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07.14.2020 Legal News

Federal Court Holds CERCLA Reporting Exemption Applies to Releases in Excess of Air Permit Limits

A federal court in Pennsylvania recently ruled a U.S. Steel Corp. manufacturing facility was not required under CERCLA to notify federal authorities of releases to the air in excess of emission limits in its air permits.  This ruling provides an expansive reading of CERCLA’s “federally permitted release” exemption for release reporting of air emissions and is favorable for manufacturers.

U.S. Steel owns a plant in Pittsburgh, Pennsylvania that produces coke and coke byproducts, including coke oven gas that is used as fuel at the plant and two adjacent U.S. Steel plants.  In late 2018 and the spring of 2019, fires occurred at the plant causing U.S. Steel to shut down certain emissions control equipment responsible for removing volatile organic compounds (VOCs) and sulfur from its coke oven gas.  The air emissions control equipment remained shut down for months after each fire, causing releases of hydrogen sulfide, benzene and other VOCs into the ambient air at the plant and the two adjacent plants using the unprocessed coke oven gas during these time periods.  U.S. Steel reported both fires to the county health department, the authority responsible for enforcing the Clean Air Act (CAA) in accordance with local laws and U.S. Steel’s air permits.  An environmental group sued, alleging the releases were required to be reported to the National Response Center (NRC) under CERCLA.  U.S. Steel filed a motion to dismiss the suit, alleging the releases were exempt from CERCLA. The Court agreed with U.S. Steel and granted its motion to dismiss.

Section 103(a) of CERCLA requires immediate reporting to the NRC of releases of hazardous substances “in quantities equal to or greater than the statutorily defined limitations.”  However, this same section exempts reporting of a “federally permitted release.”  Congress defined that term in Section 101(10) of CERCLA to mean allowable releases under numerous environmental laws, including the CAA, the Clean Water Act (CWA), the Solid Waste Disposal Act, superseded by  the Resource Conservation and Recovery Act (RCRA), the Safe Drinking Water Act (SDWA), the Marine Protection Research and Sanctuaries Act (MPRSA), and the Atomic Energy Act (AEA).  The question posed to the court was whether the exemption for “federally permitted releases” applied to releases in excess of, or otherwise not in compliance with, levels allowed under the facility’s air permits. The Court held it did.

To determine Congress’ intent as to the scope of the exemption, the Court compared the CERCLA definition of “federally permitted release” for air permits to those for permits issued under CWA, RCRA, SDWA, MPRSA and the AEA.  For releases to the air, CERCLA defines a “federally permitted release” as “any emission into the air subject to a permit or control regulation under” the CAA.  Conversely, CERCLA requires releases relating to the other five statutes to be “in compliance with” or “authorized under” a permit, regulation or standard in order to qualify for the exemption. Therefore, the Court reasoned Congress unambiguously intended the federally permitted exemption for releases subject to CAA permits to be applied differently than those under the other environmental laws.  To reach this finding, the Court interpreted “subject to” to mean that, as long as the pollutants emitted were addressed by the permit, the exemption applied even if the emissions exceeded their permit limits.

But why would Congress purposely treat CAA releases differently?  The Court concluded that Congress intended to relax the exemption for these releases because the CAA already establishes substantial prevention, response, and reporting requirements for accidental air releases that duplicate CERCLA’s reporting and response requirements. 

For facilities subject to the extensive reporting requirements under air permits, this practical approach makes perfect sense.  However, this ruling may be appealed and, in any event, may not be followed by the other federal courts in different circuits across the country.

Clean Air Act Council vs. United States Steel Corp., No. 2:19-cv-01072 (W.D. Pa. May 14, 2020).