Cities Respond to Moody’s Global Warming Rating
By Steven M. Siros
On December 4, 2017, I wrote a blog regarding Moody’s Investors Service’s threat to downgrade state and municipal credit ratings if they failed to adequately plan for and attempt to mitigate climate change risks. A day later, in conjunction with the North American Climate Summit, Chicago’s mayor and dozens of other mayors signed the “Chicago Climate Charter,” which calls on mayors to work to achieve a reduction in greenhouse gas emissions that’s equal to or more than that required by the 2015 Paris Agreement. The charter would require participating cities to track and publicly report greenhouse gas emissions and take action to plan for climate change related impacts in local infrastructure and energy planning. While these actions may not have been in direct reaction to Moody’s threat, such forward thinking may minimize the risk for participating cities in future rating downgrades relating to climate change impacts.
Cities Risk Ratings Downgrade for Failure to Address Climate Change Risks
By Steven M. Siros
In a November 28, 2017 report, Moody’s Investors Service warned cities and states that they faced the risk of a credit rating downgrade if they were not proactive in planning to mitigate the risks of climate change. The Moody’s report listed six indicators that it used to assess the exposure and overall susceptibility of states and municipalities to the physical effects of climate change, including share of economic activity derived from coastal areas, hurricane and weather damage as a share of the economy, and the share of homes in a flood plain. Based on these indicators, Florida, Georgia, Mississippi, and Texas were the states most at risk from climate change. Although Moody’s couldn’t point to a specific state or municipality whose rating was (or might be) downgraded as a result of a failure to plan for climate change, the Moody’s report clearly sets the stage for such downgrades in the future.
Dumpster Diving Results in $9.5M Penalty Recovery for California
By Steven M. Siros
DirecTV recently agreed to pay $9.5 million to settle claims by the State of California that it had illegally shipped hazardous wastes such as batteries and aerosol cans to local landfills across the state. California accused DirecTV of violating California’s Hazardous Waste Control Law and Unfair Competition Law after an investigation of DirecTV dumpsters at 25 facilities throughout the state identified violations at each location. DirecTV agreed to pay $8.9 million in civil penalties, costs, and supplemental environmental projects, and another $580,000 on measures aimed at ensuring future compliance with California’s hazardous waste regulations. The company also agreed to injunctive relief prohibiting future violations.
Great Lakes Legacy Act Key to CERCLA Innovation?
By Steven M. Siros
U.S. EPA’s Office of Superfund Remediation and Technology Innovation (“OSRTI”) recently indicated that it may be looking to the Great Lakes National Program Office’s (“GLNPO”) sediment cleanup program for best practices that might be applicable to Superfund cleanups. OSRTI’s evaluation of GLNPO’s sediment program is consistent with comments submitted by responsible parties and cleanup contractors that U.S. EPA should give more consideration to leveraging public and private funds in Superfund cleanups. The Great Lakes Legacy Act established the GLNPO, which has been working closely with states, local government entities and other stakeholders to address sediment issues at 31 areas of concern in the Great Lakes area. U.S. EPA’s website notes that the Great Lakes Legacy Act program has invested approximately $338 million to address these sediment impacted sites while leveraging an additional $227 million from non-federal parties. Whether this approach can achieve similar results at other Superfund sites remains to be seen, but such flexibility would appear to be consistent with Administrator Pruitt’s priority to more quickly and economically address CERCLA sites.
New GAO Report on DOD Drinking Water Recommends Improvements
By E. Lynn Grayson
A new GAO Report finds that DOD failed to report drinking water-related violations for 16 of its installations and that overall compliance rates were lower for DOD-treated drinking water systems. The Report also noted DOD has made some progress in addressing emerging contaminants in its drinking water, specifically including perfluorooctane sulfonate (PFOS), perfluorooctanoic acid (PFOA), and perchlorate.
The Report identified different compliance rates between DOD-treated water systems and non-DOD-treated water systems. Just one percent of individuals who received non-DOD-treated water from military installation systems were served by systems with EPA or local health violations. However, 11 percent of individuals who received DOD-treated drinking water were served by systems with such violations. DOD has taken steps to limit individuals’ exposure to some chemicals, including providing alternative water supplies and installing water treatment systems.
The Report recommends the following key actions to improve DOD’s data, reporting, and oversight of drinking water requirements:
Identify and implement any necessary changes to DOD’s environmental compliance policy to clarify DOD’s reporting requirements for violations of health-based drinking water standards;
Identify and implement actions to increase understanding at Army, Navy and Air Force installations and commands about DOD’s reporting requirements for violations of health-based drinking water regulations; and
Review reported compliance data to identify the reasons for any differences in the number of violations of health-based drinking water regulations between DOD’s two types of public water supplies and take action to address the causes of any differences.
DOD concurred with each of these recommendations.
D.C. Circuit Rejects Sierra Club Challenges to LNG Exports
By Steven M. Siros
On November 1, 2017, the United States District Court of Appeals for the D.C. Circuit rejected the Sierra Club's National Environmental Policy Act (“NEPA”) challenges to the Department of Energy’s (“DOE”) authorization of export of liquefied natural gas from three facilities in Louisiana, Maryland, and Texas. The court noted that its decision in Sierra Club v. U.S. Department of Energy (Freeport), 867 F.3d 189 (D.C. Cir. 2017) was largely determinative of the Sierra Club’s challenges to the LNG exports from these three facilities. In the Freeport decision, the court agreed that DOE had provided a reasoned explanation as to why DOE believed the indirect effects pertaining to increased gas production were not reasonably foreseeable. The court also found that DOE did not violate NEPA when declining to make specific projections regarding the environmental impacts associated with the increased production. The Freeport court also acknowledged that DOE had adequately considered the downstream greenhouse gas emissions resulting from the indirect effects of the LNG exports.
Notwithstanding the Freeport decision, the Sierra Club continued to challenge DOE’s authorizations for LNG exports for these three facilities, arguing that DOE’s reliance on an Environmental Assessment that found no significant impact (as opposed to an Environmental Impact Statement) is contradicted by evidence in the record. The court rejected this argument, noting that an agency’s finding of no significant impact will only be reversed if the decision was arbitrary, capricious, or an abuse of discretion which the court concluded was not supported by the record evidence. The Sierra Club also argued that DOE failed to consider the distributional impacts when evaluating “public interest” under the Natural Gas Act. However, the court noted that DOE had in fact considered the distributional impacts of the LNG exports.
Following this judgment, the Sierra Club will have lost all four petitions it filed against the DOE relating to NEPA assessments for LNG exports. The Sierra Club also lost all four of its petitions challenging FERC’s approval of these LNG exports. Please click here for a copy of the court’s November 1st decision.
EPA Publishes Proposed Rule on Reporting Requirements for the TSCA Mercury Inventory
By Andi Kenney
On October 26, 2017, EPA published a proposed rule requiring manufacturers and importers of mercury and mercury-added products or any other person who intentionally uses mercury in a manufacturing process to provide EPA with both quantitative and qualitative information about the elemental mercury and mercury compounds involved in their activities. 82 FR 49564 (October 26, 2017).
Under Section 8(b)(10)(B) of the Toxic Substances Control Act (TSCA), EPA must publish an inventory of mercury supply, use, and trade in the United States” in 2017 and every year thereafter. This reporting rule is authorized by Section 8(b)(10)(D) of TSCA which requires covered persons to provide EPA with the information the Agency needs to prepare that inventory.
The list of potentially affected industries is wide ranging and includes, among many others, mining, chemical manufacturing, plastics and resin manufacturing, medicinal and pharmaceutical manufacturing, coating and adhesive manufacturing, tire and rubber product manufacturing, fabricated metal products (including ammunition) manufacturing, circuit board and semiconductor manufacturing, office and industrial equipment manufacturing, watch and measuring equipment manufacturing, lighting and household appliance manufacturing, battery and electrical equipment manufacturing, boat and RV manufacturing, toy and jewelry manufacturing, and hazardous and non-hazardous waste facilities.
The reporting requirements focus on those who first manufacture mercury or mercury-added products or otherwise intentionally use mercury in a manufacturing process. The proposed rule would not apply to persons generating, handling or managing mercury-containing waste, unless that person manufactures or recovers mercury and uses it or stores it for use. Nor would it apply to those merely engaged in the trade of mercury, those importing mercury-added products for personal use and not for commercial purposes, those manufacturing mercury incidentally (such as by burning coal) or those importing a product that contains mercury solely as a component in a mercury-added product (such as a toy with a mercury-added battery). It would, however, apply to mercury or mercury-containing by-products manufactured for commercial purposes and to the storage of mercury and mercury-added products after manufacture.
EPA is proposing an initial reporting deadline of July 1, 2019, with subsequent reports due every three years thereafter. Each report would cover only the preceding calendar year.
EPA is accepting comments on the proposed rule until December 26, 2017.
Imagine a Day Without Water
By E. Lynn Grayson
Today recognizes the third annual Imagine a Day Without Water event to raise awareness and educate America about the value of water. Over 500 organizations, cities, water authorities, and corporations have joined together once again to focus attention on the importance of this valuable resource and the critical need to upgrade and improve water infrastructure throughout the U.S.
No water to drink, or even to make coffee with. No water to shower, flush the toilet, or do laundry. Hospitals would close without water. Firefighters couldn't put out fires, and farmers couldn't water their crops. Some communities in America already know how impossible it is to try to go a day without our most precious resource: water.
The 2017 Infrastructure Report Card published by the American Society of Civil Engineers provided an overall grade of a D+ for the status and condition of U.S. infrastructure. Particularly as to drinking water, the Report Card noted the following:
One million miles of pipes deliver drinking water and most date from the early 20th century with a 75-100 year lifespan
Over 240,000 water main breaks occur annually
Over $1 trillion dollars is the estimate needed to maintain/upgrade/expand service to meet water demands over the next 25 years.
Can you imagine a day without water? In the context of your business and its operations, please consider the resources available from these two organizations that address the following water-related considerations, including conditions and capacity, funding, public safety, future needs, and resilience and innovation.
EPA Announces Smart Sectors Program to Ease Regulatory Burden on Industry
By Allison A. Torrence
On September 26, 2017, EPA announced its new Smart Sectors program, a program aimed at easing the regulatory burden on industry. The official notice for this program was published in the Federal Register on September 26th (82 FR 44783), with a correction published on September 29th (82 FR 45586). EPA explained the purpose behind the Smart Sectors program in the notice:
EPA’s Smart Sectors program will re-examine how EPA engages with industry in order to reduce unnecessary regulatory burden, create certainty and predictability, and improve the ability of both EPA and industry to conduct long-term regulatory planning while also protecting the environment and public health.
EPA has initially identified 13 sectors of industry to work with under this program, based on each sector’s potential to improve the environment and public health:
Cement and concrete
Electronics and technology
Forestry and paper products
Iron and steel
Oil and gas
Ports and marine
Utilities and power generation.
EPA will designate staff-level points of contact for each industry who will act as liaisons among industry trade associations and companies, EPA program and regional offices, state and local governments, and other stakeholder groups.
Under this program, EPA will focus on three main areas:
Building relationships and improving customer service to sectors;
Developing additional expertise in each industry’s operations and environmental performance; and
Informing the planning of future policies, regulations, and Agency processes.
EPA is inviting participating industries to engage in dialogue and offer their own ideas to reduce environmental impacts. In addition, EPA will work to find creative ways to document environmental progress and regulatory burden reductions.
Jenner & Block Welcomes Sam Hirsch Back from ENRD
By Steven M. Siros
Jenner & Block is pleased to report that Sam Hirsch, former Acting Assistant Attorney General and Principal Deputy at the U.S. Department of Justice’s Environment and Natural Resources Division (ENRD), has returned to the Firm as a Partner in our Washington, DC office. Sam was formerly an attorney with Jenner & Block until 2009 when he moved to the U.S. Department of Justice, where he served as Deputy Associate Attorney General before taking on his most recent role. During his time at ENRD, Sam was primarily responsible for litigation and policy work relating to the prevention and cleanup of pollution, environmental challenges to federal programs, stewardship of public lands and natural resources, property acquisition, wildlife protection, and Indian rights and claims. As Acting Assistant Attorney General and Principal Deputy, he oversaw the drafting of more than 200 briefs, including more than 40 U.S. Supreme Court cert-stage, merits, and amicus briefs, as well as more than 150 appeal-recommendation memos to the Solicitor General. These briefs and memos dealt with cases in all 13 federal circuits and covered nearly the entire range of federal environmental and natural resources statutes, including the Clean Air Act, the Clean Water Act, the National Environmental Policy Act (NEPA), the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA, or Superfund), the Oil Pollution Act, the Resource Conservation and Recovery Act (RCRA), the Safe Drinking Water Act, the Endangered Species Act, the Migratory Bird Treaty Act, the Marine Mammal Protection Act, and the Lacey Act.
Sam was involved in all phases of the Deepwater Horizon litigation, including helping structure the global settlement, which directed more than $8.1 billion toward restoring damaged natural resources in the Gulf of Mexico. He also drafted portions of the criminal plea agreements that created the National Academy of Sciences' $500 million Gulf Research Program, which funds and conducts studies and projects to enhance oil-system safety, human health, and environmental resources in the Gulf of Mexico and other U.S. outer-continental-shelf regions that support oil and gas production.
Sam may be reached at (202) 637-6335 or firstname.lastname@example.org. Welcome back Sam!
President Trump’s U.S. EPA—Status Update on Nominations
By Steven M. Siros
Unless one has been living under a log (and even that might not be an excuse), we all know that Scott Pruitt was confirmed as U.S. EPA Administrator on February 17, 2017. However, the status of President Trump’s other U.S. EPA nominations may not be as front and center. As such, here is a quick cheat sheet for those watching at home (current as of 9/21/2017):
General Counsel: Matthew Leopold. Mr. Leopold was nominated as General Counsel to U.S EPA in September 2017. Mr. Leopold was an attorney with the Environment and Natural Resources Division of DOJ for approximately six years and then became general counsel for Florida Department of Protection. Upon leaving FDEP in 2015, he joined the Florida-based law firm Carlton Fields. Mr. Leopold’s nomination has been referred to the Senate Environmental and Public Works committee and his nomination (along with the nominations of Dourson, Wehrum and Ross) were to have been considered by the committee yesterday (Sept. 20th) but the hearings were cancelled when the Senate decided it had worked enough and adjourned early for the week.
Enforcement and Compliance Assurance: Susan Parker Bodine. Ms. Bodine was nominated as Assistant Administrator for the Office of Enforcement and Compliance Assurance in May 2017. Since 2015, Ms. Bodine has been serving as chief counsel on the Senate Environment and Public Works Committee and previously served as the Assistant Administrator of the Office of Land and Emergency Management. Ms. Bodine’s nomination was approved by the Senate Environmental and Public Works committee on July 12th and she is awaiting full Senate confirmation. Ms. Bodine has over 29 years of environmental law experience, including having worked at two law firms and being the staff director and counsel for the House Transportation & Infrastructure Committee’s water panel.
Chemical Safety and Pollution Prevention: Michael Dourson. Mr. Dourson was nominated in July 2017 to become the Assistant Administrator for the Office of Chemical Safety and Pollution Prevention. Mr. Dourson is a toxicologist who had formerly worked at U.S. EPA. After leaving U.S EPA in the 1990s, Mr. Dourson founded the non-profit group Toxicology Excellence for Risk Assessment which opponents have criticized for being at least partially funded by industry. Mr. Dourson is currently a professor at the University of Cincinnati. His nomination has been referred to the Senate Environmental and Public Works committee but his nomination hearing has been delayed.
Office of Water: David Ross. Mr. Ross was nominated in September 2017 to become the Assistant Administrator of the Office of Water. Mr. Ross currently serves as Wisconsin’s assistance attorney general and Director of the Environmental Protection Unit for the Wisconsin Department of Justice. Mr. Ross previously served in the Wyoming Attorney General’s Office. Mr. Ross seems generally to have bi-partisan support and his nomination has been referred to the Senate Environmental and Public Works committee but his nomination hearing has been delayed.
Air and Radiation: William Wehrum. Mr. Wehrum was nominated in September 2017 to become the Assistant Administrator of the Office of Air and Radiation. Mr. Wehrum had previously served as U.S. EPA’s acting assistant administrator for the Office of Air and Radiation from 2005 to 2007. He is currently with the law firm of Hunton & Williams and has over 31 years of experience working in the environmental field. Mr. Wehrum also seems to have some limited bi-partisan support but he was also nominated for this same position by President Bush in 2005 but his nomination was pulled after Democrats accused Mr. Wehrum of working with polluters. This same charge is currently being levied by environmental organizations. Interestingly, Mr. Wehrum is scheduled to argue before the D.C. Circuit on September 26th in a lawsuit challenging OSHA's silica rules pertaining to the construction industry. His nomination has been referred to the Senate Environmental and Public Works committee but his nomination hearing has been delayed.
President Trump has yet to nominate someone for the Deputy Administrator. Potential nominees that had been floated were Jeff Holmsted and Andrew Wheeler, but for now, the position is held by Mike Flynn who had previously been U.S. EPA’s Associate Deputy Administrator.
Third-Annual Environmental Attorney Reception at Jenner on Thursday 9/14
By Allison A. Torrence
On Thursday, September 14th, from 5 pm to 7 pm, environmental attorneys and professionals will come together for a networking reception at Jenner & Block's offices in Chicago. Complimentary food and drinks will be provided thanks to the event’s sponsors. This is the third year Jenner & Block has hosted this event, which continues to grow every year. Jenner & Block will be joined by a number of bar associations and organizations:
CBA Environmental Law Committee
CBA Young Lawyers Section Environmental Law Committee
ISBA Environmental Law Section
ABA Section of Environment, Energy, and Resources
Air & Waste Management Association Lake Michigan States Section
DRI Toxic Tort and Environmental Law Committee
Jenner & Block partner Allison Torrence is a former Chair of the CBA Environmental Law Committee and will be giving brief welcome remarks.
Details for this event are below. If you would like to join us at this reception, please RSVP here.
Environmental Attorney Reception
September 14, 2017 | 5:00 pm to 7:00 pm
Jenner & Block Conference Center | 45th Floor | 353 N. Clark St. | Chicago, IL 60654
Who is in Charge of Protecting the Environment--The Role of U.S. EPA and State Environmental Agencies During a Hurricane
By Steven M. Siros and Allison A. Torrence
Following Hurricane Harvey, and with the pending landfall of Hurricane Irma, the manner and degree to which federal and state agencies coordinate environmental protection duties may seem chaotic and disorganized. However, there is a specific protocol that guides these federal agencies in taking steps to protect the environmental in anticipation of and following a hurricane.
As brief background, in 1988, the Robert T. Stafford Disaster Relief and Emergency Assistance Act (the “Stafford Act”) was promulgated in an effort to establish an orderly process pursuant to which the Federal Government provides disaster and emergency assistance to State and local governments. At the request of the Governor of an affected State, the President may declare a major disaster or emergency. For example, on September 4, 2017, Florida Governor Rick Scott declared a state of emergency in anticipation of Hurricane Irma. Shortly thereafter, President Trump declared a major emergency. Upon declaration of such a major disaster or emergency, the President appoints a Federal Coordinating Officer (“FCO”), a FEMA official who is charged with coordination of Federal assistance to the affected State and local governments.
FEMA’s primary focus is protection of human life and the majority of federal resources are obviously directed towards that goal. However, FEMA also works closely with other agencies such as U.S. EPA and state environmental agencies to implement emergency response activities focused on protecting the environment. FEMA has established numerous Emergency Support Functions (ESFs), which provide the structure for coordinating interagency support for a Federal response to declared disasters and emergencies. U.S. EPA has been designated as the ESF Coordinator for Emergency Response # 10—Oil and Hazardous Materials Response.
Here are some key environmental issues that federal and state agencies focus on during a natural disaster such as a hurricane:
Performing initial evaluations of drinking water systems to identify potential vulnerabilities, and then performing post-disaster damage assessments to identify impacted systems and provide resources to bring those systems back on line as rapidly as possible. Over 4,000 public drinking water systems were impacted in Texas and Louisiana as a result of Hurricane Harvey.
Taking steps to secure federal and state cleanup sites (i.e., proactively removing drums of waste and either shutting down remedial systems or ensuring that those systems will continue to operate) in advance of the hurricane, and then promptly assessing damage to those sites and taking emergency measures to abate any ongoing releases to the environment.
Assessing conditions at major industrial facilities and proactively ensuring that chemical and waste containers are appropriately secured and assisting in the implementation of preventive measures (i.e. process shutdowns).
Assessing and taking steps to abate releases from smaller industrial facilities that are likely to lack the emergency preparedness plans that should be present and implemented at larger industrial facilities.
U.S. EPA also has the ability to address potential fuel shortages by waiving certain fuel emission requirements under the Clean Air Act, as has already occurred in response to Hurricane Harvey.
U.S. EPA has a general hurricane website that provides useful information about protecting health and the environment before and after a hurricane. U.S. EPA will also typically set up websites that are intended to keep the public informed as to the status of its ongoing operations. For example, U.S. EPA set up a website for Hurricane Harvey and a website for Hurricane Irma. State regulatory agencies have also set up similar websites—TCEQ has a Hurricane Harvey website and FDEP has a Hurricane Irma website. Although we certainly hope that Hurricane Irma veers far east off into the Atlantic, if it does not (which unfortunately appears likely to be the case), federal and state resources are being readied in an effort to prevent and mitigate adverse environmental impacts associated with this storm.
Hurricane Harvey Response: TCEQ Suspends Environmental Rules
By E. Lynn Grayson
As the cleanup, rebuilding, and recovery continues in the aftermath of Hurricane Harvey, there has been increasing news coverage about the environmental consequences resulting from impacts of this devastating storm in Texas. We have all seen the coverage on the Arkema SA chemical plant explosion and fire in Crosby, Texas, as well as this weekend’s news that 13 Superfund sites in the Houston area have been flooded and are experiencing possible damage. What we have not heard much about is action on the part of the Texas Commission on Environmental Quality (TCEQ) to do its part to allow residents and their commercial and industrial businesses to recover.
Last week, TCEQ issued a Request for Suspension of TCEQ Rules that may prevent, hinder, or delay necessary action in coping with Hurricane Harvey. The rules suspended in order to manage Hurricane Harvey impacts address regulatory obligations related to air, water, storage tank, fuel and waste management. In addition, TCEQ has developed a Hurricane Response webpage and made clear the Agency's priority is the recovery efforts helping to restore water and wastewater services as well as to assess damage, manage debris, and bring other critical services back online.
Most substantive federal environmental laws and their implementing regulations also provide emergency exemptions that can be triggered following any natural or manmade disaster to ensure laws do not interfere with rescue and recovery efforts. Most emergency exemptions require a declaration or finding on the part of the United States Environmental Protection Agency (EPA) or of another high-ranking government official. We will address EPA's Hurricane response actions in future blogs.
At a time when the residents of Texas need the best of their government, TCEQ is providing an excellent example of support, help, and a willingness to do what is right under the circumstances. Kudos to TCEQ!
New Climate Change Disclosure Guidance
By E. Lynn Grayson
State Street Global Advisors (SSGA), managing $2.6 trillion in assets, recently took action to motivate companies to treat climate change as a significant risk and to encourage businesses to ensure that assets and long-term business strategies are resilient to climate change impacts. SSGA published “Perspectives on Effective Climate Change Disclosure” to provide guidance to companies on best practices for climate-related scenario-planning disclosure.
The new guidance provides insight into four (4) areas:
Governance and board oversight of climate change;
Establishing and disclosing long-term greenhouse gas emission goals;
Disclosing the average and range of carbon price assumptions; and
Discussing impacts of scenario planning on long-term capital allocation decisions.
The guidance is intended to identify current disclosure practices that are useful to investors in evaluating the robustness of climate-related scenario-planning exercises and climate-related strategic reports by companies in high impact sectors, such as oil and gas and mining.
SSGA drew upon its work with over 240 climate-related engagements with 168 companies that their Asset Stewardship Team had conducted over the past four (4) years.
This guidance document provides good insight to measure and evaluate existing climate change-related disclosures and may offer additional incentive to companies considering new or additional disclosures.