Where the law and the environment connect

OLYMPUS DIGITAL CAMERAOn November 6, 2013, ASTM revised its standard for conducting Phase I environmental site assessments, known as Standard E1527-13 (entitled “Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process”).  ASTM E1527-13 is the first revision to the ASTM Phase I standard since its 2005 revision of the standard (known as ASTM E1527-05).

The ASTM standards are a helpful tool for parties seeking to avoid, or at least minimize, potential liability pursuant to the federal Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA,” also known as “Superfund”).  CERCLA imposes liability without regard to fault or negligence on present facility owners and certain past owners, as well as certain other parties, for any environmental contamination found on the property.  This means that a purchaser and current owner of land contaminated by the actions of others could be held liable under CERCLA for the cleanup of the property.  Fortunately, CERCLA has a few defenses for these situations for so-called “innocent landowners,” “bona fide prospective purchasers,” and “contiguous property owners.”  However, to qualify for these defenses, CERCLA requires a property owner to conduct “all appropriate inquiries” on or before the date of acquiring the contaminated property, among other requirements.

Prior to November 2005, there was no federally approved statute or regulation defining the procedure that a prospective purchaser must follow in conducting all appropriate inquiries.  However, on November 1, 2005, the United States Environmental Protection Agency (“EPA”), issued a final rule entitled the “Standards and Practices for All Appropriate Inquiries.”  Effective on November 1, 2006, the All Appropriate Inquiries Rule for the first time established federal standards and practices for conducting all appropriate inquiries, as a first step to qualifying for one of the elusive CERCLA defenses.

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Earlier this month, in Latinos Unidos De Napa v. City of Napa, the California Court of Appeals upheld the city of Napa’s determination that it did not have to prepare an environmental impact report (EIR) under the California Environmental Quality Act (CEQA) when enacting minor changes to its general plan and zoning ordinances.

Napa prepared a program EIR prior to adopting its comprehensive update of its general plan in 1998.  The general plan set forth Napa’s future plans for development through the year 2020.  The program EIR analyzed the impacts of future projected growth within the city through the same time period.  Although the future housing element was not updated at that time, the program EIR analyzed the impacts of the existing housing elements.

In 2009, Napa began the process of updating its housing element and prepared an initial study under CEQA.  Among other things, the initial study analyzed the extent to which the changes contemplated by the adoption of the housing element could result in new or different environmental impacts not already analyzed with respect to the general plan.  Based on this review, the city determined that the project was within the scope of the program EIR and required no further environmental review.

epa-logo3-300x300Settlement plays a fundamental role in the Environmental Protection Agency’s (“EPA”) Superfund enforcement program. Potentially Responsible Parties (“PRPs”) seeking to resolve their liability through the settlement process should take note that EPA recently issued two new guidance memoranda on its settlement procedures.  One memorandum sets forth revised procedures for managing the duration of remedial design/remedial action negotiations and notably encourages the use of orders known as Unilateral Administrative Orders (“UAOs”) in the face of unsuccessful negotiations.

The recent memorandum, entitled Revised Policy on Managing the Duration of Remedial Design/Remedial Action Negotiations, and dated September 21, 2012, is aimed at strengthening EPA’s negotiation practice, shortening the duration of negotiations, and achieving timely settlements.  Of note to PRPs is that EPA’s new guidance strongly endorses use of UAOs, stating: “We encourage use of EPA’s UAO authority in appropriate cases as a key component to expediting the RD/RA negotiation process.”  The Guidance further cautions that “Potentially Responsible Parties (PRPs) should know during negotiations that EPA is willing and ready to issue a UAO if they unreasonably delay settlement.”  The memorandum is available here for further review.

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car-300x205While we tend to think of a CERCLA “facility” as the real property where environmental contaminants have come to be located, it is important to remember that CERCLA’s definition of “facility” is actually much broader than that and can serve to open the door to “Potentially Responsible Parties” not considered in your initial cost recovery analysis.

Pursuant to CERCLA, the owner of a facility from which hazardous substances have been released is liable for the costs of responding to the release.  Two recent CERCLA cases  involving motor vehicles illustrate how CERCLA’s broad definition of “facility” expands CERCLA “owner” liability beyond ownership of contaminated real property to ownership of equipment and vehicles from which contaminates have been released.  These cases also provide us with an answer to the question:  Is your vehicle a CERCLA facility?  And the answer is:  It depends.

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bike1-300x199While most attempts to push-through last-minute CEQA reform were parked until next year, one bill, AB 2245, glided through the legislature and now heads to the finish line on Governor Brown’s desk for signature.  The bill, which provides streamlined environmental review for certain bike lane projects, was unanimously passed by the State Assembly on August 24th after receiving only one dissenting vote in the Senate.

AB 2245 exempts from the California Environmental Quality Act (CEQA) bike lane projects in urbanized areas that require repainting of streets and highways, as opposed to widening, when the restriping is consistent with a prepared bicycle transportation plan.  CEQA is the state’s landmark environmental law that requires a public agency to identify significant environmental impacts of projects it proposes to carry out or approve.  CEQA’s procedural and substantive requirements aim to prevent damage to the environment and encourage informed-decision-making.  Recently, the law has come under increasing fire for its potential to be misused for non-environmental purposes.  The law frequently results in extended project delays, and when the project being delayed is considered “green” or one that will reduce emissions of greenhouse gases, the law can seem counterproductive.

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water_boardsOn May 1, 2012, the California State Water Resources Control Board (SWRCB) adopted via Resolution No. 2012-0016 the Water Quality Control Policy for Low-Threat Underground Storage Tank Case Closure (Low-Threat Closure Policy).  The Low-Threat Closure Policy finally became effective on August 17th.  This should be good news for the thousands of UST sites in California because the Low-Threat Closure Policy will hopefully make it easier to obtain closure.  At a minimum it defines more clearer criteria for obtaining closure.

The Low-Threat Closure Policy recognizes that many petroleum release cases pose a low-threat to human health and the environment. The policy’s purpose is to establish consistent California statewide case closure criteria for low-threat petroleum UST sites. To potentially qualify for closure, the site must satisfy eight general criteria (applicable to all sites), as well as media-specific criteria as it pertains to groundwater, vapor intrusion to indoor air and direct contact, and outdoor air exposure.  Below is a brief description of each of these criteria.

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gavel-150x150Recently, Solutia Inc. and Pharmacia Corporation filed a petition for writ of certiorari with the U.S. Supreme Court seeking to overturn the Eleventh Circuit’s ruling that a Potentially Responsible Party (“PRP”) conducting a cleanup pursuant to a consent decree is foreclosed from bringing a cost recovery action against other PRPs under CERCLA Section 107, and may only seek contribution from other parties under CERCLA section 113.  This ruling is significant because 1) unlike CERCLA section 107, section113 does not provide for joint and several liability against other PRPs, 2) under CERCLA section 113, PRPs that settle with the government are given contribution protection, and 3) the statute of limitations under section 107 and section 113 differs.

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gavel-250x300On August 8th, the California Supreme Court granted review of the Second District Court of Appeal’s decision in Neighbors for Smart Rail v. Exposition Metro Line Construction Authority.  As previously blogged in April, the Second District found that a lead agency’s use of projected future conditions to measure the environmental impacts that a long-term infrastructure project would have on traffic and air quality did not violate the California Environmental Quality Act (CEQA).  The Second District’s decision put it at odds with holdings of the Fifth and Sixth District Court of Appeals, making the issue of whether CEQA prohibits the use of projected future baselines ripe for review.

Public agencies have long argued that using current-conditions to measure the impacts of major infrastructure projects that will not be completed for many years to come is not helpful in determining the true traffic and air quality impacts the project will have once operational.  The California Supreme Court will now decide whether CEQA allows public agencies to have the discretion to select a future baseline for long-term projects.  Our blog will keep you updated on the court’s decision.

On August 9, 2012, the California Supreme Court handed down its much anticipated decision in State of California v. Continental Ins. Co. The California Supreme Court held that the “all sums” method of allocation applies in California and that an insured can horizontally stack all successively triggered policies in an environmental property damage case involving a single occurrence causing continuous and progressive contamination throughout multiple policy years.

Therefore, a liability insurer is obligated to pay all sums the insured become obligated to pay for property damage attributable to a contaminated site up to policy limits as long as some of the continuous property damage occurred while that particular insurer’s policy was on the loss.  An insurer cannot limit its liability to just the amount of loss that occurred during its particular policy period.  The Supreme Court also concluded that absent specific “anti-stacking” policy language, an insured is entitled to “stack” the consecutive policy limits of each successively triggered policy to recover the limits of all policies on the risk for the loss.

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House-150x150Yesterday, the California Energy Commission unanimously approved energy efficiency standards for new homes and commercial buildings. The new 2013 Building and Energy Efficiency Standards (Standards), which take effect on January 1, 2014, are projected to be 25 percent more efficient than previous standards for residential construction and 30 percent more efficient for nonresidential construction.

For new residential construction, the Standards include:

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