EPA: veto of Arch Coal permit was too routine to merit appeal

The U.S. Environmental Protection Agency said in a June 27 filing at the U.S. Court of Appeals for the D.C. Circuit that there is no reason for the full court to take on a three-judge ruling that is being appealed by the Mingo Logan Coal unit of Arch Coal (NYSE: ACI).

The three-judge panel had ruled that EPA was working within its existing authority when it vetoed a Section 404 Clean Water Act permit issued by the U.S. Army Corps of Engineers for Mingo Logan’s 2,278-acre Spruce No. 1 strip mine in Logan County, W.Va.

“The panel’s straightforward reading of the Clean Water Act’s plain language does not merit rehearing en banc,” EPA said in its June 27 response brief. “Mingo Logan does not allege that the panel decision conflicts with a decision of the Supreme Court, this Court, or any other court. Nor does this case present a legal question of exceptional importance. The panel considered and properly rejected Mingo Logan’s arguments, which cannot be squared with the statutory text. The company’s new arguments at the petition stage are forfeited and unpersuasive. The petition should be denied.”

Among other things, EPA said a rehearing by the full court “is not favored” in a case like this where the panel decision does not conflict with any decision of any court.

Also, the panel decision broke no legal ground, EPA said. “To the contrary, the panel followed a well-worn path when it ‘enforce[d] plain and unambiguous statutory language according to its terms.’ The panel appropriately rooted EPA’s 404(c) authority in the sweeping, retrospective language (‘withdrawal,’ ‘any,’ ‘whenever’) that Congress chose, and it was not persuaded by unrelated statutory provisions or ambiguous legislative history. There is nothing exceptional about the panel’s approach or the outcome of the case.”

Nor did the panel disrupt reasonable industry expectations, as the Mingo Logan petition suggests, EPA added. “The panel merely endorsed EPA’s 34-year-old interpretation of the Clean Water Act, an interpretation announced in the agency’s 1979 regulations and reaffirmed in post-permit 404(c) actions in 1981, 1992, and 2011. Mingo Logan cannot cite any other interpretation of Section 404(c) ever articulated by EPA, the Corps, or any court other than the district court in this case. At bottom, the company and its amici simply disagree with the regulatory balance that Congress struck in 1972. But that is a policy question resolved by Congress, not a legal question for the en banc court.”

Mingo Logan criticizes EPA’s ‘audacious’ assertion of retroactive authority

Mingo Logan on June 7 had filed its motion for an en banc hearing. The Corps had in 2007 issued this permit, with the advice and consent of the EPA. Then the EPA later vetoed it, saying it would have too much impact on the local watershed. Mingo Logan won an initial, March 2012 decision at the U.S. District Court level, then lost an April 23 decision by the three-judge panel at this appeals court.

“The authority asserted by the Environmental Protection Agency (‘EPA’) in this case is as audacious as it is unprecedented,” said Mingo Logan in its June 7 petition. “EPA claims nothing less than a unilateral power to nullify, at any time, a Clean Water Act (‘CWA’) permit issued years ago by a different agency, even though the permitting agency has found that EPA’s concerns present no new information and were addressed in the permit when it was issued.”

The coal company added: “EPA’s sweeping interpretation of its limited power over ‘specifications’ under section 404(c) of the CWA is not just breathtaking. It is also—as the District Court correctly concluded—wrong. Congress gave the Army Corps of Engineers the principal permitting authority for discharges of dredged or fill material under section 404; EPA’s role is secondary. The panel’s decision to vest an agency having a subsidiary role with the authority to eviscerate the final agency action of a different agency with the primary statutory role is unprecedented and wrong. It makes no sense to allow EPA to effectively nullify a permit issued by the Corps based on nothing more than the fact that EPA—but not the Corps—has changed its mind.”

This case is seen by the whole coal industry, not just Arch Coal, one of the country’s largest coal producers, as a key indicator of just how much authority an activist EPA has over coal mine permitting. The industry’s theory is that if the Spruce No. 1 permit isn’t safe, no issued permit is safe.

Mingo Logan said in the June 7 motion that the EPA veto has left it only 12% of the mine area to work. A May 30 site inspection report from the West Virginia Department of Environmental Protection shows that as of that point the Spruce No. 1 operation was “active, moving coal,” with 329 acres of the 2,278-acre permit area disturbed by mining up to that point. The site is being operated by contractor Eagle Creek Mining LLC, controlled by coal operators John and Thomas Potter.

U.S. Mine Safety and Health Administration data shows that Spruce No. 1, listed under Eagle Creek Mining, produced 145,500 tons in the first quarter of this year, 624,111 tons in 2012 and 819,831 tons in 2011.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.