platforms
By Alexander J. Bandza
Last week, the New Jersey Assembly unanimously passed a bill, A4258, which is notably broad in its language on allocating liability and damages for releases of hazardous substances from offshore drilling platforms. The bill would supplement N.J.S.A. 58:10-23.11, the New Jersey Spill Compensation and Control Act, which defines hazardous substances to include petroleum and petroleum products. The bill sets out that potentially liable parties include “[a]ny person who discharges a hazardous substance from a drilling platform” or “is in any way responsible for a hazardous substance that is discharged from a drilling platform.” (Emphasis added.) This discharge need not occur within the jurisdiction of New Jersey so long as the hazardous substance eventually “enters the waters of the State.” Persons that meet the above two conditions are “strictly, jointly and severally [liable], without regard to fault,” for:
Minnesota House and Senate Each Pass Bills Banning The Sale and Manufacture of Products Containing Plastic Microbeads
By Alexander J. Bandza
"Microbeads" are synthetic microspheres widely used in cosmetics, skin care and personal care products, which are added as exfoliating agents. Public interest groups have expressed concern that, because wastewater systems may be unable to filter microbeads from effluent released into public waterways, microbeads are entering the marine food chain. This week, the Minnesota House and Senate each passed bills that would ban the manufacture and sale of products containing plastic microbeads.
Both bills contain the same phased timeline:
Revised TSCA Reform Bill Approved by Senate Environment and Public Works Committee
Effective December 31, 2018, no one can sell personal care products containing synthetic plastic microbeads, but persons can continue selling over-the-counter drugs containing synthetic plastic microbeads. However, that same day, no one can manufacture for sale over-the-counter drugs that contains synthetic plastic microbeads.
Effective December 31, 2019, no one can sell over-the-counter drugs containing synthetic plastic microbeads.
By Steven M. Siros
At long last, with a 15-5 bipartisan vote, a Senate bill that would amend the Toxic Substances Control Act (TSCA) moved out of the Senate's Environment and Public Works Committee. Notwithstanding continuing objections from Senator Boxer, the bill that came out of the committee contained a host of changes from the original bill that were intended to address concerns that had been raised by democrats, environmental and public health advocates and U.S. EPA.
Several of these key changes include:
Existing Information to Increase Efficiency
U.S. EPA will incorporate existing information regarding hazard and exposure published by other Federal agencies or the National Academics into safety assessments, with the objective of increasing the efficiency of the safety assessments and determinations where that information is available, relevant, and scientifically reliable.
The term "unreasonable risk" is either clarified to exclude consideration of costs or other non-risk factors to conform with the safety standard definition, or the word "unreasonable" is dropped.
Deadline for Implementing Restrictions and Prohibitions
Compliance deadlines for risk management rules are to be "as soon as practicable," and bans and phase-outs are to be implemented "in as short a period as is practicable."
Access to CBI Information
If U.S. EPA bans or phases out a chemical, there is a rebuttable presumption that information on that chemical should no longer be protected as confidential business information.
States allowed to co-enforce, with condition that penalties can be collected from either Federal government or State and penalties at the state level cannot be greater than under federal TSCA.
Clarification that State air and water laws are not pre-empted.
State information collection and disclosure laws are protected from pre-emption.
Any State chemical regulation is permanently protected from pre-emption that is in effect before August 1, 2015.
Designation of a Low Priority Chemical
90 days of public comment for all listing decisions.
Public can challenge a low priority decision within 60 days of listing.
Clarifications of High Priority Designation
U.S. EPA required to designate a chemical as high priority based on "significant" hazard and "significant" exposure, and may designate a chemical as high priority if it has either characteristic.
When setting the initial list of high priority chemicals, U.S. EPA must give preference to TSCA Work Plan Chemicals that are persistent and bioaccumulative.
PBTs added as a criteria for U.S. EPA to consider when making prioritization determinations.
In risk management, U.S. EPA is required to select restrictions for PBTs that reduce exposure "to the maximum extent practicable."
Industry Petitioned Chemicals
In addition to high-priority chemicals designated by U.S. EPA, manufacturers and processors can petition U.S. EPA to designate additional non-high priority chemicals for safety assessments and determinations.
The industry would pay 100% of the cost of the assessment.
These chemicals can amount to a minimum of 25% and a maximum of 30% of the cumulative total number of high priority chemicals.
U.S. EPA Work Plan Chemicals
For chemicals that U.S. EPA has already identified as high risk chemicals on the TSCA Work Plan, manufacturers can petition for those chemicals to move to a safety assessment and determination, and pay 50% of the cost. U.S. EPA has full discretion to approve or deny these industry petitions.
The revised Senate bill seems to enjoy wide bi-partisan support and has been embraced by several advocacy groups, including the Environmental Defense Fund However, Senator Boxer has already indicated that she intends to pursue additional changes to the bill, stating "if anyone thinks the fight is over, it is just beginning."
Another bill to amend TSCA is also making its way through the House of Representatives. The discussion draft, captioned the "TSCA Modernization Act of 2015" was released by Representative John Shimkus. The House's discussion draft is much narrow in scope than the bill making its way through the Senate and has yet to make its way out of the House Energy and Commerce Subcommittee on Environment and Economy.
Assuming that the House bill makes it out of committee, the expectation is that the two chambers will have to reconcile the differences in the two bills in a conference committee.
Earth Day 2015: Beach Clean Up!
By E. Lynn Grayson
On Friday, April 17th, Jenner & Block partnered with ComEd and Exelon to clean up the 12th Street beach at Northerly Island, in cooperation with the Alliance for the Great Lakes. Our group picked up over 85 pounds of broken glass, plastic beverage containers, food wrappers, cigarettes, and other miscellaneous trash and debris.
The Adopt-a-Beach program is the premier volunteer initiative for the Alliance for the Great Lakes. Teams remove litter and enter results into the Adopt-a-Beach online system to share with local beach authorities, educate the public, and improve the beaches and the health of the Great Lakes.
This picture shows our team after clean up efforts at 12th Street beach:
What will you do to celebrate Earth Day 2015? How about participating in the Adopt-a-Beach program?
To learn more about beach clean up opportunities or to schedule an event, visit http://www.greatlakes.org/.
A special thanks to our own Gay Sigel for organizing the Jenner & Block team. Thanks, Gay!
Criminal Asbestos Case Against Tennessee Salvage Company
By E. Lynn Grayson
U.S. District Judge Ronnie Greer sentenced five people to prison terms in federal court in Greeneville, Tennessee, this week for conspiring to commit Clean Air Act offenses in connection with the illegal removal and disposal of asbestos-containing materials at the former Liberty Fibers Plant in Hamblen County, Tennessee, the Justice Department announced. A&E Salvage had purchased the plant out of bankruptcy in order to salvage metals which remained in the plant after it ceased operations.
U.S. District Judge Greer sentenced Mark Sawyer, 55, of Morristown, Tennessee, a former manager of A&E Salvage, to the statutory maximum of five years in prison, to be followed by two years of supervised release. A&E Salvage manager Newell Lynn Smith, 59, of Miami, Florida, was sentenced to 37 months and two years of supervised release. A&E Salvage Manager Eric Gruenberg, 50, of Lebanon, Tennessee, received a 28-month sentence. Armida, 56, and Milto DiSanti, 54, of Miami, Florida, each received sentences of six months in prison, to be followed by six months of home confinement. The judge ordered all the defendants to pay restitution of more than $10.3 million, which will be returned to Environmental Protection Agency's (EPA) Superfund, which was used to clean up the plant site contamination.
According to court documents, all the defendants pleaded guilty to one criminal felony count for conspiring to violate the Clean Air Act's "work practice standards" salient to the proper stripping, bagging, removal and disposal of asbestos. According to the EPA, the individuals engaged in a multi-year scheme in which substantial amounts of regulated asbestos containing materials were removed the former Liberty Fibers plant without removing all asbestos prior to demolition and stripping, bagging, removing and disposing of such asbestos in illegal manners and without providing workers the necessary protective equipment.
While managing asbestos in renovations and demolition projects can be challenging from an environmental and worker safety perspective, there clearly is a right way to do it and a wrong way. This case serves as a good reminder that taking shortcuts to save time and/or money has significant consequences.
California Seeks to Amend Proposition 65
By Steven M. Siros
On January 12, 2015, California's Office of Environmental Health Hazard Assessment ("OEHHA") proposed modifications to California's controversial Proposition 65 regulations. As any company that does business in California should know, Proposition 65 requires that a warning be provided for any product that contains one of hundreds of chemicals identified on the Proposition 65 list if there is any risk of a person being exposed to the listed chemical above a specified threshold. As a result, one is bombarded with Proposition 65 warnings from the point one disembarks onto the jet bridge until the time one arrives at his/her hotel and orders room service. OEHHA's proposed amendments to Proposition 65 appear to do little to ease the regulatory burden on companies that do business in California and/or minimize the burden of having to read all of the Proposition 65 warnings.
Overview of Proposed Changes
Warnings Must Now Identify Specific Chemicals: OEHHA has listed the following 12 chemicals which must be identified by name in any Proposition 65 warning: Acrylamide; Arsenic; Benzene; Cadmium; Carbon Monoxide; Chlorinated Tris; Formaldehyde; Hexavalent Chromium; Lead; Mercury; Methylene Chloride; and Phthalates.
Modified "Safe Harbor" Language: In order to avail oneself of the "safe harbor" warning, the warning must state that a product "can expose you" to a chemical or chemicals as opposed to the old "safe harbor" language that merely required that the warning state that the product "contains a chemical" that is known to the State to cause cancer or reproductive toxicity. In addition, for the following consumer products and services, specific warnings would be required: food and dietary supplements; alcoholic beverages; restaurant foods and non-alcoholic beverages; prescription drugs; dental care; furniture; diesel engine exhaust; parking facilities; amusement parks; designated smoking areas; petroleum products; service station and vehicle repair facilities.
New Lead Agency Website: The proposed regulations would also create a new section on the OEHHA website that would provide detailed information on products and exposures. OEHHA would also have the authority to request that businesses provide more detailed information, including estimated levels of exposure for listed chemicals.
Limited Responsibility for Retailers: Retailers would be relieved from Proposition 65 liability in most circumstances and the responsibility for providing the requisite Proposition 65 warning would fall squarely on the manufacturer, distributer, producer and/or packager.
OEHHA will be accepting written comments on the proposed changes until April 8, 2015. Not surprisingly, OEHHA's proposed regulations have not been warmly received by industry and it is expected that affected businesses and trade associations will be submitting comments in opposition to these proposed amendments. Please click here and here to see the text of the proposed amendments.
Environmental Groups Sue Over Applicability of TRI Data
By E. Lynn Grayson
A recent lawsuit filed by 10 environmental groups against EPA alleges that EPCRA Section 313 Toxic Release Inventory (TRI) reporting should apply to oil and gas extraction companies. The environmental groups want TRI data regulatory requirements about releases to the environment to apply to oil drilling and exploration, hydraulic fracturing and natural gas processing activities.
According to the lawsuit recently filed in the U.S. District Court for the District of Columbia, EPA conducted rulemaking in the 1996-1997 time frame to consider adding other industry sectors to the list of facilities required to complete TRI reporting. At that time, EPA concluded that "oil and gas extraction classified in SIC code 13 is believed to conduct significant management activities that involve EPCRA Section 313 chemicals." EPA did not regulate the oil and gas industry following these earlier rulemaking efforts and for that reason, in 2012, environmental groups petitioned EPA to initiate rulemaking to add the oil and gas industry to TRI reporting requirements. The lawsuit alleges that EPA has not responded to that petition.
The environmental groups also allege that 127 tons of hazardous air pollutants are released by the oil and gas industry annually as well as other releases to the environment through discharges to surface waters, contamination of groundwater, underground injection and disposal in landfills. The lawsuit contends that regulation of the oil and gas industry is even more important today given the expansion of hydraulic fracturing and horizontal drilling.
The environmental groups bringing the lawsuit include the: Environmental Integrity Project, Center for Effective Government, Chesapeake Climate Action Network, Citizens for Pennsylvania's Future, Clean Air Council, Delaware Riverkeeper Network, Natural Resources Defense Council, Responsible Drilling Alliance, and Texas Campaign for the Environment.
The oil and gas industry has concluded that TRI requirements never were intended to cover such facilities given the few employees typically involved in these operations and the multitude of other regulations applicable to the oil and gas industry. They also look to the 1996-1997 rulemaking effort but with a different recollection recalling that EPA confirmed at that time that "…This industry group is unique in that it may have related activities located over significantly large geographic areas. While together these activities may involve the management of significant quantities of EPCRA section 313 chemicals in addition to requiring significant employee involvement, taken at the smallest unit (individual well), neither the employee nor the chemical thresholds are likely to be met." Industry advocates have criticized these environmental groups, and particularly the Environmental Integrity Project, for attempting to manipulate data in order to oppose oil and gas development and seeking to impose additional regulatory requirements on an industry already heavily regulated.
The TRI program is an expansive regulatory initiative that mandates annual reporting obligations for certain facilities that fall within specific industry sectors, have 10 or more full time employees and manufacture or process 25,000 pounds of toxic chemicals subject to EPCRA Section 313 or otherwise use 10,000 pounds of these same chemicals in any given year. It is typically the case that many of the oil and gas extraction operations would not meet these reporting thresholds as previously concluded by EPA. It appears, however, that this issue may be debated once again in the context of this case.
Texas Petrochemical Refinery Achieves Reasoned Victory Against Clean Air Act Citizen Suit
By Alexander J. Bandza
ExxonMobil Corp. (Exxon) operates a refinery complex in Baytown, Texas, which is the largest petroleum and petrochemical complex in the U.S. This Complex is governed by Title V operating permits issued by the Texas Commission on Environmental Quality (TCEQ). In a 2010 citizen lawsuit, Environmental Texas Citizen Lobby Inc. and the Sierra Club alleged that, since 2005, equipment breakdowns, malfunctions and other non-routine incidents at the Complex caused illegal emissions of benzene, hydrogen chlorides, sulfur dioxide, hydrogen sulfide, carbon monoxide, and other substances. Plaintiffs sought $641 million in damages. On December 17, 2014, the District Court declined to impose any penalty, finding that the $1.4 million penalty and stipulation on future corrective action that Exxon previously agreed to with TCEQ was sufficient.
The case illustrates that a proactive EHS effort can pay real dividends in defending against citizen suits or enforcement actions, even if the number of violations are not in the company’s favor. By way of background, all parties stipulated to Exxon’s indications of noncompliance, described as:
241 “reportable emissions events” (i.e., those events “that release greater than a certain threshold quantity of pollutants” and are reported to TCEQ);
3,735 “recordable emissions events” (i.e., those events “that release less than the aforementioned threshold quantity of pollutants” but are not reported to TCEQ); and
901 Title V deviations.
TCEQ investigates all reportable emissions events. After investigating, TCEQ assessed about $1.1 million in penalties against Exxon, and Harris County assessed about $0.3 million in penalties. Furthermore, in 2012, TCEQ and Exxon entered into an agreed enforcement order, which stipulated penalties for future reportable emissions events and mandated four environmental improvement projects. The projects would cost about $20 million.
Finding as a threshold matter that not all of Plaintiffs’ counts were actionable, the court declined to assess penalties for any of Plaintiffs’ remaining counts. The Court was not persuaded that the number of events and deviations meant anything: “Despite good practices, it is not possible to operate any facility—especially one as complex as the Complex—in a manner that eliminates all Events and Deviations.” Rather, the Court was persuaded that Exxon’s efforts to conduct an internal investigation and implement corrective actions after every discovery of a potential non-compliance event, which conformed to or exceeded industry practice, meant that Exxon “made good faith efforts to comply with the CAA.” Furthermore, the Court was not persuaded that the violations were serious or lengthy in duration, nor was it persuaded that Exxon gained any economic benefit from non-compliance. The Court entered judgment for Defendants.
The findings of fact are available here.
Governor Quinn Nixes Illinois Statute of Repose for Construction Asbestos Claims
By Steven M. Siros
In one of his last acts on the way out of office, Governor Quinn gave what some describe as a "big Christmas gift for the plaintiffs' bar" when he signed into law a bill that exempts construction-related asbestos personal injury claims from Illinois' ten-year statute of repose. SB 2221 was targeted at plaintiffs suffering from mesothelioma, a form of lung cancer with a long latency period. The bill will go into effect on June 1, 2015.
The bill was opposed by pro-business groups which argued that the bill only further reinforced Illinois' reputation for having an abusive legal climate. According to Illinois Lawsuit Abuse Watch, Madison County, Illinois is home to a quarter of the nation's asbestos litigation and this bill will certainly enable additional asbestos litigation. On the other hand, the bill's sponsors contend that the bill levels the playing field for those suffering from mesothelioma, a disease for which the symptoms may not present themselves for more than 20 years after exposure. Please click here to see a copy of the bill that was signed into law by Governor Quinn.
Illinois SB 2221 To Eliminate the State’s Statute of Repose for Construction Defects Arising Out of Pollution, Hazardous Substances
By Alexander J. Bandza
Under 735 ILCS 5/13-214, Illinois provides for a ten-year statute of repose for any actions in “tort, contract or otherwise” on defects in construction of improvements to real property. Specifically, subsection (b) provides that:
No action based upon tort, contract or otherwise may be brought against any person for an act or omission of such person in the design, planning, supervision, observation or management of construction, or construction of an improvement to real property after 10 years have elapsed from the time of such act or omission.
State Rep. Nekritz has introduced SB 2221, which would strip the protections afforded by section 5/13-214 for actions “resulting from the discharge into the environment of any pollutant.” Specifically, the bill adds a new subsection (f), which provides that:
(f) Subsection (b) does not apply to an action that is based on personal injury, disability, disease, or death resulting from the discharge into the environment of any pollutant, including any waste, hazardous substance, irritant, or contaminant (including, but not limited to, smoke, vapor, soot, fumes, acids, alkalis, asbestos, toxic or corrosive chemicals, radioactive waste, or mine tailings).
While speculating on the Legislature’s intent is always risky business, this proposed bill may have been conceived in the wake of the U.S. Supreme Court’s decision in CTS Corporation v. Waldburger, 134 S. Ct. 2175 (2014), which held that CERCLA § 9658 does not preempt states’ statutes of repose. As Illinois courts have long recognized, the construction statute of repose was enacted for the express purpose of insulating all participants in the construction process from the onerous task of defending against stale claims. SB 2221’s broad and unqualified language could have the drastic effect of stripping the protections afforded by section 5/13-214 whenever any “discharge into the environment of any pollutant” was involved.
SB 2221 is available here.