Emergency Exemptions from Environmental Laws Applicable to the Coronavirus Pandemic

To help our clients navigate the coronavirus (COVID-19) crisis, Arnold & Porter has established a Coronavirus Task Force covering a wide range of issues and challenges. Subscribe to our "Coronavirus (COVID-19)" mailing list to receive our latest client Advisories and register for upcoming webinars.

Introduction

The national response to the coronavirus crisis will face several impediments and obstacles, but federal and state environmental laws should not be among them. Most of these laws have emergency exemptions that allow the usual (and sometimes lengthy) procedures to be bypassed, and some substantive requirements to be waived, in instances of true urgency. Furthermore, nearly all environmental consent decrees include force majeure provisions that will excuse performance with compliance obligations under certain circumstances. This Client Alert provides a preliminary review of many of these exemptions and exceptions to ordinary environmental obligations.

Responding to the National Emergency

It is too early to know all that must be done to cope with this crisis, but some that can be imagined would ordinarily be subject to environmental regulation.

To pick one example that is already apparent, if some of the more dire predictions of the virus's spread come true, the nation's supply of hospital beds will be overwhelmed, and it will be necessary to build many new medical treatment facilities. If this was to be done with federal money, it could ordinarily be deemed to be a major federal action (or perhaps many actions—one for each facility) requiring impact assessments and possibly environmental impact statements (EISs) under the National Environmental Policy Act (NEPA).

However, President Trump's declaration of a national emergency on March 13 invoked the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act). In addition to giving many powers to the Federal Emergency Management Agency, the Stafford Act provides an exemption from NEPA for immediate response actions. 42 U.S.C. § 5159, 44 C.F.R. § 10.8.

Many of these facilities might be built in existing hospital parking lots or other open land. However, it is possible that some will require demolishing existing buildings. The Stafford Act also gives the President the authority to clear debris and wreckage resulting from major disasters. 42 U.S.C. § 5173(a).

The text of NEPA contains no emergency exemptions. However, the implementing regulations of the Council on Environmental Quality authorize lead agencies to make "alternative arrangements" in emergency situations. 40 C.F.R. § 1506.11. For disasters and other emergencies abroad, Executive Order 12114 (Environmental Effects Abroad of Major Federal Actions) provides (in section 2-5) for exemptions from environmental review requirements for relief action.

Additionally, after the terrorist attacks of September 11, 2001, the U.S. Environmental Protection Agency (EPA) used its enforcement discretion and issued "no action assurances" to allow certain actions that would otherwise violate the Clean Air Act. This included, for example, rules regarding vapor recovery at gasoline pumps and certification rules for tank truck carriers.

State Environmental Exemptions During Emergency Response

Several states have laws comparable to NEPA that govern actions requiring discretionary state or local approvals. These might otherwise require environmental review of new construction, but these, too, tend to have emergency exemptions.

One example is New York's State Environmental Quality Review Act (SEQRA). The regulations under it exempt from the EIS requirement "emergency actions that are immediately necessary on a limited and temporary basis for the protection or preservation of life, health, property or natural resources, provided that such actions are directly related to the emergency and are performed to cause the least change or disturbance, practicable under the circumstances, to the environment." 6 N.Y.C.R.R. § 617.5(c)(42). The courts have interpreted this provision broadly to encompass events that at first glance do not look much like emergencies (such as prison overcrowding and homelessness), but obviously the response to the coronavirus would qualify.

New York, like many states, have laws that provide for broad exemptions from a wide variety of laws in the event of emergency. For example, New York State Exec. L. Art. 2-B § 29-a provides that:

[s]ubject to the state constitution, the federal constitution and federal statutes and regulations, the governor may by executive order temporarily suspend any statute, local law, ordinance, or orders, rules or regulations, or parts thereof, of any agency during a state disaster emergency, if compliance with such provisions would prevent, hinder, or delay action necessary to cope with the disaster.

After the destruction of the World Trade Center on September 11, 2001, Governor George Pataki used this law on September 12, 2001, to suspend many statutes of limitations, and on October 9, 2001, he used this same law to suspend certain regulations regarding transportation and handling of solid wastes, so as to facilitate the World Trade Center removal operation. It became clear, however, that the SEQRA process was about to delay the start of replacement of one of the buildings that had collapsed, 7 World Trade Center. This was a serious matter because that building had been built atop a Consolidated Edison Co. electrical substation that provided electricity to much of Lower Manhattan. Until that substation could be rebuilt, electricity service was provided through a jerry-rigged system of cables running on the surface of the streets. This was an intrinsically unstable situation. Thus the state invoked SEQRA's emergency provision and allowed site preparation activities to go forward before the completion of the SEQRA process. Ultimately the state decided that no EIS was necessary, as the new 7 World Trade Center, though taller than the original, had less square footage and therefore it generated less traffic and sewage, used less water and energy, and otherwise had fewer impacts. Thus, SEQRA did not delay the reconstruction of 7 World Trade Center.

Other states have similar exemptions for environmental reviews during emergencies. For example, the California Environmental Quality Act (CEQA) exempts from the environmental impact report (EIR) requirement "[e]mergency repairs to public service facilities necessary to maintain service" as well as "[s]pecific actions necessary to prevent or mitigate an emergency." Cal. Pub. Res. Code §§ 21080(b)(2), (4). CEQA defines an emergency as a "sudden, unexpected occurrence, involving a clear and imminent danger, demanding immediate action to prevent or mitigate loss of, or damage to, life, health, property, or essential public services." Id. § 21060.3. The CEQA guidelines elaborate that "emergency projects . . . exempt from the requirements of CEQA" include "[e]mergency repairs to publicly or privately owned service facilities necessary to maintain service essential to the public health, safety or welfare" including "those that require a reasonable amount of planning to address an anticipated emergency." 14 Cal. Code Reg. § 15269(b). As in New York, California state courts have interpreted the emergency emptions broadly to encompass events that at first glance do not seem like emergencies (such as prison overcrowding and beach erosion), but the response to the coronavirus would clearly qualify.

The Massachusetts Environmental Policy Act (MEPA) provides for a more limited emergency exemption in the "rare case[s]" when it is "essential to avoid or eliminate an imminent threat to environmental resources or quality or public health or safety." 301 Mass. Code Regs. § 11.13(1). However, the project proponent must "limit any emergency action taken without prior due compliance with MEPA . . . to the minimum action necessary to avoid or eliminate the imminent threat." Id. Additionally, the proponent must file an initial environmental notification form within 10 days of commencing the action, and the proponent must later file an EIR after the emergency action is taken. Id. § 11.13(2).

By comparison, the Washington State Environmental Policy Act (SEPA) does not include any relevant statutory or regulatory provisions that would exempt emergency actions. However, the Washington Department of Ecology guidance on SEPA provides that a lead agency can grant an emergency exemption if an action meets two conditions. First, the action must be "needed to avoid an imminent threat to public health or safety," and second, there must not be "adequate time to complete SEPA procedures."¹

Similarly, after major disasters, states issue many waivers. For example, after Hurricane Katrina in 2005, the Louisiana Department of Environmental Quality granted relief from the rules applicable to wastewater discharges; air emissions relating to repair activities and temporary power sources; on-site solid and hazardous waste management; inspection and rehabilitation of underground storage tanks; and numerous inspection, monitoring, and discharge reporting requirements. Likewise, the state of Texas suspended many environmental regulations after Hurricane Harvey in 2017.

Environmental Exemptions More Broadly

Besides responding to emergency conditions directly, companies may have difficulty complying with environmental obligations more generally as a result of the global coronavirus pandemic. These challenges may stem from a wide variety of conditions including supply chain disruptions for pollution control equipment; inability of employees to work on site; and prioritization of resources to immediate and critical safety needs. It is important, in these circumstances, for companies to understand the relevant exemptions that may apply and how to trigger these exemptions appropriately.

Emergency exemptions in environmental law fall into two broad categories—the generic and the case-specific. The generic exemptions, in turn, come in four types: exemptions from permitting requirements; relaxation of substantive standards; exemptions from, or acceleration of, certain processes; and releases from liability. The case-specific exemptions are aimed at specific projects or geographic areas. Examples included congressional declarations of non-navigability that shield certain areas from Corps of Engineers permitting requirements, and congressional and state legislative declarations that certain projects need not go through the standard environmental review process.

Few of these exemptions are self-executing. Most require a declaration or finding of the President (which has just been issued) or the administrator of EPA (either acting on his or her own authority, or under a delegation from the President) or of another high federal official. In the absence of such a federal action, regulated entities generally cannot simply plead that the environmental laws do not apply to them. A notable exception is the act of God or war defense that is found in most of the federal statutes that confer environmental liability.

The National Historic Preservation Act applies to a broad array of federal actions. The regulations of the Advisory Council on Historic Preservation provide for emergency procedures. 36 C.F.R. § 78.3(a).

Most of the substantive environmental laws and their implementing regulations contain emergency exemptions of various sorts. Many of them have been used after disasters like hurricanes and earthquakes.

Under the Clean Air Act, the available waivers include:

• from national emission standards for hazardous air pollutants from stationary sources when in the interests of national security, 42 U.S.C. § 7412(i)(4);
• for federal emission sources where "in the paramount interest of the United States," 42 U.S.C. § 7418(b);
• from certain of the requirements under the National Emissions Standards for Hazardous Air Pollutants for the demolition of asbestos-containing buildings, when the building has been ordered torn down because it "is structurally unsound and in danger of imminent collapse," 40 C.F.R. § 61.145(a)(3); and
• for federal procurement when in the paramount national interest, 42 U.S.C. § 7606(d).

The Clean Water Act and its regulations have several exemptions. Among them are:

• acts of God or war, 33 U.S.C. § 1321(a)(12);
• emergencies that require expedited procedures for the processing of permit applications by the Corps of Engineers, 33 C.F.R. § 325.2(e)(4);
• emergencies requiring expedited direct action by the Corps of Engineers, 33 C.F.R. § 337.7; and
• exigent discharges of oil and hazardous substances, 33 U.S.C. § 1321(c)(2), 40 C.F.R. § 122.3(d).

The Comprehensive Environmental Response, Compensation, and Liability Act also has an act of God or war defense. 42 U.S.C. §§ 9607(b)(1), (2). Additionally, it allows emergency removal actions, 42 U.S.C. § 9604(a), 40 C.F.R. § 300.400.

The Coastal Zone Management Act allows the President to authorize federal actions that are inconsistent with state coastal plans if the President finds it is in the paramount interest of the country, or the Secretary of Commerce determines it is a matter of national security. 16 U.S.C. § 1456(c)(1)(B).

The Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) requires that products used to disinfect inanimate objects are registered by EPA (all of the states have similar requirements). FIFRA permits EPA to exempt federal and state agencies from certain requirements of the statute (including product registration requirements) if EPA determines that emergency conditions exist that require such exemption. 7 U.S.C. § 136p, 40 C.F.R. pt. 166. On March 13, 2020, EPA announced that it had used expedited procedures under FIFRA to expand the list of previously-approved general use disinfectant products for use specifically in combating the coronavirus.

The Resource Conservation and Recovery Act allows the President to determine it to be in the "paramount interest" of the nation to exempt any federal solid waste management facility. 42 U.S.C. § 6961(a). This authority also extends to federal underground storage tanks. 42 U.S.C. § 6991f(a). EPA may issue temporary emergency permits to allow treatment, storage, or disposal of hazardous wastes where there is imminent and substantial endangerment to human health or the environment. 40 C.F.R. § 270.61(a). The standards applicable to treatment, storage, and disposal facilities may also give way in time of emergency. 40 C.F.R. § 264.1(g)(8).

The Safe Drinking Water Act allows states to exempt public water supply systems from maximum contaminant levels due to "compelling factors," including "[u]rgent threats to public health." 42 U.S.C. §§ 300g-5, 300g-1.

Even where there is no explicit exemption, the environmental authorities have generally made it clear that they will take no enforcement action against actions that could impede the immediate response to a major disaster.

Consent Decree Obligations

Companies often have specific environmental obligations—including pollution control measures, reporting, environmental mitigation, and other requirements—incorporated as part of a consent decree or other agreement with federal or state governmental agencies. In most such agreements, a company may be excused of its obligation (for a period of time) if the delay is caused by a force majeure event. As discussed above, there may be circumstances caused by the coronavirus pandemic or the declared national emergency that constitute a force majeure event, including, for example, a true inability to obtain necessary equipment or supplies. However, it is critical that companies understand the specific force majeure definitions and procedures applicable to their environmental obligations.

For purposes of most consent decrees with EPA, a force majeure event is defined as "any event arising from causes beyond the control of [the settling defendants], of any entity controlled by [settling defendants], or of [settling defendants'] contractors that delays or prevents the performance of any obligation under [the consent decree] despite [settling defendants'] best efforts to fulfill the obligation."² Almost all EPA consent decrees further provide that a "financial inability" to perform will not constitute a force majeure event.³

Finally, it is important that companies familiarize themselves with the procedures of invoking a force majeure exception to their consent decree obligations. Most force majeure provisions have very strict deadlines by which they must notify EPA of the event that might cause a delay. Often, a company must report the circumstances orally or electronically to EPA within 72 hours, sometimes even less. EPA also frequently requires rapid follow-up in writing with specific information including:

• an explanation and description of the reasons for the delay;
• the anticipated duration of the delay;
• all actions taken or to be taken to prevent or minimize the delay;
• a schedule for implementation of any measures to be taken to prevent or mitigate the delay or the effect of the delay;
• the rationale for attributing such delay to a force majeure; and
• a statement as to whether such event may cause or contribute to an endangerment to public health or welfare, or the environment.⁴

Conclusion

The national emergency caused by the global coronavirus pandemic will cause unprecedented response actions and likely result in significant disruptions throughout our economy. Fortunately, environmental obligations are often sufficiently flexible to facilitate necessary response actions and to excuse, where appropriate, certain delays in environmental compliance. As discussed above, most federal and state environmental laws have emergency exemptions that allow the usual environmental review procedures to be bypassed, and some substantive requirements to be waived, in instances of true urgency. Furthermore, nearly all environmental consent decrees include force majeure provisions that will allow for a delay of compliance obligations under certain circumstances. Of course, the application of these exceptions will vary depending upon the specific circumstances, and thus a careful review of those circumstances is a critical next step.

* * * * *

Michael B. Gerrard is a professor and Faculty Director of the Sabin Center for Climate Change Law at Columbia Law School, and Senior Counsel in the New York office of Arnold & Porter.
Brian D. Israel, a partner in Arnold & Porter's Washington, DC, office, is chair of the firm's Environmental practice group.

Francesa Bochner-Brown contributed to this Advisory. Ms. Bochner-Brown is a graduate of Duke University School of Law and is employed at Arnold & Porter's Washington, DC office. Ms. Bochner-Brown is admitted only in California. She is not admitted to the practice of law in the District of Columbia.

© Arnold & Porter Kaye Scholer LLP 2020 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.