April 17, 2020

Regulated Entities Should Consider Benefits and Limitations of EPA’s COVID-19 Policy in Light of Post-Publication Developments

Environmental Alert

(by Lisa Bruderly, Julie Domike and Gary Steinbauer)

U.S. Environmental Protection Agency’s March 26, 2020 temporary COVID-19 enforcement discretion policy establishes the steps regulated parties must take to qualify for enforcement protection for noncompliance caused by COVID-19 (“COVID-19 Policy” or “Policy”).  Our previous Alert outlined the Policy’s scope, eligibility criteria, and expectations.  In less than a month, EPA’s Policy has generated significant controversy, conflicting media reports, congressional inquiries, and now a federal lawsuit.  Critiques of the Policy and EPA’s evolving messaging make clear that entities affected by COVID-19 should be thoughtful and strategic in their reliance on the potential relief provided by the Policy.

EPA’s Response to Backlash

In response to initial criticisms, EPA initiated several steps to explain its stance on environmental compliance and enforcement during the pandemic.  On March 30, 2020, EPA issued a news release to correct “the record on reckless reporting” by certain media outlets and clarify that the Policy applies on a case-by-case basis.  To quell legislative opposition, EPA sent members of Congress a letter on April 2, 2020, defending the Policy.  EPA has also created a Frequently Asked Questions webpage answering several questions on the scope and application of the COVID-19 Policy.

Environmental Groups Sue EPA and State Attorneys General Weigh-In

At the same time, environmental groups and the states have voiced concerns related to the Policy.  On April 1, 2020, a coalition of environmental groups, led by the Natural Resources Defense Council, petitioned EPA to promulgate an emergency rule requiring regulated parties to affirmatively report COVID-19-caused noncompliance and provide information similar to what EPA requires parties to document under the Policy.  …

April 17, 2020

A. A. Moore Capito – Corporate Attorney

Emerging Technologies Profile 

Why do you have two jobs? I’ve got the best of both worlds – in business and in public service. I love being an attorney because it challenges me every day to help clients achieve their business goals. My other job is being a member of the West Virginia House of Delegates. After having worked in Washington, D.C. serving on the White House advance team and as a staff member in the Department of Defense, I attended law school to prepare me for both worlds.

What do you do at Babst Calland? I represent publicly traded and privately held clients in mergers, acquisitions and divestitures, as well as business structuring, governance, commercial contracts, and real estate transactions.

When you are not at Babst Calland, you can be found… at the State Capitol in Charleston, West Virginia performing my legislative duties. I am passionate about West Virginia and the growing opportunities to reinvent ourselves in a way that focuses on innovation, entrepreneurship, and technological growth for the future. Helping West Virginia to expand in the technology space is one of my roles as co-chair of the Tech Caucus in West Virginia’s House.

Personally, what fulfills you most? My family and colleagues at work. I’m so blessed to have an opportunity to live, work, and raise a family in a place I love.

Tell us something about yourself that people may not know. The A.A. in my given name is from my late grandfather – Arch Alfred Moore, Jr., former Governor of West Virginia. My Mom – Shelley Moore Capito – is a U.S. Senator from West Virginia. I also play solitaire, with real cards, in my free time. …

April 16, 2020

Commonwealth Court Update: Preliminary Opinions and Development Rights

The Legal Intelligencer

(by Krista-Ann Staley)

The Pennsylvania Commonwealth Court, the statewide intermediate appellate court that hears and decides land use appeals, took a temporary hiatus from issuing opinions while the Unified Judicial System of Pennsylvania adapted to the COVID-19 pandemic. During the hiatus, the Commonwealth Court: closed to the public for all nonessential functions through April 30, in accordance with a series of orders from the Pennsylvania Supreme Court; cancelled its March argument session in Harrisburg, indicating that it would decide all cases listed for argument on briefs unless a party requested an oral argument; extended certain filing deadlines under the Pennsylvania Rules of Appellate Procedure and deadlines for briefs, petitions, motions and applications for pending matters for 30 days; cancelled its April argument session in Harrisburg; relocated its May argument session from Pittsburgh to Harrisburg; and announced the May argument list. The Commonwealth Court then resumed posting opinions April 7, and is expected to work through a backlog of cases while its operations remain limited.

Prior to its hiatus, the Commonwealth Court released several land use decisions, two of which addressed statutory interpretation issues through subjects that rarely come before the court: zoning officer preliminary opinions and transferrable development rights.

In Friends of Lackawanna v. Dunmore Borough Zoning Hearing Board, No. 1586 C.D. 2018 (Pa. Commw. Ct. Feb. 18, 2020), the court addressed the “preliminary opinion” procedure set forth in the Pennsylvania Municipalities Planning Code, 53 P.S. §§10101, et seq. (the MPC). That process, added as Section 10916.2 of the MPC by the act of Dec. 21, 1988, P.L. 1329, serves to advance the timeline for a substantive validity challenge and allow a landowner to “secure assurance that the ordinance …  is free from challenge” before filing a land use application. …

April 15, 2020

EPA Publishes Interim Guidance on Site Field Work Decision-Making Related to COVID-19 Impacts

Environmental Alert

(by Lindsay Howard and Matthew Wood)

The COVID-19 pandemic continues to disrupt nearly all aspects of American life and business, including ongoing response activities being conducted under the authority of the U.S. Environmental Protection Agency (EPA).  In connection with these impacts, on April 10, 2020, EPA published a memorandum entitled, Interim Guidance on Site Field Work Decisions Due to Impacts of COVID-19 (“EPA’s COVID-19 Field Work Guidance” or “Guidance”).  The Guidance offers guidelines, specific factors, and examples EPA Regions should consider in their decision-making processes to continue, reduce, or suspend on-site work.  Driving these case-by-case decisions are EPA’s two main priorities: (1) protecting the health and safety of the public, as well as EPA’s staff and cleanup partners; and (2) maintaining EPA’s ability to prevent and respond to environmental emergencies.  This Alert addresses questions regarding EPA’s guidelines and decision-making under the Guidance.

To What Sites Does EPA’s COVID-19 Field Work Guidance Apply?

EPA’s COVID-19 Field Work Guidance applies to ongoing and emergency response actions conducted at sites across the United States under multiple federal programs, including Superfund, RCRA, and TSCA, where EPA is the lead agency or has direct oversight of or responsibility for the work being performed.  EPA acknowledges that any number of parties may actually be performing the work covered by its Guidance, including EPA, states, tribes, other federal agencies, or potentially responsible parties (PRPs).  Although the Guidance does not apply directly to states, EPA specifies that Regions should share the Guidance with states and assist states conducting state-lead RCRA cleanups.

In What Types of Situations Will EPA Regions Reduce or Suspend Response Actions?

The Guidance identifies multiple situations that have informed (or may inform) Regions’ decisions to reduce or suspend response actions.  …

April 13, 2020

Coronavirus may be basis to invoke force majeure provision of consent orders and consent decrees in Pennsylvania

The PIOGA Press

(by Kevin Garber, Sean McGovern and Jean Mosites)

On March 6, Governor Tom Wolf issued a Proclamation of Disaster Emergency throughout the Commonwealth under the Pennsylvania Emergency Management Services Code in response to the expanding COVID-19 coronavirus pandemic. On March 13, President Donald Trump declared a state of national emergency. Many other states and local governments are following suit. These government actions may be a basis to invoke the force majeure clause of consent orders and consent decrees between regulated parties and the Pennsylvania Department of Environmental Protection, other state and local environmental regulatory agencies or the U.S. Environmental Protection Agency.

The standard force majeure provision of most DEP consent orders and agreements allows deadlines in the order to be extended if circumstances beyond the reasonable control of the regulated party prevent compliance with the order. Similar provisions are often found in consent agreements with EPA and in consent decrees approved by federal and state courts.

These force majeure provisions typically require the affected party to notify the agency of the force majeure event when the party becomes aware or reasonably should have become aware of the event impeding performance. For example, the model DEP Consent Order and Agreement requires telephone notice within five working days and written notice, in some circumstances by notarized affidavit, within 10 working days describing the reasons for the delay, the expected duration of the delay, and the efforts being taken to mitigate the effects of the event and length of the delay. This model provision states that failure to comply with the timing and notice requirements invalidates a force majeure extension.

There are compelling reasons why the coronavirus pandemic, which is unlike any event experienced in this country, is beyond the contemplated scope of agency force majeure clauses such that strict adherence to the timing and notice provisions should be excused and extensions should be granted as necessary. …

April 13, 2020

DEP will consider requests to temporarily suspend environmental requirements due to COVID-19

The PIOGA Press

(by Lisa Bruderly and Daniel Hido)

As businesses in Pennsylvania struggle to deal with significant disruptions and challenges to their operations caused by the COVID-19 pandemic, environmental agencies have recognized the challenges the pandemic presents to achieving compliance with environmental obligations. For example, on March 26 the U.S. Environmental Protection Agency issued a temporary policy for excusing COVID-19-related noncompliance (see accompanying article). Similarly, on March 31 the Pennsylvania Department of Environmental Protection issued an alert (www.dep.pa.gov/Pages/AlertDetails.aspx) announcing that it would consider requests to temporarily suspend certain regulatory, permit, and/or other legal requirements due to COVID-19. DEP also provided the form needed to make such a request.

This announcement reflects a thought change from DEP’s previous assertion that COVID-19’s impact on businesses in Pennsylvania would not excuse compliance with environmental laws, stating that “[a]ll permittees and operators are expected to meet all terms andconditions of their environmental permits, including conditions applicable to cessation of operations.”

What is required to request a temporary suspension?

Unlike EPA’s temporary policy, which does not require regulated entities to submit documentation regarding an inability to meet routine compliance obligations, DEP is requiring submittal of the request form. While DEP did not elaborate on how it will review requests for suspension, it will generally evaluate (1) the reasons for the request in light of the COVID-19 pandemic, and (2) the risk of harm to the environment or public health if the request is or is not granted.

Importantly, it will not be enough for entities to show that COVID-19 has restricted their ability to comply with regulatory, permit or other legal requirements; entities must demonstrate that strict compliance would prevent, hinder or delay necessary action in coping with the COVID-19 emergency. …

April 8, 2020

Update: U.S. DOT Agencies and TSA Extend COVID-19 HazMat Relief

Transportation Safety Alert

(by Boyd Stephenson, Varun Shekhar, Jame Curry)

Babst Calland has updated this alert to capture new HazMat background check relief extended by the Transportation Security Administration (TSA).

In response to the COVID-19 pandemic, U.S. Department of Transportation (DOT) agencies that regulate the surface transportation of hazardous materials (HazMat) have extended several forms of relief.  The Pipeline and Hazardous Materials Safety Administration (PHMSA) has waived some HazMat training requirements and delayed some equipment recertifications.  The Federal Motor Carrier Safety Administration (FMCSA) and the Federal Railroad Administration (FRA) are implementing PHMSA’s waiver in their modes. FMCSA has also allowed states to extend the effective dates for commercial driver’s licenses (CDL) and commercial learner’s permits (CLP).  Additionally, FRA has activated its emergency docket.  FRA has not extended any hazardous materials-specific relief.  Finally, the Transportation Security Administration (TSA) is allowing states to extend HazMat endorsements (HME).

Hazardous Materials Shippers, Carriers, and Package Manufacturers

  • On March 25th, PHMSA issued an updated policy declining to enforce recurrent training requirements under 49 C.F.R. § 172.704(c)(2) against HazMat employers unable to train employees due to COVID-19.  Employers are still required to provide initial training to a new hazardous materials employee before the employee may perform regulated functions.
  • On April 1st, PHMSA issued two surface transportation-related emergency special permits authorizing the filling and transportation of certain DOT specification cylinders up to 12 months after they are due for a periodic requalification during the COVID-19 emergency. PHMSA also authorized the transportation of certain cylinders overdue for retesting due to COVID-19 disruptions.

Truck Transportation

  • On March 18th, FMCSA issued an expanded emergency declaration waiving certain provisions of Parts 390 through 399—most notably the hours of service requirements—for drivers providing direct assistance in support of relief efforts. 

    • …

April 8, 2020

Amidst Coronavirus Pandemic NHTSA Issues First Proposed Rule Modifying the Federal Motor Vehicle Safety Standards to Remove Barriers to Automated Vehicles

Transportation Safety Alert

(by Ashleigh Krick, Boyd Stephenson and Justine Kasznica)

Amidst the coronavirus pandemic, the National Highway Traffic Safety Administration (NHTSA or the Agency) is moving forward with Automated Driving Systems (ADS) rulemakings.  On March 30, 2020, NHTSA issued the first of several anticipated regulatory actions proposing to amend the Federal Motor Vehicle Safety Standards (FMVSSs) to remove barriers to ADS-equipped vehicles, including those without traditional manual controls.  As with prior guidance from NHTSA, the Agency seeks to prioritize safety while promoting technology innovation.

On March 30, 2020, NHTSA issued a Notice of Proposed Rulemaking (NPRM) proposing to amend several of the crashworthiness FMVSSs (200 Series) for vehicles equipped with ADS that do not have manual controls and vehicles that are designed to transport only property (Occupant-less Vehicles).  NHTSA proposes several new or changed definitions, textual clarifications, and applicability changes to preserve the same level of occupant protection provided in current standards, while clarifying the application of the standards to ADS-equipped vehicles.  Specifically, NHTSA addresses configurations where, due to the lack of manual controls, the “driver seat” should rather be considered a front “passenger seat.”  NHTSA also proposes to modify the applicability of the 200 Series to Occupant-less Vehicles.

NHTSA issued this NPRM in response to comments received from the Agency’s January 18, 2018 Request for Comments that sought input on regulatory barriers in existing FMVSSs for ADS-equipped vehicles with non-traditional interior designs.  Many commenters thought that most of the regulatory barriers in the 200 Series did not require extensive research as only minor textual changes—principally driver-related references—would be needed.  Commenters agreed that the current crash protection provided to vehicle occupants should be maintained for ADS-equipped vehicles. …

April 7, 2020

Update: Paycheck Protection Program FAQs (as of Tuesday, April 7, 2020)

Client Alert

(by Moore Capito, Christian Farmakis and Andrew Terranova)

Yesterday, the Small Business Administration (the SBA) published “Frequently Asked Questions” (the FAQ) guidance regarding the Paycheck Protection Program (PPP Loan), enacted as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Among other clarifications, below are some of the critical points that the SBA has clarified in the FAQ. The full FAQ can be found here. The SBA intends to update this document on a regular basis.

Monthly Payroll Verification by Lender

A lender is not to replicate an applicant’s calculation of “monthly payroll costs.” A lender’s minimal review of calculations based on a payroll report by a recognized third-party payroll processor, for example, would be reasonable. If the lender identifies errors in the borrower’s calculation, the lender should work with the borrower to remedy the error.  See FAQ #1.

Some Companies with More than 500 Employees can Apply for PPP Loan

Companies with more than 500 employees can qualify for the PPP loan if the company satisfies the existing statutory and regulatory definition of a “small business concern” under section 3 of the Small Business Act. A company can qualify if it meets the employee-based or revenue-based size standard corresponding to its primary industry. Visit www.sba.gov/size for the industry size standards.

Additionally, a business can qualify for a PPP loan as a small business concern if it meets both tests in the SBA’s “alternative size standard” as of March 27, 2020. …

April 3, 2020

U.S. DOT Agencies Extend COVID-19 HazMat Relief

Transportation Safety Alert

(by Boyd Stephenson, Varun Shekhar, Jame Curry)

In response to the COVID-19 pandemic, U.S. Department of Transportation (DOT) agencies that regulate the surface transportation of hazardous materials (HazMat) have extended several forms of relief.  The Pipeline and Hazardous Materials Safety Administration (PHMSA) has waived some HazMat training requirements and delayed some equipment recertifications.  The Federal Motor Carrier Safety Administration (FMCSA) and the Federal Railroad Administration (FRA) are implementing PHMSA’s waiver in their modes.  FMCSA has also allowed states to extend the effective dates for commercial driver’s licenses (CDL) and commercial learner’s permits (CLP).  Additionally, FRA has activated its emergency docket.  FRA has not extended any hazardous materials-specific relief.

Hazardous Materials Shippers, Carriers, and Package Manufacturers

  • On March 25th, PHMSA issued an updated policy declining to enforce recurrent training requirements under 49 C.F.R. § 172.704(c)(2) against HazMat employers unable to train employees due to COVID-19.  Employers are still required to provide initial training to a new hazardous materials employee before the employee may perform regulated functions.
  • On April 1st, PHMSA issued two surface transportation-related emergency special permits authorizing the filling and transportation of certain DOT specification cylinders up to 12 months after they are due for a periodic requalification during the COVID-19 emergency.  PHMSA also authorized the transportation of certain cylinders overdue for retesting due to COVID-19 disruptions.

Truck Transportation

  • On March 18th, FMCSA issued an expanded emergency declaration waiving certain provisions of Parts 390 through 399—most notably the hours of service requirements—for drivers providing direct assistance in support of relief efforts.  Direct assistance includes transporting medical supplies, food, paper, and grocery products;

    • …

April 3, 2020

PADEP Will Consider Requests to Temporarily Suspend Environmental Requirements Due to COVID-19

Environmental Alert

(by Lisa Bruderly and Daniel Hido)

As businesses in Pennsylvania struggle to deal with significant disruptions and challenges to their operations caused by the COVID-19 pandemic, environmental agencies have recognized the challenges that the pandemic presents to achieving compliance with environmental obligations. For example, on March 26, 2020, the U.S. Environmental Protection Agency (USEPA) issued a temporary policy for excusing COVID-19-related noncompliance (see Babst Calland’s March 30, 2020 Environmental Alert for further details). Similarly, on March 31, 2020, the Pennsylvania Department of Environmental Protection (PADEP) issued an Alert announcing that it would consider requests to temporarily suspend certain regulatory, permit, and/or other legal requirements due to COVID-19. It also provided the form needed to make such a request. This announcement reflects a thought change from PADEP’s previous assertion that COVID-19’s impact on businesses in Pennsylvania would not excuse compliance with environmental laws, stating that “[a]ll permittees and operators are expected to meet all terms and conditions of their environmental permits, including conditions applicable to cessation of operations.”

What is Required to Request a Temporary Suspension?

Unlike USEPA’s temporary policy, which does not require regulated entities to submit documentation regarding an inability to meet routine compliance obligations, PADEP is requiring submittal of the request form. While PADEP did not elaborate on how it will review requests for suspension, it will generally evaluate (1) the reasons for the request in light of the COVID-19 pandemic, and (2) the risk of harm to the environment or public health if the request is or is not granted.

Importantly, it will not be enough for entities to show that COVID-19 has restricted their ability to comply with regulatory, permit, or other legal requirements; …

April 3, 2020

Update: Interim Final Rule Issued for Paycheck Protection Program

Client Alert

(by Moore Capito, Christian Farmakis and Andrew Terranova)

On April 2, 2020, the Small Business Administration (the SBA) published an Interim Final Rule regarding the Paycheck Protection Program (PPP Loan), enacted as part of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Below are critical points that the SBA has clarified in the published guidance. The Interim Final Rule can be found here.

What is the interest rate of the loan?

The SBA has advised that the interest rate of the loan has been increased from a 0.5 percent fixed rate to a 1 percent fixed rate.

Do independent contractors count as employees for purposes of PPP Loan calculations or PPP Loan forgiveness?

No. Independent contractors have the ability to apply for their own PPP Loans, so they do not count for purposes of a borrower’s PPP Loan calculations or forgiveness.

How can PPP Loan proceeds be used?

The proceeds of a PPP loan are to be used for:

  1. payroll costs (as defined in the Act and in 2.f.);
  2. costs related to the continuation of group health care benefits during periods of paid sick, medical, or family leave, and insurance premiums;
  3. mortgage interest payments (but not mortgage prepayments or principal payments);
  4. rent payments;
  5. utility payments;
  6. interest payments on any other debt obligations that were incurred before February 15, 2020; and/or
  7. refinancing an SBA EIDL loan made between January 31, 2020 and April 3, 2020.

    8. …

April 2, 2020

US Supreme Court Update: Cases to Watch for CERCLA Practitioners

The Legal Intelligencer 

(by Alana Fortna)

While there are several interesting environmental cases currently before the U.S. Supreme Court, two cases are particularly relevant for any legal practitioner handling Superfund cases, whether they involve site remediation issues or litigation over the cleanup costs. The two cases to watch are Atlantic Richfield v. Christian, Case No. 17-1498, and County of Maui v. Hawaii Wildlife Fund, Case No. 18-0260. Respectively, these two cases deal with the important legal questions of preemption and how groundwater discharges can be regulated and enforced. Both issues could have a significant impact on the scope of remediation and potential litigation at Superfund sites. CERCLA practitioners should watch for the opinions in these two cases.

The Atlantic Richfield appeal came out of the Montana Supreme Court, and it asks the court whether the Comprehensive Environmental Response, Compensation and Recovery Act (CERCLA), 42 U.S.C. Section 9601 preempts state common law remedies. The case involves the Anaconda Smelter Site, a Superfund site covering 300 square miles of property impacted by historical smelter and ore processing operations. The U.S. Environmental Protection Agency (EPA) placed the site on the National Priorities List in 1983 and identified Atlantic Richfield Co. as a potentially responsible party (PRP). After years of remedial investigation under EPA oversight, the EPA approved a remedial action plan for the cleanup of the site. The respondents in the appeal are a group of landowners who sued Atlantic Richfield alleging common law tort claims seeking more traditional damages, such as monetary damages and diminution of property value.  However, the respondents also sought relief in the form of restoration, asking that Atlantic Richfield remediate or pay for remediation above and beyond the EPA-approved remedy. …

April 2, 2020

COVID-19 Updates to Pennsylvania & West Virginia Unemployment Laws

Employment & Labor Alert

(by Stephen Antonelli, Mychal Schulz and Brian Lipkin)

At this uncertain time, many employers are considering whether to lay off or furlough employees – particularly employees who are unable to work remotely.  Earlier this week, we provided guidance on an alternative to layoffs and furloughs, as some employers are exploring grants and loans that are available under the new federal and state stimulus programs.  With this Alert, we are providing an update on recent changes to Pennsylvania and West Virginia unemployment laws:

  • Increased Benefit Amounts  Normally, unemployment benefits are capped at $573 per week in Pennsylvania and $424 per week in West Virginia.  Under the Paycheck Protection Program provision of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the federal government will supplement state unemployment benefits by $600 per week.  Through July 31, 2020, unemployment benefits will be capped at $1,173 per week in Pennsylvania, and $1,024 per week in West Virginia.  As a result, for the next four months, some workers may actually earn more in unemployment benefits than they would have earned in wages.  For example, an employee who would otherwise receive $100 per week of state unemployment benefits will now receive an additional $600 per week from the federal government.  After the federal supplement of $600 per week expires, the employee may continue to collect unemployment benefits at the usual rate in each state
  • Expanded Eligibility  Until recently, Pennsylvania and West Virginia limited unemployment benefits to certain employees.  In Pennsylvania, to receive unemployment benefits, an employee must have earned at least $116 per week, during at least 18 weeks in the past year.  In West Virginia, employees must satisfy two requirements within the past year: they must have earned a total of at least $2,200;

    • …

April 1, 2020

End of the Trail: Supreme Court to Hear Atlantic Coast Pipeline Appeal

Institute for Energy Law Oil & Gas E-Report

(by Adam Speer)

On October 4, 2019, the Supreme Court of the United States granted certiorari to hear an appeal of the Fourth Circuit’s decision vacating the United States Forest Service’s special use permit authorizing the Atlantic Coast Pipeline (ACP) to cross beneath a segment of the Appalachian National Scenic Trail. In Cowpasture River Preservation Association v. Forest Service, 911 F. 3d 150 (4th Cir. 2018), a three-judge panel from the Fourth Circuit Court of Appeals ruled that the United States Forest Service lacked the statutory authority pursuant to the Mineral Leasing Act (MLA) to grant a pipeline right-of-way across the Appalachian Trail. The Fourth Circuit’s decision halted the construction of the ACP. If the decision stands, it could impede the completion of the ACP and affect other current and future pipeline projects along the east coast, like the Mountain Valley Pipeline, that would also cross the Trail.

For the full article, click here.

For the full report, click here.

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