Becker's Iowa Environmental Law Update : Iowa Environmental Lawyer & Attorney : Charles Becker : Belin McCormick P.C. Law Firm : IA Regulatory Compliance, Site Cleanups

Three months ago I said that cost-benefit analysis was at the heart of the environmental debate between Republicans and Democrats. Two months ago I said that the United States Supreme Court granting unfettered discretion to EPA to define the applicability and scope of cost-benefit analysis was an extraordinary gift to our new EPA administrator. Three days ago I said that we could expect this administration to make wholesale revisions to the administrative rules and guidelines governing regulation of the environment.

So what happens?  EPA begins to modify the guidelines it uses to undertake cost-benefit analysis when analyzing environmental regulations. The best description I’ve seen is by Michael Livermore. He writes:

The Guidelines [for Preparing Economic Analysis] is little known outside of EPA, but used regularly by the agency to design every major environmental regulation. Before any rule is adopted, it must go through an economic analysis according to the Guidelines . . . .

The draft changes to the Guidelines are under discussion now and will hopefully be adopted this fall. These revisions would create a major shift in the status quo at EPA.

I have to agree with Michael when he says it will create a major shift in the status quo. He argues that that shift will be a good thing for environmental regulation. While I don’t agree with this conclusion, I do think it is very interesting, and telling, that this EPA is acting so quickly to change even the most fundamental rules governing environmental regulation.

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I have read, with interest, several posts that describe the most recently concluded United States Supreme Court term as being a miserable year   for environmental interests. The authors point out that of the five cases addressing the environment, all of them resulted in reversals of decisions that had favored environmentalists. Based on this scorecard, the posts are quick to label the majority of members of this Supreme Court as being hostile to the environment and pro-business. Glenn Sugameli, an attorney with the environmental group Earth Justice, went so far as to say that he believes that the Court put on “pro-business blinders.”
 

While the outcome of the cases certainly did not advance environmental interests, I find it difficult to refer to the outcomes as pro-business. In fact, in three of the cases, the Court deprived the business community of what it needs most.
 

Businesses necessarily rely upon predictability. They need to know, to the greatest extent possible, that the rules of the game are not going to constantly shift. They need to know that government will not make major changes in the regulatory scheme and that they can plan future  purchases, hiring, markets, expansion and the like on rules that are not subject to daily variation. This is critical in the area of environmental regulation where a change in the rules can shift millions of dollars in costs. Business owners understand that there will always be some changes, but they expect it to occur through a cumbersome and combative process (a/k/a Congress). In short, they hope for some level of stability. By this measure, the Supreme Court did not do business a favor during this term.
 

In my previous post relating to Entergy Corp. v. Riverkeeper, Inc., I noted that the end result was that the Court has now accorded broad deference to EPA to determine when and where the agency will employ the use of a cost-benefit analysis. In a similar vein, I noted that in the Coeur Alaska, Inc. v. SEACC case, the Court deferred to EPA’s interpretation as found in an unpublished memorandum authored by the Director of EPA’s Office of Wetlands, Oceans and Watersheds.  In both of these cases, the Supreme Court was making it clear that EPA can change the rules as it sees fit and without public comment.  In several articles written about the Coeur Alaska case, the comment was made that, although the environmentalists lost that case, there would be an easy fix by asking the present administration to take action (presumably without the need for public comment) to repeal the interpretation of the rule that allowed the Supreme Court to rule in favor of Coeur Alaska.  

In Winter v. NRDC, Inc., the Court ruled that the needs and prior practices of the Department of the Navy should receive deference. As in Entergy and Coeur Alaska, this case resulted in substantially strengthening the hand of the governmental entity.
 

Though it is an admittedly small sample, I believe that the best way to label this Court is pro-government when it comes to environmental questions. Given the complexities of environmental regulation, I can’t say that I’m surprised at the rulings which, in effect, simply defer to the expertise of the agency.  What does surprise me is that the Roberts Supreme Court believes that making federal agencies more powerful and less accountable is a good result.
 

Moreover, the impact on many types of businesses is likely going to be significant in light of the political climate. It is an understatement to say that the Obama  administration’s view of environmental regulation is significantly different  from the view held by the Bush administration. With this Court’s seal of approval, changes in EPA regulations, guidance documents and unpublished memos are going to come fast and furious. If anyone really believes that it is “pro-business” for the Supreme Court to tell EPA that it has discretion to change the rules whenever it desires and without notice or public comment, I would question their definition.
 

I believe I can safely guarantee that a change in the presidency, like death and taxes, is a certainty at some time in the future. When that happens, the rules will change yet again. And for business, the lack of certainty, or at least relative stability, is anything but “pro-business.”
 

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As a result of a previous post regarding the misguided attempts by several cities to ban plastic bags at grocery stores, I got called to task by a concerned reader.  If you think you're so smart, how do you get rid of the plastic and paper bags? 

I'm supposed to complain AND come up with a solution?  That seems pretty demanding.  On the other hand, it's a fair question that deserves at least an attempt at a response.  So, how might we do that?

Since, as a practical matter, groceries will need to be sacked, there is only one way to eliminate the bag as a waste -- be sure the bag is reusable.  That's not a shocker, but getting there is the trick.  To do that, we need to somehow convince the shopper that using the bag over and over is to their advantage in some way.  The history of environmental regulation has shown that there are essentially two methods of "encouraging" reuse: 1) hit the public’s conscience or 2) hit their pocket book

APPEALING TO CONSCIENCE

Under the guilt approach, you explain how much damage is being done to the environment by paper and plastic bags and hope that the public starts to bring their own bags for sacking. When you look at the statistics on the costs of creating paper and plastic bags, it's an easy case to make. The only problem with this is that it doesn’t work.   Most people have heard some version of the statistics, yet today only a small number of individuals at mainstream grocery stores bring reusable bags. If you can’t get those shoppers to do it, it isn't going to have any real impact.

You could help this philosophy along, however, by simply banning all bags at grocery stores. That would then force the buyer to bring a sack or, as in the case of Sam’s Club, hope that there is a spare box (that you then throw out at home).  Maybe the stores could hire young high school men and women to become grocery “carriers” instead of grocery “sackers” to take the groceries to the cars. That way the store owners wouldn’t hear the customers swearing as they carried the groceries, load by load, to the kitchen.  

You will have to judge for yourself, but I doubt that a total ban would work. If an individual store implemented it, the loss of business would likely force them back to bags. To avoid this, a city would need to be sure that every store followed the rule, but if there was a city-wide ban imposed, I would guess that, whenever possible, a lot of people would shop at the next closest city.  Although it would be a bold move, I haven't found any city that has considered a total bag ban.

APPEALING TO THE POCKETBOOK

The more likely solution is the pay-as-you-throw option.  That is, if you use a throw-away bag, you pay for the cost of the toss, not just the cost of production.

The simplest method is to just charge everyone a nickel for each bag. This should encourage re-use.  New York  has considered this.  The difficulty with this solution is that it sounds like a tax, which is a political lightning rod.  Also, unless the cost is high, I don't think it would be effective.  If your grocery bill is $50 or $100, most people would be willing to pay the extra 40¢ or 50¢ rather than change their behavior and, if that is the case, there’s no reduction in the waste stream.  If you want to change behavior, you need to get smarter than that.

For example, you could do what a some states do with beverage cans. You could charge, say, 5¢ per bag and return the nickel if they return the bag. While consumers may be willing to pay the 5¢ with no chance of getting it back, they don't seem to be as willing to throw it away. I'm sure that there is a psychological name for this, but I like to think of it as the PAF (people are frugal) effect.  You can almost always count on it. 

Once the bags were returned, they could be recycled. If they weren’t returned, the nickel would go to the landfill.  It's hard for the consumer to argue with it because they are getting their money back (with a little effort).  The biggest objectors would be the grocery stores, so they would likely need to get something for their effort, as is currently done with the can deposit.  This solution has the added incentive that, just like with beverage cans, enterprising youths and adults would search out discarded bags and return them for the nickel. You wouldn’t see many bags blowing around the neighborhood.  It isn’t a perfect solution, but it might work.

An interesting variation would be to simply charge $1 per bag and all bags would be those recyclable, hemp ones that we are now seeing at most stores. You know, the ones that drive you crazy because you remember that you have ten of them stored in your trunk just as the cashier says: “Paper or plastic?” The difference here would be that if you forget to bring your recycled bags, you would get to buy another three or four for your collection at $1 each. At $1 a bag, the PAF effect is really going to kick in. My guess is that after someone accumulates 15 or 20 of those bags, forgetting the bags will be a thing of the past.  (While I'm on it, would it be so hard for grocery stores to post "Don't Forget Your Bags" signs throughout the parking lot?)

Maybe none of these suggestions will work, but they're a start.  I leave the rest to the city council members -- that's why they're paid the big bucks.

RELATED POST: Sure Plastic Bags Are Better For The Environment, But Is That The Real Question?

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In its final environmental ruling for this term, the United States Supreme Court went up against the fishes.  The fishes lost.

In Coeur Alaska, Inc. v. Southeast Alaska Conservation Council, the plaintiff mining company sought to pipe a slurry of 210,000 gallons of process wastewater and 1,440 tons of tailings each day to the bottom of Lower Slate Lake. The parties to the litigation agreed that the activities would fill the lake with solids and destroy all aquatic life. Upon conclusion of the mining operations, Coeur Alaska proposed to cap the tailings with four inches of native material and restore and expand the lake.

Since the lake was a water of the United States, Coeur Alaska needed a permit to discharge the slurry. The difficulty here was that the Clean Water Act provides for two distinct methods of getting a discharge permit. Under Section 404 of the Act, the Corp of Engineers can issue permits for discharge of “fill material," with EPA having the right to veto. Fill material is defined to be any material "that has the effect of . . . [c]hanging the bottom elevation of water."  For discharges of anything other than fill, Section 402 of the CWA requires EPA to issue permits pursuant to the effluent limitations of the Act. 

As one might imagine, EPA and the Corps occasionally disagree on who has jurisdiction, and such was the case with mining tailings.  In 2002, the Corps and EPA promulgated a regulation that defined fill material to include “tailing or similar mining-related materials.”  Still, the regulation failed to identify whether the fill material, that was subject to the Corps jurisdiction, needed to meet performance standards.

In a 2004 internal memorandum written by Diana Regas, the Director of EPA’s Office of Wetlands, Oceans and Watersheds during the Bush administration, Ms. Regas declared that EPA’s performance standards did not apply to discharges of fill material.

Based on this information, Coeur Alaska sought a discharge permit from the Corps of Engineers rather than EPA. The Corps determined that any environmental damage would be temporary and issued the permit. SEACC challenged the Corps decision and won at the 9th Circuit, but lost before the Supreme Court.

In a 6-3 decision, the High Court held that the terms of the CWA were ambiguous. The Court said:

Because Congress has not “directly spoken” to the “precise question” of whether an EPA performance standard applies to discharges of fill material, the statute alone does not resolve the case.

Since the statute did not provide the answer, the Court attempted to determine congressional intent.  However, they found another road block in that there was no such indicia.  Next, the Court looked to agency regulation, but found it to be ambiguous. Stepping down one more rung, the Court looked to the subsequent interpretation of the regulation by EPA and found Ms. Regas' internal EPA memo that the performance standards do not apply to fill material.  The Court declared that the memo did not satisfy the Court's previous ruling in Chevron v. NRDC on what can be accorded deference by a court, but went on to say: 

The Memorandum presents a reasonable interpretation of the regulatory regime. We defer to the interpretation because it is not “plainly erroneous or inconsistent with the regulation[s].”

With that, the Supreme Court reversed the 9th Circuit and allowed Lower Slate Lake (presumably to be renamed Much Higher Slate Lake in the near future) to be filled with the slurry.

It must be said that this Court searches very hard for guidance. On the central question of whether performance standards apply to discharges of fill material, they found that:

• The statute had not “directly spoken” to the “precise question;”
• There was no indicia of Congressional intent;
• Agency regulations were ambiguous; and
• One internal agency memo, that had not been subject to public comment and which did not meet the Court’s previous cases to merit deference, was sufficient to justify the discharge.

That is one heck of a memo. For all those low level staffers and department heads who think that no one reads anything that they put in their reports, Ms. Regas would beg to differ. Those memos can have some real clout.

I would note that the oral arguments, as well as references in the opinion, indicated that several members of the Court were consoled by the fact that EPA had veto power and it did not exercise it in this case. If EPA didn’t see the need to veto it, why should the Court?  I suppose there are any number of ways to answer that question. Suffice it to say that a majority of this Supreme Court, reviewing a Bush-era EPA decision, felt that the answer was that it shouldn’t.
 

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I just noticed an interesting new law that was passed in the District of Columbia.  As of July 1, coal tar pavement dressings and sealants cannot be used or sold.  It was also banned in Austin, though that ban has been criticized. The D.C. ban, which is part of the District's storm water regulation, is designed to prevent polycyclic aromatic hydrocarbons (PAHs) from being washed off of parking lots and entering streams, rivers and Chesapeake Bay.  It was determined that the dust coming from parking lots sealed with coal tar products have concentrations of PAHs that are 80 times higher than the dust from unsealed parking lots.  While there is an alternative to the coal tar product, it has its deficiencies. 

For the entrepreneurial type out there, this is a trend worth following.  It used to be that we would allow  the conscience of the consumer to choose the environmentally better product.  When that didn't work, because most consumers buy the cheapest and/or most effective product (which is not often the environmentally friendliest choice), at least two legislatures came up with an alternative -- ban the product. This same reasoning can be found in the banning of phosphorus containing fertilizer. 

I'm not trying to be critical here, I'm just trying to point out a trend.  I would say that perhaps the next product to be considered could be char-broiled hamburgers, but my guess is that the burger lobby is a little stronger than the coal tar pavement dressing lobby.  But that's just a guess.

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I’ve noticed that a number of cities around the country are considering passing ordinances that would ban plastic bags at grocery stores.

I thought we were done with this discussion. Okay, I’ll end it now. As between paper grocery bags and plastic ones, plastic is the better choice for the environment. There, that one’s done.

Next topic: What does the term “better” mean?

That’s the real question, isn’t it? Like so many things environmental, what is "better" depends a lot on what you count.

Rather than rehash all the literature, I’ll just give you the highlights and you can decide:

• In 1999, 14 million trees were cut down to produce the 10 billion paper grocery bags used by Americans in that year;
• Paper sacks generate 70% more air and 50 times more water pollutants than plastic bags;
• It takes 594 BTUs of energy to produce a plastic bag and 2,511 BTUs for a paper bag;
• It takes 91% less energy to recycle a pound of plastic than it takes to recycle of pound of paper;
• In today’s landfills, neither plastic nor paper will degrade;
• It takes 12 million barrels of oil to produce the 100 billion plastic bags used in the U.S. annually;
• The average American family accumulates 60 plastic bags in only four trips to the grocery store.

With regard to one of the primary reasons to ban plastic bags -- the killing of animals -- David Santillo, a Greenpeace marine biologist, told the Times of London:

It's very unlikely that many animals are killed by plastic bags.  The evidence shows just the opposite.  We are not going to solve the problem of waste by focusing on plastic bags. It doesn’t do the Government’s case any favours if you’ve got statements being made that aren’t supported by the scientific literature that’s out there. With larger mammals, it's fishing gear that's the big problem.  On a global basis, plastic bags aren't an issue.  It would be great if statements like these weren't made.

Given the energy costs (and the CO2 implications), I would say that the plastic bag wins. At a minimum, it’s a wash and wouldn’t justify a change in the law. 

But in the end, that’s not really the point. Some would say that everything we throw away causes some level of harm to the environment.  (My belief that all landfills are just future archaeological treasure troves hasn't really caught on).  That’s why there is so much discussion about the bag debate being a false choice. If you deem it desirable to reduce the amount of environmental damage, you don’t do it by choosing one bad thing over another. In this case, that would just increase the use of paper bags, which is "worse" for the environment.  You do it by eliminating the waste stream all together. You do it by finding a way to get rid of the disposable bag.

The cities that are talking about passing laws to ban plastic bags are missing the point by ignoring the science.  Moreover, they are missing a golden opportunity.  If there is the political will to outlaw plastic bags, certainly there is the will to devise a solution that actually gets rid of the waste stream.     Maybe the bag debate isn't the most pressing environmental issue of the day.  But (and this is important for politicians) it is a visible one.  It's time to get creative.  Just don't make the problem worse by banning plastic bags. 

 RELATED POSTS: The Grocery Bag Dilemma: Some Suggested Solutions

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