June 10, 2020

PHMSA Proposes Regulatory Reforms for Natural Gas Pipelines

Pipeline Safety Alert

(by Keith Coyle and Ashleigh Krick)

On June 9, 2020, the Pipeline and Hazardous Materials Safety Administration (PHMSA or the Agency) published a Notice of Proposed Rulemaking (NPRM) proposing amendments to the gas pipeline safety regulations at 49 C.F.R. Parts 191 and 192.  PHMSA explained that the purpose of the NPRM is to ease regulatory burdens identified through internal agency review, petitions for rulemaking, and public comments.  The Agency estimates that the proposed amendments will result in approximately $129 to $132 million in annualized cost savings, with the largest cost savings due to amendments related to farm taps and atmospheric corrosion inspections.  Comments are due August 10, 2020.

The NPRM covers the following topics:

Proposed Exemptions from the Distribution Integrity Management Program Requirements

  • PHMSA is proposing to codify the policy announced in its March 2019 Exercise of Enforcement Discretion by allowing operators of farm taps to maintain pressure regulating devices on farm taps under either the distribution integrity management program (DIMP) requirements or 49 C.F.R. § 192.740.  While not defined in the proposed Part 192 amendments in the NPRM, the preamble describes a farm tap as “individual gas service line directly connected to a gas transmission, production, or gathering pipeline.”  PHMSA estimates that, based on information submitted by distribution operators, the proposal to allow operators to manage farm taps under DIMP or § 192.740 will result in nearly $42 million in annualized cost savings.
  • PHMSA is also proposing to exempt farm taps originating from unregulated production and gathering pipelines from the DIMP requirements, the overpressure protection inspection requirements in § 192.740, and the annual reporting requirements in Part 191. 

    • …

June 5, 2020

USEPA Significantly Revises Section 401 Water Quality Certification Process

Environmental Alert

(by Lisa Bruderly and Daniel Hido)

The United States Environmental Protection Agency (USEPA) has pre-published a final rule that streamlines the water quality certification requirements under Section 401 of the Clean Water Act (CWA), 33 U.S.C. § 1341 (the 401 Rule).  Section 401 requires any applicant for a federal license or permit which will, or may, result in a discharge to waters of the United States (WOTUS) to obtain a certification that the discharge will comply with applicable water quality requirements from the applicable state, authorized tribe or interstate agency (Certifying Authority).

The rulemaking, found at 40 CFR Part 121, is in response to President Donald Trump’s April 10, 2019 Executive Order 13868, which identified Section 401 as “one source of confusion and uncertainty hindering the development of energy infrastructure” and directed USEPA to update its regulations and guidance.  USEPA characterizes the 401 Rule as the agency’s first “holistic” analysis of Section 401 since the 1972 Federal Water Pollution Control Act amendments (i.e., the CWA).

The 401 Rule is expected to benefit applicants for federal permits or licenses which will, or may, result in a discharge from a point source to WOTUS, including applicants seeking National Pollutant Discharge Elimination System (NPDES) and Section 404 permits, as well as hydropower and pipeline licenses issued by the Federal Energy Regulatory Commission (FERC) by (1) narrowing and streamlining the certification process, (2) limiting the scope of Certifying Authority review/response, and (3) capping the amount of time that Certifying Authorities can review a certification.  The Rule comes in response to state attempts to delay natural gas pipelines and other energy-related facilities through extended Section 401 certification processes, requiring applicants to address a number of considerations unrelated to water quality, including climate change. …

June 4, 2020

What to Expect When You’re Expecting OSHA to Visit Your Reopened Workplace

The Legal Intelligencer

(by Brian Lipkin)

The Occupational Safety and Health Administration (OSHA) is the federal agency that enforces workplace safety and health rules. On May 19, OSHA issued two enforcement memos outlining its plans to inspect workplaces during the COVID-19 pandemic. These memos took effect on May 26.

As workplaces reopen, here is what employers can expect:

  • High Exposure Workplace Inspections

When employees go back to work, OSHA anticipates an influx of COVID-19-related complaints. As a result, OSHA will prioritize inspections of workplaces with “high” and “very high” risks of COVID-19 exposure, including medical facilities, nursing homes and clinical laboratories.

OSHA is less likely to visit workplaces with medium- and low-risk levels, meaning that employees have less frequent and less close contact with the public. So, retail stores and offices are unlikely to have an OSHA compliance officer pay a visit. If OSHA receives a complaint about a medium- or low-risk workplace, it will typically send a letter, ask the employer to respond in writing and close the inspection without any in-person contact.

  • Allowances for Unavailable Equipment

OSHA requires all businesses to provide workers with personal protective equipment. Depending on the type of workplace, equipment to protect against COVID-19 can include masks, gloves and hand sanitizer.

Having shopped at Target recently, OSHA compliance officers understand many businesses can’t purchase these items because they are in limited supply. OSHA will use its discretion in citing employers that have acted in good faith, so employers should document their attempts to purchase any equipment that is unavailable.

If a business can’t purchase the right protective equipment, it should consider changing workplace rules to limit exposure risks. …

June 2, 2020

Pennsylvania Supreme Court Preserves Rule of Capture

RMMLF Mineral Law Newsletter

(By Joseph K. Reinhart, Sean M. McGovern and Casey Snyder)

On January 22, 2020, the Pennsylvania Supreme Court affirmed that the rule of capture, a 150-year-old legal doctrine that applies when a well drains oil and gas from a reservoir that crosses multiple properties, can be applied to hydraulic fracturing of unconventional wells. See Briggs v. Sw. Energy Prod. Co., 224 A.3d 334 (Pa. 2020). The decision reverses the April 2, 2018, ruling by the Pennsylvania Superior Court that the rule of capture did not apply to hydraulic fracturing. Briggs v. Sw. Energy Prod. Co., 184 A.3d 153 (Pa. Super. 2018); see Vol. XXXV, No. 2 (2018) of this Newsletter.

In Briggs, the plaintiffs owned property adjacent to land owned by Southwestern Energy Production Co. (Southwestern). Southwestern used hydraulic fracturing for natural gas extraction from the Marcellus Shale formation, and wells were drilled on and fluids injected only beneath its land. Briggs, 224 A.3d at 339, 343.

The court ruled that the rule of capture was applicable to hydraulic fracturing as it is to any other means of artificially stimulating the flow of oil and gas. Id. at 352. It emphasized that the application of the rule of capture did not rest on the distinction between using natural flow and hydraulic fracturing. However, the court did not answer the question of whether horizontal hydraulic fracturing could constitute a trespass by physical intrusion of properties adjacent to a well site. Id. at 350–51. The court remanded the case to the superior court to determine whether or not the plaintiffs’ claims could move forward in light of what it said were pleading deficiencies in the complaint for failing to allege a physical intrusion. …

June 2, 2020

Updates on Changes to Coal Refuse Disposal Temporary Cessation Provisions

RMMLF Mineral Law Newsletter

(By Joseph K. Reinhart, Sean M. McGovern, Daniel P. Hido and Gina N. Falaschi)

In recent months there have been several notable updates regarding Pennsylvania’s statutory and regulatory provisions on temporary cessation of coal refuse disposal operations.

OSMRE Publishes Proposed Rule Regarding Pennsylvania Regulatory Program

As reported in Vol. XXXVI, No. 4 (2019) of this Newsletter, Act 74, P.L. 452 (2019), amending the 1968 Coal Refuse Disposal Control Act (CRDCA), 52 Pa. Stat. §§ 30.51–.66, went into effect on December 3, 2019. Act 74 amended section 6.1(i) of the CRDCA, 52 Pa. Stat. § 30.56a(i), regarding temporary cessation of operations. Prior to Act 74, section 6.1(i) required operators to install a system for preventing precipitation from contacting coal refuse disposal areas that have reached capacity, permanently ceased operation, or temporarily ceased operation for more than 90 days, but allowed the Pennsylvania Department of Environmental Protection (PADEP) to approve an extension of up to one year for reasons of labor strike or business necessity. Act 74 removed the one-year time limit on temporary cessation and the restriction that an extension beyond 90 days could only be granted for reasons of labor strike or business necessity.

On October 16, 2019, Pennsylvania submitted an amendment to its regulatory program under the Surface Mining Control and Reclamation Act to the Office of Surface Mining Reclamation and Enforcement (OSMRE) for approval. OSMRE published notice of the proposed program amendment in the Federal Register on February 14, 2020. See 85 Fed. Reg. 8494 (proposed Feb. 14, 2020) (to be codified at 30 C.F.R. pt. …

June 2, 2020

PADEP Proposes Significant Changes to Permitting Process for Stream and Wetland Impacts

RMMLF Water Law Newsletter

(by Lisa Bruderly and Dan Hido)

The Pennsylvania Department of Environmental Protection (PADEP) is proposing comprehensive changes to its regulations and guidance regarding the permitting of obstructions and encroachments of waters of the commonwealth. See 25 Pa. Code ch. 105. The regulatory revisions, if promulgated, are expected to significantly change the chapter 105 permitting process by increasing the amount of time and effort necessary to complete an individual (joint) permit application and likely causing delays in obtaining a permit.

PADEP has presented the regulations and guidance to several of its advisory committees, including, most recently, the Water Resources Advisory Committee (WRAC) on May 28, 2020. The proposed revisions are expected to be presented to the Environmental Quality Board in the second half of 2020, with a 60-day public comment period to follow. PADEP’s draft final technical guidance document (TGD) on alternatives analysis requirements is expected to be finalized and published in coordination with the proposed regulatory revisions. Documents related to the proposed rulemaking are available here.

Proposed Regulatory Changes to Chapter 105
According to PADEP, the proposed chapter 105 revisions are intended to clarify existing requirements, update/delete outdated references, and codify existing practices. The revisions would add or change 18 definitions, revise several existing permit waivers, and add six new waivers under 25 Pa. Code § 105.12, including waivers for temporary environmental investigation activities and for temporary mats and pads used to minimize erosion and sedimentation at a wetland crossing. The proposal would also significantly expand requirements for individual permit applications under 25 Pa. Code § 105.13. Some of the notable proposed revisions are discussed below.

Alternatives Analysis. …

June 10, 2020

Federal Court in West Virginia Rejects NPDES Permit Modifications through WVDEP Administrative Orders

Environmental Alert

(by Kip Power)

Companies holding National Pollutant Discharge Elimination System (NPDES) permits issued by the West Virginia Department of Environmental Protection (WVDEP) (known as WV/NPDES Permits) should take note that any adjustments to the effluent limits in those permits that are made through WVDEP administrative orders (as part of enforcement settlements or otherwise) may provide less than complete protection against future enforcement actions. On March 24, 2020, the federal District Court for the Northern District of West Virginia issued yet another decision in a line of cases establishing that WV/NPDES Permits may only be modified through a regulatory process that involves public notice, an opportunity for comments, and compliance with all of the other procedures mandated by WVDEP regulations for such permit changes. Ohio Valley Environmental Coalition and The Sierra Club v. Eagle Natrium, LLC, Civil Action No. 5:19-cv-00236 (March 24, 2020 Memorandum Opinion and Order) (Bailey, J.) (updated and revised, April 13, 2020).

In Eagle Natrium, Plaintiffs filed a citizen suit under the federal Clean Water Act (CWA) based on numerous self-reported discharges from the Defendant’s chlor-alkali plant located in Natrium, West Virginia that allegedly exceeded the effluent limits for (among other parameters) mercury and benzene hexachloride (BHC) found in the Defendant’s WV/NPDES Permit. The Defendant sought summary judgment on the basis that the WVDEP had previously commenced and was diligently prosecuting an enforcement action against it for the same violations, which serves as a statutory bar to CWA citizen suits.

In ruling against the Defendant with respect to the alleged violations of its mercury limits, the Court found that the WVDEP’s pending civil action sought to enforce interim mercury limits that had been established by that agency through an administrative order (and two subsequent extensions of that order) that had not been the subject of public notice and comment.  …

May 29, 2020

Ninth Circuit Denies Emergency Motion for Partial Stay of Montana District Court’s NWP 12 Vacatur

Environmental Alert

(by Lisa Bruderly and Ben Clapp) …

May 28, 2020

Project Labor Agreements Continue to Cause Controversy

The Legal Intelligencer

(by John McCreary and Benjamin Wright)

The Community College of Allegheny County (CCAC) recently decided to proceed with construction on its campus. In order to facilitate this project, CCAC entered into a project labor agreement (a PLA) with the Pittsburgh Regional Building and Construction Trades Council of Pittsburgh, AFL-CIO on Feb. 15, 2011. The Associated Builders Association of Western Pennsylvania (ABC) filed a lawsuit on behalf of multiple contractors who operate open shop in Western Pennsylvania seeking to enjoin the CCAC from enforcing the PLA. This suit is the latest in a long series of contentious disputes regarding the utilization of PLAs in the public sector.

In its complaint, the ABC alleges that the terms of the PLA effectively preclude nonunion workers and workers who belong to unions other than those affiliated with the Pittsburgh Regional Building Trades Council from performing construction work, and that the PLA compels workers to associate, join or pay dues to these unions as a condition of employment.

Specifically, the ABC alleges that all contractors have a right under the First and Fourteenth Amendments to determine whether or not to unionize and with which unions to associate. The complaint alleges that the PLA’s requirement that contractors hire their employees through the signatory unions’ hiring halls is a violation of these constitutionally protected rights. The ABC also alleges that this requirement violates the National Labor Relations Act as Section 7 of the Act, 29 U.S.C. Section 157, gives employees the right to decide whether they want union representation. It alleges that the PLA violates the National Labor Relations Act because it requires nonunion members to become union members as the unions will not refer nonmembers through their hiring halls, effectively creating a compulsory union shop in violation of 29 U.S.C. …

May 27, 2020

EQB Publishes Proposed Rulemaking for Control of VOC Emissions from Existing Oil and Natural Gas Sources

Environmental Alert

(by Michael Winek, Gary Steinbauer, Gina Falaschi)

Pennsylvania’s Environmental Quality Board (EQB) published a proposed rulemaking in the May 23, 2020, Pennsylvania Bulletin entitled “Control of VOC Emissions from Oil and Natural Gas Sources.”  50 Pa.B. 2633.  This proposed rulemaking would have Pennsylvania adopt reasonably available control technology (RACT) requirements and RACT emission limitations for existing oil and natural gas sources of volatile organic compound (VOC) emissions.  As proposed, the rule would apply to owners and operators of any of the following oil and natural gas sources of VOC emissions that were in existence on or before the effective date of this rulemaking: storage vessels (in all segments except natural gas distribution), natural gas-driven pneumatic controllers, natural gas-driven diaphragm pumps, centrifugal compressors and reciprocating compressors, and fugitive emission components.

This proposal is based on EPA’s October 2016 Control Techniques Guidelines (CTG) for the Oil and Gas Industry, which provide RACT requirements for VOC emissions from existing oil and gas sources.  Pursuant to the federal Clean Air Act, EPA established National Ambient Air Quality Standards (NAAQS) for six “criteria pollutants,” which includes ground-level ozone. Ground level ozone is created in a photochemical reaction of oxides of nitrogen (another criteria pollutant) and VOCs in the presence of sunlight.  The federal statute requires any (i) existing major source of VOC emissions (generally more than 50 tons per year of VOC depending on location) in an ozone nonattainment area and (ii) any other source (i.e., minor sources) for which EPA has issued a CTG to implement RACT to control emissions, consistent with the issued CTG.  Pennsylvania is in the northeast ozone transport region, which makes the Commonwealth nonattainment for ozone, and thus triggers RACT under federal law. …

May 26, 2020

Why useful public/private partnerships often go undiscovered

Smart Business

(by Adam Burroughs with Moore Capito)

Governments offer many funding and other partnership opportunities to assist private enterprises. Businesses can benefit greatly from these public/ private partnerships, but first they need to be aware of what funding is out there. Awareness is often driven by government agencies, and industry and trade associations. However …

“There is no substitute for having a relationship with a trusted adviser who is well educated on both public and private funding mechanisms,” says Moore Capito, a shareholder at Babst Calland.

Smart Business spoke with Capito about public/private partnerships and strategies to better connect businesses with potentially helpful government opportunities.

Why isn’t there more participation in public programs by businesses?

How often or how readily businesses take advantage of government programs can depend on the type of program and the market sector. For example, agricultural businesses are heavy users of government programs — subsidies, for instance — because that’s been inculcated into that business segment. Many recent partnership opportunities have been geared toward the small business sector (i.e. Small Business Administration (SBA) programs; programs for Disadvantaged Business Enterprises; Minority-owned Businesses Enterprises; Women-Owned business Enterprises; and 8(a)/Minority or Women Owned Small Businesses; as well as SBA loans, including recent high-profile SBA loan programs like the Paycheck Protection Program (PPP) and Economic Injury Disaster Loan that were designed to support small businesses through the COVID-19 pandemic). However, there are plenty of existing government programs available to established businesses that are willing to take the time to look.

While lack of awareness can be a barrier, the administrative burden can also discourage participation. There tends to be significant paperwork necessitated by regulations designed for oversight. …

May 18, 2020

West Virginia DEP Receives Notice of Intent to Sue Under SMCRA Based on Deficiencies in Mine Reclamation Fund

Environmental Alert

(by Kip Power and Robert Stonestreet)

For many years, national and regional environmental interest groups have objected to the alternative bonding system (ABS) administered by the West Virginia Department of Environmental Protection (WVDEP) as a part of WVDEP’s approved coal mine regulatory program under the federal Surface Mining Control and Reclamation Act of 1977, 30 U.S.C. 1201, et seq., (SMCRA). Unlike other bonding programs that require full-cost bonds to secure performance of reclamation requirements under mining permits, the West Virginia ABS involves two components: (1) site-specific bonds posted by mine permittees based on the anticipated costs of reclamation, limited to a maximum of $5,000 per acre; and (2) a Special Reclamation Fund (SRF), funded by a tax on coal production (currently set at 27.9 cents per clean ton). The SRF is intended to fund reclamation expenses in the event WVDEP revokes a permit and the proceeds of site-specific bonds are insufficient to cover the costs to reclaim a disturbed area governed by the revoked permit.

In February 2016, the Ohio Valley Environmental Coalition and other groups filed a petition with the U.S. Department of the Interior’s Office of Surface Mining Reclamation and Enforcement (OSM – the oversight agency under SMCRA), asking that OSM take over the bonding program for mining permits in West Virginia. That petition (which also raised concerns about allowing large companies to self-bond) was never acted upon prior to the change in presidential administrations in January 2017. Long before that, a SMCRA citizens suit was brought in early 2000 in the federal District Court for the Southern District of West Virginia, challenging OSM’s failure to invalidate the West Virginia ABS and impose a federal mine permit bonding system. In response to that suit, the court declined to order OSM to take the requested actions in light of commitments by agency officials to address the groups’ concerns. …

May 12, 2020

Opportunities: Leveraging Technology to Meet New Demands

Emerging Technologies in a Time of Pandemic

(by Ben Clapp, Julie Domike, Gina Falaschi, Justine Kasznica and Boyd Stephenson)

Most of the world is staying home, but businesses must still pay their bills. In late April the federal government estimated the U.S. economy contracted by 4.8 percent in the first quarter of 2020, mostly due to the Coronavirus pandemic. Because the real economic consequences of social distancing occurred in April, future numbers will likely be as bleak, if not worse.

Yet, some businesses are taking bold steps, innovating in communications with their customers, and leveraging pre-existing tools to retool how their customers interact with the company and its product. Companies that never before offered delivery are experimenting with last mile logistics. Farms whose regular restaurant or hotel customers are closed due to public health orders are retooling their supply chains to supply local households. And companies that previously relied on face-to-face interactions are turning to virtual solutions to bring their product to market, even in a field like wine production—where taste is an essential part of the purchasing decision. These companies described here provide just a few examples of how creatively leveraging existing technologies can allow a company to maintain operations.

Last Mile Logistics

The Coronavirus pandemic has shined a spotlight on last-mile delivery, with demand for food, medicine, and other deliveries skyrocketing due to social distancing requirements. While pandemic-driven demand has unquestionably strained existing last-mile delivery resources, retail suppliers that never before relied on delivery have developed their own solutions, provided by a number of companies with technology-based delivery systems and logistics platforms to demonstrate how emerging technologies can be employed to safely and efficiently bridge gaps between suppliers and their customers. …

May 11, 2020

Babst Calland Lands 2024 Space Mission Legal Work for Astrobotic

Firm to Develop Legal/Commercial Framework for Payload Service for NASA’s Artemis Human Landing System

Babst Calland today announced that under a recently announced NASA award, Astrobotic Technologies, Inc. (Astrobotic) has selected the firm to develop what could become the first-of-its-kind blueprint for commercial payload delivery to space for the Artemis human missions as well as future human-crewed space missions.

Pittsburgh-based Astrobotic will be developing the commercial payload service for Dynetics (a Leidos subsidiary), one of three prime contractors (alongside SpaceX and Blue Origin) selected by NASA to design and build a commercial Human Landing System (HLS) and compete to build a privately-developed system to take the first woman and next man to the lunar surface in 2024 as part of the NASA Artemis program.

“As the leading lunar payload delivery provider, we are thrilled to begin setting up this new business model onboard the Dynetics human lander,” said Astrobotic CEO John Thornton. “With payload expertise from our Peregrine and Griffin lunar lander programs, we are well-positioned to extend our payload services to include the new lunar lander. We’re helping to develop and set the standard for the commercial payload market, and that is very exciting,” added Thornton.

Dynetics is leading a broad coalition of industry partners, including Astrobotic, to not only send humans back to the lunar surface, but to also help companies, governments, universities, and nonprofits across the globe send non-human payloads onboard the Artemis Human Lander System. Such payloads can include critical instruments, project and infrastructure products and materials that can support human activities on the lunar surface.

“Helping to launch this new mission to the Moon and to develop the commercial, policy and regulatory framework for its payload delivery business is an exciting opportunity for Astrobotic, all of its partners, and for our team of attorneys at Babst Calland, “ said Justine M. …

May 11, 2020

Potential Clean Water Act Liability extends to discharges to groundwater that reach surface water

The PIOGA Press

(by Lisa Bruderly and Kevin Garber)

On April 23, the Supreme Court, in a landmark decision, ruled that in certain circumstances discharges of pollutants through groundwater to navigable waters could be required to have an NPDES permit under the Clean Water Act (CWA). While the court remanded the Hawai’i Wildlife Fund v. County of Maui litigation to the Ninth Circuit to reconsider the specific issue of injected wastewater that reached the Pacific Ocean through lava tubes, it more broadly provided a new “functional equivalent” test to address whether the CWA requires an NPDES permit when pollutants originating from a point source are conveyed to navigable waters by a nonpoint source, such as groundwater.

Justice Stephen Breyer, writing for the 6-3 majority, held that an NPDES permit is required “when there is a direct discharge from a point source into navigable waters or when there is the functional equivalent of a direct discharge” (emphasis added). The court’s new test for CWA liability has far-reaching implications, creating potential exposure for agency permitting and enforcement and citizen suit pressure under many scenarios where pollutants may intentionally or unintentionally enter surface water by way of groundwater through Class V injection wells, pipeline leaks, spills and releases to ground, waste impoundments/ lagoons, existing groundwater contamination, leaking underground storage tanks and even septic tanks.

New “test” creates more questions than clarity
Subjective, conflicting interpretations of the new “functional equivalent” test are inevitable. Focusing primarily on considerations of time and distance, Justice Breyer offered the following two contrasting examples of how the test might be applied: (1) “where a pipe ends a few feet from navigable waters and the pipe emits pollutants that travel those few feet through groundwater (or over the beach), the permitting requirement clearly applies; …

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