Articles, Alerts & Perspectives

Pittsburgh, PA and Washington, DC

PIOGA Press

(By Christina Manfredi McKinley and Keith Coyle)

On May 16, 2023, the D.C. Circuit issued a decision vacating in its entirety a challenged piece of a rule related to safety valve requirements for gas gathering lines. That decision, GPA Midstream Association and American Petroleum Institute v. United States Department of Transportation and Pipeline and Hazardous Safety Administration, held that the agency violated the Administrative Procedure Act and acted arbitrarily and capriciously when it failed to explain, let alone consider, why the rulemaking’s safety standard would be practicable and make sense for regulated gathering lines until issuing the final rule, when there could be no peer review or public comment.

In 2020, PHMSA published a notice of proposed rulemaking to comply with a Congressional directive to the agency to consider the use of valve, or automatic shutoff technology, on gas transmission lines. But the notice of proposed rulemaking and risk assessment said nothing about the costs and benefits of applying the standard to gathering pipelines. Nevertheless, because of certain pre-existing rules, new or replaced regulated gathering lines would have been subject to the proposed standard unless expressly carved out by the rule.

As such, in their comments to the proposed rule, the Petitioners sought an exemption for gathering pipelines. Among other things, they argued the risk assessment lacked the cost-benefit data needed to justify applying the rule to gathering pipelines. Knowing these objections, PHMSA proceeded with the rulemaking anyway. In the final rule’s preamble, PHMSA addressed some of the objections. It pointed out that the proposed rule never said regulated gathering lines would be exempt—which is correct because the proposed rule said nothing at all—and it included some data about gathering lines in the final rule’s risk assessment. …

Pittsburgh, PA

Smart Business

(By Adam Burroughs featuring Jean Mosites)

Fluorinated chemicals, or per- and polyfluoroalkyl substances (PFAS), are a large and diverse family of chemical compounds used in myriad consumer, commercial and industrial products. Because these “forever chemicals” do not break down and tend to accumulate when released into the environment, numerous state and federal agencies are emphasizing, and increasingly enforcing, new waste and water management practices.

“They’re attempting to significantly reduce PFAS compounds that may be present in water, air, soil and many products to mitigate any health-related risks that may come with them,” says Jean M. Mosites, shareholder and co-chair of the Environmental Practice Group at Babst Calland. “Because of this, businesses are facing regulatory uncertainty, high costs of mitigation, and the potential for class-action litigation amidst increasing public awareness.”

Smart Business spoke with Mosites about the uncertainties facing businesses as governments work to address the known or suspected impacts of PFAS.

How have government regulations changed recently?

Recently, the Environmental Protection Agency (EPA) laid out a whole-of-agency approach to addressing PFAS. The roadmap sets timelines by which the agency plans to take specific actions and commit to bolder new policies.

Some states have already enacted laws regulating the presence of PFAS in drinking water, food packaging and consumer products. There have been increased federal and state regulation across a variety of program areas, including drinking water, site remediation and operational permits issued under the Clean Water Act.

Among the more sweeping recent government regulatory developments has been the EPA’s March 2023 proposal of a first-ever national drinking water standard called the National Primary Drinking Water Regulations. The proposed standard is far below any of the standards adopted by the states, all of which will need to revise their laws to be as strict as federal law when finalized. …

Pittsburgh, PA

Legal Intelligencer

(By Michael Korns and Anna Hosack)

Municipalities in Pennsylvania are “creatures of the state,” and thus, have only those powers that have been granted to them by the Commonwealth.  One of the foundational statutes of Pennsylvania municipal law is the Pennsylvania Municipalities Planning Code (“MPC”), 53 P.S. § 10101 et seq.  The MPC grants municipalities the right to regulate subdivision, land use, and zoning, and establishes the procedures and guidelines that govern local land regulation.  However, the MPC is just a statute, and what powers the state has granted, it can just as easily take away.  A recent opinion from the Commonwealth Court shows the dangers of relying solely on the MPC procedural rules when other statutes are also potentially in play and highlights the importance of understanding when the normal day to day protocols of the MPC may be superseded by other laws.

In R. Bruce McNew v. East Marlborough Township, No. 29-MD-2022, 2023 WL 3081354 (Pa. Cmwlth. Apr. 26, 2023), the Pennsylvania Commonwealth Court revisited the impact of the Agricultural Communities and Rural Environmental Act (“ACRE”), 3 Pa.C.S. § 101 et seq., and the Right to Farm Act, 3 P.S. §§ 951-958 (“RTFA”), on a municipality’s ability to regulate forestry and timber harvesting within its boundaries.

Fundamentally, Pennsylvania municipalities have no inherent power of their own; but rather, they possess only such powers of government as are expressly granted to them by statute and as are necessary to carry the same into effect.  Through enactment of the MPC, the General Assembly authorized the governing body of each municipality to enact, amend, and repeal zoning and subdivision and land development ordinances to allow for local regulation of land use.   …

Pittsburgh, PA

TEQ Magazine

(By Dane Fennell)

Artificial Intelligence (AI) has made its way into the legal profession — though not in the way that some news headlines might suggest. Recently, a program called ChatGPT passed several law and business school exams. However, for anyone who has any thoughts that we are entering an age of AI legal representation, flesh and blood lawyers who engage in utilizing AI on a daily basis can confirm that those days are a long way off.

“While AI is being used as a tool in a number of different areas of the law, it’s not yet capable of taking over all human roles,” says Dane Fennell, Senior Counsel at Babst Calland. “It’s just an arrow in the quiver that professionals can use to help them be more efficient, saving them and their clients time and money.”

Fennell discusses the state of AI technology in the legal profession — how it’s being used, and what it can and can’t do.

How would you characterize AI’s place in the legal world?

There are a number of ways that AI has found its way into the legal profession. For example, in M&A due diligence, AI can be used to review large volumes of documents to assist the legal team to home in on the key aspects of a deal with much more speed and efficiency than a manual review. This saves clients time and money, and actually enables the review team to expand the scope of a review to find the “needle in the haystack” issues.

Consumer-based programs are helping those who find themselves with relatively minor legal issues, such as parking tickets and credit card fees. …

Pittsburgh, PA

PIOGA Press

(By Jean Mosites and Kevin Garber)

The Marcellus Shale Coalition v. Department of Environmental Protection and Environmental Quality Board, 573 M.D. 2016.

In April 2023, the Pennsylvania Supreme Court vacated the Commonwealth Court’s decision that had invalidated several “public resource” provisions in 25 Pa. Code Chapter 78a. The Supreme Court’s decision is an abrupt departure from its 2018 decision affirming the preliminary injunction on Count I that had been imposed by the Commonwealth Court in 2016. The Supreme Court’s latest ruling puts these regulations into effect in the well permit process for the first time.

There is no statutory right to judicial review of new regulations in Pennsylvania. Such challenges must proceed in the form of declaratory judgment action in the Commonwealth Court or “as applied” in an appeal before the Environmental Hearing Board on a case-by-case basis. The latter course is duplicative, lengthy and costly, offering only piecemeal relief. MSC challenged portions of the new Chapter 78a regulatory package through a declaratory judgment action in October 2016, seeking relief for its members from regulations beyond the scope of Environmental Quality Board’s (EQB) authority, regulations with high cost and little discernible benefit.

Count I of MSC’s Petition for Review challenged Sections 78a.15(f) and (g), and the related definitions contained in Section 78a.1 of the Chapter 78a regulations. The provisions created a new pre-permitting process for well permit applicants, requiring new notice and comment opportunities in addition to those expressly authorized by Act 13, as adopted in 2012. The relevant defined terms include:

Common areas of a school’s property—An area on a school’s property accessible to the general public for recreational purposes. …

Pittsburgh, PA and Washington, DC

The Foundation Mineral and Energy Law Newsletter

Pennsylvania – Mining

(By Joseph Reinhart, Sean McGovern, Gina Falaschi Buchman and Christina Puhnaty)

As previously reported in Vol. 39, No. 2 (2022) of this Newsletter, the Pennsylvania Department of Environmental Protection’s (PADEP) CO2 Budget Trading Program rule, or RGGI Rule, which links the commonwealth’s cap-and-trade program to RGGI, was published in the Pennsylvania Bulletin in April 2022. See 52 Pa. Bull. 2471 (Apr. 23, 2022). RGGI is the country’s first regional, market-based cap-and-trade program designed to reduce carbon dioxide (CO2) emissions from fossil fuel-fired electric power generators with a capacity of 25 megawatts or greater that send more than 10% of their annual gross generation to the electric grid.

Three legal challenges were filed in response to the publication of the final rule. On April 25, 2022, owners of coal-fired power plants and other stakeholders filed a petition for review and an application for special relief in the form of a temporary injunction, which was granted. See Bowfin KeyCon Holdings, LLC v. PADEP, No. 247 MD 2022 (Pa. Commw. Ct. filed Apr. 25, 2022); Vol. 39, No. 3 (2022) of this Newsletter. Briefing has been filed and the court heard 30 minutes of oral argument in the case on November 16, 2022. On March 24, 2023, the Supreme Court of Pennsylvania granted requests to dismiss the preliminary injunction because the petitioners had failed to pay the bond required to secure the preliminary injunction. Petitioner Bowfin KeyCon Holdings, LLC, which has an interest in some of the subject coal-fired power plants, filed an appeal of the bond amount in summer 2022, claiming that the bond was infeasible or impossible to pay and asked the court to reduce it to a negligible amount. …

Pittsburgh, PA

 The Foundation Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(By Joseph Reinhart, Sean McGovern, Matthew Wood and Christina Puhnaty)

On February 17, 2023, the Clean Air Council (CAC) and the Environmental Integrity Project (EIP) sent a letter to the Pennsylvania Department of Environmental Protection (PADEP) requesting that the agency issue an order to Shell Chemical Appalachia LLC (Shell) to temporarily halt operations at the Shell Polymers Monaca Plant in Beaver County, Pennsylvania (Plant). See Letter from EIP & CAC to PADEP (Feb. 17, 2023). Specifically, CAC and EIP alleged that people living near the Plant had been exposed to volatile organic compounds (VOCs), nitrogen oxide (NOx), and other pollutants emitted in violation of Shell’s plan approval, the federal Clean Air Act, and the Pennsylvania Air Pollution Control Act (APCA). CAC and EIP cited PADEP’s February 2023 notice of violation (NOV) documenting the Plant’s exceedances of the 12-month rolling total emission limitations for VOCs in November and December 2022 and the 12-month rolling total emission limitations for NOx in December 2022, as well as the agency’s December 2022 NOV for the same VOCs emissions violations during September and October 2022. CAC and EIP also highlighted multiple malfunction reports submitted to PADEP by Shell documenting alleged violations of the visible emissions limitations of the Clean Air Act and Shell’s plan approval related to emissions from the Plant’s flares.

CAC and EIP urged PADEP to immediately act using the authority granted to it under the APCA, arguing that the statute allows the agency to issue orders to facilities to cease operations in violation of the APCA, plan approvals, or permits, citing as precedent a stop construction order PADEP issued in 2018 related to incidents during the construction of the Mariner East 2 pipeline. …

Charleston, WV

Employment Bulletin

(by Mychal Schulz)

The West Virginia Supreme Court issued a decision in a closely watched case where the estate of a motorcyclist killed by an employee after she left work, and who was found to have numerous prescription drugs in her system at the time of the accident, sought to impose liability on the employer.

Facts.
Brandy Liggett began her employment with Speedway on September 13, 2015, and she received training while working at a Speedway store on September 13, 14, and 15. On September 15, Ms. Liggett worked the 6 a.m. to 2 p.m. shift. During that shift, her manager, Bobby Jo Maguire, and another employee, Jennifer Wells, observed Ms. Liggett nod off to sleep. Specifically, Ms. Maguire observed Ms. Liggett appearing to fall asleep a couple of times while watching training videos. Ms. Maguire sent Ms. Liggett outside, believing that the fresh air would wake her up, but then Ms. Maguire and Ms. Wells observed Ms. Liggett nodding her head and appearing to fall asleep while standing next to a trash can outside. Ms. Wells remarked to Ms. Maguire that “something was going on” and that “something might be wrong with” Ms. Liggett.

Nonetheless, as Ms. Liggett approached the end of her shift, she was asked if she would work an extra hour as Speedway needed another person from 2 p.m. to 3 p.m. because of a call off.  Neither Ms. Maguire nor Ms. Wells could stay, so Ms. Liggett volunteered to stay that extra hour.

At 3 p.m., Ms. Liggett left the Speedway and drove to her son’s middle school to drop off football equipment. Thereafter, she drove home, but on her way home and about five miles from the school, she crossed the center line and struck a motorcycle, killing the driver, Kevin Jarrett. …

Pittsburgh, PA

Legal Intelligencer

(by Gary Steinbauer and Christina Puhnaty)

In the nearly decade-long saga to regulate greenhouse gas (GHG) emissions from fossil fuel-fired power plants, the U.S. EPA recently began the rulemaking process for a new set of regulations that would impose restrictions on emission units at new and existing power plants. On May 23, 2023, the U.S. EPA published a proposed rule entitled “New Source Performance Standards for Greenhouse Gas Emissions From New, Modified, and Reconstructed Fossil Fuel-Fired Electric Generating Units; Emission Guidelines for Greenhouse Gas Emissions From Existing Fossil Fuel-Fired Electric Generating Units; and Repeal of the Affordable Clean Energy Rule” (Proposed Rule), starting a comment period that ends on July 24, 2023. 88 Fed. Reg. 33,240 (May 23, 2023). EPA’s Proposed Rule relies heavily on hydrogen co-firing and carbon capture and sequestration (CCS) deployment as part of the decarbonization of the power-producing sector.

In the Proposed Rule, EPA proposes five distinct actions under section 111 of the Clean Air Act (CAA). First, EPA is proposing to amend existing New Source Performance Standards (NSPS) for GHG emissions from new and reconstructed fossil fuel-fired stationary combustion turbine EGUs. Second, EPA is proposing to amend existing NSPS for GHG emissions from fossil fuel-fired steam generating units that undergo a large modification. Third, EPA is proposing emissions guidelines for GHG emissions from existing fossil fuel-fired steam generating EGUs (including coal, oil, and gas-fired steam generating EGUs). Fourth, EPA is proposing emissions guidelines for GHG emissions from the “largest, most frequently operated” existing stationary combustion turbines. Lastly, EPA is proposing to repeal the Affordable Clean Energy (ACE) Rule promulgated by the Trump administration in 2019 because “the emissions guidelines established in ACE do not reflect the Best System of Emissions Reduction (BSER) for steam generating EGUs and are inconsistent with section 111 of the CAA in other respects.” 88 Fed. …

Pittsburgh, PA

Smart Business

(By Adam Burroughs featuring Alyssa Golfieri)

There are common pitfalls related to zoning and land use that can occur in real estate transactions. When acquiring a property with the intent to develop, redevelop, or continue an existing use, there are simple, inexpensive steps buyers can take to get ahead of and navigate these issues during the due diligence process.

“Local regulation and municipal cooperation can be a big hurdle,” says Alyssa E. Golfieri, a shareholder at Babst Calland. “But the zoning due diligence process doesn’t have to be complicated and can be started before buyers execute a letter of intent.”

Smart Business spoke with Golfieri about zoning and land use due diligence in real estate transactions.

What documents need to be acquired, reviewed and analyzed?

Before a buyer’s due diligence period expires, the buyer should confirm what, if any, zoning, land use and condemnation-related matters are or were pending, initiated, or approved that affect the subject property. Relying on the seller to provide relevant zoning and land use records is a major pitfall buyers fall into. It is rare that a seller can produce such records, especially when the seller isn’t the original developer. Buyers should take advantage of their state’s public disclosure laws because it is an easy, inexpensive process that can yield significant results. Submit the records request early in the process because municipalities have a generous range of time for response.

What should buyers know about existing permits and approvals?

Failure to confirm conditions or obligations that are imposed through existing permits and approvals is a common pitfall for buyers. Buyers need to understand what permits and approvals exist for the property and use as early as possible because they often contain conditions or ongoing obligations that become the buyer’s responsibility upon closing. …

Pittsburgh, PA and Washington, DC

GO-WV

(By Christina Manfredi McKinley and Keith Coyle)

On May 16, 2023, the D.C. Circuit issued a decision vacating in its entirety a challenged piece of a rule related to safety valve requirements for gas gathering lines.  That decision, GPA Midstream Association and American Petroleum Institute v. United States Department of Transportation and Pipeline and Hazardous Safety Administration, held that the agency violated the Administrative Procedure Act and acted arbitrarily and capriciously when it failed to explain, let alone consider, why the rulemaking’s safety standard would practicable and make sense for regulated gathering lines until issuing the final rule, when there could be no peer review or public comment.

In 2020, PHMSA published a notice of proposed rulemaking to comply with a Congressional directive to the agency to consider the use of valve, or automatic shutoff technology, on gas transmission lines.  But the notice of proposed rulemaking and risk assessment said nothing about the costs and benefits of applying the standard to gathering pipelines. Nevertheless, because of certain pre-existing rules, new or replaced regulated gathering lines would have been subject to the proposed standard unless expressly carved out by the rule.

As such, in their comments to the proposed rule, the Petitioners sought an exemption for gathering pipelines. Among other things, they argued the risk assessment lacked the cost-benefit data needed to justify applying the rule to gathering pipelines.  Knowing these objections, PHMSA proceeded with the rulemaking anyway.  In the final rule’s preamble, PHMSA addressed some of the objections.  It pointed out that the proposed rule never said regulated gathering lines would be exempt—which is correct because the proposed rule said nothing at all—and it included some data about gathering lines in the final rule’s risk assessment.  …

Pittsburgh, PA

GO-WV

(By Lisa Bruderly)

On May 25, 2023, the U.S. Supreme Court issued a highly-anticipated decision that significantly narrows the extent of wetlands within the definition of “waters of the United States” (WOTUS), and, therefore, within the jurisdiction of the federal Clean Water Act (CWA). Under the majority opinion in Sackett v. EPA, the Court held that “waters” are limited to “only those relatively permanent standing or continuously flowing bodies of water” that are described as “streams, oceans, rivers, and lakes” and to “adjacent” wetlands that are “indistinguishable” from those bodies of water. Therefore, a wetland is only a WOTUS (and subject to CWA jurisdiction) if: (1) the adjacent body of water is a WOTUS (i.e., “a relatively permanent body of water connected to a traditional interstate navigable water”); and (2) the wetland has a “continuous surface connection” with that water “making it difficult to determine where the ‘water’ ends and the ‘wetland’ begins.” As Justice Samuel Alito stated: Federally regulated wetlands “must be indistinguishably part of a body of water that itself constitutes ‘waters’ under the CWA. . . .  Wetlands that are separate from traditional navigable waters cannot be considered part of those waters, even if they are located nearby.”

The Sackett litigation involves Michael and Chantell Sackett, who have been unable to build a house because the U.S. Environmental Protection Agency (USEPA) and the U. S. Army Corps of Engineers (the Corps) determined that a wetland on their Idaho property was a WOTUS, requiring CWA Section 404 permitting.  Both the U.S. District Court for the District of Idaho and the Ninth Circuit sided with the Agencies’ WOTUS determination, citing the “significant nexus” test introduced by Justice Anthony Kennedy in his concurring opinion in the U.S. …

Washington, DC and Pittsburgh, PA

GO-WV

(Brianne Kurdock, Jim Curry, Gary Steinbauer, Lee Banse)

On May 5, 2023, the Pipeline and Hazardous Materials Safety Administration (PHMSA) released the pre-publication version of a notice of proposed rulemaking (NPRM) titled “Gas Pipeline Leak Detection and Repair.” PHMSA published the NPRM in response to section 113 of the Protecting our Infrastructure of Pipelines and Enhancing Safety Act of 2020 (PIPES Act). Section 113 of the PIPES Act directed PHMSA to promulgate final regulations by December 27, 2021, requiring operators of gas transmission, distribution pipelines, and certain gathering lines to conduct leak detection and repair programs.

PHMSA proposes to amend 49 CFR Parts 191, 192, and 193 to: increase the frequency of leakage survey and patrolling requirements; introduce leakage survey and repair requirements for liquefied natural gas (LNG) facilities; require grading and repairs of leaks; reduce the use of blowdowns and intentional venting; impose design, configuration, and maintenance requirements for relief devices to reduce emissions; expand reporting requirements; and require that Type A, B, and C gathering lines submit geospatial pipeline location data to the National Pipeline Mapping System (NPMS). PHMSA proposes a six-month effective date for this rulemaking.

Comments on the NPRM are due on July 17, 2023.

Scope

Among other notable features of the proposal, the scope of this NPRM extends beyond the Section 113 congressional mandate by including Type C gathering lines, underground natural gas storage facilities, and LNG facilities. The statutory mandate was limited to regulated gathering lines in a Class 2, 3, or 4 location, and new and existing gas transmission and distribution pipelines. …