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The Insider

Court Cases Create Uncertainty For Fate Of EPA’s Deregulatory Efforts

New developments in appellate and Supreme Court cases are creating fresh uncertainty for the fate of several EPA deregulatory efforts, with hard-to-read oral argument sessions in three of the suits and a possible end to the high court case on groundwater pollution without a ruling.

Appellate judges heard argument in three cases this week; weighing the fates of EPA’s rule delaying implementation of 2015 power plant effluent standards, its shift away from “second guessing” states’ air permitting judgment and its guidance that effectively scraps an Obama-era rule limiting climate-warming hydrofluorocarbon (HFC) refrigerants.

In the U.S. Court of Appeals for the District of Columbia Circuit, judges grappled with the fate of the HFC guidance at a May 3 argument session, as environmentalists and Democratic-led states argued that EPA’s decision to drop enforcement of the 2015 rule entirely goes far beyond what is required by a D.C. Circuit decision that partially vacated the policy.

Inside EPA will have full coverage of Natural Resources Defense Council v. Wheeler later today. But out of the three-member panel, Judge David S. Tatel appeared to back the challengers’ position while Judge Sri Srinivasan asked probing questions of both sides, and newly confirmed Judge Neomi Rao seemed to agree with EPA that the guidance is not “final,” which would block any lawsuit over its legality.

Earlier, on May 1, another D.C. Circuit panel heard argument in Sierra Club v. EPA, et al., but again produced no clear signal of where it stands on the case’s merits. Instead, the judges used all of their questions to probe whether the suit belongs in their court, as environmentalists contend because the decision sets broad national policy, or instead in the 10th Circuit, as EPA argues, because it pertains only to the specific permit at issue governing a Utah power plant:

D.C. Circuit Wrestles With Venue For Suit On EPA Air Permit Policy Change
Appellate judges at May 1 oral argument wrestled with which circuit court has jurisdiction to hear environmentalists’ suit claiming a major Trump administration shift in Clean Air Act permitting policy barring the agency from “second guessing” states’ permit decisions is unlawful, but the judges did not indicate how they might rule.

The case is over EPA’s 2017 decision not to object to a state-issued Clean Air Act operating permit for a coal-fired utility in Utah, which the challengers say sets a nationally-binding precedent that amounts to a rulemaking, and will unlawfully preclude the agency from objecting to states’ permitting decisions even when those permits are unlawfully lax.

But EPA has countered that the case is at its core about the sufficiency of a single permit, and should thus be heard in the 10th Circuit that includes Utah. If the D.C. Circuit agrees, it would forestall any decision on the merits of the policy change.

Finally, judges in the 5th Circuit heard argument May 1 in Clean Water Action, et al., v. EPA, et al., where environmentalists say EPA violated the CWA by delaying implementation of two provisions in its 2015 effluent rule for power plants while it considered revising them after granting an industry petition for reconsideration.

Again, the judges gave few signs on how the panel will ultimately rule, as each side saw one judge seem to sympathize with its arguments while the third questioned both sides:

5th Circuit Judges Appear Split On Suit Over Delay Of Utility Effluent Rule
Appellate judges at May 1 oral argument appeared split on environmentalists’ suit over EPA’s delay until 2020 of two provisions in the Obama-era power plant effluent rule, with one judge strongly backing the government and a second judge appearing to favor critics of the delay -- leaving the third judge hearing the case as a swing vote.

Meanwhile, elected officials in the strongly Democratic Hawaii county asking the Supreme Court to hold groundwater pollution from its wastewater treatment plant is not subject to CWA limits are proposing a sudden settlement to the case, out of concern that a win could end up furthering the Trump administration’s environmental agenda:

County Eyes Ending CWA Groundwater Suit To Avoid High Court Precedent
The county government of Maui, HI, is weighing a bill that would settle or withdraw a high-profile Supreme Court case over Clean Water Act (CWA) penalties for groundwater-borne pollution, potentially averting a ruling the county fears could “damage” the CWA by setting a nationwide precedent that the law does not apply to such pollution.

County of Maui v. Hawai'i Wildlife Fund, et al., has emerged as a test of whether pollution discharges that flow through groundwater to protected surface waters can violate the CWA -- a hotly contested question that has split appellate courts.

EPA itself has released an April 15 guidance saying “the best, if not the only, reading of the CWA” is that it never limits groundwater pollution, and if the high court agrees with Maui it would enshrine that view of the law nationwide.

But officials in the county are now weighing a settlement offer from their environmentalist opponents, with one council member telling the Associated Press that they “should not be in that position” of handing the White House a major victory.