Friday, December 2, 2016

ELC Essay #2: Seeing Past the Zero Sum Game in Environmental Policy – Harder than it Looks

by J.B. Ruhl

In Nonzero: The Logic of Human Destiny, Robert Wright offers a sweeping view of human evolution that culminates in his argument that modern society has become so complex and interconnected that there are no true “zero sum” games to be played between people or institutions. Economists and game theorists use the zero sum game concept to describe a situation in which each participant's gain (or loss) of utility is exactly balanced by the losses (or gains) of the utility of the other participant(s). A zero sum game isn’t necessarily a bad situation—in fact, it’s what economists argue markets and trading should produce. The reason is that if the situation is nonzero sum, then by definition one participant can gain by more than another loses, or even both can gain. That’s why sellers sell products and consumers buy them! The market depends on traders to identify nonzero sum situations and trade away until they reach zero sum, which is what economists refer to as Pareto optimality.

Being in a zero sum game can be a sticky situation, however, if there is some reason why redistribution of the pie is necessary.  If it were just up to the participants in a zero sum game, and assuming they are what economists describe as “rational economic actors,” they would not agree to redistribute the pie unless someone (irrationally) volunteers to be made worse off to make someone else better off. But it is not always up to just the participants. Sometimes government, in pursuit of a desired social policy, intervenes to force a “trade” at least some of the participants would not voluntarily (rationally) make.

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December 2, 2016 | Permalink

Thursday, December 1, 2016

ELC Essay #1: What We Talk About When We Talk About Zero-Sum Environmentalism

By Jessica Owley

This past summer, a small but hardy group of law professors gathered to discuss the concept of zero-sum environmentalism. In particular, we had set for our agenda to get “beyond” zero-sum environmentalism. The suggestion was that there is a dominant approach to environmental law issues that frames them as zero-sum and that this framing can be damaging to environmental progress. What we grappled with, though, is whether environmental problems really are (at least at times) zero-sum. Is the description of an environmental issue as zero-sum ever accurate? Are laws treating issues as zero-sum when they shouldn’t be doing so? Or maybe ignoring a zero-sum framework that is at play? Perhaps there are no zero-sum environmental dynamics in the real world and instead “zero-sum” is just the language we (or some of us) use to describe environmental tradeoffs. Zero-sum as used in the context of environmental policy implies stark winners and losers. If the environment wins, the economy must lose. To protect the owls, we destroy the lives of the loggers. To prevent global climate change, Americans must completely change life as we know it.

Our discussions revealed (unsurprisingly) that we all came to this question with different examples, assumptions, and solutions. Some people rejected the idea that zero-sum problems ever actually exist and suggested that reliance on the framework and use of the term can be damaging to environmental governance. Not just because it is an overly constrained view of how tradeoffs actually work, but because the language of zero-sum necessarily creates a combative stance that can impede collaboration and creative thinking. Others suggested that for some environmental concerns, the zero-sum framework was actually underused. That is, we might reach better results if we confront the actual tradeoffs. What work does it do to label environmental problems a zero-sum game? In this case, climate change and biodiversity protection served as key examples. Maybe we do need to emphasize that you can’t have your cake and eat it too. Building that hospital will indeed lead to the extinction of a species. Putting the conundrum in stark terms might help highlight the need for embracing the principle of in dubio pro natura (when in doubt act in favor of nature). Most of us agreed, however, that when we see the zero-sum rhetoric or when we use it ourselves, we aren’t really talking the language of economists. We are taking their term and simplifying it (taking a complex topic from another discipline and simplifying it for our use is something we legal academics are good at). But more than that, we realized that we aren’t actually the ones using this term. In fact, it is not heavily used in the legal academy. It is used in the media, though, and by politicians.

 

 

This chart shows an increase use of the phrase “zero-sum” in books first appearing around 1940 and increasingly used since then with a tapering off beginning in 2000. However, overall there is not a high frequency of use of the phrase. Zero-sum Environmentalism did not appear often enough to be plotted with google’s ngram function. What would be more interesting is to chart this phrase in speeches, academic publications, and news articles, but well … I don’t know how to do that.

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December 1, 2016 | Permalink

Environmental Law Collaborative (ELC) Essays on Zero-Sum Environmentalism

This past summer, members of the Environmental Law Collaborative tackled the concept of Zero-Sum Environmentalism. As an initial foray into our experience with the phrase and its implications, we have followed our pattern of earlier sessions and have written initial essays on our view of the topic. We had anticipated beginning to post these essays mid-November (is the Ides of November a thing?). All of these essays were written before the election, some well before the election. With the election, we faced a real conundrum of whether these essays still have value. What needs rethinking here? In particular, many of us now feel that this conversation is actually more urgent than previously contemplated. Indeed, I confess to being one of the authors who perhaps did not take on the task as seriously as I should have. Some authors have responded directly to the election results and others feel that the results only heighten the urgency of the discussion. As always, the ELC essays represent for us an initial foray into a topic area in which we plan to delve deeper. Thus, I hope you read these essays in that light and help us investigate these ideas with active use of the conversation potential of blogs that allows us to comment and respond to each other. We also welcome other essays tackling this same question and I hope to hear from many of you in the coming months.

Sincerely – Jessie Owley

The Environmental Law Collaborative appreciates the support and funding of the Rocky Mountain Mineral Law Foundation. ELC is also now a 501(c)(3)

December 1, 2016 | Permalink

Thursday, November 17, 2016

Bad Public Lands Bills in Congress - H.R. 866 and H.R. 1484

In what is hopefully not an indicator of legislative initiatives under the Trump Administration, the House Natural Resources Committee held a hearing on Tuesday on two public lands bills that would open up virtually all Forest Service and BLM lands (except Wilderness Areas) for oil and gas drilling and remove almost all environmental protections currently governing drilling activity.  The first bill, H.R. 866, The Federal Lands Freedom Act, would transfer oil and gas permitting authority from the federal government to the respective states, in every state containing federal public lands managed by the Forest Service and the Bureau of Land Management.  It would also exempt those decisions from the Administrative Procedures Act (APA), the Endangered Species Act, the National Environmental Policy Act and the National Historic Preservation Act, basically removing all protection for endangered species, public participation in leasing and permitting decisions (in states lacking a state version of the APA), environmental planning, judicial review, and cultural and historic resource protections in any states that do not have equivalent versions of these laws.  The revenue sharing arrangement between the states and the federal government currently allows states to receive 49% of oil and gas leasing revenue from federal lands located within their borders, and this would remain the same under H.R. 866, which will add financial incentives for states to rapidly increase exploration and drilling.  

H.R. 866 imposes no environmental restrictions on state permitting programs, which would simply take over oil and gas leasing upon filing a “declaration” of intent to do so with the Secretary of Interior.  Although this bill threatens the environmental and cultural values of public lands everywhere, it sends a particularly ominous message about the future of National Monuments, National Forests, and Wilderness Study Areas.  Areas like the Grand-Staircase Escalante National Monument, the Colorado National Monument, the White River National Forest (targeted specifically in written testimony supporting the bill filed by the Heritage Foundation), and National Forest lands throughout the Appalachian region would be immediately open for drilling if H.R. 866 were enacted.   

The second bill, H.R. 1484, is a land transfer bill aimed at divesting the federal government of 45 million acres of BLM and National Forest lands in the State of Nevada.  Titled the “Honor the Nevada Enabling Act of 1864 Act,” this is the latest in a series of efforts by western states to seek ownership and control of vast amounts of federal public lands under the theory that Congress promised these lands to the states in the various enabling acts admitting each state into the Union.   Aside from several flaws in the legal arguments supporting these bills, which strain to bend the plain text of the enabling acts and Supreme Court precedent in Pollard v. Hagan and Dred Scott v. Sandford into support for a federal divestiture the likes of which this country has not seen in over a hundred years, many are based on economic studies that lack critical information about how states will manage the immense administrative burdens they would assume if their efforts succeed.  H.R. 1484 in particular cites a legislative task force report commissioned by the Nevada legislature and finalized in 2014, which concludes that the State could assume title and generate net revenue by immediately ramping up oil and gas development to the maximum extent possible, in a model similar to the way school trust lands are managed (to maximize revenue).  Yet, this conclusion is belied by the detail in the report.  For instance, even if all 45 million acres of transferred lands in Nevada were mineral-bearing, which the report concedes is impossible, the State could not shoulder the massive financial expenses associated with fire management and suppression, which is one of the largest current expenditures for the BLM and the Forest Service in the public lands states.  The report concedes that it lacks critical information on fire suppression and other key details.  In short, the numbers don’t add up, at least not as they are presented now.

Entirely missing from the discussion of H.R. 1484 is any explanation of how the state will manage conservation and environmental protection on the 45 million acres of acquired lands.  It is clear that mining and grazing will continue unabated.  The report indicates that recreational uses will be preserved, as will all valid existing rights of way across public lands.  Wilderness Areas, National Parks, National Wildlife Refuges, National Monuments, desert tortoise Areas of Critical Environmental Concern, and Herd Management Areas for Wild Horses and Burros would remain federal and are expressly excluded from H.R. 1484, but National Forests and all BLM lands not expressly exempted would be transferred.  This means that all 60 of the current Wilderness Study Areas in Nevada would be abolished, and 2.5 million acres of currently protected WSAs would likely opened for mineral extraction, grazing, or other uses that would eliminate future Wilderness potential.  The shift in ownership “style” between the federal government and the State of Nevada would be simply devastating for wildlife, watersheds, fragile Great Basin ecosystems, and other environmental values.

Two weeks ago, it would have appeared unlikely that these bills would ever leave committee, but given the recent election results and the huge shake-up in Washington that is sure to come, these bills (and similar efforts in the Senate) may be ones to watch in the coming year.  More information about H.R. 866 and H.R. 1484 can be found here.

Hillary Hoffmann, Vermont Law School

November 17, 2016 | Permalink | Comments (0)

Call for Papers: California Western Law Review Special Issue, "On the Border: A Legal Survey of the Southwest"

A Call for Papers from California Western Law Review:

California Western Law Review is excited to invite submissions for its special spring issue. Entitled On the Border: A Legal Survey of the Southwest, the edition intends to seize upon California Western’s close proximity to the southern border to highlight the myriad legal issues impacting our region.

While we are interested in showcasing new and innovative scholarship on immigration and criminal issues, we also hope to incorporate a more holistic view of the legal terrain of San Diego and the Southwest. Accordingly, we encourage submissions that address environmental and Native American law; legal developments in biotechnology and intellectual property; military and trade issues; and any other topic that might help illuminate the legal dynamism of San Diego and the Southwest.

Submissions from all members of the intellectual community are welcome; our Spring 2017 issue hopes to feature members of the bench, the bar, and the academy.

If you have an article you would like to submit, please email California Western Law Review with a copy of your manuscript and your CV at lawreview@cwsl.edu, with the subject line “Spring 2017 Special Issue.”

If you would like additional information, please do not hesitate to contact Jake Novack, Editor-in-Chief of California Western Law Review, at janovack@law.cwsl.edu.

November 17, 2016 | Permalink

Thursday, November 10, 2016

Six Thoughts for an Environmental Law Student Wondering what this all Means

As a future environmental attorney, I'm confused and angry and sad. And as a human being, I'm equally as confused and angry and sad. A lot of us students are trying to process all of this today.

That was the beginning of an email that one of my students sent me yesterday.  I think she speaks for a lot of us.  So I thought it might be helpful to share a few thoughts, some but not all of them optimistic, about what we face going forward.  I should say at the outset that I am writing for the benefit of readers who, like me, think environmental protection is important and that climate change and other environmental problems are all too real.

This is going to be a battle.  There have been a few hints of hopeful speculation that perhaps Trump’s tense relationship with mainstream Republicans means he won’t adopt their traditionally anti-environmental positions.  I don’t share much of that hope.  Election Day revealed that other than a few outlying voices in the wilderness like Mitt Romney, the embrace between Trump and conservative Republicans is a big, warm bear hug.  Trump’s transition team selections also suggest that he’s going to be just another far-right conservative, albeit with fewer ideas and a shorter attention span.  And I think those far-right conservatives believe, perhaps with some basis, that loud anti-environmentalism is a key component of the glue that binds their unlikely coalitions together.

We have fought this battle before, and we have won.  Political defeats have a way of feeling new each time.  And this one is new in some ways, but the new elements have more to do with basic common decency than with the environment.  For as long as it has existed, the environmental movement and its predecessors have encountered intense opposition from extractive industries and their political allies.  And it’s often been an uphill fight.  We have lost, over and over again.

But by being persistent, we have also won major and lasting gains.  In most of the United States, air quality is dramatically better now than it was in the 1970s.  It is even more dramatically better than it would have been had we not enacted environmental laws.  Water quality also is greatly improved, though not everywhere, and we just aren’t making toxic waste dumps like we used to.  A few iconic species have been nursed out of threatened or endangered status, and we’ve also kept many, many species from going extinct.  Cities have become more livable, which reduces demand for many resources.  Renewable energy is becoming an increasingly large part of our energy mix.  Per capita water use has been dropping.  And all across the country, there are still beautiful places—some very wild, some urban, and some in between—to go enjoy the outdoors, and to be reminded of why it is so important.

We also have succeeded in building stronger institutions for environmental protection.  Environmental compliance is now baked into the operational cultures of many companies.  Other businesses, like mitigation bankers, manufacturers of pollution control technologies, renewable energy developers, and environmental consultants, use business models that depend upon environmental protection (and put a lot of people to work).  Despite the caricatures of overbearing, insensitive bureaucrats, environmental regulators have gotten much better at finding ways to make genuine environmental protections work for businesses.  There are, of course, some industries whose basic model is opposed to environmental protection, and many of those industries are old enough to have thoroughly insinuated themselves into the political sphere.  But they don’t stand for the economy as a whole.

We have many forums in which to work.  The President is obviously very important to environmental law.  But he isn’t everything.  A lot of good can still come from work at the state and local level.  Direct advocacy toward corporations has sometimes been quite effective, and there is much we could do (like, for example, providing more encouragement to corporations to stop funding industry groups whose real agendas are defined by conservative activists rather than the businesses they ostensibly serve).  And on the greatest environmental challenge of our time—climate change—progress anywhere is progress everywhere.  So we should make gains, and fight losses, on many fronts, and the net result may be positive even if we suffer crushing setbacks in some places.

We have many tools with which to work.  The classic environmental advocacy strategy has been to pass a regulatory statute, which the executive branch then implements.  On the side of land preservation, it’s been to get Congress or the executive to set land aside.  While neither strategy looks quite so promising in the years to come, it’s worth remembering that elements of each have succeeded in every presidential administration in decades.  Even the George W. Bush Administration, never known as a champion of environmental protection, signed strong new fisheries laws, advanced stream and wetland protections, and designated massive areas of the Pacific Ocean as marine sanctuaries.

But the environmental movement has long been creative in finding alternative advocacy strategies, and we can be creative again.  When finding market-oriented regulatory strategies seemed like a way to build coalitions with center-right Republicans, environmentalists embraced economic incentive-based regulation.  If supporting manufacturing and construction goals is a central priority of the new administration, we can do that, too, and it wouldn’t be anything new.  From the Clean Water Act of 1972, which included major funding for wastewater treatment infrastructure, to more recent support for solar and wind construction, the environmental movement has a history of striking alliances with people who want to build things.  There are plenty of opportunities to do more of that.

The American Voters Did Not Repudiate Environmental Protection.  Most voters want environmental protection.  Poll after poll shows that.  Environmental protection may not be a high-salience issue in many places, but this razor-thin election was not a mandate for Donald Trump to begin tearing up our system of environmental law.  Of course, he may act like he has a mandate.  But overreach provides opportunities for responses.

We Have a Powerful Advocate on our Side.  Part of the reason environmentalism was once such a bipartisan issue is that most people derive value from the natural environment.  And that’s true even in—perhaps particularly in—some of the greatest strongholds of Trump support.  Montana and Idaho are spectacular places.  The hills of rural Ohio are beautiful, as are the beaches of the Carolinas and the Gulf Coast.  I spend part of each summer in northern Michigan; it is gorgeous.  And I’m hopeful that the persistent, insistent advocacy of the environment itself will eventually bring people back to the idea that environmental protection is something worth doing—that part of the pride of culture and place that motivates many voters on all sides of the political spectrum means embracing, again, pride in the landscapes within which we live.

You signed up for this.  When you became interested in environmental law, did you think it was going to be an easy field to work in?  I doubt it.  Probably what drew you to the field, at least in part, was your sense that your participation in it would matter, and that wouldn’t be true if victories came easily.  So let’s roll up our sleeves and get to work.  Maybe that means working for an advocacy group.  Maybe it means working with business clients to find new ways to protect the environment and comply with the law while still making money and keeping people employed.  There are so many possible ways to help.  But whatever it means for you, you are needed today, now more than ever.

- Dave Owen

November 10, 2016 | Permalink | Comments (5)

Sunday, August 14, 2016

What Have TMDLs Done?

"TMDLs suck."  At least, that's what a guest speaker told my environmental law class a few years ago.  To be fair, he was just talking about TMDLs for urban stormwater; in that context, the speaker (a municipal stormwater manager and committed environmentalist) saw them as highly ineffective tools.  But I wondered then if the statement might have broader accuracy.

So last year, when the Vermont Journal of Environmental Law asked me to speak at a conference on TMDLs, I decided to look more deeply into the literature on TMDLs and to try to summarize what we know about what they've accomplished.  The results of that inquiry are now available on VJEL's website (as part of a larger volume; I'd add a link but the site seems to be having issues at the moment) and here (as a stand-alone article).  The nutshell summary: there's a lot we don't know, but what we do know is discouraging.  Once upon a time, TMDLs were one of the great hopes of water quality law.  Today, there is very little evidence that they have fulfilled that promise.  And there are reasons--which the article explores in detail--why we shouldn't be surprised at the scant evidence of success.

There are also important caveats to that conclusion, one of which the VJEL volume spends several hundred pages exploring.  At present, the most ambitious TMDL projects in the nation address Chesapeake Bay and Lake Champlain.  The Chesapeake Bay TMDL tends to get more attention, but the Lake Champlain effort seems genuinely promising.  At the symposium, my favorite panel brought David Mears--currently a Vermont Law School professor, but also a recent commissioner of the Vermont Department of Environmental Protection--together with several of his government colleagues to talk about how Vermont was implementing the Lake Champlain TMDL.  It was an inspiring panel, and a good reminder that a TMDL can be an effective way to achieve water quality improvements if it has the support of committed, pragmatic, and smart state officials.  The written VJEL edition provides a similar story in much greater detail.  Unfortunately, however, that circumstance does not seem nearly common enough.

- Dave Owen

 

August 14, 2016 | Permalink | Comments (0)

Wednesday, August 10, 2016

What Brexit Means for Biofuels, Means for Wood Pellet Markets, Means for Southern U.S. Forests

Southern wood pellet facilities

Great Britain's exit from the European Union ("Brexit") has both impacted economic markets and raised generalized geopolitical concerns. One of those concerns is what will happen to the U.K.'s commitment to addressing climate change. Renewable energy policies are squarely within the center of Britain's climate change commitments. In particular, questions have been raised about what Brexit will mean for biofuel use, such as for wood pellets that have replaced coal in boilers at electricity generating facilities. One such facility is Drax Biomass in England. Drax has made substantial commitments to converting its operations from coal to wood pellet biofuels. While debate rages regarding whether or not wood pellets as a means of generating electricity is a net climate positive, at least in the short term, wood pellets constitute a market that has expanded rapidly in in the southeastern U.S. (as represented in the image at the top of this post). Wood pellet generation in the South has surpassed 10 million annual short tons with more than 6 million short tons of additional capacity under construction. Exports from the US to Europe doubled between 2012 and 2013, and some project that capacity could increase 10-fold by 2020.

Others are not so enthusiastic about wood pellet market development in the South. Concerns range from the effect on southern forests—potentially converted more readily into monoculture plantations devoid of biodiversity and negatively impacting water quality—to concerns that even if wood pellets are "renewable" and "carbon neutral" in the long term, in the short term burning wood pellets for energy may release enough carbon dioxide into the atmosphere to push us past a climate tipping point.

The flip side of this debate, of course, is that southern forests are under increasing forest conversion pressure due primarily to urbanization. The U.S. Forest Service has projected that if trends continue, 13 percent of southern forests may be lost, due primarily to urban development. With fewer pulp and paper markets into which forest owners can inject their timber (pulp and paper has been steadily moving operations overseas), and with increasing forest fragmentation due to family forests being split up via generational transfers, forest owners are looking to convert forests to other uses. Wood pellet markets could provide a tremendous opportunity to incentivize private forest owners to keep their forests forested, or even incentivize non-forest landholders to reforest, leading to a net CO2 sink even while burning wood for energy.

Enter Brexit. Regardless of the debate about whether wood pellet market development is good or bad for southern forests or the climate, the recent English referendum to exit the European Union could have dramatic ramifications for market development. Many of the climate targets the UK maintains were driven largely by European Union goals. But in the wake of Brexit, and in a move that shocked many, the UK government decided to shutter its Department of Energy and Climate Change. The department will be merged into an expanded Department of Business, Energy and Environmental Strategy. Many see the replacement of the word "climate" with the word "business" in the department's title as an ominous sign of England's commitment to the Paris Agreement. In fact there is a high correlation between Brexit supporters and climate change deniers. A new group has even emerged called Clexit (Climate Exit) to push for the UK's withdrawal from the Paris Agreement. 

I've recently discussed the potential effect of Brexit on the southern U.S. wood pellet industry with industry representatives, who take the position that while the UK may have taken cues from the European Union in developing its renewable energy policies, much policy development—and in particular regarding wood pellets—was UK driven. Even so, with shifting political winds giving climate deniers a more robust platform in the UK, even those domestic policies could be called into question. While wood pellets could be viewed favorably as another energy source, it is UK government subsidies (and thus UK citizen tax dollars) that prop up the market. Without those subsidies, coal would be four times cheaper than wood pellets as a means of generating electricity.

The UK's exit from the European Union has other probable ramifications. The UK has been more favorable toward the use of biofuels like wood pellets in its electricity generation sector than have other European countries. By exiting the European Union, the UK has lost much of its ability to influence other European countries in that direction. This could reduce the scope of the wood pellet market globally, which in turn could reduce timber markets in the southeastern U.S. and put southern forests at increased risk of conversion.

As far as immediate harm to wood pellet markets in the South, industry executives believe there will be no direct negative ramifications, at least for now. If the UK chooses to reduce subsidies for the use of wood pellet fuels, then it will certainly make wood pellet mill operation in the US more expensive. Industry representatives say that the key players are well hedged and are locked into long-term contracts. So it seems that at least until those contracts run out, or unless companies go bankrupt by not hedging properly, the southeastern U.S. wood pellet market will remain.

Ultimately, the ramifications of a decision like Brexit are more complex and far-reaching than many of those who voted for it likely understand (see, e.g., "After Brexit Vote, Britain Asks Google: 'What is the EU?'"). The southeastern U.S. could very well see an increased loss of southern forests and associated jobs due to the UK's exit—a result tied directly to the general trend in the U.K. toward a nationalistic voter base that is antagonistic to basic, well-established science. It is a tragic irony—many of those in the southern U.S. whose livelihoods depend on forest product markets also identify with the same nationalistic tendencies and predispositions to rejecting sound science—tendencies and predispositions that result in support of phenomena like Donald Trump's campaign. In doing so, these voters hurt their own economic well-being and place at risk the landscape that makes the southern U.S. the most productive forested region of the world.

- Blake Hudson 

August 10, 2016 | Permalink | Comments (0)

Tuesday, July 26, 2016

Call for Papers: Washington Journal of Environmental Law & Policy (WJELP) Symposium on the Challenges of Earthquakes and Natural Disasters

The Washington Journal of Environmental Law & Policy (WJELP) invites submissions for papers focused on how the legal landscape contends with the challenges of earthquakes and natural disasters. Partnering with the University of Washington’s Environmental Law Program, WJELP will be hosting a symposium on this topic in mid-January 2017. Accepted papers will be featured in a monograph book, and select authors will have the opportunity to present at the symposium.

Submitted papers should relate to the growing need for law and policy addressing earthquakes and natural disaster preparedness and response at various scales. In addition, papers may address other issued surrounding the topic, including liability concerns, land use planning, and regulatory matters. We also welcome proposals for independent symposium speakers.

Preferred submission deadline is November 28, 2016

Please submit articles by email to wjelp@uw.edu or through our page on ExpressO.

For WJELP’s publishing criteria, please see our website.

July 26, 2016 | Permalink

Wednesday, June 22, 2016

Federal District Court: Federal Government May Not Regulate Fracking on Federal Lands

In a merits opinion issued on June 21, 2016, the U.S. District Court for the District of Wyoming (Judge Skavdahl) held that the U.S. Bureau of Land Management--the agency tasked with protecting and preserving federal lands for multiple uses by the public--lacks the authority to regulate hydraulic fracturing ("fracking") on federally-owned and managed lands. Using a Chevron step 1 analysis (one standard used to review agencies' interpretation of the meaning of statutes that grant agencies authority), the court finds that "Congress has directly spoken to the issue and precluded federal agency authority to regulate hydraulic fracturing," with the exception of fracturing that uses diesel fuels. The court bases this erroneous conclusion on the Safe Drinking Water Act (SDWA)--an Act that governs Environmental Protection Agency and state authority over underground water sources. Under the SDWA, entities that inject substances underground must first obtain a permit from the EPA or a state to ensure that they will not endanger underground drinking water sources.

In 2005, Congress revised the SDWA to provide that the Act excludes non-diesel fracking from the definition of "underground injection" governed by the SDWA. Specifically, the SDWA provided, beginning in 2005: "For purposes of this part, [t]he term 'underground injection'-- . . . excludes . . . the underground injection of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities" (emphasis added). Thus, as of 2005, the EPA could not regulate fracking under the SDWA. But this SDWA language--language that is only written "for the purposes" of this specific portion of the SDWA--says nothing about the other federal acts under which the EPA may or may not regulate fracturing.  Indeed, this is why the EPA has since been able to issue several fracturing regulations under the Clean Air Act. Moreover, the narrow exemption of fracturing from the SDWA says nothing about how other agencies may regulate fracturing under other acts, such as the Federal Land Policy and Management Act and Mineral Leasing Act, which govern the Bureau of Land Management's review of oil and gas activities on BLM lands. And many of the BLM's current fracking regulations--all of which the court has invalidated through its holding--have nothing to do with underground injection, the topic of the SDWA.  Rather, they address subjects such as requiring oil and gas operators to use tanks, rather than surface pits, to hold fracturing wastes.

The court's determination that Congress under the SDWA has "directly spoken" to the issue of whether the BLM may regulate fracking on federal lands is farfetched and lacks any reasonable legal basis. After all, how can an Act that applies to the EPA, and primarily to underground injection activities on private lands, "directly," or even impliedly, remove the BLM's authority to regulate fracking wastes--and related activities such as the surface handling of fracking wastes--on federal lands? Indeed, in the legislative history of the SDWA, Congress made clear that in passing the Act it did not intend to "limit the authority" of the BLM's predecessor agency.

The court's failure to find any case on point--and its twisting of the meaning of one of my old law review articles to support its Chevron holding--demonstrate the artificial contortions required to reach this poorly-reasoned holding. Indeed, in my article cited by the court, I indicate in a footnote that despite the exemption of fracturing under the SDWA, other federal acts can apply to fracturing. I specifically cite to an Endangered Species Act issue that arose in a BLM approval of a fracturing operation on federal lands, noting that the ESA and Clean Water Act could apply to the review of fracturing operations. Nothing in my 2009 article indicates that the exemption of fracturing from the SDWA, which is administered by the EPA, weakens the federal regulation of fracturing by other agencies under other acts. In Congressional testimony I gave last summer, which highlighted, among other things, state petitioners' misuse of my article in their district court filings, I stated: "[M]y article does not address the separate authority of the BLM to regulate fracturing on federal lands." Unfortunately, the court in both its preliminary injunction and merits opinion largely adopts petitioners' dishonest interpretation and use of my article.  Law review articles can provide useful history and can help illuminate the meaning of statutes and prior court opinions, but courts should not use them in place of direct legal precedent.  Here, it appears that the court could find no legal precedent directly on point and therefore resorted to misinterpreting an old article that I wrote when I was a visiting assistant professor in a two-year (untenured) fellowship position--an article that I have since built upon in much greater detail in more recent and more relevant work.

The court's erroneous determination that a Congressional exemption of one activity from one federal environmental act exempts that activity from all other federal statutes--including statutes that apply to activity on lands owned and managed for the benefit of the public--could have far-reaching consequences.  For example, the Clean Water Act exempts many agricultural and silvicultural (forestry) activities from its provisions. Under the court' s reasoning in the fracking case, this could suggest that the BLM and Forest Service may not review and regulate grazing and logging on federal lands under the Federal Land Policy and Management Act and other acts governing public agencies' management of public lands.

Beyond its core holding that the SDWA clearly and directly prevents the BLM from regulating fracturing on federal lands, the court also suggests that the BLM has not historically regulated fracturing much and therefore should not be able to now--a point largely irrelevant to whether an agency is now authorized to regulate a particular activity.  Even if an agency's historic choice to extensively regulate an activity (or to not regulate this activity) were relevant to a Chevron analysis, the BLM should win in this case. The BLM has long governed numerous aspects of oil and gas development on federal lands, including underground activities such as casing (lining) the well so that oil, gas, or other substances flowing through the well do not mix with underground water. Indeed, the BLM historically regulated certain aspects of fracking on public lands--not just conventional oil and gas development. An old regulation issued by BLM's predecessor agency required oil and gas operators to first submit a well casing program to the agency before engaging in well stimulation, which includes fracturing. 30 C.F.R. 221.21 (1942).

Congress in the Federal Land Policy Management Act, which directs the BLM's management of public lands, indicated that it was the express policy of Congress to protect "water resource . . . values" on federal lands and to require the BLM to manage public lands for "a combination of balanced and diverse resource uses" by current and future generations. 42 U.S.C. 1701(a)(8) and 1702(c). Without the ability to regulate fracking, which is used for most new oil and gas wells, the BLM will struggle to achieve this mandated balance.

-Hannah Wiseman

June 22, 2016 | Permalink

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)

Wednesday, March 30, 2016

A Few Reactions to the Hawkes Oral Argument

The United States Supreme Court heard oral argument this morning in U.S. Army Corps of Engineers v. Hawkes, a case considering whether "jurisdictional determinations" under the Clean Water Act are subject to judicial review.  Below are a few reactions to the questions and answers at oral argument (all based on reading the transcript; I was not there).

  • This shouldn't be as ideologically fraught as some of the Court's other recent environmental cases.  The basic dilemma raised by this case is that informal government communications can be really helpful to regulated entities, but it can also seem frustrating and unfair when a regulated entity finds itself bound, as a practical if not legal matter, by those informal communications and can't challenge them in court.  Ruling against the government could chill a form of communication that most regulated entities find helpful; ruling against for the government could delay the ability of non-governmental entities of all types--liberal advocacy groups as well as conservative groups and businesses--to challenge legal positions they find objectionable.  That does not, on its face, sound like an overtly ideological dilemma, and, perhaps not surprisingly, some of the justices were clearly troubled by both sides' arguments.  But the more conservative justices appear, from their questions, to be skeptical of the notion that informal communication might be a valuable service offered by agencies, and to have adopted the more cynical view that it's really just about extending the agency's power and reach.  Once they've made that move, the case does start to look a whole lot more ideologically charged. 
  • So is the Clean Water Act "unconstitutionally vague" but not at all ambiguous?  At one point, Justice Kennedy suggested that the Clean Water Act's jurisdictional provisions might be unconstitutionally vague.  Yet fifteen years ago, in SWANCC v. United States, Justice Kennedy signed on to an opinion that expressly declined to accord Chevron deference to the Army Corps's and EPA's interepretation of that same jurisdictional provision.  The Court normally gives Chevron deference to reasonable agency interpretations of ambiguous statutory provisions, but the SWANCC majority instead concluded that the statute's meaning was sufficiently clear that no such deference was required.  Five years later, in Rapanos v. United States, Justice Kennedy authored a concurring opinion interpreting those same provisions; his concurrence again declined to accord Chevron deference.  Perhaps this is just a reminder that no one should make too much of stray asides at oral argument, but the suggestion that the statutory language--which hasn't changed--is now unconstitutionally vague seems drastically at odds with Justice Kennedy's prior positions.
  • The 404 permitting process is faster, usually, than the justices realize.  In one question, Justice Ginsburg described the dilemma of a landowner who receives an unfavorable (from the landowner's perspective) jurisdictional determination: "now they have to go through this whole process, and it's going to take years and cost me a lot of money."  But it probably won't take years.  Below, I've pasted a chart from a recent Army Corps/EPA report on 404 permitting.  As you can see, typical permitting times are much shorter than Justice Ginsburg suggested.  And while the data don't answer this question, I suspect permitting times are likely to be particularly short for the kinds of borderline situations in which landowners request jurisdictional determinations.  Generally speaking, bigger impacts to aquatic resources require longer permitting times, and landowners whose impacts will be big usually have no need of jurisdictional determinations.

Army corps chart

This may not matter for the legal issue in the case.  An obligation to go through a six-month permitting process, or even a two-month process, is still an obligation.  But I'm concerned to see more of the justices implicitly buying into elements of a false narrative about the oppressiveness of the 404 program.  

And that mythmaking was in further evidence later in the argument.  At one point, Justice Alito made the following assertion about the consequences of a jurisdictional determination: "And if they issue a negative,­­ I'm sorry,­­ an affirmative jurisdictional determination, as a practical matter, that's going to mean in most instances that the project is shut down."  That statement is inaccurate.  In reality, an affirmative jurisdictional determination means the landowner may have to adjust the project design and may need to compensate for the resulting impacts to aquatic resources.  But it does not mean the project will be shut down.

  • As an administrative law professor, I love this question from Justice Kagan.  She gets it. 

I mean, one of the reasons I find this case very difficult is because all over the Federal government there are compliance offices of various kinds whose function is to give advice to people. And often that advice comes with very specific recommendations. It says we will not take enforcement action if, or, we do not consider it a violation of law  on the following facts. And I guess what I want to know is your view of how this program compares to various other kinds of programs like this, whether it's the ­­ whether it's tax opinion letters, or SEC opinion letters, or FCC or whatever, how this program compares to those and where you could draw sensible lines, because mostly we want  government agencies to do these things. We think that this helps people, to actually know what the government thinks about particular factual situations. So how do we draw lines in this area, in your view?

Dave Owen

 

March 30, 2016 | Permalink | Comments (0)

Wednesday, March 9, 2016

The Devil Is in the Design: Forming California's New Groundwater Sustainability Agencies

Not that long ago, the opening words of one of Joe Sax’s articles described California pretty well. “We Don’t Do Groundwater,” the title began, and until recently, that was true—in spite of the immense importance of the resource.  Outside of a few urban areas in coastal southern California, California groundwater use regulation was largely an oxymoron.  

In 2014, that changed. The California Legislature passed the Sustainable Groundwater Management Act, a statute designed to create comprehensive and, as its name suggests, sustainable management of groundwater.  The statute also is designed to promote local discretion and control.  While the legislature defined broad goals and conferred oversight authority on the California Department of Water Resources and State Water Resources Control Board—both of which are statewide agencies—primary implementing authority will rest with local groundwater sustainability agencies, or GSAs.  Those GSAs are now just beginning their work, and many challenges lie ahead.

This week, UC Berkeley Law School’s Center for Law, Energy, and the Environment (working in partnership with UC Water and researchers from UC Hastings, UC Santa Cruz, the University of Idaho, the University of Massachusetts, and the Union of Concerned Scientists) released a report designed to help these GSAs succeed. 

The report begins with the premise that GSA governance systems will help determine the success of SGMA implementation – even the best plan has limited value without an agency that can implement it.  To facilitate effective implementation, the report offers a framework for institutional design. More specifically, it identifies a series of criteria for evaluating whether GSAs are likely to be able to govern both fairly and effectively.  The criteria – scale, human capacity, funding, authority, independence, representation, participation, accountability, and transparency – should help stakeholders and agencies evaluate whether a GSA will be able to manage groundwater sustainably. The report also draws upon examples from the management of other natural resources to illustrate some of the challenges GSAs are likely to face, and some of the ways other resource management agencies have worked through similar challenges.

Some key recommendations include:

  • GSAs should minimize the fragmentation that is so common among California water management. Those GSAs should focus, to the extent possible, on aligning their scale to groundwater basin boundaries, rather than existing jurisdictions.
  • GSAs will need to develop a range of expertise, including technical, legal, financial, and management, in order to understand and effectively manage a complex and hidden resource. Funding the development of this human capacity will require giving careful thought to a variety of sources of revenue. State agencies will also need to consider how they can best lend their expertise to local regulatory efforts.
  • To avoid the potential for domination by a narrow range of interests, GSAs will need to develop mechanisms for participation and representation of a broad range of stakeholders.
  • To ensure accountability, the state needs to be prepared to actively exercise its oversight responsibilities, and to clearly signal now how and under what conditions it will do so.

The report provides more detail on these and other recommendations, and can also serve as a reference to the tools and options available to GSAs. We intend for the report to help the people who staff and manage GSAs as they attempt to meet the challenges of groundwater management, the state agencies who act as the crucial backstop for the act’s implementation, and the many stakeholders who will ultimately benefit from achieving groundwater sustainability in their local basins.  California now does groundwater, and we hope this report will help us do it well.

- Dave Owen and Michael Kiparsky

Michael Kiparsky is Associate Director of the Wheeler Institute for Water Law and Policy at Berkeley Law.  The report's other authors were Nell Green Nylen, Juliet Christian-Smith, Barbara Cosens, Holly Doremus, Andrew Fisher, and Anita Milman.

March 9, 2016 | Permalink | Comments (0)

Sunday, March 6, 2016

Clean Water Act Jurisdiction and the Changing Supreme Court

Since Justice Scalia’s passing, the blogosphere has been abuzz with speculation about how the changed composition of the Court will affect environmental law.  This post adds a little more to that speculation.  My focus is not the Clean Power Plan litigation, which has (justifiably) gathered much of the attention, but instead the litigation over the joint EPA-Army Corps Clean Water Rule.  And my prediction is a bit different from most predictions about the Clean Power Plan.  Here, I predict, that changes in court composition probably won’t matter much.

Before I explain the reasons for that prediction, a little context may be helpful.  The Clean Water Rule (also sometimes referred to as the Waters of the United States Rule (or just WOTUS)) determines the geographic scope of federal jurisdiction under the Clean Water Act.  The Army Corps and EPA jointly released the rule last summer.  Its most controversial provisions retain, with minor adjustments, existing jurisdictional practices for small-ish wetlands and streams.  Most of the rule’s opponents (a combination of states and regulated industries) were hoping for narrower jurisdiction, and they filed many lawsuits challenging the rule.  Some environmental groups, while generally supportive of the rule, objected to a few provisions they thought narrowed jurisdiction too much, and they, too, have sued. 

The challenges will be decided by the Sixth Circuit Court of Appeals, which recently and somewhat grudgingly ruled that it did have jurisdiction over the cases.  I think the outcome before the Sixth Circuit will likely turn on one of two questions: first, was the final rule a logical outgrowth of the proposed rule, or were changes in the final rule sufficiently unexpected that they deprived interested parties of their opportunity to comment?  And, second, is the rule consistent with the text of the Clean Water Act, as interpreted by the Supreme Court in Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers and Rapanos v. United States?  After the Sixth Circuit decides on those issues, cert petitions seem likely.  And a grant of cert would surprise no one (particularly if the Sixth Circuit decision turns on the second question above; the first might seem more fact-bound and less cert-worthy).

If a case is likely to wind up at the Supreme Court, and if the underlying issues have closely divided the Court in the past, a change in the composition of the Court would seem to be very important.  So why not here?  It helps to consider a few different scenarios through which the case could reach the Court.

Scenario 1: The Sixth Circuit upholds the Clean Water Rule, and cert petitions are decided by an eight-member Court.  This scenario could occur if the Sixth Circuit decides the case exceedingly quickly, or if the appointment stalemate drags on well into the next administration.  If that happens, then a denial of cert seems likely—there would probably be a minimum of four strong votes to affirm the Sixth Circuit, and therefore little appetite for further review—and the Sixth Circuit decision would stand.  And the change in Court composition would turn out to matter. 

But this scenario isn’t likely.  Many months will likely pass before the Sixth Circuit issues an opinion, and a petition for cert will probably be reviewed by a nine-member Court.  I’m also mildly pessimistic about the rule’s chances before the Sixth Circuit.  The current panel has two Republican appointees--an imperfect indicator of inclinations, but not a meaningless one--and that panel already has stayed the rule and sent some signals of concern about its legality.  I do not think those signals are justified, but it’s the judges, not me, who will decide the case.

Scenario 2: The Sixth Circuit sets aside the Clean Water Rule, and cert petitions are decided by an eight-member Court.  In this circumstance, I think Supreme Court review is more likely.  The four liberal justices would likely want to reverse the Sixth Circuit and uphold the rule, and they might reasonably hope that Justice Kennedy would eventually join them.  Consequently, the outcome of the case would likely come down to Justice Kennedy’s vote—just as it would have if Justice Scalia still were a member of the Court. 

And (here comes the bolder part of the prediction) I think Justice Kennedy will vote to uphold the rule.  His Rapanos opinion seems to me to reflect three basic concerns: he wouldn't mind some boundaries on federal authority; he wants a science-based rule; and he wants a rule consistent with the basic goals of the Clean Water Act.  This rule may do less than Justice Kennedy might like to limit federal authority.  But, as mountains of record evidence make pretty clear, EPA couldn’t limit federal authority very much while also writing a strongly science-based rule and respecting the goals of the Clean Water Act.  In past cases, Justice Kennedy has acknowledged that his commitments to state empowerment sometimes need to give way to other values, and I think—and hope—he’d say the same thing here.

(I’ve also argued elsewhere that states actually have a lot of influence over what EPA and the Army Corps do within the boundaries of their jurisdiction, which suggests that a proponent of a strong state role could be comfortable with broad federal jurisdiction.  But that’s a little tangential here.)

Scenario 3: A nine-member Court, with five Republican appointees and four Democratic appointees, hears the petition for cert and decides the case.  This circumstance is likely to produce a similar outcome to scenario 2.  There still would be four votes to grant cert; the liberals still would have a reasonable hope of bringing Justice Kennedy to their side, and Justice Kennedy still would be the deciding vote.  He’d have one more colleague asking him to join the conservative bloc, but he seems to make up his own mind.

Scenario 4: A nine-member Court, with five Democratic appointees and four Republican appointees, hears the petition for cert and decides the case.  This might seem to be a very different scenario, for Justice Kennedy now would no longer be the tiebreaking vote, and the rule would probably be upheld.  Indeed, one might think, at first, that the rule would be upheld under a rationale that gives EPA and the Army Corps more latitude to regulate broadly

But EPA and the Army Corps themselves have largely foreclosed that possibility.  In crafting the rule, EPA and the Army Corps adopted Justice Kennedy’s “significant nexus” standard as governing law.  They clearly put a high priority on writing a rule that Justice Kennedy would vote to uphold, and building a record that would convince him to uphold it.  With a reconstituted and more liberal Court, EPA and the Army Corps probably could assert jurisdiction more broadly.  But they had no way of knowing that Court might be coming—and it still might not come—so they decided, quite reasonably, to make Justice Kennedy the deciding vote before the rulemaking even began.

Other scenarios are possible, of course; we live in an unpredictable world.  But if the scenarios above exhaust the most likely possibilities, I think the bottom line is that for Clean Water Act jurisdiction, at least, Justice Kennedy is still the deciding vote.

- Dave Owen

March 6, 2016 | Permalink | Comments (0)

Thursday, February 25, 2016

Daniels and Grow Sun on Externality Entrepreneurism

Professors Lisa Grow Sun and Brigham Daniels recently posted the latest draft of their recent article, Externality Entrepreneurism, on SSRN. This article builds on an earlier article, Mirrored Externalities, that they published in the Notre Dame Law Review in 2014. In Mirrored Externalities, Grow Sun and Daniels highlighted the fact that “negative externalities are the inverse—the mirror image—of the positive externalities.” For example, preserving a wetland can be described as creating positive externalities, such as water filtration and flood control; conversely, destroying the wetland can be characterized as creating inverse negative externalities: poorer water quality and increased flooding. The reason that mirrored externalities matter is “the framing of externalities has profound effects on both the way we think about and process externalities and on our politics and policy development.” Emphasizing negative externalities, for example, may suggest the appropriateness of particular types of policy solutions (like fines and regulation) and may trigger loss aversion in a way that positive externalities do not.

In Externality Entrepreneurism, they expand their consideration of the framing of externalities, examining a variety of ways that externality arguments can be employed to drive legal and social change. The abstract of their paper is as follows:

The way that economists have taught us to think about externalities—asking us to identify, measure, and internalize them—while useful, has created a substantial blind spot. According to economic thinking, the law ought to incentivize or force those who create externalities to internalize them. Yet, internalizing externalities is just one way of many that externalities shape law and politics: legal and political actors frequently employ externalities to galvanize or oppose change by strategically identifying, selecting, framing, and promoting externalities. These actors exaggerate and highlight different externalities with the aim of capturing the attention of individuals, the media, networks of interest groups, and ultimately legal and political decisionmakers. We call those who use externalities this way “externality entrepreneurs.” Externality entrepreneurism is prevalent in all levels and branches of government and in almost every area of law and policy, yet it is completely unexplored in existing scholarship. This Article seeks to remedy that neglect and begin the broader conversation about this vitally important lens. Because externality entrepreneurism is so ubiquitous and universal, understanding it is critical not only for those who wish to create change in our political and legal institutions but also for those who wish to more fully understand and evaluate the mechanisms by which such change occurs.

I highly recommend both of these thoughtful and insightful pieces on how important the framing of externalities/internalizing environmental costs and benefits is to modern policy development.

- Blake Hudson

February 25, 2016 | Permalink | Comments (0)

Wednesday, February 24, 2016

The Latest on Koontz v. St. Johns: State Supreme Court Declines to Review Appellate Decision on Remand in Key Takings Case

This past week, the Florida Supreme Court denied a petition for certiorari in the long-running takings case of Koontz v. St. John’s River Water Management District. The denial lets stand an appellate decision on remand from the U.S. Supreme Court that presents significant obstacles for state efforts to protect the environment and regulate land uses. 

To re-cap, in 1972 Koontz bought a 15-acre lot consistently predominantly of wetlands.  Two decades later, the state proposed conditions allegedly aimed at mitigating the wetland impacts of a shopping mall that Koontz sought permission to build on the property.  Koontz scoffed at the proposed conditions.  In a rather confusing back-and-forth, the state withdrew those conditions and denied the requested permit, before reconsidering and unconditionally granting that permit.  Despite having the permit in hand, Koontz continued to press his claim that the originally proposed conditions amounted to an unconstitutional taking for which he was due compensation.

In 2009, a state appellate panel determined that Koontz was entitled to $477,000 in takings compensation for the property’s lost rental value over the period of time between the denial of his development application and the issuance of the permit in light of the fact that the initially proposed conditions did not comport with the heightened scrutiny discussed in the Supreme Court’s conveniently-rhyming Nollan and Dolan decisions. (Together, these cases require the state—as the defendant—to prove that some unspecified class of permit conditions bear an “essential nexus” to and are in “rough proportionality” with the proposed development’s impacts to avoid having to pay takings compensation.)

In 2013, the U.S. Supreme Court confirmed that, where a governmental entity (i) proposes certain permit conditions but (ii) later withdraws those proposed conditions and (iii) makes a decision to approve or deny the requested permit, those temporarily proposed conditions are subject to the heightened scrutiny of Nollan and Dolan.

The Supreme Court’s decision describes Koontz as presenting a dispute that fits within Nollan and Dolan’s “special application” of the Court’s unconstitutional conditions jurisprudence. This description is peculiar for, among other reasons, the Court stated that “nothing has been taken” from Koontz because he never had to comply with any untoward permit conditions. Further complicating matters, the Court did not discuss what remedy, if any, might be available to a claimant who successfully argues that a proposed condition does not pass Nollan and Dolan muster, stating that “[b]ecause [Koontz] brought his claim pursuant to a state law cause of action, the Court has no occasion to discuss what remedies might be available for a Nollan/Dolan unconstitutional conditions violation either here or in other cases.”

Yet on remand in June of 2014, the state appellate court summarily concluded by a 2-1 vote that its earlier decision awarding “just compensation” for a “taking” was “entirely consistent” with the Supreme Court’s decision.  It, therefore, “reaffirm[ed]” its compensation award for lost rents over the period of time between the denial of Koontz’s original development application and the issuance of the permit.

The dissenting judge saw the remand as presenting the question of whether a damage award was appropriate under a state statute for action that represents an “unreasonable exercise of the state’s police power constituting a taking without just compensation.” With the Supreme Court having confirmed that no taking occurred, she contended that the case could only be decided summarily in favor of the state. At minimum, though, she would have requested additional briefing.

Last week, nearly two years after the appellate court’s decision on remand, the Florida Supreme Court denied the state’s petition for certiorari. The state has not yet announced whether it will ask the U.S. Supreme Court to take up the case a second time. 

The implications for environmental protection and land use controls are potentially significant should the Florida appellate court decision stand, especially if that decision proves influential as other states’ courts begin to wrestle with the vagaries of the U.S. Supreme Court’s decision in Koontz.

Until the 1980s, it was largely understood that the state need not pay compensation for property later found to be taken by a regulatory action if the state repealed that regulatory action immediately upon the takings finding. Yet in its 1987 decision in First English, the Supreme Court concluded that “where the government’s activities have already worked a taking of all use of property, no subsequent action by the government can relieve it of the duty to provide compensation for the period during which the taking was effective.”

There is broad agreement that First English’s holding requiring compensation in these instances has a chilling effect on government regulation.  The appellate decision on remand in Koontz seemingly works to expand First English’s retroactive takings compensation principle to at least some government communications made during pre-decisional negotiation sessions and subjects such communications to the heightened scrutiny of Nollan and Dolan.

There are a number of courses that government entities could take in this confusing and chilling post-Koontz world, all of which admittedly come with their own shortcomings and risks.  Sean Nolon posed several here, and I added to Sean’s list here. It may be fodder for future empirical work to determine which of these approaches—and the assuredly many other approaches that are not discussed in these essays—the myriad state and municipal entities adopt moving forward. 

Tim Mulvaney

Guest blogger Tim Mulvaney is a Professor of Law at Texas A&M University School of Law.  He can be reached at  tmulvaney@law.tamu.edu.

February 24, 2016 | Permalink | Comments (0)

Monday, February 22, 2016

Reverse Us, Please: The Sixth Circuit and WOTUS Jurisdiction

The United States Court of Appeals for the Sixth Circuit just released on opinion retaining jurisdiction in the litigation challenging the joint EPA/Army Corps Clean Water Rule, also often known as the Waters-of-the-United States (or WOTUS) rule.  The question before the court was whether the Clean Water Act assigned jurisdiction over challenges to the rule to the courts of appeals or to federal district courts.  Many of the rule's challengers wanted their claims in district court, or so they argued; the federal government sought to keep the case in the Sixth Circuit.  Today, the feds prevailed; the Sixth Circuit held that jurisdiction should remain at the appellate level.

It reached that conclusion with very little agreement or enthusiasm.  The case produced three opinions, with two concurring in the retention of jurisdiction, but not on the rationale, and one dissenting.  All three judges agreed that the best reading of the statute would have assigned jurisdiction to the federal district courts.  But two of the three judges believed that binding judicial precedent foreclosed that reading of the statute.  That resulted in statements like this, all from the judges who ruled in favor of appellate jurisdiction, and thus for the federal agency defendants.

Judge McKeague:

-"On its face, the Agencies' argument is not compelling."

-"While [the challengers'] plain arguments are not without facial appeal, we are hardly at liberty to ignore the consistent body of case law that has sprung from that language in encounters with the real world...  Were we arguing on a blank slate, the argument would be more persuasive, but we're not."

Judge Griffin:

- "I concur in the judgment... only because I am required to follow our precedentially-binding decision...

- "In my view, it is illogical and unreasonable to read the text of either [of the Clean Water Act jurisidictional provisions at issue] as creating jurisdiction in the courts of appeals for these issues."

That kind of language seems an awful lot like an invitation for Supreme Court (or en banc) review.  But will that invitation to the Court be granted?  For two reasons, I suspect it might not.  

The first is that there might not be a cert petition.  The petitioners who "lost" on this motion might have decided that they're actually quite happy to stick with the Sixth Circuit, where they've drawn a conservative panel--a panel, in fact, that already has stayed the rule.  Their only advantage to a cert petition might be to draw out the litigation a little longer, and thus to potentially lengthen the stay.  And the Department of Justice isn't exactly likely to appeal when it just won.

The second reason is that the Supreme Court might not have any interest in granting cert.  The issue here is specific to one statute.  There isn't a circuit split.  And the issue probably wouldn't strike the justices as very interesting or important.  Indeed, the one Justice whose interest a cert petition might have piqued would have been Justice Scalia, who I think would have been rather offended at the non-literal readings prior courts had given to the statutory text in question.  And Justice Scalia, of course, has passed away.

So the case may very well continue forward in the Sixth Circuit, heard by a panel of judges that would have unanimously dismissed the challenges, and would have let those challenges proceed instead in federal district court, had they believed governing judicial precedent allowed that option.

- Dave Owen

 

February 22, 2016 | Permalink | Comments (2)

Wednesday, February 17, 2016

The Clean Power Plan, the Supreme Court's Stay, and Irreparable Harm

Last week, the Supreme Court controversially stayed implementation of the Clean Power Plan (CPP), the cornerstone of the Obama Administration’s climate policy, while twenty-nine states proceed with litigation against it. The CPP targets greenhouse gas emissions from power plants, which account for about a third of all U.S. carbon emissions. The rule is designed to reduce emissions from coal-fired plants, the dirtiest form of energy production, through a mix of stricter limits on existing plants, measures to increase energy efficiency, and other mechanisms that encourage producers to shift from coal to cleaner renewables and natural gas.

The CPP provides for substantial flexibility in how reduction targets may be attained within states, allowing states to choose among various options proposed in the rule, to come up with their own proposals, or to opt for federal regulation in lieu of state oversight. Nevertheless, generators heavily invested in coal argue that implementation will require expensive changes.

It therefore surprised no one that states with the most coal-dependent economies, and with political leadership most sympathetic to the coal industry, are challenging the CPP in court. They argue, among other things, that EPA is unauthorized to regulate power plants this way, that the standards imposed by the rule did not take fair account of the costs of implementation, and that the final rule was insufficiently related to the proposed rule on which the public provided comment. Eighteen other states are supporting the rule, together with environmental groups and some power companies (including utilities in some states that are challenging the rule). Proponents contend that federal environmental laws have always targeted energy production, a primary source of regulated pollutants, and that the CPP legitimately follows from established legal authority, the regulatory record, and the proposed rule.

EPA always knew the CPP would be litigated, and so the lawsuits came as no surprise. But the Court’s move to stay the rule—before the issues had even been aired in open court—has apparently surprised everyone. The one-page order made no judgment on the merits of the case, but it suspends implementation of the rule while the litigation runs its full course, a process expected to take at least eighteen months. The Court split along ideological lines in issuing the stay, with the five more conservative justices voting for the stay over opposition by the four more liberal justices. Just weeks earlier, the D.C. Circuit declined to issue the plaintiffs’ requested stay, following uniformly applied federal judicial norms—until now.

The Supreme Court has never before blocked implementation of a generally applicable regulation before its merits have been considered by a federal appeals court, so the stay has provoked a vociferous response. Supporters of the CPP excoriate the move as “unprecedented” while opponents hail it as “historic.” Undue judicial activism may be in the eye of the beholder, but most agree that the stay does not bode well for the future treatment of the CPP before the Court. Such an unusual move cannot help but send signals that at least five of the justices are skeptical of at least parts of the rule.

The CPP is the Obama Administration’s last and best effort to take on the super-wicked problem of climate change, and its ambition responds appropriately to the magnitude of the challenge. All of us will benefit from sensible climate policy in the long run, but as with all regulatory changes, there will be winners and losers in the short run—and the losers are passionately defending their interests in the litigation at hand. They are entitled to do so, and the courts must give their arguments the most serious consideration.

Nevertheless, the Court’s novel stay raises concerns of a different order. It represents another move by the Roberts Court to shift power toward the judiciary on matters that relate not to individual constitutional rights—where judicial prowess necessarily overtakes the majoritarian tendencies of the political branches—but to the complex allocation of costs and benefits within a comprehensive regulatory program, where judicial capacity is easily eclipsed by legislative and executive competence. The three branches of government specialize in answering very different legal questions, and conservative-leaning courts like the Roberts Court are usually quick to remind us that broad-brush public policymaking is not a judicial task.

The CPP, for example, makes sophisticated choices about responsibly balancing the potential harms of regulating and not regulating harmful pollutants, and how to structure regulatory obligations to maximize health benefits while minimizing economic harms—all after exhaustively accounting for public input on the proposed rule. If the justices nevertheless find legal infirmity after carefully engaging all evidence and arguments, it is their duty to reject it. But when the Court breaks with its own norms to block the President’s capstone climate initiative for the remainder of his final term—before meaningful judicial review of the merits—perhaps that approaches the boundaries of appropriate use of its own authority. If it does not invite pause about the constitutional separation of powers, it at least gives cause to reflect on the lessons of the Lochner era (in which the Court struck down state economic regulations of which the majority disapproved).

Opponents of the CPP argue that the stay is legitimately unprecedented because the CPP is itself unprecedented—asserting a wide range of authority that is both proven and untested, prompting deliberation of legal questions with which the Court has not previously engaged. Yet most litigation reaching the Supreme Court raises novel questions of law; if not, they would be easily resolved in the lower courts. Claims that a pre-litigation stay was required to prevent irreparable harm are also overblown, because the CPP was designed to phase changes in gradually, giving states producers and ample time to move forward and adjust at a measured pace. States had until 2018 to submit plans for compliance—well after this litigation is expected to conclude—and until 2025 to begin showing actual progress.

The irreparable harm with which we must now contend is to the fragile international consensus on sustainable climate governance. In signaling such strong skepticism toward the CPP, the stay could irreparably damage the global community’s efforts by weakening the very U.S. leadership that led to the historic climate accord reached in Paris just two months earlier. On December 12, 2015, breaking through decades of stalled progress, 195 nations pledged to work together on forestalling the catastrophic effects of a warming climate. While the agreement itself did not guarantee the needed results, it established a critical framework for global collaboration that, many hoped, would further spur world financial and energy markets toward investment in carbon-neutral renewables and away from fossil fuels.

President Obama helped inspire the participation of other nations by assuring them that the U.S. would honor its own commitments under the agreement, and the CPP was the centerpiece of this effort. Now, all who relied on U.S. assurances before making their own commitments must be deeply unsettled. Even though the CPP may yet emerge wholly or mostly unscathed in litigation, as many experts predict it should, the damage to post-Paris momentum could already have been done. Without even reaching the merits of the case, the Supreme Court has thus cast doubt on the entire prospect of U.S. compliance with the Paris accord—and with it, doubt on compliance by other nations as well.

In this way, the stay could cause irreparable harm not only to countless U.S. citizens affected by domestic climate policy, but to the hundreds of millions of the world’s most vulnerable people—none of whom are represented in these proceedings—who are at risk from sea-level rise, hurricanes, drought, and fires associated with climate change.

(Pause here for somber reflection… for an appropriately long and somber time.)

Okay: that’s the depressing, glass-half-empty view of what has happened this week. Resisting the urge to just hide under the covers, let me now suggest a more hopeful alternative. The Court has undeniably, inexplicably dealt a blow to the CPP in the short term. But in the long term, perhaps it is not the death knell for the underlying elements of the plan, for U.S. compliance with the Paris accord, and for continued momentum for a global response to the climate crisis.

The CPP was designed to nudge U.S. energy markets away from its path-dependence on fossil fuels and toward sources that impose fewer harmful externalities on human health and the environment. But that path is changing anyway, as both market and environmental forces operate to shift energy production toward renewables. In some parts of the country, wind energy is now cost competitive with natural gas. In places like West Texas, solar photovoltaic is now cost competitive with gas. Extending beneficial tax treatment to renewables that oil and gas have long enjoyed would move them toward economies of scale more quickly, but the trends suggest that low-carbon energy sources will make economic sense even without regulatory incentives.

As low-carbon sources become increasingly economically competitive, many states will continue to follow important elements of the CPP even if the Supreme Court ultimately rejects it. More than half the states have already established well-developed renewable portfolio standards—requirements that a certain percentage of their electricity must come from renewable energy sources—and they will likely continue to implement them regardless of the Court’s conclusion. Most states in the Northeast are already on track to comply with the CPP. Ongoing progress in energy efficiency will further cut carbon emissions, even without changes in production.

Moreover, even if the CPP struggles in court, carbon emissions from power plants will still be regulated under the Clean Air Act. Why? None other than the Supreme Court required it in Massachusetts v. EPA, which famously held that the Clean Air Act requires EPA to regulate greenhouse gases. Other air pollution rules, such as the Mercury and Air Toxics Standards that limit the emission of hazardous pollutants, will likely prevent new coal plants from coming online. Indeed, few, if any, new plants have been built in recent years.

Finally, it’s important to remember that while half the states have lined up against the CPP, most of the remaining half stand with it. Even some of the states opposing the rule are politically split—such as Colorado, where the attorney general opposes the plan, but the governor endorses it. There remains substantial support for the CPP, and a growing list of experts have publicly argued that it should survive judicial review on the merits, notwithstanding the Court’s apparent skepticism. So while the future of the CPP is uncertain, it is certainly not over. Only time will tell, and although time is not on our side, we can make the most of it by keeping on the path to cleaner energy as best we can while the litigation plays out.

--Erin Ryan

--Erin Ryan is Professor of Law at the Florida State University School of Law.  A version of this essay first appeared on Feb. 17, 2016, on the American Constitution Society Blog. Hannah Wiseman contributed invaluable sources and inspiration to this essay.

February 17, 2016 | Permalink | Comments (0)