Environmental Enforcement Implications from Recent DOJ and EPA Guidance

sboxermanFeatured Expert Column – Environmental Law and Policy

by Samuel B. Boxerman, Sidley Austin LLP

Last month, the U.S. Department of Justice (DOJ) and the Environmental Protection Agency (EPA) separately issued informal guidance documents that could have a major impact on businesses enterprises’ environmental law and regulatory compliance. DOJ’s guidance relates to civil enforcement activities generally, while EPA’s involves environmental law enforcement at the state level under the rubric of cooperative federalism. Each document is explained below.

Justice Department guidance

On Jan. 25, 2018, DOJ issued a new policy, “Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases,” that prohibits the department from using its civil enforcement authority to compel compliance with agency guidance documents. The new policy extends to federal agencies an earlier policy issued by Attorney General Jeff Sessions that prohibited DOJ from relying on its own guidance in enforcing the law. See “Prohibition of Improper Guidance Documents,” issued Nov. 16, 2017.

The new policy applies to “affirmative civil enforcement” actions brought by DOJ. Declaring that “[g]uidance documents cannot create binding requirements that do not already exist by statute or regulation,” the policy dictates that “the Department may not use its enforcement authority to effectively convert agency guidance documents into binding rules.”

The new policy has major implications for civil environmental enforcement actions, such as Clean Air Act New Source Review and Clean Water Act matters, for which DOJ relies heavily on EPA guidance documents to establish violations of law. It also creates uncertainty for matters under the Comprehensive Environmental Response, Compensation & Liability Act of 1980 (CERCLA), where EPA traditionally relies on sometimes lengthy guidance documents to guide private party cleanups.

1. What is the effect on Clean Air Act and Clean Water Act enforcement?

DOJ enforcement often relies heavily on guidance when bringing claims under the Clean Air and Clean Water Acts. For example, in Clean Air Act matters, DOJ relies on EPA guidance to support its emission calculations, counter defenses, or claim a defendant had fair notice of the regulatory requirements. On the mobile source side of air enforcement, EPA’s position on tampering with emissions controls is not codified in regulations, but in a 1972 “interim” guidance referred to as Memo 1A. Under the Water Act, EPA and the U.S. Army Corps of Engineers use agency guidance for determining what waters are regulated under the Act. The new policy may make it more difficult for DOJ attorneys to obtain approval for new complaints, and may be factored into EPA and Corps enforcement decisions as well.

2.Will the new policy bar the practice of incorporating guidance documents into CERCLA consent decrees?

EPA remedial-design and remedial-action consent decrees often contain multiple references to guidance documents. Indeed, a consent decree requiring a cleanup will include a statement of work that details cleanup requirements, along with references to guidance documents that frame the settling parties’ conduct. Private parties negotiating CERCLA decrees should explore whether the current policy of demanding compliance with guidance documents as an element of settlement will continue in light of the new DOJ policy.

3. What happens, then, when DOJ tries to enforce a consent decree?

That remains to be seen. If the government accuses the settling defendant that is implementing the cleanup of violating the consent decree, DOJ may want to enforce the terms of the settlement, including any alleged failure to follow guidance documents incorporated into the consent decree. If DOJ cannot enforce compliance with EPA guidance documents, it makes little sense to insist on including those guidance documents in the settlement in the first instance.

4. What about DOJ enforcement of CERCLA unilateral administrative orders?

When EPA issues a unilateral administrative order (UAO) to a private party, the order requires the party to follow dozens of EPA guidance documents. If the respondent refuses to comply, DOJ must then decide whether to file suit to enforce the UAO. The new policy suggests DOJ may no longer bring an action to compel compliance, given the EPA guidance documents in the UAO. Private parties should weigh that when deciding whether to comply with a CERCLA UAO.

EPA guidance

On January 22, 2018, Susan Bodine, EPA’s Assistant Administrator for the Office of Enforcement and Compliance Assurance (OECA), issued guidance to EPA Regional Administrators outlining a program to enhance states’ role in enforcing federal environmental laws. EPA, Interim OECA Guidance on Enhancing Regional-State Planning and Communication on Compliance Assurance Work in Authorized States (Jan. 22, 2018). The guidance reflects EPA Administrator Pruitt’s goal to enhance cooperative federalism and foster a more collaborative partnership between the federal and state governments. Key aspects are:

  • Joint EPA-state planning. The guidance directs the regions to conduct senior leadership meetings with each of their States. The regions need to have adequate procedures in place to inform management on the important compliance matters to discuss with state leadership and ensure that there are “no surprises.”
  • State primacy in authorized programs. The guidance also directs the EPA Regions to “generally defer to authorized States as the primary day-to-day implementer of their authorized/delegated programs,” subject to certain exceptions, such as an emergency or in response to widespread non-compliance identified as a national issue.  EPA will invoke the exceptions, however, only after coordinating with the State.
  • Ongoing evaluation process. The guidance also documents a process for EPA to review and improve its approach. In September, the EPA regions will provide progress reports to EPA headquarters, and EPA will update the Guidance based on the reports and input from States and other compliance partners, including the Environmental Council of the States (ECOS). EPA has instituted an ECOS-EPA Compliance Assurance Collaboration Workgroup to develop principles and best practices for collaborative inspections, enforcement and performance measurement.

Some of these approaches are not new.  However, by documenting these procedures, the guidance provides additional clarity on the process for EPA-state collaboration and sets the stage for a more significant role for the States in environmental compliance assurance, consistent with the goals of the current administration.

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