Tuesday, May 31, 2016

The Clean Water Act in the Crosshairs

Today, the United States Supreme Court released its opinion in US Army Corps of Engineers v. Hawkes, Co.  The key question in Hawkes was whether a Clean Water Act jurisdictional determination--that is, a determination about whether an area does or does not contain waters subject to federal regulatory jurisdiction--is a final agency action within the meaning of the Administrative Procedure Act.  According to a unanimous court, a jurisdictional determination is indeed final agency action.

The majority opinion, written by Justice Roberts, presents the kind of short, businesslike analysis one typically associates with an uncontroversial case.  But then comes Justice Kennedy's concurrence, and it's a doozy.  In three paragraphs, Justice Kennedy (joined, perhaps not so surprisingly, by Justices Alito and Thomas) asserts that "the reach and systemic consequences of the Clean Water Act remain a cause for concern";' that "the act's reach is 'notoriously unclear'" (quoting Justice Alito's concurrence in Sackett v. EPA); that the Clean Water Act holds "ominous reach"; and that the act  "continues to raise troubling questions regarding the Government's power to cast doubt on the full use and enjoyment of private property throughout the United States." 

This matters, of course, because if Merrick Garland is not confirmed to the United States Supreme Court, if Donald Trump is elected, and if President Trump appoints the kind Heritage-Foundation-Approved judge he has promised to appoint, Justice Kennedy will be probably be the deciding justice in any future challenge to the joint EPA/Army Corps of Engineers Clean Water Rule.  Similarly, if the Sixth Circuit sets aside the rule, the Court will need five votes to reverse that decision, and Justice Kennedy would have seemed, until recently, like the most likely fifth vote.  He doesn't seem that way any more.

This also is a bit surprising.  In his concurring opinion in Rapanos v. United States, Justice Kennedy demonstrated a fairly nuanced understanding of, and respect for, the goals and purposes of the Clean Water Act.  He even took his fellow conservatives to task for lacking such understanding and respect.  So it seemed plausible that he would continue to think the the act's protections serve important purposes, and that he would realize that EPA and the Army Corps implement those protections in ways that are actually quite solicitous of the state, local, and business interests that Justice Kennedy (along with many other people) obviously cares deeply about (I've written about that general subject here and here).  It must have seemed plausible to staff and EPA and the Army Corps, too, for they invested years or work in writing a new rule that relies heavily on Justice Kennedy's Rapanos opinion.  Now, however, it's as though that opinion never happened.  In its place, both at the Hawkes oral argument and now in his concurrence, comes rhetoric seemingly plucked directly from industry lobbyists' talking points.  Perhaps we should have seen this coming, for in recent years Justice Kennedy has played a key and enthusiastic role in gutting campaign finance regulation and the Voting Rights Act, joined an opinion that would have taken down the Affordable Care Act, and generally has been a fairly reliable supporter of any conservative activists' project that did not involve blocking gay marriage.  But still, some of Justice Kennedy's past environmental opinions seemed to foreshadow a different position on the Clean Water Act.

In a post just a few months ago, I predicted that if the Clean Water Rule reached the Supreme Court, Justice Kennedy would likely vote to uphold it.  Oops.  I'm not making that prediction any more.

-Dave Owen 

May 31, 2016 | Permalink | Comments (1)

Monday, May 2, 2016

Local Fracturing Bans Preempted in Colorado

Following a general trend toward state preemption of local control over oil and gas development, the Colorado Supreme Court issued two opinions today finding that Colorado law preempts local hydraulic fracturing (“fracking”) bans and moratoria in Longmont and Fort Collins.  The state constitution of Colorado gives local governments home rule authority, with article XX, section 6 providing that local law shall “supersede” any conflicting law of the state.  This suggests that local governments in Colorado have relatively strong local powers.  But the Colorado Supreme Court has long held that local laws may supersede state law only when the laws relate to “matters of local concern,” such as a local sales tax.  When local laws involve matters of statewide concern, or matters of mixed state and local concern, state law supersedes the local laws if the local laws “conflict” with state law or are otherwise preempted.

Following its earlier Voss decision, the Colorado Supreme Court determined in its two cases today that hydraulic fracturing is a matter of mixed state and local concern, applying a four-factor test: 1) the importance of statewide uniformity of regulations, 2) extraterritorial impact of the local regulation, 3) whether the area has been traditionally regulated by state or local governments, and 4) whether the Colorado constitution specifically indicates that the regulatory area should be governed by state or local governments.  With respect to the importance of statewide uniformity, the court noted that oil and gas sits in shared reservoirs underground, and that a local ban could impact the many rights of individuals who have an ownership interest in that pool of oil and gas—including rights in other local jurisdictions.  Furthermore, a patchwork of local bans could make fracturing less productive and could cause “waste” of oil and gas, meaning that the maximum potential amount of oil and gas would not be extracted when fracturing occurred.  The court also found that local fracturing bans impact other jurisdictions—possibly making it more expensive to produce oil and gas by forcing a company to drill outside of jurisdictional limits to access underground reserves—and possibly causing a “ripple effect” that encouraged other local governments to implement similar bans.  For the third factor, the court noted a conflict.  The State of Colorado has traditionally regulated oil and gas development, but local governments have traditionally regulated the types of uses allowed on land within their jurisdiction (including oil and gas uses).  Thus, the court found that there is mixed state and local interest for this factor.  Finally, the Colorado constitution does not make clear whether fracturing control should be within state hands or whether local governments should have exclusive land use authority.

The court then went on to determine whether state law preempted local control, using a conflict preemption analysis.  In the Longmont case the court noted the importance of local land use control over oil and gas, pointing to the General Assembly’s having “recognized the propriety of local land use ordinances that relate to oil and gas development.”  And the court emphasized that the State of Colorado lacks exclusive control over regulating the technical aspects of oil and gas development.  However, the court noted that the Colorado Oil and Gas Conservation Commission regulates certain aspects of fracturing—indeed, the court perhaps exaggerated the extent to which the state regulates fracturing. For example, in the Longmont case the court characterized Colorado’s requirements for disclosing fracturing chemicals as requirements that “regulate the fracturing process.”  This is perhaps a reach because the requirements are merely informational and do nothing to substantively limit the fracturing process.  However, the court also pointed to Colorado’s regulation of the disposal of waste from fractured wells. It then went on to find that local bans on fracturing and the storage and disposal of fracturing wastes “materially impede” state law, which allows fracturing and regulates it. It thus determined that state law preempts local moratoria and bans relating to fracturing.

These opinions follow similar preemption of local regulation and bans on fracturing in Louisiana (Energy Management Corp. v. City of Shreveport, 397 F.3d 297 (5th Cir. 2005)), New Mexico (Swepi v. New Mexico, 81 F.Supp. 3d 1075 (D.N.M. 2015)), Ohio, Oklahoma, Texas, and West Virginia. The exceptions to the trend are New York and Pennsylvania

Many of these cases, including those decided today, have not yet fully grappled with the challenge of reconciling strong home rule authority over land use matters with a state's interests in regulating oil and gas development. Instead, the courts tend to promptly find preemption, concluding that a state's interests win out over local control despite the state's having previously granted extensive home rule authority to its local "arms."

-Hannah Wiseman

May 2, 2016 in Energy, Land Use | Permalink

The Surprising Evolution of Federal Stream Protections

Right now, the United States’ second-most-heated environmental controversy—behind only the Clean Power Plan—involves the Clean Water Rule, which seeks to clarify the scope of federal regulatory jurisdiction under the Clean Water Act.  According to its many opponents, the rule is one big power grab.  EPA and the Army Corps of Engineers, according to the standard rhetoric, are unfurling their regulatory tentacles across the landscape like some monstrous kraken, with devastating consequences for key sectors of the American economy.

Epa stream imageIn a forthcoming article, I argue that this rhetoric is false, and that it also misses a much more interesting true story.  The Clean Water Rule is indeed part of a major regulatory transformation, which has extended and transformed regulatory protections for small streams.  But the Clean Water Rule is just a small part of that transformation.  Some of the most important events occurred earlier, in places and under presidential administrations that are not typically seen as founts of environmental progress.  A simple story of regulatory overreach (or, conversely, regulatory capture) also explains very little of what has happened.  Streams have more protection now than they did as recently as the late 1990s.  But even as regulatory agencies have extended protections, they also have found ways to accommodate regulated industries in the application of environmental law.

And why might you care?  One reason is that this story of regulatory transformation might help us see the Clean Water Rule in a different, and more positive, light.  A second reason is that small streams are very important, though many people don’t realize that fact.  There are thousands of them across the American landscape, and their contributions to water quality—and their potential to complicate plans for construction and development—are enormous. 

Finally, and most importantly, this story of small streams offers a parable for the hidden history of environmental law.  Many people, including law professors, offer dark takes on the current state of environmental policymaking.  Complaints of Congressional gridlock are constant.  Courts, with some exceptions, generally seem like poor forums for advancing new theories of environmental protection.  And administrative reforms may not sound particularly enticing if one thinks, as many people do, that agencies are either myopic, empire-building over-regulators or, alternatively, industry’s captives.  But the evolving history of stream regulation suggests that environmental protection is not so gridlocked; that agencies can be, and are, engines of positive reform; and that those changes can occur in ways industries can live with.  The full story, as anyone who reads the article will quickly note, is more complicated than that simple summary; this is not just a happy tale.  But at its core, the recent history of stream regulation provides some basis for optimism.

Of course, that optimism comes with a big caveat: the litigation isn’t over yet.  In the months to come, advocates will continue trying to persuade judges that EPA and the Army Corps are out of control, and that basic principles of federalism require those agencies’ jurisdiction to be severely limited.  They may yet succeed, for the fact that a narrative is largely false does not necessarily make it unpersuasive or inconsequential.  And that would be a shame.  The real story of stream protection—if judges allow it to continue unfolding—is one of environmental law continuing, in its messy, sometimes frustrating way, the process of growing up.  And growing up, here as elsewhere, is something to celebrate, not enjoin.

- Dave Owen

image from epa.gov.


May 2, 2016 | Permalink | Comments (0)