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

On October 16, 2009, EPA drew a line in the sand regarding mountaintop mining. With regard to the Spruce No. 1 Service Mine Permit located in Logan County, West Virginia, EPA informed Arch Coal, Inc. that it was beginning the process that could result in the rescission of its Clean Water Act permit.  Although the mine had a validly-issued permit from the Corps of Engineers, EPA believes that it has broad authority to veto the Corps' issued permit if it finds that serious water quality damage may occur and that there are methods to avoid such damage.   In the words of William Early, the acting regional administrator for EPA in Region III:

We recognize the issued permit contains several provisions that may be intended to address water quality and mitigation based upon information and data available at the time [of the issuance of the Clean Water Act Section 404 permit]. However, in light of new data and information since permit issuance, EPA remains concerned with much of the analysis set forth in your letter, particularly as it relates to the potential for adverse water quality impacts, further avoidance and minimization measures, the potential for accumulative impacts, and identification and enforceability of success criteria for mitigation.

Mr. Early’s concern, as stated in the letter, is that the operation of the mine “may result in unacceptable adverse impacts to fish and wildlife resources.” He noted that the project allows for the construction of six valley fills for placement of excess spoil material generated through the surface coal mining activities and that there were only minimally acceptable methods to minimize impacts to aquatic resources. In EPA’s view, “there is the potential for [the mine’s] associated discharges to cause further stream degradation.” Early also noted that the existing permit fails to contain adequate measures to mitigate environmental damage and does not set out what procedure would be appropriate if water-quality impacts would happen to occur.

The action of EPA is notable in several respects:

• It is the first time that EPA has threatened to rescind a permit for a project that had been previously authorized.
• Since 1989, only one other project has received a Section 404(c) veto from EPA.
• Prior to 1989, a total of eleven projects have received a veto, none of which involved mining.

Additionally, it is interesting to note that EPA's review is purportedly based on "new data and information since permit issuance,"  a process that took almost ten years.  Some might wonder wherther it is new evidence or a new administration that is driving the review and, if it is the latter, what impact will it have on business to know that the fundamental rules of the game (such as revoking already issued permits) can be changed every four or eight years? 

Though environmentalists may look on the EPA action as an indicator that the EPA under Obama is going to be much more aggressive against mountaintop mining, perhaps this is not really the best test case for that proposition. This site was, after all, one of the very few sites that even the Bush-era EPA was reluctant to give a glowing review. In June of 2006, during the comment period for the permit for the Spruce Mine, the site received a ranking of “EC-2,” which equates to “Environmental Concerns and Insufficient Information.”  Further, in its statement, EPA "emphasizes that the Spruce No. 1 represents an unusual set of circumstances we do not expect to be repeated again."

While it is a significant first step, what action is taken by this EPA for the remaining seventy-eight mountaintop mining permits will be much more telling.

RELATED POST:  Switchback Regulation and Mountaintop Mining: The Wrong Path?
 

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Traveling up a mountain is never an easy proposition -- thin air, cold temperatures and those dizzying roads that whipsaw back and forth for miles.  While I recognize the need for switchback roads to convey the traffic, I have trouble using them as a model for environmental regulation, but it seems that that is where we are today; that is, changing environmental policy 180 degrees with each change of administration.  A case in point is Coeur Alaska, Inc. v. SEACC and EPA's recently announced initiative relating to mountaintop mining.

                                                 THE COEUR ALASKA CASE

The last time we saw  Coeur Alaska, the company had just won their case before the United States Supreme Court and could fill a lake with sludge from their mining operations. They were allowed to do so because a Bush-era EPA policy, as set forth in a director's memorandum, said that it was acceptable for the Corp of Engineers to issue the permit without applying the performance standards of the Clean Water Act to the fill material.  The Court deferred to EPA's interpretation because it was "not plainly erroneous or inconsistent with the regulation[s].”

Here we are, eighty-one days since the decision and all you can say is what a difference a few days make.

                                                MOUNTAINTOP MINING REVIEW
 

On September 11th, EPA declared that all seventy-nine pending permits for mountaintop removal mining would be sent back for additional review under the term of the Clean Water Act. EPA’s concern is that these operations would “likely cause water quality impacts.”

Lisa Jackson, the EPA Administrator, attempted to emphasis that this was an "enhanced coordination process" between EPA and the Army Corps of Engineers and that it was not a change in policy. With all due respect to Ms. Jackson, I think she misspoke. It isn’t a change in law, but it is certainly a change in policy. She said as much when she told the Tampa Bay Press: “The whole permitting process had become a bit toothless.” In a year’s time, this EPA will have every molar, bicuspid, canine and incisor back in place (the jury is still out on the wisdom teeth).

                                                             THE IMPACT

The problematic holding of the Coeur Alaska case isn’t only what Coeur Alaska won, but how it won it. The Supreme Court reaffirmed that EPA has great discretion in all things environmental. In that case, the holding worked to the advantage of the business.  However,  that ruling (and others) also gives EPA the ability to quickly reverse the environmental policies of the past eight years.  I agree that to the victor goes the spoils and that changes in many areas are appropriate.  My concern is that when there is another change in EPA (one of those few guarantees in life), the road will almost certainly take a hard turn, this time to the right.  And when the inevitable happens, it will turn back yet again.

In the end, maybe switchback regulation is as necessary as switchback roads.  But while both will get you where you want to go, they certainly expend a lot of energy, and costs, to get there.  So what's the alternative?  Maybe something more permanent, like a tunnel or legislation, is preferable.  Sure they both have up front costs, but at least you minimize the whipsaw effect (that is so hard on brakes and business planning).

RELATED POSTS:  The Supreme Court and the Environment: Who Did They Really Help?

                              COEUR ALASKA, INC. VS. SEACC: When Is A Lake Really a Landfill?

                              ENTERGY CORPORATION VS. RIVERKEEPER, INC.

                              Clean Water and Mountaintop Mining No Longer Mix

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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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