As we previously reported on here, the Trump Administration earlier this month proposed a $2.7 billion budget reduction for U.S. EPA. However, Congress has passed a spending bill that rejects reductions to both U.S. EPA and the Department of Energy. Trump signed the bill today.
As reported here, as to the U.S. EPA, Congress proposed holding the agency’s funding at $8.1 billion, even with the 2017 level.
And, at the DOE:
- $6.2 billion for the Department of Energy’s Office of Science, an $868-million jump from the 2017 level. Trump had sought to cut its budget to just under $4.5 billion.
- The omnibus includes an increase of nearly $1.5 billion in DOE clean energy funding, including a 14% increase to the renewable energy and efficiency office, and a 16% increase at the Advanced Research Projects Agency-Energy (ARPA-E). Trump had sought to cut the renewables office by 65% and eliminate ARPA-E.
- The Office of Fossil Energy would increase by 10%, the nuclear office by 19%, science office by 16%, and the energy office by 8%. The loan programs office would be preserved, as would funding for carbon capture and storage.
These avoided spending cuts and/or spending increases are an encouraging sign for environmentalists and other clean tech advocates.
In the Absence of Any Federal Movement, States Continue to Attempt to Legislate Carbon Rules or Taxes
As reported in Salon and Law360 (sub. req.), states, the “laboratories of democracy,” continue to attempt to experiment with legislation carbon rules or taxes. Washington and Oregon are the latest examples, although such efforts have so far failed. Washington’s proposal would have taxed carbon emissions, whereas Oregon’s proposal would have established a cap-and-trade program.
After the Washington tax bill failed, a coalition of environmental, community and labor groups filed a proposed citizens’ initiative that would put a price on carbon emissions. The proposal would charge $15 per metric ton of carbon content of fossil fuels and electricity sold or used in the state starting in 2020. It would increase by $2 a year in 2021 until the state meets its carbon emissions reduction goal for 2035.
As of February of this year, as reported in Law360 (sub. req.), 10 states have released bills to combat climate change and raise revenue by using the tax system, with some 30 different bills in play. According to this report, the range of carbon taxes are from $5-35/ton (bills in Vermont set the base rate at $5 per ton of carbon while bills in New York set it at $35 per ton).
These state-level efforts underscore the challenge of convincing the public and a broad base of stakeholders to act on a problem that Congress first tried to address over a decade ago, most famously through the McCain-Lieberman Climate Stewardship Act of 2003 and the Waxman-Markey American Clean Energy and Security Act of 2009. Interestingly, it may be this patchwork of state-level action that induces Congress to act sometime in the future.
EPA Proposes Notice of Intent to Proceed with Rulemaking for CERCLA Financial Responsibility Requirements for the Chemical Manufacturing, Petroleum and Coal Products Manufacturing, and Electric Power Industries
Yesterday, on January 11, 2017, the EPA issued a notice of intent to proceed with rulemaking regarding whether and to what extent financial responsibility requirements under CERCLA section 108(b) should apply to the Chemical Manufacturing, Petroleum and Coal Products Manufacturing, and Electric Power Industries.
The rulemaking will have an interesting path forward in light of its history and the upcoming administration change. On January 6, 2010, the Environmental Protection Agency (EPA) published an Advance Notice of Proposed Rulemaking (ANPRM) that identified additional classes of facilities within three industry sectors that could warrant developing financial responsibility requirements under CERCLA section 108(b): (1) the Chemical Manufacturing industry (NAICS 325); (2) the Petroleum and Coal Products Manufacturing industry (NAICS 324); and (3) the Electric Power Generation, Transmission, and Distribution industry (NAICS 2211). In August 2014, environmental groups filed a lawsuit in the U.S. Court of Appeals for the District of Columbia Circuit, for a writ of mandamus requiring issuance of CERCLA section 108(b) financial responsibility rules for the three additional industries identified by EPA in the ANPRM. EPA and the petitioners submitted and the court approved an Order on Consent, which included a schedule for further administrative proceedings under CERCLA section 108(b). Critically, in granting the motion to enter the Order, the D.C. Circuit recognized that “the content of [the rulemaking required under the Order] is not in any way dictated by the [Order].” Therefore, the upcoming administration may be bound to entertain the process of rulemaking, it appears free to disregard producing any rule as a result of this process.
Trade Associations Obtain Nationwide Injunction Against Portions of the “Fair Pay and Safe Workplaces” Regulatory Scheme, and Agencies Stand Down (For Now)
Portions of the Fair Pay and Safe Workplaces regulations, specifically those related to reporting violations of labor laws and restricting mandatory arbitration, have been enjoined on a nationwide basis by the District Court for the Eastern District of Texas (“District Court”). The paycheck transparency provisions were upheld by the District Court and remain enforceable. Following the District Court’s Order, on October 25, 2016, federal executive agencies issued guidance to their senior procurement officials to halt implementation of the Fair Pay and Safe Workplaces regulations enjoined by the Court, and confirmed that the paycheck transparency provisions (FAR 52.2005, 22.2007(d) and clause 52.222-60) remain in effect.
As reported, the government is still weighing whether to appeal the injunction. Although it seems likely that the government will appeal the District Court’s order and argue that the District Court does not have the authority to issue the injunction on a nationwide basis, it remains uncertain whether the government could actually obtain this relief. When faced with a similar TX federal district court nationwide injunction of executive action and regulation in the context of immigration, the U.S. Court of Appeals for the Fifth Circuit upheld the district court’s authority to issue that nationwide injunction. On review, the Supreme Court split 4-4, leaving the Fifth Circuit’s decision in place. Effectively, this means that TX federal district courts and the Fifth Circuit can stall the administration’s desired policies on a nationwide basis until the Supreme Court acquires another Justice. Because we are in an election year and do not know the identity of the next Supreme Court Justice or when that Justice would be confirmed, the ultimate outcome of this injunction remains elusive at this time. However, even with some legal uncertainty, we anticipate that most government contractors would prefer to forego all but the paycheck transparency requirements until there is a greater likelihood that the enjoined regulations will be upheld than exist at this time. Indeed, even beyond the strength of the substantive arguments, the District Court briefing and oral argument made clear that had the regulations had gone into effect, the government was not yet ready to accept any reports of purported “violations” because the electronic portal to receive such data was not yet complete.
Trade Associations File Suit Challenging the “Fair Pay and Safe Workplaces” Regulatory Scheme as Unlawful and Unconstitutional
As we previously reported here, 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. Despite strenuous objections, including from groups representing defense contractors, on August 25, 2016, DOL and FAR Council finalized the rules (the “Fair Pay Regulations”) by which 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 determinations subject to appeal. Certain portions of the Fair Pay Regulations take effect as early as October 25, 2016.
In Associated Builders and Contractors of Southeast Texas v. Fed. Acquisition Regulatory Council, Case No. 1:16-cv-00425, E.D. Tex. (filed Oct. 7, 2016), Associated Builders and Contractors of Southeast Texas (“ABC-Texas”), Associated Builders and Contractors, Inc. (“ABC”), and the National Association of Security Companies (”NASCO”) filed suit in federal district court against members of the DOL and FAR Council challenging E.O. 13673 and the Fair Pay Regulations. ABC and ABC-Texas represent nearly 21,000 member construction contractors and related firms in Texas and throughout the country. NASCO represents companies that employ more than 400,000 trained security officers.
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.
As previously reported by my colleague Lynn Grayson, ExxonMobil has faced a recent onslaught of scrutiny over allegations that fossil fuel companies had committed fraud by downplaying the effect of climate change on their businesses. These matters include a subpoena issued by the U.S. Virgin Islands’ Attorney General’s office related to allegations of violating two state laws by obtaining money under false pretenses and conspiring to do so; and New York Attorney General Schneiderman’s investigation where documents have been subpoenaed to determine whether the company misled investors about the dangers climate change posed to its operations.
Two events last week suggest that this fight will not end anytime soon.
- ExxonMobil filed suit in the Northern District of Texas, seeking an injunction barring the enforcement of a civil investigative demand issued by the Massachusetts Attorney General to ExxonMobil, and a declaration that this demand violates ExxonMobil’s rights under state and federal law, including the First and Fourteenth Amendments to the Constitution, as well as the Dormant Commerce Clause.
- The Attorneys General of 13 states wrote a sharply-worded letter to their colleagues, noting that “this effort by our colleagues to police the global warming debate through the power of the subpoena is a grave mistake” and “not a question for the courts.” The letter outlines how this investigation is in fact “far from routine” because of its following three characteristics: “1) the investigation targets a particular type of market participant; 2) the Attorneys General identify themselves with the competitors of their investigative targets; and 3) the investigation implicates an ongoing public policy debate.”
We will continue to monitor developments on this heated situation.
Two recent New York Times op-ed contributors shed light on the magnitude of the challenges that we face domestically with respect to water, its infrastructure, and our ability to measure it, and offer possible policy prescriptions.
Not only are countless businesses publicly supporting a global climate agreement from COP21 as we previously reported, several businesses and business coalitions are pledging to take operational and strategic actions in advance of such an agreement. As reported by Ceres, set out below here are a few of the business coalitions and their pledges:
OSHA Penalty Limits to Increase Almost 80% in the Next Year, With Annual Inflation Adjustments Authorized Thereafter
Buried in the landmark Bipartisan Budget Act of 2015 (H.R. 1314) (“2015 Budget Act”) signed by the President on Monday, November 2, 2015, Section 701 requires the Occupational Safety and Health Administration (OSHA) to begin indexing its penalty limits to inflation, much like the US EPA and other federal agencies do now. This section, called the “Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015” (“2015 Penalties Act”), also has “catch-up” provisions, which mean that the existing $7,000 penalty limit (for other-than-serious and serious violations under OSHA, originally set in 1990) can be increased to approximately $12,477 per violation, and the existing $70,000 penalty limit (for willful and repeat violations) can be increased to approximately $124,765 per violation. OSHA must adjust these penalties through an interim final rulemaking no later than August 1, 2016.
IARC’s Classification of Red Meat and Processed Meats as Carcinogenic Exposes Food Manufacturers, Distributers, and Retailers to Proposition 65 Liability
The Internet was buzzing yesterday with news that the International Agency for Research on Cancer (IARC) of the World Health Organization (WHO) has classified red meat as a Group 2A carcinogen (“probably carcinogenic to humans”) and processed meat as a Group 1 carcinogen (“carcinogenic to humans”). In general, IARC evaluates the environmental causes of cancer in humans, including chemicals (e.g., formaldehyde), complex mixtures (e.g., air pollution), physical agents (e.g., solar radiation), biological agents (e.g., hepatitis B virus), and personal habits (e.g., tobacco smoking). IARC has long played a role as a source of scientific information that carries weight in federal and state regulation of potentially harmful substances and toxic tort lawsuits involving such substances.
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.
U.S. EPA Releases One-Week Internal Review on the Colorado Mine Blowout, Concludes the Incident Was “Inevitable”
Earlier this week, the U.S. EPA released its “Internal Review of the A
ugust 5, 2015 Gold King Mine Blowout,” which provides the EPA Internal Review Team’s “one week rapid assessment” of the events and potential factors contributing to the Colorado mine adit blowout earlier this month. The Review sets out a series of conclusions and recommendations, many of which lay the foundation for absolving the U.S. EPA of any wrongdoing here while proposing extensive recommendations for the future.
Last week, on July 15, 2015, the US EPA revised the 1988 underground storage tank (UST) regulation and the 1988 state program approval (SPA) regulation. Some of these changes had their roots in the Energy Policy Act of 2005, which set out additional requirements in states that received federal RCRA Subtitle I money from EPA. Part of the impetus for this regulation was to apply these changes to Indian country and all states. Other changes relate to revising the regulations in light of technological changes and challenges that have surfaced over the years. The effective date of the regulations is October 13, 2015. Some of the key changes are set out below.
D.C. Circuit Rejects Enviro and Industry Challenges to EPA’s Nonhazardous Secondary Materials Rule; Implications for Combustion Standards Remain
Last week, the D.C. Circuit issued an unpublished per curiam decision in Solvay USA Inc. v. U.S. EPA, No. 11-1189 (D.C. Cir.), rejecting all arguments from both environmentalists and industry against EPA’s non-hazardous secondary material (NHSM) regulations under the Resource Conservation and Recovery Act (RCRA). By way of background, the characterization of non-hazardous secondary materials pursuant to the NHSM has implications under the Clean Air Act (CAA) for the standards by which those materials can be incinerated in combustion units.
Back to the Future: EIA’s Analysis of EPA’s Clean Power Plan Concludes that Power Sector CO2 Emissions May Drop to 1980s Levels
In June 2014, EPA issued its proposed Clean Power Plan to regulate CO2 emissions from existing power plants under section 111(d) of the Clean Air Act. The Clean Power Plan proposes to limit carbon emissions from existing fossil fuel-fired electric generating units, including steam generating, integrated gasification combined cycle, or stationary combustion turbines operating or under construction by January 8, 2014. In August 2014, Representative Lamar Smith requested that the U.S. Energy Information Administration (EIA) analyze the effects of the Clean Power Plan on, among other things, greenhouse gas emissions, electric markets, and coal plants retired.
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:
- May 2015 (Final Rule). Clean Water Rule: Definition of “Waters of the United States”. The U.S. Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers proposed a rule for determining whether a water is protected by the Clean Water Act.
- June 2015 (ANPRM and NRPM). Proposed Greenhouse Gas Endangerment and Cause or Contribute Findings Under CAA Section 231 for Aircraft, and ANPRM on the International Process for Reducing Aircraft GHGs and Future Standards. In this action, EPA will determine whether greenhouse gas emissions from aircraft cause or contribute to air pollution which may reasonably be anticipated to endanger public health or welfare. Concurrent with these proposed findings, EPA will release an Advanced Notice of Proposed Rulemaking (ANPRM) to provide an overview of the International Civil Aviation Organization's (ICAO) efforts to reduce greenhouse gas emissions.
- June 2015 (NPRM). Greenhouse Gas Emissions and Fuel Efficiency Standards for Medium- and Heavy-Duty Engines and Vehicles--Phase 2. These second sets of standards would further reduce greenhouse gas emissions and fuel consumption from a wide range of on-road vehicles from semi-trucks to the largest pickup trucks and vans, and all types and sizes of work trucks and buses.
- July 2015 (NPRM). Non-Hazardous Secondary Materials--Additions to List of Categorical Non-Waste Fuels; Other Treated Woods. The Treated Wood Council has submitted a petition for various types of treated wood to be added as categorical non-waste fuels. Materials classed as NHSM can be burned for fuel in lightly regulated boilers rather than more strictly regulated incinerators.
New Jersey Assembly Unanimously Passes Bill Broadly Allocating Liability and Damages for Hazardous Substance Discharges from Offshore Drilling Platforms
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
"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:
- 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.
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.
Illinois SB 2221 To Eliminate the State’s Statute of Repose for Construction Defects Arising Out of Pollution, Hazardous Substances
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.
On Tuesday, October 28, 2014, the US EPA published its final rule that adjusts the allowance system for the consumption and production of hydrochlorofluorocarbons (HCFCs) for years 2015 to 2019. The rule was promulgated pursuant to the Clean Air Act, certain sections of which ensure that the United States meets its obligations under the Montreal Protocol on Substances that Deplete the Ozone Layer (Protocol). Under the Protocol and its amendments, all developed countries are subject to caps on their consumption and production of HCFCs. These countries must achieve a certain percentage of progress towards the total phaseout of production and consumption of HCFCs by certain dates.
Under yesterday's rule, the US EPA issued allowances for four HCFCs and implemented a de minimis exemption for use of existing inventory of HCFC-225ca/cb and HCFC-124. Allowances for each of the four HCFCs are as follows:
- HCFC-22. For consumption, the US EPA allocated about 10,000 MT in 2015 with an annual decrease of about 2,000 MT per year until its phase-out in 2020. For production, EPA allocated about 28,000 MT each year. Under existing regulations, HCFC-22 production and consumption are zero in 2020.
- HCFC-123. For consumption, EPA allocated about 2,000 MT per year through 2019. EPA also allowed for continued use of HCFC-123 in nonresidential streaming fire suppression applications.
- HCFC-124. For consumption and production, EPA allocated 200 MT per year through 2019.
- HCFC-142b. For consumption an production, EPA allocated 35 MT in 2015 with an annual decrease of 5 MT per year. Under existing regulations, HCFC-142b allowances for production and consumption are zero in 2020.
For HCFC-225ca/cb, the US EPA allocated zero percent of the baseline for production and consumption. However, the US EPA finalized a de minimis exemption to allow any person with HCFC-225ca/cb in inventory prior to January 1, 2015, to use that material as a solvent. The US EPA also finalized a de minimis exemption to allow any person with HCFC-124 in inventory prior to January 1, 2015, to use that material as a sterilant for biological indicators.
The rule becomes effective on January 1, 2015. The full rule can be found here.
DOD Finalizes Amendments to DFARS Regarding the Storage, Treatment, and Disposal of Non-DOD Toxic and Hazardous Materials on DOD Sites
On September 30, 2014, the Department of Defense (DOD) published a final rule that amends Defense Federal Acquisition Regulation Supplement (DFARS) subpart 223.71 to better align the DFARS with the current provisions set forth in 10 U.S.C. 2692 concerning storage, treatment, and disposal of nondefense toxic and hazardous materials. This rule affects contractors and subcontractors performing contracts that involve the storage, treatment, or disposal of toxic or hazardous materials not owned by DOD on a DOD installation. The proposed rule was issued earlier this year and received no public comments.
Some of the larger changes are as follows:
- Under section 223.7102 (“Policy”), subsection (b) was added, which states that when storage of toxic or hazardous materials is authorized based on imminent danger, the storage provided is required to be temporary and must cease once the imminent danger no longer exists.
- Several new exemptions under section 223.7104 (“Exceptions”) were added, including:
- (a)(1), which added an exception to the prohibition for the storage, treatment, or disposal of materials used in connection with an activity of DOD or in connection with a service performed on a DOD installation for the benefit of DOD;
- (a)(9), which expanded the exception for the storage of toxic or hazardous materials not owned by DOD but is required or generated in connection with the authorized and compatible use of a facility of DOD, including the use of such a facility for testing material or training personnel; and
- (a)(11), which added an exception for the storage of material not owned by DOD when the Secretary of the military department concerned determines the material is required or generated in connection with the use of a space launch facility on a DOD installation or other land controlled by the United States.
- Section 223.7105 (“Reimbursement”) was added, which provides that the Secretary of Defense may assess a charge for any storage or disposal provided under the subpart.
- Under section 223.7106 (“Contract clause”), subsection (a) was revised to broaden the clause application to include solicitations and contracts that may require access to a DOD installation.
The final rule can be found here.
As previously reported, the US EPA initially issued its direct final rule confirming that the new ASTM E1527-13 standard, in addition to the older ASTM E1527-05 standard, would be acceptable for prospective purchasers of real property to conduct “All Appropriate Inquiries” (AAI) under CERCLA. On June 17, 2014, EPA published a proposed rule that proposed to amend the AAI Rule to remove the reference to the older ASTM E1527-05 standard.
According to the US EPA, the Agency took this route “to reduce any confusion associated with the regulatory reference to a historical standard that is no longer recognized by its originating organization as meeting its standards for good customary business practice.” Furthermore, the US EPA believed that eliminating the reference to the older ASTM E1527-05 standard would promote the use of a “consensus-based, good customary business standard.”
The clarifications and improvements of the new ASTM E1527-13 standard are as follows:
- an updated definition of “Recognized Environmental Condition (REC)”;
- an updated definition of “Historical Recognized Environmental Condition (HREC)”;
- a new term, “Controlled Recognized Environmental Condition (CREC)”;
- a clarification to the definition of “de minimis condition”;
- a revised definition of “migrate/migration’’ to specifically include vapor migration;
- a revised definition of “release’’ to clarify that the definition has the same meaning as the definition of release in CERCLA; and
- additional guidance related to the regulatory agency file and records review requirement to provide a standardized framework for verifying agency information obtained from key databases.
The US EPA delayed the effective date of this rule for one year, until October 6, 2015, recognizing that some parties may still be using the older ASTM 1527-05 standard. The rule will not impact “parties who acquired properties between November 1, 2005 and the effective date of this final rule and used the 2005 ASTM standard (ASTM E1527–05) to comply with the AAI Rule.”
To ensure a smooth transition, practitioners are encouraged to begin using ASTM E1527-13 as soon as practicable. The final rule is available here.