DENR Case Update

John C. EvansAssistant Attorney General

NCDOJ

Air Quality

United States v. Duke Energy 411 F.3d 539 (4th Cir. 2005) Changes made to coal-fired utility boilers

Link to nuclear… The issue was whether those changes subjected

the boilers to New Source ReviewState-of-the-art air pollution controls

BACT or LAERPredict Impacts from the source

Air Quality

NSR Applicability Requires an “emissions increase” Regulation had historically measured the increase in

“annual” emissions NC Federal Middle Dist. Court reads the regulations to

require an initial hourly increase Regulations Early Policy

Air Quality

4th Cir. (includes NC) Upheld the NC Middle Dist. Court Decision

Rational was different Clean Air Act definition of “modification” was

the same for NSR as for NSPS program

Appeal to US Supreme Court by environmental groups . . . US did not appeal.

Air Quality

Take Home Hourly test for all major sources in NC (and

other 4th Cir. States) Still use the annual test as well.

All other states use just an annual test. Policy [Check your policies before taking

enforcement and be sure to distinguish]Early policy – Agency was inconsistent with early

policy.

NSR Regulatory Changes

NSR Applicability Rule 12/31/02 (Final)

NSR Equipment Replacement Rule 10/27/03 (Final)

Utility Hourly Test Proposed

NSR Applicability Rule

12/31/02 Rule Actual Emissions Increase Using Projections Plantwide Applicability Limit Clean Unit Exemptions Pollution Control Project Exemptions

NSR Applicability

New York v. EPA Challenged the new rule 2005 Court upheld most of the reform package but

did strike down Clean Units and Pollution Control Projects

NSR Applicability

What is the impact of New York v. EPA? Limited because EMC approved the rule

changes but…Non-Attainment Rules went into effectAttainment Rules (PSD) have not gone into

effect

Equipment Replacement Rule

EPA proposed the Equipment Replacement Rule to help provide clarity (i.e. a “bright line test”) on the issue of what changes trigger NSR

Exempt if the change meets 3 conditions Replacing component (not the whole thing) Less than 20% of the replacement cost Does not change the basic design

Equipment Replacement Rule

DC Cir. Court stayed the rule Oral Arguments heard on 8 February 06 Not in effect in NC

Still using the multi-factor test to determine routine maintenance.

No current plans to adopt . . . yet

M&W Clearing

614 S.E.2d 568 (2005) Open burning --- however the size and scope

was unusual Nine large piles less than 1000 ft from building

Notice of Violation Civil Penalty Assessment of $36,000

What about the $10,000 per day?

M&W Clearing

State prevailed at OAH State prevailed in Superior Ct State prevailed in NC Court of Appeals

BUT – the decision was 2:1 Appeal to NC Supreme Court

M&W Clearing

Issues Factual Question

Nine Piles One Violation? Nine Violations?

Procedural IssueNotice of Violation stated one violationPast Practice provided that scattered piles was one

violation

M&W Clearing

Take Home Notice of Violation must be carefully drafted

Multiple violations – continuing violationsRe-issue the NOV if necessary to correct clarified issues

Procedures (written)Past ActionPolicy Memos – DAQ has an “enforcement tree”

Follow them, Update Them Note in your assessment if it is not covered

Public Records

Why Do You Care? Enforcement Cases Appealed Attorney asks you to prepare a document – a

statement – a report

Communication Written Oral

Attorney Privilege

McCormick (2004) Held that there was not an attorney work product

privilege for city attorneys

Work Product Thoughts and impressions of attorney Work prepared by the agency at the direction of

the attorney

Attorney Privilege

Legislative Response - Public Records Law Amended Provides protection for “Trial Preparation Material”

Applies to administrative proceedingsApplies to issues where there is a threat of litigation

Lessons Identify covered documentsNotify Attorney if threatened litigation

Attorney Privilege

Attorney Client Communications Different than work product Protected …. Not totally

Communications From AttorneyCommunications To Attorney?

Oral Communications

Inspections

Getting Into a Site While Staying Out of Trouble DENR Enforcement Training, June 2005

Issues: Warrant Consent Plain View

Luxury Wheels

Colorado case – Not NC but instructive Facts

Chrome plating company Company discharged to city sewer Permits

Allowed to “enter the premises”Permit included on on-property sampling box

Luxury Wheels

City regulators took samples During the day (open) At night (covert)

Samples at night were higher? Sampling taken over the course of about a

year revealed numerous violations of their permit limits.

Luxury Wheels

4th Amendment - unreasonable search and seizure if there is an expectation of privacy Wastewater flowing into manhole – no expectation

of privacyTrash on the side of the roadThe manhole wasn’t accessible to general public –

however once the wastewater gets into the pipe without any possibility of retrieval – no expectation of privacy.

WARNING – These decisions are fact specific. If you have ANY doubt . . . STOP

Luxury Wheels

CONSENT Warrantless search OK if consent if granted. Government argued that the source consented to the

search by accepting the permit with the sampling box permit condition

Company says they were forced to accept the condition

Court – “Close Call” Company had choice of installing more expensive

monitoring equipment.

Luxury Wheels

Closely Regulated Another exemption to the warrant

requirement Gas Stations in Wyoming Vehicle Dismantlers in New York Fishing in North Carolina

What about environmental regulation?

Luxury Wheels

“I am unaware of any precedent for declaring that a business is subject to warrantless searches as “closely regulated” solely because it is subject to general purpose environmental laws.

Luxury Wheels

Open Fields Another exception to the warrant

requirement … however Does not apply to removing objects such as

samples Particularly in this case were the waste water

was not visible.

Luxury Wheels

Take Home Training (review manual, ask for agency specific

training, etc…) CAUTION b/c exemptions (open fields, expectation

of privacy, closely regulated) are very fact specific Consent is the best - if you ask and don’t get consent

DO NOT ENTER Lost evidence Personal Liability (Trespass, Constitutional Claims)

Supplemental Environmental Projects

NC School Board v. Moore (2005) Supplemental Environmental Projects (SEPS)

are subject to the NC Constitutional requirement that penalties paid to NC agencies go to school boards

SEPS are not voluntary payments Feds not bounds by this requirement so sometimes

it may be advantageous to work with the Feds on enforcement.

Water Resources

Two Supreme Court Cases North Dakota v. US Corps of Engineers U.S. v. Rapanos

No decisions Argued this term Far-reaching impacts

North Dakota v. US Corps of Engineers

N.D. designated a reservoir as a fishery and set Clean Water Act standards under CWA Section 303

Corps wanted to release water from the reservoir to manage “navigable waters”

Release would lower the water levels would adversely impact the fishery

State filed action to prevent the release

N.D. v. US Corps of Engineers

Corps said that they did not have meet the CWA standard and they claimed sovereign immunity. Despite the fact there were other options available to the

Corps to manage downstream navigation

Broad discretion to control navigable waters overrides States environmental laws

This case is set to argued this spring and the results will have a significant impact on enforcing CWA standards against the US Corps.

US v. Rapanos

Rapanos asked the state to inspect his property to see if he needed a permit prior to filling the property for a shopping center

The state said it was probably a wetland and he should hire a consultant

The consultant confirmed his belief that the parcel was a “wetland”

Rapanos disagreed and proceeded with the project

US v. Rapanos

Criminal and civil charges were brought against Rapanos

Criminal Charges Prison Time? (See Judge’s thoughts on this)

Ultimately, after several appeals and delays Rapanos was found criminally liable

US v. Rapanos

Issue: Extent of “navigable water” Are non-navigable waters not physically

adjacent to a traditional navigable water subject to regulation?

US Supreme Court has attempted to clarify this issue twice in the past

US v. Rapanos

Riverside Bayview 1985 To protect pollution “at its

source” the CWA was to be read broadly

Wetlands adjacent to lakes, rivers, streams may function as integral parts of the whole

Adjacent wetland can be subject to regulation

SWANNC 2002 Limited “broad”

holding in Riverside Must have “significant

nexus” between wetlands and navigable water

Rapanos

Majority Including 4th Cir (NC) No direct abutment

requirement Hydrological

connection is enough

Minority 5th Cir. Requires that non-

navigable water directly abut the navigable water to be subject to CWA

Rapanos

Another Supreme Court interpretation of the extent to which the federal CWA has jurisdiction

Note: NC has an isolated wetland program that was developed in response to the SCANNC decision of 2001.

Beach Access Case

Fabrikant et. al., v. Currituck County 1998 case just ended Property owners were claiming title to the area

between the wet sand and the dunes Keep the public off the beach Court dismissed this claim

This presentation has not been reviewed by and does not represent the official position of the NC DOJ. The summaries and commentary

expressed herein are solely those of the author.

John C. EvansAssistant Attorney General

NCDOJ

(919) 716 - 6600

jevans@ncdoj.com