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Pennsylvania Brownfields & Environmental Law

Information and Developments in Brownfields and Pennsylvania Environmental Law

Clearing the Fog on the PA Supreme Court’s Marcellus Shale Decision

Posted in Articles

There’s been a good bit of confusion in the early reactions to the Pennsylvania Supreme Court’s decision in Robinson Township et al v. Commonwealth of Pennsylvania, et al., declaring that key aspects of the Act 13 revisions to Pennsylvania’s Oil and Gas Law are unconstitutional.  We will review the main points and help clear the fog.

Cutting right to the chase, the main results of the Supreme Court’s 4-2 judgment are as follows: 

  • Act 13’s limitations on local zoning authority, which were intended to promote statewide uniformity and certainty, are void and so are the sections of the law that enforce those limitations;
  • The law’s setback waiver provision is also void, and the majority further enjoined the entirety of the setback regime set forth in Act 13 from taking effect on the grounds that the remaining setback provisions were not severable from the waiver provision;
  • The delegation of certain roles under the Act to the Public Utilities Commission for review of local ordinances and proposed local ordinances was upheld;  
  • Other aspects of the petitioners’ claims are headed back to the Commonwealth Court for further proceedings consistent with the Supreme Court’s opinion, most notably a challenge to Act 13’s healthcare confidentiality provisions, a challenge to Section 3241 of the law on grounds that it would allow the unconstitutional taking of property for private purposes, and the issue of severability of the remaining valid provisions of Act 13 from those the Supreme Court declared invalid. 

Some quick background and context:  Act 13 created a comprehensive new statutory and regulatory regime to govern Marcellus Shale and other unconventional oil and gas development in Pennsylvania.  Among its provisions, the law (a) imposed consistent setback requirements for drilling activities from buildings, water supply wells and water bodies, but allowed developers to seek variances from the Department of Environmental Protection; (b) sought to promote statewide uniformity and certainty by restricting the scope of municipal zoning authority as it applied to oil and gas development activities; and (c) provided that health professionals could obtain information about trade secret or proprietary chemical constituents used in drilling operations in order to treat patients, so long as they agreed to keep that trade secret or proprietary information confidential. 

A group of municipalities, two local officials, an environmental group and its chief executive, and a physician challenged these and related provisions of the law, and sought to have Act 13 declared unconstitutional under both the Pennsylvania and US Constitutions.  They brought their claims first to the Commonwealth Court, which granted a preliminary injunction against the setback waiver and the municipal zoning limitations and then decided that those provisions were unconstitutional.  On cross-appeals to the Supreme Court, only six of the seven justices participated in the consideration of the case (neither Justice Orie Melvin nor her successor, Justice Stevens, took part).

The Supreme Court split 4-2 on the results, and in most respects on the reasoning on which the judgment was based.  But the centerpiece of the lead opinion, authored by Chief Justice Castille, only had the support of two other justices who decided the case, and therefore did not constitute a majority of the Court.  In his opinion, designated as the Opinion Announcing the Judgment of the Court, the Chief Justice extensively discussed the Environmental Rights Amendment to the Pennsylvania Constitution.  That opinion provides that the people have a constitutional right to clean air, water, and preservation of natural resources, and that the Commonwealth holds the public natural resources of the state in public trust “for the benefit of all of the people.”  Chief Justice Castille drew parallels between fracking and early coal industry practices.  He stated that the municipal zoning restrictions and the setback waiver were in direct conflict with the Environmental Rights Amendment. 

Justice Baer, in his concurring opinion, agreed to invalidate the provisions at issue only on the narrower grounds of substantive due process.  Together with Chief Judge Castille’s group, that created a majority of justices determining that certain provisions were unconstitutional.

Given the divided grounds upon which the decision of the Court was constructed, reports that the Environmental Rights Amendment has been imbued with new vigor may be premature.  The 1971 Environmental Rights Amendment has only infrequently been interpreted and then not in the context of private individuals and municipalities seeking to invalidate legislation.  However, the extensive discussion contained in the Chief Justice’s opinion, which concludes that the Environmental Rights Amendment authorizes the Court to conduct its own evaluation of whether legislation 1) unreasonably impinges on rights to clean air and pure water or 2) breaches the Commonwealth’s trustee obligations with regard to the conservation of public natural resources, is likely to be raised in future litigation. 

Another important takeaway:  The Robinson Township decision does not have any impact on existing drilling activities in Pennsylvania.  The decision does clearly alter the playing field in Pennsylvania going forward, most particularly in terms of the role municipalities will play in shale development.

We will continue our discussion of the issues as Robinson Township winds back through the Commonwealth Court on remand.

USEPA Issues Final Rule Referencing New Phase I Standard; Plans to Withdraw Reference to Old Standard

Posted in Articles, Pennsylvania Brownfields

As expected, on December 30, 2013, USEPA published notice of its Final Rule amending its All Appropriate Inquiries regulations (40 CFR 312) to include reference to ASTM International’s E 1527-13, Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process.  The surprise in the notice of the Final Rule is USEPA’s declaration that it intends to withdraw reference to E 1527-05, the prior and superseded version of ASTM’s Phase I Standard Practice, through a further amendment process.

The December 30 preamble to the Final Rule states:

Given that the revised ASTM E1527-13 standard is now available from ASTM International and given that ASTM International established that the ASTM E1527-13 standard is the only standard that reflects the consensus of its technical committee, EPA intends to publish a proposed rule to remove the current reference in the AAI Rule to the historic standard.

This statement by USEPA paves the way for a clearer path forward and less potential for confusion than was likely, given the references to two versions of E 1527 in the revised AAI Rule published today.

Also of note, on the vapor issue, USEPA states in the Preamble:

EPA wishes to be clear that, in its view, vapor migration has always been a relevant potential source of release or threatened release [under the AAI Rule] that, depending on site-specific conditions, may warrant identification when conducting all appropriate inquiries.

The revised version of 40 CFR 312.11(c), including reference to E 1527-13, is effective immediately.

 

 

 

 

BREAKING: PA Supreme Court Invalidates Key Provisions of Marcellus Shale Law

Posted in Articles

A splintered Pennsylvania Supreme Court today declared unconstitutional several key provisions of Act 13, the 2012 law that comprehensively revised Pennsylvania’s Oil and Gas Law to account for Marcellus Shale exploration and extraction activities.  Notably, the PA Supremes invalidated Act 13’s limitations on municipal zoning in connection with oil and gas activities.  Some aspects of the case were remanded back to the Commonwealth Court for further proceedings.  We are still reviewing the opinions – which you can find at the following links:  Castille, C.J., for the Court; Baer, J., concurring; Saylor, J., dissenting; Eakin, J., dissenting – and we will have more coverage over the coming days of the holdings, the court’s reasoning, and what it means for Marcellus Shale development in Pennsylvania.  Stay tuned.

Land Bank Deal in Philadelphia City Council Could Make Underutilized Properties Available for Redevelopment

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Thousands of underutilized properties in the City of Philadelphia could be made available for redevelopment in the future thanks to an eleventh-hour compromise on the pending Philadelphia Land Bank bill.  The Land Bank bill is intended to streamline the process for getting blighted properties out of the hands of absentee owners (or the City itself) and into the hands of private developers and Community Development Corporations for coherent redevelopment in line with City and neighborhood planning efforts.  Our discussion of an earlier version of the bill is here

The compromise deal worked out by City Council President Darrell Clarke and the primary sponsor of the bill, Councilwoman Maria Quiñones-Sánchez, focuses on the role that Philadelphia City Council members will have in approving transfers of abandoned properties.  PlanPhilly posted a PDF copy of the amended language this morning.  Early this afternoon, Council approved the addition of the amendments to the bill, and will vote on final passage next week in Council’s last meeting of 2013. 

The proposed amendments include a continuing role for the Vacant Property Review Committee (VPRC) advisory board favored by Council President Clarke, but with additional mechanisms to make the VPRC process more transparent, such as publishing meeting agendas and transcripts online and requiring advance public notice of VPRC meetings.  Under the proposed amendments, Council members will not be required to give written consent, pursuant to the longstanding Philadelphia tradition of councilmanic prerogative, for each parcel to be acquired by the Land Bank – instead, Council’s approval role would be limited to an annual review of the Land Bank’s strategic plan and sign-off on the Land Bank’s expenditures.  Today’s amendments also name the initial members of the Land Bank board.

Some Land Bank proponents have argued that the inclusion of the VPRC as an additional layer in the process will perpetuate existing delays in the disposition and acquisition of vacant and abandoned properties; Council President Clarke and his supporters have argued that the VPRC will provide necessary oversight for the appointed Land Bank board.  It remains to be seen, if the bill passes as amended, how quickly the City of Philadelphia will be able to get the necessary machinery of a Land Bank up and running (including budgetary support for the coming fiscal year), and whether and to what degree the system contemplated by the amended bill will actually speed up the process by which vacant and abandoned properties can be acquired from the City by private developers and CDCs for redevelopment and restoration to the City’s tax rolls.

ASTM Publishes E 1527-13 — Summary of Changes

Posted in Uncategorized

On Wednesday, November 6, ASTM International announced that it has officially approved and published the latest revision of its Phase I Environmental Site Assessment Protocol, E 1527-13, Standard Practice for Environmental Assessments: Phase I Environmental Site Assessment Process.   As reported in a prior post, USEPA issued both a direct final rule and a back up proposed rule on August 15, 2013, that would add a reference to the expected ASTM E 1527-13 in USEPA’s All Appropriate Inquiries (AAI) regulations at 40 CFR 312.11(c).  Approximately forty comments were submitted, including adverse comments and therefore, on October 29, USEPA officially withdrew the direct final rule.  USEPA expects the final rule incorporating a reference to the new version to be issued by the end of 2013.  Note that E 1527-13 is not officially recognized by USEPA as sufficient to meet AAI until USEPA issues its final rule.

It likely will be prudent to require your consultant to use E 1527-13 in Phase I assessments once the USEPA rule change goes final, if time and expense permit the file reviews added by the new version.  USEPA said conflicting things in the materials associated with the rule, for example it emphasized that approval of an additional version of the ASTM Standard would add flexibility (an additional option to E 1527-05), but it also made  references to the greater “validity” of the new version of the standard.  ASTM will stop training on the old version and will mark it as “superseded.”  E 1527-05 will remain in the AAI Rule as acceptable, but there is a view that E 1527-13 is a clarification by ASTM of what ASTM intended in E 1527-05 all along, and, therefore, that compliance with E 1527-05 might be evaluated in the future by a court (in the inherently-after-the-fact determination characteristic of AAI and the landowner liability protections) through the lens of the more explicit language of E 1527-13.

It will be more important than ever to be on the same page with any consultant you engage for a Phase I.

Changes that appear in E 1527-13 include:

Recognized Environmental Condition and related terms

  • Recognized environmental condition was simplified and clarified to help bring greater consistency to the identification of RECs
  • Historical REC was clarified to exclude any REC.  Under the E 1527-13 version, an HREC is a condition that was in the past, but is not now, a REC.
  • Controlled REC definition was developed to categorize certain RECs as currently managed to a regulatory standard that does not permit unrestricted property use.  This is designed to replace the use of HREC for conditions that require continued management or restrict possible uses.
  • De minimis condition was clarified to make clear that RECs that require management or restrict use are still RECs.
  • Release definition was added to support principled application of REC definition consistent with Superfund
  • Environment definition was added to support principled application of REC definition consistent with Superfund

Consideration of vapors — Note: Our view of how vapors should be evaluated in a Phase I are addressed by an earlier post.

  • Definition of migrate/migration was added. primarily for reference to vapors
  • Indoor air quality non-scope item has been clarified as limited to air quality unrelated to a Superfund release
  • References to E 2600-10, Vapor Encroachment Standard Guide were added
User Responsibilities
User responsibilities in Section 6 have been clarified to be mandatory — “should” has become “must,” for example, as to:
  • Conducting searches for environmental liens and activity and use limitations, including review of recorded land title records and judicial records, where liens and AULs would only be recorded in judicial records
  • Consideration of the user’s own specialized knowledge
  • Gathering and consideration of commonly known or reasonably ascertainable information within the local community about the property.  This vague undertaking may be the source of dispute in the future.
In addition, Section 6 clarifies what information “should” be provided to the EP, including, liens, AULs, specialized knowledge and commonly know information, and any discounted purchase price due to contamination.

File Reviews

In Section 8, prescriptive language has been added for regulatory files reviews

  • “If the property or any of the adjoining properties is identified on one or more of the standard environmental records sources [e.g. RCRIS] . . . pertinent regulatory files and/or records associated with the listing should be reviewed . . . to obtain sufficient information . . . in determining if a REC, HREC, CREC or a de minimis condition exists at the property in connection with the listing.”
  • “If, in the environmental professional’s opinion, such a review is not warranted, the environmental professional must explain within the report the justification for not conducting the regulatory file review.
Note:  Files accessible within 20 days are considered reasonably accessible.
Also, the EP shall “consider the possible releases that might have occurred . . . in light of historical uses . . . in identifying” RECs.  We have some concern that this will be misused by consultants to identify RECs solely on information related to past uses.
Other Changes
  • Flexibility has been added regarding the language of conclusions
  • Legal Appendix rewritten
  • User Questionnaire updated
  • Table of Contents updated
  • Business Environmental Risk discussion added

Philadelphia Land Bank Moves Closer to Reality

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On October 28, 2013, an amended version of Philadelphia’s Land Bank bill (Bill No. 130156, introduced March 7, 2013, as amended October 28, 2013) was approved by the Public Property and Public Works Committee of Philadelphia City Council on a 6-1 vote.  It now heads to the full Council for a vote. 

Philadelphia has over 40,000 vacant or abandoned properties that are viewed as an impediment to development, raise public safety concerns, and are not generating tax revenue.  Currently, the property disposition system in Philadelphia can be difficult to navigate successfully, particularly for those trying to assemble multiple parcels for redevelopment.  The Land Bank bill is intended to streamline the process for getting blighted properties out of the hands of absentee owners (or the City itself) and into the hands of private developers and Community Development Corporations for coherent redevelopment in line with City and neighborhood planning efforts. 

The amended version of the bill that passed through the Public Property Committee begins to address the issue, with the laudable goals of greater transparency, predictability, and efficiency.  But it still requires multiple layers of approvals from different agencies, which could undermine the new process.  We expect further amendments as the bill makes its way to a final vote, and will provide updates on the bill’s progress.

PADEP’s New Commitment to Community Environmental Projects

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The Pennsylvania Department of Environmental Protection is overhauling its Community Environmental Project (CEP) policy, after several years of uncertainty over the viability of the policy.  The CEP policy, noticed for public comment in the October 26, 2013 Pennsylvania Bulletin, allows the Department to exercise its enforcement discretion to permit a person or regulated entity, in appropriate circumstances, to resolve a portion of any civil penalties stemming from a violation of environmental law by undertaking a project that provides a substantial public health and environmental benefit to the community impacted by the violation or to the general public.  The new policy takes encouraging steps to clarify the Department’s approach toward including CEPs in settlements, announcing that the Department “will consider” CEPs in partial settlement of civil penalties “in situations it decides are appropriate.” 

The new policy would apply to all PADEP enforcement actions involving civil penalties under statutes administered by the Department that are pursued after the policy’s eventual effective date.  Under the policy, a party negotiating with the Department over civil penalties may make a detailed written proposal for a CEP to serve as partial settlement of its liability.  Every proposed CEP must provide a substantial public health and safety or environmental benefit, and must include actions or activities that the proposing party is not otherwise legally required to do.  The Department will not consider a CEP that in any way alters the proposing party’s obligations to remedy any violation and return to compliance, or substitutes for any remedial requirement resulting from the violation.  PADEP will evaluate a proposed CEP’s feasibility, need for PADEP oversight, costs and benefits.

So what is an “acceptable” project?  As an initial matter, the Department generally won’t consider a CEP as partial settlement of intentional, willful, or grossly negligent conduct.  Repeat offenders need not apply.  The draft policy sets out examples of projects the Department might consider acceptable, as well as those it would likely not find acceptable. The common thread:  the benefits of the CEP must relate to public health or safety or the environment and must flow to the community or the general public, not to the proposing party. 

Under the policy, CEPs in the same geographic area, airshed, or watershed as the violation are preferred (or alternatively, projects that have a broader regional or statewide benefit) and should, if possible, address the medium – air, land, or water – related to the violation.  Long-term impacts are favored over temporary effects.  The policy encourages proposing CEPs in disproportionately burdened communities and Environmental Justice areas.  The policy also encourages communication and coordination with community members, NGOs, and local governmental bodies to help identify “shovel-ready” projects for consideration.  In my experience, PADEP’s Office of Environmental Advocate and Office of Legislative Affairs may also be helpful in identifying appropriate projects and locations.

Any approved CEP will be embodied in an enforceable document, such as a Consent Order and Agreement or Consent Decree, and the Department will provide oversight or arrange for third-party oversight to determine whether the CEP is performed to the agreed-upon standards.  A failure to follow through on a promised CEP, then, could lead to a separate action by the Department to enforce the terms of the agreement, or to recover the value of the project. 

Overall, the revised policy offers persons and regulated entities who are facing civil penalties some guidance on what will be accepted as a CEP in partial settlement of violations.  It is our hope that the Department will work closely with all stakeholders in ensuring that the word gets out.  We encourage members of the regulated community and the general public to review the draft policy and offer your comments before the November 25th deadline.  Written comments may be submitted by email (RA-EPpubliccomments@pa.gov) or by regular mail to Holly Cairns, Department of Environmental Protection, 400 Market Street, P.O. Box 2063, Rachel Carson State Office Building, Harrisburg, PA  17105-2063.

PADEP Wants to Hear From Permit Applicants on Implementation of New Permitting Policies

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As the first anniversary of the Pennsylvania DEP’s Permit Review Process and Permit Decision Guarantee approaches, the Department has opened up a supplementary comment period to take public comment on implementation of the two policies.  We discussed the policies last year, here, here, and here.   According to the Department’s most recent quarterly report (link opens PDF), the new programs have helped achieve a significant reduction (66%) in the backlog of permits awaiting decision.

We urge permit applicants who have experience under the new permitting regime to add their perspectives, so the Department can have a full picture in evaluating the effectiveness of the policies.  The supplementary comment period will remain open through December 4, 2013 – your written comments may be submitted to Daniel Coulter by email (send to dcoulter@pa.gov) or by regular mail at 400 Market Street, Harrisburg, PA, 17101. 

WHAT YOU NEED TO KNOW ABOUT THE FEDERAL SHUTDOWN’S IMPACT ON THE EPA AND ENVIRONMENTAL PROJECTS

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The shutdown of the federal government has effectively closed the U.S. Environmental Protection Agency for business. According to the EPA’s September 27, 2013 Contingency Plan for Shutdown, 94% of the agency’s 16,205 employees are being furloughed effective today. Essential personnel, such as project managers in the Superfund program and others performing functions necessary to ensure the safety of human life and protection of property, will remain on the job. Certain exempted positions, as well as positions funded outside of the EPA appropriation or by dollars carried over from past appropriations may also continue working, but only on the tasks funded by these exempted or unexpired dollars. The same general principles will apply to the Departments of Energy and the Interior (where 69% and 81% of employees, respectively, would be furloughed, according to the Washington Post) and to the Army Corps of Engineers.

Thus, unless emergencies or national security needs beckon, the work of our federal environmental and energy agencies, including permitting decisions, inspections and enforcement, grantmaking, contracting, research, and public outreach and education, will largely grind to a halt beginning today. This can be frustrating for those with pending federal permit applications that won’t be acted upon, or it can offer a (temporary) respite to those who are out of compliance and dreading the inspector’s knock. But it also means that important scientific research is not progressing, that critical environmental and energy policies are not being implemented, that grant funds and public-private initiatives are not promoting innovation in the private sector, that Pennsylvania’s environmental agencies stand to lose not only the necessary cooperation of their federal counterparts but also critical funding that EPA provides to support the work of state environmental agencies, and – most poignantly – that our friends, neighbors and family members who work for federal agencies, or who do a substantial amount of contracting work for the federal government, are bearing a significant financial burden for however long this lasts.

Let’s hope that this chapter ends quickly, and the EPA, the rest of the federal government, and all the folks whose jobs and livelihoods depend on it are back to work soon.

PHILADELPHIA JOINS BUILDING ENERGY BENCHMARKING

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On October 31, 2013, the first step of Philadelphia’s building energy benchmarking begins and may require you to take action.  Energy benchmarking is a method to measure and compare energy performances of buildings.  It provides a standard to compare the energy efficiency of similar buildings, like the miles per gallon number used by cars. 

Under the new law, any commercial building owner or manager with indoor floor space of 50,000 square feet or more, or any owner or manager of a mixed-use building where the commercial portion is at least 50,000 square feet, must register information regarding the use of utilities for the building. 

The requirements begin with the entry of information on EPA’s EnergyStar Portfolio Manager System.  The EnergyStar Portfolio Manager is an online tool available at www.energystar.gov/buildings. 

EnergyStar Portfolio Manager requires entry of information regarding the building’s energy expenses, its water efficiency and its carbon emissions.  Building owners enter information from billings on energy meters and water meters.  The Manager then calculates an EnergyStar rating for the building. 

Philadelphia will create a registry of information for all the buildings subject to the new ordinance.  A prospective purchaser or lessee, upon request, may get a copy of the statement of Energy Performance that is generated by the Portfolio Manager.  Also, the public will have access to the newly created database.  The ordinance is intended to allow tenants, prospective purchasers, lessees and the public to compare the energy profiles of large buildings in the City. 

Failure to comply with the ordinance is subject to a fine and penalties, calculated on a daily basis.