Environmental Mitigation in Consent Decrees Law Review Articles

New Lawsuit Challenges DOJ Policy Prohibiting SEPs

Wednesday, October 14, 2020

The ongoing battle over Supplemental Environmental Projects (SEPs) – environmentally-benign, across-compliance projects that defendants concur to undertake for potential penalty mitigation in settlement of environmental enforcement actions – heated up terminal week when an environmental group sued the chaser general and others for violating the Administrative Procedure Act (APA) in issuing a legal memorandum finer halting the projects.

The last time we discussed SEPs, the U.s. Department of Justice (DOJ) was challenging a carve up understanding entered into between 2 individual parties – that were also parties to a consent decree with the DOJ – that required one of those parties to undertake projects akin to SEPs. That matter is still being briefed (for boosted background on DOJ'southward new stance on SEPs, see our May 2020 post and September 2019 post).

The U.s.a. Environmental Protection Agency (EPA) has supported SEPs since 1984, when the agency issued its first SEP policy. SEPs have enjoyed widespread back up from communities and regulated entities alike. Merely over the past several years, the DOJ has expressed increasing skepticism over the propriety of SEPs, culminating in the issuance on March 12, 2020, of a memorandum entitled, "Supplemental Ecology Projects ("SEPs") in Civil Settlements with Private Defendants" (SEP Prohibition Memo), prohibiting SEPs in all only a pocket-size course of diesel emission reduction projects in mobile source matters. The SEP Prohibition Memo posits that SEPs stand for a violation of the Miscellaneous Receipts Act, which provides that a government official "receiving money for the Government from any source shall deposit that money with the Treasury," discipline to certain exceptions.

On Oct. 8, the Conservation Constabulary Foundation (CLF) filed a lawsuit in the United States District Courtroom of Massachusetts (Conservation Law Foundation v. William Barr et al., Example No. 1:xx-cv-11827), seeking to vacate the SEP Prohibition Memo and enjoin DOJ and EPA from implementing that policy – equally an arbitrary and capricious violation of the APA. In challenging the SEP Prohibition Memo, CLF noted that the EPA and other agencies take long relied on the rationale that because no penalty is owed to the government until a settlement is finalized, including a SEP in settlement understanding does not merchandise penalties for projects.

The CLF notes that pollution disproportionately harms low income and minority communities, and SEPs have been a tool for reducing those impacts. Jeffrey Clark, the current banana chaser general of DOJ'south Environment and Natural Resource Segmentation (ENRD) and author of the SEP Prohibition Memo, argues in the memo that despite the safeguards contained within EPA'due south SEP policy, SEPs still divert funds that otherwise would take gone to the Treasury to projects benefiting third parties, in violation of the police.

CLF, in its complaint, argues that EPA had implemented robust protocols, through its SEP Policy, to ensure that SEPs met certain criteria to avert running afoul of the Miscellaneous Receipts Human activity. That policy, says CLF, has been blessed by the Office of Legal Counsel, besides as past the many courts that have entered consent decrees including SEPs. Co-ordinate to CLF, by misreading the evidently language of the Miscellaneous Receipts Act and ignoring the decades of precedent supporting the SEP Policy, DOJ acted arbitrarily and capriciously – and in a style likely to unduly harm low-income and minority communities.

If the upcoming ballot results in a modify in assistants, a new attorney general could potentially withdraw the SEP Prohibition Memo and perhaps moot the CLF instance. In the meantime, all the same, the SEP Prohibition Memo volition continue to bar SEPs in settlements, until withdrawn or deemed illegal.

©2022 Greenberg Traurig, LLP. All rights reserved. National Police force Review, Volume X, Number 288

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Caleb J. Holmes focuses his practice on environmental and commercial litigation. He has a wide range of experience in environmental transaction and regulatory counseling matters.

Caleb represents businesses in state and federal courts in environmental and commercial litigation matters. He advises and represents industrial and state clients on environmental issues arising in permitting, compliance activities, as well as business concern and existent estate transactions generally. Caleb represents natural gas exploration and product companies and midstream...

Bernadette M. Rappold focuses her practice on federal and state regulatory issues related to energy and the environment. Bernadette has substantial litigation experience and advises clients on regulatory compliance as well every bit the environmental, safety and wellness aspects of numerous business and real manor transactions, including water, air and chemical hazards. Bernadette offers clients perspective gained through years of service at the Environmental Protection Agency. While serving as a director of the Special Litigation and Projects Sectionalisation in the Part of Civil...

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