Great Lakes and St. Lawrence Cities Initiative Requests Hearing on City of Waukesha Lake Michigan Water Diversion
On August 19, 2016, the Great Lakes and St. Lawrence Cities Initiative (the GLSL Cities Initiative) requested a hearing before the Great Lakes-St. Lawrence River Basin Water Resources Council (the Compact Council) regarding the Compact Council’s June 21, 2016 decision to approve the City of Waukesha’s application for a diversion of Great Lakes Basin Water.
The Compact Council was established in 2008 pursuant to the Great Lakes-St. Lawrence River Basin Water Resources Compact (the Compact). The Compact details how the States will work together to manage and protect the Great Lakes-St. Lawrence River Basin. The Compact Council is comprised of the Governors of each of the eight Great Lakes States (Illinois, Indiana, Michigan, Minnesota, New York, Ohio, Pennsylvania and Wisconsin).
The Compact prohibits diversions of Great Lakes water outside of the Great Lakes Basin, with limited exceptions. One exception allows a community that is not located within the Great Lakes Basin, but is located within a county that is partly within the Great Lakes Basin, such as the City of Waukesha, to apply for a diversion of Great Lakes water if that community can meet strict conditions. The City of Waukesha submitted an application for a diversion of Great Lakes water in 2011, and a revised application in 2013. The Wisconsin Department of Natural Resources approved Waukesha’s diversion application and sent the application to the Compact Council in January 2015. The Compact Council approved Waukesha’s Great Lakes diversion application, with conditions, on June 21, 2016.
The GLSL Cities Initiative is a binational coalition of over 120 U.S. and Canadian mayors and local officials, representing over 17 million people, working to advance the protection and restoration of the Great Lakes and St. Lawrence River. The GLSL Cities Initiative maintains that the Compact Council’s decision to approve Waukesha’s diversion of Lake Michigan water fails to protect the integrity of the Compact. The request for hearing states that:
Allowing a Diversion that is contrary to the strict requirements of the Compact threatens the resource that provides drinking water for 40 million people and is the foundation upon which a strong regional economy is based, to the detriment of the members of the GLSL Cities Initiative.
To date, the Compact Council has not responded to the request for hearing.
DOL, FAR Council Finalize “Fair Pay and Safe Workplaces” Regulations, Forcing Government Contractors to Disclose Non-Final Labor Law Alleged Violations in the Contracting Process
On August 25, 2016, the Department of Labor (DOL) and the Federal Acquisition Regulatory Council (FAR Council) issued the Final Rule and Final Guidance implementing President Obama’s Fair Pay and Safe Workplaces Executive Order (E.O. 13673), signed on July 31, 2014. Under this new regime, those who seek to contract with the government (contracts over $500,000) must disclose alleged and final wage and labor law “violations,” including non-final agency allegations of labor law violations and agency determinations still subject to appeal, rendered against the contractor within the last three years. The government, through newly established agency labor compliance advisors (ALCAs), will then review each of those alleged and final “violations” and determine whether to award or extend the government contract. The Rule and Guidance will take effect in phases starting on October 25, 2016.
On September 1, 2016, Jenner & Block is hosting a CLE program titled Overview of Critical Litigation Issues for Environmental Practitioners in our Chicago offices at Noon. The program will feature two of our environmental litigation partners as speakers, Steven Siros and Allison Torrence. Together, they will provide environmental litigation updates addressing new developments related to the Clean Power Plan, “waters of the United States,” emerging contaminants, and CERCLA cost recovery/contribution claims.
The U.S. Court of Appeals for the District of Columbia has rejected arguments by the federal government that allowing an aerospace contractor to pass through certain CERCLA remediation costs back to the government under its existing government contracts constituted an impermissible double recovery under CERCLA. Lockheed Martin Corp. v. U.S. (D.C. Cir. Aug. 19, 2016). Lockheed had incurred in excess of $287 million to remediate several contaminated sites where it had manufactured solid-propellant rockets pursuant to government contracts. Lockheed sued the government under CERCLA to recover a portion of its costs incurred to remediate these sites, alleging that the government was directly responsible under CERCLA for a portion of these costs due to the government’s acquiescence in certain of Lockheed’s disposal activities. At the same time, however, the government and Lockheed had entered into an agreement pursuant to which the government agreed that Lockheed was entitled to recover a portion of its remedial costs as indirect costs charged through its current government contracts (the “Billing Agreement”).
The district court engaged in a thorough analysis of the typical CERCLA equitable contribution factors and allocated a specific percentage of liability to Lockheed and a specific percentage of liability to the government (the percentages varied across the sites). On appeal, the government pointed to the fact that Lockheed was already recovering a significant portion of its remedial costs from the government through the Billing Agreement and argued that any further obligation on the part of the government to reimburse Lockheed for additional remedial costs was inconsistent with CERCLA’s broad equitable principles and constituted an impermissible double recovery under CERCLA Section 114.
Relying in large part on the Billing Agreement, the D.C. Circuit noted that “the government agreed to [Lockheed’s recovery of its response costs] by entering into a settlement that allowed Lockheed in its new contracts to charge the government for the company’s own CERCLA liability at the discontinued sites.” Notwithstanding that the D.C. Circuit appeared sympathetic to the government’s claim that CERCLA was not designed to provide for a government-funded cleanup program but instead intended to shift remediation costs to the polluting party, here the government voluntarily agreed to the complained of funding mechanism when it entered into the Billing Agreement. In response to the government’s argument that allowing Lockheed to continue to pass these remedial costs through the Billing Agreement constituted an impermissible “double recovery,” the D.C. Circuit noted that the district court found that crediting mechanism agreed to by the parties would preclude any perceived “double recovery” and the D.C. Circuit found no reason to disturb that finding. Interestingly, the D.C. Circuit specifically stated that nothing in the Federal Acquisition Regulations or the Defense Contract Audit Agency Manual mandated the crediting mechanism agreed to by the parties but the D.C. Circuit declined to opine on the interplay of federal contracting law and CERCLA Section 114, leaving that to be resolved at a later time.
A recently issued PHMSA advisory bulletin seeks to clarify the regulatory requirements that apply to mothballed or idled unused gas or hazardous liquid pipelines. As required by the Pipeline Safety Bill that was signed into law on June 22, 2016, PHMSA recently issued an advisory bulletin providing guidance to owners and operators of gas or hazardous liquid pipelines regarding the requirements for idle and/or unused pipelines.
Although the bulletin recognizes that owners and operators often refer to pipelines that are not in operation but that might be used again in the future as “idled,” “inactive,” or “decommissioned,” the PHMSA regulations do not recognize “idle” or “inactive” status for hazardous liquid or gas pipelines. Instead, the regulations consider such pipelines to either be active and fully subject to all relevant parts of the safety regulations or abandoned. Assuming that these pipelines have not been abandoned in accordance with the requirements set forth at 49 CFR §§ 192.727 and 195.402, these pipelines must comply with all relevant safety requirements, including periodic maintenance, integrity management assessments, damage prevention programs, and public awareness programs.
The bulletin goes on to suggest, however, that in situations where the pipeline has been purged of all hazardous materials but not yet abandoned because of an expectation that the pipeline may later be used, the owner/operator may be able to defer certain of these safety requirements. Although PHMSA indicated that it intends to engage in a future rulemaking to provide further guidance as to which requirements might be deferred, in the interim the bulletin suggests that owners or operators planning to defer certain activities coordinate the deferral in advance with the regulators.
The guidance also reiterates that notwithstanding that companies might not have access to records relating to where historical pipelines might be located and/or if these pipelines were properly purged of combustibles, the owners and operators still have a responsibility to assure facilities for which they are responsible or last owned do not present a hazard to people, property, or the environment.
Please click here to see PHMSA's advisory bulletin.
EPA has announced a new waste and materials tracking feature in its Energy Start Portfolio Manager—a free benchmarking and tracking tool for commercial building owners and managers. The new waste tracking functionality allows the management of energy, water and waste via one secure online resource. This is another effort to promote and encourage sustainable materials management to conserve resources, remain economically competitive and support a healthy, sustainable environment.
EPA’s Energy Star Portfolio Manager provides a platform to improve energy performance, prioritize efficiency measures, and verify energy reductions in buildings. It currently measures energy, water and greenhouse gas metrics in more than 450,000 U.S. buildings, representing 40 percent of U.S. commercial space. The new resource unifies energy, water and waste under one virtual “roof” to streamline sustainability management programs allowing entities to better understand their environmental footprint and resource costs.
EPA is hosting two webinars to introduce the basics of the new waste tracking component in the Energy Start Portfolio Manager:
- Introducing Waste & Materials Tracking in Portfolio Manager—August 18 at 2:00 p.m. ET
- Introducing Waste & Materials Tracking in Portfolio Manager---September 15 at 1:00 p.m. ET
To learn more about sustainability initiatives in commercial buildings or to register for the upcoming webinars: https://www.energystar.gov/buildings/owners_and_managers/existing_buildings/use_portfolio_manager/track_waste_materials
Earlier this year New York Attorney General Eric Schneiderman spearheaded a coalition of attorneys general investigating whether ExxonMobil misled investors and the public about its knowledge of climate change. As previously reported in this blog (see ExxonMobil, 13 State Attorneys General Fight Back Against the Exxon Climate Probes and Climate Change Allegations Against Big Oil Continue), ExxonMobil has sued the Attorneys General for the U.S. Virgin Islands and Massachusetts pushing back on allegations and related subpoenas dating back at least 40 years into the corporate history and internal communications of the company related to climate change considerations. Two recent developments ensure the conflicts over these government led investigations against ExxonMobil are far from over:
- This week the Energy & Environment Legal Institute and the Free Market Environmental Clinic filed litigation in the Supreme Court of New York against New York Attorney General Eric Schneiderman over his refusal to produce climate change-related communications demanded by these groups in requests filed under the New York Freedom of Information Law (FOIL). The free-market litigation nonprofits requested all correspondence between AG Schneiderman and eight individuals that contained certain keywords including “energy,” “fossil,” “climate,” “RICO” and “fraud.” The individuals targeted were associated with environmental organizations as well as lawyers that had litigated against ExxonMobil in the past. The Attorney General’s Office denied the FOIL requests claiming the communications sought were exempt from disclosure because they were protected as attorney client, attorney work product or inter- or intra-agency memoranda. The nonprofits assert that the majority of the information sought is communications between AG Schneiderman and outside parties that would not fall under any legal protections for withholding information.
- Last month, led by Texas Representative Lamar Smith, the U.S. House Committee on Science, Space and Technology issued ten (10) subpoenas to the Attorneys General of New York and Massachusetts as well as a number of nongovernmental environmental advocacy groups seeking climate change-related communications among the attorneys general and the environmental groups that support them associated, at least in part, with the ongoing investigations against ExxonMobil. The attorneys general have refused to produce any documents saying the request encroaches onto their states’ sovereign power to pursue their fraud investigations. Both Attorneys General Schneiderman and Healey have pushed back on the issuance of these subpoenas noting they are “…are an unprecedented effort to target ongoing state law enforcement investigations or potential prosecutions…” and if allowed would “…eviscerate AG Healey’s ability to conduct an ordinary and lawful investigation.”
Many have expressed skepticism about the legal reasoning and logic of the fraud, securities and RICO investigations launched by the “Green 20” state attorneys general. Critics charge the state attorneys general are using governmental power to further political objectives and in the process violating ExxonMobil’s constitutional rights of free speech and freedom from unreasonable searches. It appears there is nothing “ordinary and lawful” in the context of this unusual investigation aimed at achieving climate change parity where more appropriate regulatory and legislative efforts have failed.