Periconi, LLC Environmental Law Blog

Appellate Division Upholds Right of New York Municipalities to Regulate Fracking through Zoning Ordinances

2013-05-16T13:09:14Z

Municipalities in New York have received the green light to regulate fracking – even to the point of banning it – through local zoning ordinances. It’s a second consecutive victory for municipalities in the New York courts, and an affirmation of New York’s long history of vesting decision making powers in local governments through Home Rule.

On May 2^nd, 2013, the Appellate Division for the New York State Supreme Court Third Judicial Department handed down its ruling in the closely watched case of Norse Energy Corporation v. Town of Dryden et al. As we had previously reported here at the Periconi, LLC Environmental Law Blog, Anshultz Exploration Corp., the predecessor-in-interest to Norse Energy, had appealed a 2012 ruling of the New York State Supreme Court upholding a Dryden, New York zoning ordinance which limited the areas in the town where fracking was permitted (as well as a similar zoning ordinance in Middlefield, New York, which was consolidated with the Dryden case).

Anshultz had argued that the ordinance sought to regulate fracking, and therefore was preempted by New York State’s Oil, Gas and Solution Mining Law (OGSML), which reserves regulatory authority over oil and gas extraction for the New York State Department of Environmental Conservation. After losing its challenge at the trial level, it appealed the decision to the Appellate Division. The appeal was later taken over by Anshultz’s successor, Norse Energy.

Writing for a unanimous court, Justice Peters affirmed the trial court’s decision, holding that “the OGSML does not preempt, either expressly or impliedly, a municipality’s power to enact a local zoning ordinance banning all activities related to the exploration for, and the production or storage of, natural gas and petroleum within its borders.”

The court’s analysis followed the same “how” versus “where” distinction adopted by the trial court. Whereas the OGSML regulated how oil gas extraction may take place – the technical details governing how wells are drilled and gas extracted – a municipality’s zoning ordinance only regulates where that activity takes place, and general land use regulation is not preempted by the OGSML.

The court recognized that “the Town’s exercise of its right to regulate land use through zoning will inevitably have an incidental effect upon the oil, gas and solution mining industries,” but concluded “that zoning ordinances are not the type of regulatory provision that the Legislature intended to be preempted by the OGSML.” In fact, the OGSML specifically reserves municipal authority over local roads and taxes, a clear indication to the court that the Legislature meant to ensure that municipal jurisdiction over certain areas remained.

While the Norse decision is certainly a victory for proponents of home rule in New York State, Norse Energy has hinted that an appeal to New York’s highest court, the Court of Appeals, is likely. Stay tuned to the Periconi, LLC Environmental Law Blog for further updates.

Appellate Division Upholds Right of New York Municipalities to Regulate Fracking through Zoning Ordinances originally appeared on Periconi, LLC Environmental Law Blog on May 16, 2013.Tweet This

EPA Announces New Tenant Protections Under Superfund

2013-04-30T19:47:07Z

Share/Bookmark

EPA has just extended to tenants the Bona Fide Prospective Purchaser (“BFPP”) protection, by which Congress previously exempted certain prospective owners from harsh Superfund liability. Even where the landlord loses its BFPP protection, the new EPA enforcement guidance memo allows tenants to hold onto it, assuming the tenant can meet certain requirements.

Traditionally, a tenant derived its BFPP status from the landowner who complied with each of the eight criteria set out in Section 101(40)(A)-(H) of the Superfund law. Principal among these requirements is conducting “All Appropriate Inquiries” before purchasing the property, usually through commissioning a Phase I Environmental Site Assessment. There are also continuing obligations after purchase, such as not spreading the contamination around by development activities, and providing EPA with access to the property. Simple enough, except for the cases where landowners failed or refused to comply with their ongoing obligations and lost their BFPP status.

So what happens to a tenant when a landowner loses its BFPP status?

Prior to EPA’s new enforcement guidance memo, it was an open question, fraught with potential liability for the tenant. But under the new EPA guidance, a tenant can actually establish its own independent BFPP status if it complies with those same eight criteria set out in Section 101(40)(A)-(H). The only difference is that rather than conducting “All Appropriate Inquiries” prior to the purchase of the property, the tenant must conduct AAI prior to signing its lease.

With the Gowanus Canal and Newtown Creek Superfund sites cutting through the heart of industrial Brooklyn and Queens, parties looking to rent space in these areas would do well to take notice of EPA’s new enforcement guidance, and plan accordingly. By laying the proper groundwork with AAI and minding the continuing obligations, tenants can now obtain the peace of mind provided by BFPP status, without worrying about their landowner’s ability to retain its status as a BFPP.

Of course, EPA’s enforcement guidance does not have the force of law, and is applied by EPA on a site-specific basis. Potential tenants on contaminated properties should be sure to consult with an environmental attorney before signing any lease to ensure that any issues presented by the unique characteristics of an individual site or set of proposed operations will not present problems in meeting EPA’s BFPP requirements for tenants.

EPA Announces New Tenant Protections Under Superfund originally appeared on Periconi, LLC Environmental Law Blog on April 30, 2013.Tweet This

Beekeepers File Suit Against the EPA Over Controversial Pesticide Registrations

2013-04-08T13:14:31Z

Share/Bookmark

Beginning in the winter of 2006-2007, bees began to die in – or simply disappear from – commercial hives around the US. Increasing numbers of beekeepers since then reported similar disappearances of bees, and the phenomenon became known as Colony Collapse Disorder, or CCD. While the exact causes of CCD are unknown, beekeepers and environmental groups have argued that the losses are due to a class of pesticides called neonicotinoids, a type of pesticide that is taken up by plants and stored in tissues as the plant grows and develops. Here’s why even the pesticide manufacturers are now taking the problem seriously.

In response to the growing concern, a coalition of beekeepers and environmental groups petitioned the United States Environmental Protection Agency in 2012 to suspend the use of certain neonicotinoids. After receiving an unsatisfactory response, the coalition sued the EPA in the United States District Court for the Northern District of California on March 21, 2013. The suit, Ellis et al. v. Bradbury et al., alleges that the EPA improperly approved certain neonicotinoids for use, and demands that the court block any further use of the pesticides in the United States.

Under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) 7 U.S.C.A. § 136 et seq., the EPA is supposed to control the distribution, sale and use of pesticides in the United States. It does so by requiring registration of pesticides before they can be used or distributed. It is the EPA’s registration process for certain neonicotinoids that the Ellis plaintiffs attack in their complaint. Specifically, they allege that EPA failed to provide the proper public notice of the registration and changed uses of clothianidin and thiamethoxam. According to the Ellis plaintiffs, the behind closed doors process resulted in the public not having the opportunity to argue that the registration of the pesticides should be denied because of a threat of unreasonable harm to the environment.

This lawsuit comes at a time of growing scrutiny on neonicotinoids, as the New York Times has recently reported that the increased use of neonicotinoids has “roughly tracked rising bee deaths,” which are responsible for pollinating up to $15 billion worth of crops in the United States. Regulators in some European Union countries have banned the use of some types of neonicotinoids, and the two top manufacturers of the pesticides have recently proposed a plan to support bee health in the EU as an effort to prevent the individual country bans in the EU from spreading to the rest of the EU.

While the impact of Ellis et al. v. Bradbury et al. has not yet unfolded, the addition of federal litigation to the political and popular debates regarding the effects of neonicotinoids on honeybee populations will almost certainly have an effect on the pesticide and agricultural industries. Stay tuned to the Periconi, LLC Environmental Law Blog for further developments in the case.

Beekeepers File Suit Against the EPA Over Controversial Pesticide Registrations originally appeared on Periconi, LLC Environmental Law Blog on April 8, 2013.Tweet This

Extension of New York State Fracking Moratorium Passes State Assembly, But its Ultimate Fate is Unclear

2013-03-25T20:07:01Z

Share/Bookmark

On March 7, 2013, the New York State Assembly passed legislation to extend the moratorium in place on high pressure horizontal hydraulic fracturing – hydrofracking or fracking – of shale that has been in place since 2008. Though the bill, Assembly Bill 5424-A, passed the Assembly by a wide margin of 95 to 40, the legislation must still be approved by the State Senate and signed by Governor Cuomo before taking effect. It is unclear if the Senate, which is controlled through a power sharing agreement among Republicans, Democrats and the Independent Democratic Caucus, will act on the bill.

The fate of the moratorium legislation is further complicated by the fact that the Cuomo Administration’s own position on fracking is still evolving. The Department of Environmental Conservation missed its November 2012 deadline to finalize fracking regulations, and sought an extension of time so that the Department of Health to conduct further investigation into could consider whether the DEC adequately reviewed the potential public health impacts of the proposed regulations. State Commissioner of Health Dr. Nirav Shah, together with a team of health experts, is still conducting the review.

Even if the Senate passes the bill, precedent exists for Governor Cuomo to veto the legislation. Cuomo’s predecessor, Governor David A. Paterson, vetoed a different version of a fracking moratorium in 2010, and instead issued an executive order putting in place a more narrowly defined moratorium. Of course, Governor Cuomo’s ultimate course of action depends on the still-unfolding review of health potential public health impacts. If Dr. Shah and his team conclude that the DEC regulations did not adequately consider the potential public health impacts, the Cuomo administration would not likely veto the moratorium.

For Assembly Speaker Sheldon Silver and the other sponsors of Assembly Bill 5424-A, the calculus is much simpler. In a press conference announcing the legislation on March 6, 2013, Speaker Silver explained that “[o]ne, the health and well-being of the people must always take precedence over industry profits, and two, the natural gas locked within the Marcellus Shale and the Utica Shale isn’t going anywhere. We’re not going to lose it.”

Whatever the fate of Assembly Bill 5424-A, stay tuned to the Periconi, LLC Environmental Law Blog for further updates.

Extension of New York State Fracking Moratorium Passes State Assembly, But its Ultimate Fate is Unclear originally appeared on Periconi, LLC Environmental Law Blog on March 25, 2013.Tweet This

Destruction of Oil Spill Investigation Data Ruled Not Sufficiently Prejudicial to Warrant the Dismissal of a Cost Recovery Action Under Navigation Law § 12

2013-03-07T19:15:21Z

Share/Bookmark

Does the destruction of plaintiff’s technical data supporting disclosed oil spill investigation reports get a defendant off the hook? Apparently not, decided the Appellate Division (Third Dept.) in a November 2012 decision, rejecting a defense motion to reverse a plaintiff’s trial verdict. Defendants had received the reports themselves, without the backup technical data, but had not requested any of the data for nearly a year after the commencement of litigation, well after a document retention policy caused destruction of the backup data.

Here’s the background: in 1997, the New York State Department of Environmental Conservation discovered two oil spills on neighboring properties owned by the 158th Street & Riverside Drive Housing Company, Inc. and the A.M.G. Properties Company, respectively. DEC hired an environmental consultant to investigate and clean up the spills, and brought suit against the two defendants in 1999 to recover the cost of the clean up under section 12 of the New York State Navigation Law.

158th Street settled with the DEC for $50,000, but A.M.G. chose to proceed with litigation. As part of the discovery process, DEC disclosed the investigation reports prepared by its consultants in the course of the investigation and remediation of the spill. However, it wasn’t until 2010 that A.M.G. requested any of the supporting technical data from the reports. An environmental consultant will always support its reports with technical data such as sampling methods and chain of custody forms that document proper handling of samples. Gaps in this technical data can sometimes raise questions about the reliability of the consultant’s report, but by the time A.M.G. requested the technical data, it had been destroyed pursuant to the DEC consultant’s seven year document retention policy.

At the conclusion of the trial, the jury awarded DEC a verdict of $792,200.98 in remediation costs, and assessed aggregate penalties of $857,500. A.M.G. appealed the verdict to the Appellate Division, arguing that DEC’s failure to preserve the spill investigation reports and supporting technical data should have entitled A.M.G. to summary judgment. The Appellate Division affirmed the trial court’s verdict for DEC, explaining that A.M.G. “failed to “establish that they were prejudiced to the extent that they were unable to defend the case.” State of New York v.158th Street & Riverside Dr. Housing Co., 513590 (Nov. 29) at 4.

In other words, merely arguing that the destruction of the supporting technical data theoretically prevented the defendant from mounting some unspecified defense was not enough to warrant overturning the trial court’s verdict. Instead, the defendant had to meet a much higher burden of proving not only did the plaintiff possess specific documents that should have been turned over to the defendant, but the plaintiff destroyed those documents maliciously, and that destruction prevented the defendant from mounting any defense to the case. A.M.G. failed to meet this burden, and was therefore unsuccessful in challenging the trial court’s verdict on appeal.

Environmental litigation is often complicated by the presence of reams of technical data produced by environmental consultants. Having experienced environmental counsel and consultants who are able to wade through the data and craft an appropriate strategy through a data-driven and analytically rigorous approach is often the difference between making an informed decision to settle early, as the defendant 158th Street did in this case, and facing an unfavorable verdict, as defendant A.M.G. did.

For more information on the New York Navigation Law, see the Periconi, LLC Environmental Law Blog here.

Destruction of Oil Spill Investigation Data Ruled Not Sufficiently Prejudicial to Warrant the Dismissal of a Cost Recovery Action Under Navigation Law § 12 originally appeared on Periconi, LLC Environmental Law Blog on March 7, 2013.Tweet This

After Surviving a Legal Challenge, the Coney Island Boardwalk is “Going Green”

2013-02-05T17:04:27Z

Share/Bookmark

There are perhaps few other sights so closely associated with the summer scene at Coney Island than the wooden boardwalk. Predating even the venerable Coney Island Cyclone roller coaster, the boardwalk has been the main thoroughfare along which have strolled generations of New Yorkers and tourists alike, out for a game of ski-ball, some ice cream, or simply to enjoy the ocean views.

But despite the nostalgic and historical character of the boardwalk, changing times are buffeting Coney Island and turning the wooden boardwalk into a relic. In recognition of the need for an upgrade, the New York City Department of Parks and Recreation proposed in 2010 a new design for the boardwalk that replaces the traditional tropical hardwood lumber with a green replacement: recycled plastic lumber and concrete, and that action has survived a challenge by those for whom the nostalgia of the wooden boardwalk is paramount.

The new design outraged some in the community who felt the wooden boardwalk was indispensable to Coney Island’s historical character. The Parks Department countered that the continued use of tropical hardwood in the boardwalk was too expensive and harmful for the environment. It cited a 2008 policy announced by Mayor Bloomberg to reduce the amount of tropical hardwood consumed by the city of New York—one of the country’s largest consumers of tropical hardwood.

Undeterred, a community group known as the Coney-Brighton Boardwalk Alliance filed suit, alleging that the Parks Department had not properly considered the impact of replacing the wooden boardwalk under the State Environmental Quality Review Act, and its local analog, the New York City Environmental Quality Review Act. The Alliance argued that the Parks Department had arbitrarily decided that the boardwalk replacement was exempt from full review under SEQRA and CEQRA, and that the Parks Department should be required to prepare a full Environmental Impact Statement.

In his opinion, Kings County Supreme Court Justice Martin M. Solomon held that the Parks Department had properly concluded that the boardwalk replacement was exempt from SEQRA and CEQRA review for two reasons. First, the boardwalk replacement merely involved “routine or continuing agency administration” and did not involve any “major re-ordering of priorities that may affect the environment.” Matter of the Coney-Brighton Boardwalk Alliance v. New York City Department of Parks and Recreation, 2012 NY Slip Op 32936(U) at p. 6. Second, because the Alliance failed present any expert testimony on the alleged environmental impacts of the boardwalk replacement, the court concluded that the Alliance did not “establish a substantial adverse change” in the local environment. Id.

As public awareness of the environmental impacts of our building materials has grown in recent years, so too has the push to include more environmentally responsible building materials in our public projects. Unfortunately, as the conflict that led to Matter of the Coney-Brighton Boardwalk Alliance showed, the push for more environmentally responsible infrastructure sometimes clashes with historical nature of New York City’s landmarks. But environmental responsibility doesn’t always have to conflict with the historical character of New York City’s historic landmarks. One example of a project that “greens” city infrastructure without altering the appearance of a landmark is the Brooklyn Bridge Forest Project, which seeks to replace the tropical hardwood in the Brooklyn Bridge boardwalk with ethically sourced wood from Guatemala.

The New York State Department of Environmental Conservation has also sought to encourage the growing public awareness and support for green building materials through its administrative rulemaking process. Under a proposed amendment to the SEQRA regulations, projects that incorporate certain green building infrastructure techniques would be exempt from SEQRA review.

While the proposed amendments are still under consideration, if approved, the green building exemption would institutionalize support for green infrastructure, and discourage other lawsuits like the Matter of the Coney-Brighton Boardwalk Alliance in the future.

After Surviving a Legal Challenge, the Coney Island Boardwalk is “Going Green” originally appeared on Periconi, LLC Environmental Law Blog on February 5, 2013.Tweet This