Judge rules for Corps in coal permit case involving Leeco Inc.

A federal judge on Aug. 23 issued a pro-coal decision in a case brought by environmental groups against the U.S. Army Corps of Engineers over Section 404 Clean Water Act permitting for coal producer Leeco Inc.

Kentuckians for the Commonwealth (KFTC) and the Sierra Club brought this action seeking a declaration that the Corps violated the Clean Water Act (CWA) and the National Environmental Policy Act (NEPA) in issuing a permit to Leeco, authorizing the corporation to mine-through and fill several unnamed tributaries of Stacy Branch and Yellow Creek. Plaintiffs requested injunctive relief.

Before the U.S. District Court for the Western District of Kentucky were a series of cross motions for partial summary judgment. First, plaintiffs filed their motion for partial summary judgment as to their human health effects claims in Counts I, II, and III. Defendants responded with their own motions for partial summary judgment. Thereafter, the court requested expedited briefing as to plaintiffs’ water quality claims in Count IV of their complaint.

The court in the Aug. 23 decision denied plaintiffs’ motion as to Counts I, II, and III and as to Count IV and granted the defendants’ motions.

Plaintiffs initiated this challenge in October 2012 after the Corps’ Louisville District Office issued a permit that authorizes Leeco to discharge fill materials into streams that qualify as “waters of the United States” under the CWA and accompanying regulations. The discharges relate to Leeco’s plan to construct one hollow fill, one sediment control pond, and various “mine throughs” on unnamed tributaries of Stacy Branch and Yellow Creek of Carr Creek, located in Knott and Perry counties, Ky., as part of its nearby surface coal mining operations.

In February 2007, Leeco filed its original application for a permit that covered six hollow fills and six sediment control ponds in various unnamed tributaries of Carr Creek. The proposed construction involved discharges into 22,761 linear feet of stream. As part of its application, Leeco submitted the Kentucky Division of Mine Permits’ (KDMP) authorization of the mine. Leeco subsequently advised the Corps that it intended to supplement its application on various issues, including avoidance and minimization, water monitoring, and mitigation.

Then, in June 2009, this was among 79 permitting actions that got caught in an “enhanced coordination process,” put together by the then-new Obama Administration to look at Corps permitting for this type of coal mining. That process involved the Corps, the U.S. Environmental Protection Agency and the Department of the Interior, which oversees the U.S. Office of Surface Mining. Leeco’s application was one that was recommended for additional coordination and review.

After engaging in this coordination process, Leeco submitted a revised permit application in July 2011. The revised configuration proposed construction of a single, large hollow fill and sediment pond. The new design would impact a total stream length of 18,268 linear feet, or 3.5 miles, reducing the original proposal’s impact by 4,593 linear feet.

In April 2012, the EPA informed the Corps it had no further concerns regarding the proposed project. In May 2012, the Corps completed its review. In its decision, the Corps found awarding the permit would “not significantly affect the quality of the human environment” and that, therefore, no environmental impact statement was required under the NEPA. The permit went into effect in July 2012. In October 2012, plaintiffs filed the present civil action.

Judge Thomas Russell found, among other things, that the Corps adequately addressed downstream water conductivity.

“Plaintiffs make a number of compelling and well-documented arguments,” the judge wrote. “Were the Court deciding the Permit issue in the first instance, perhaps its opinion would be different. However, under the highly deferential standard of review afforded to the Corps, the Court finds it did not act unreasonably. Though, as Plaintiffs’ arguments illustrate, reasonable minds could differ on many of the issues decided by the Corps, the Corps adequately analyzed the issues before it before issuing the Permit. Because the Court finds the Corps did not act arbitrarily and/or capriciously, Plaintiffs’ motions are DENIED and Defendants’ motions are GRANTED.”

James River Coal, the parent of Leeco, alluded to this case in its Aug. 9 Form 10-Q report: “In 2009, the EPA announced publicly that it will exercise its statutory right to more actively review Section 404 permitting actions by the [Corps]. In the third quarter of 2009, the EPA announced that it would further review 79 surface mining permit applications, including four of our permits. These 79 permits were identified as likely to impact water quality and therefore required additional review under the Clean Water Act. We abandoned three of our permits and the fourth was issued to us in July 2012. On October 17, 2012 two environmental groups filed suit against the [Corps] in the U.S. District Court for the Western District of Kentucky claiming that the [Corps] unlawfully issued the Section 404 permit to us because the [Corps] failed to perform an Environmental Impact Statement and failed to consider alleged adverse effects on human health and welfare from surface coal mines before issuing the Section 404 permit. The Section 404 permit and the outcome of this case, which cannot be determined at this time, are not material to our operations.”

Section 404 permits like these have been tough to get and to use in recent years due to multiple environmental group lawsuits and a get-tough approach to the Corps permitting process adopted by the Obama U.S. Environmental Protection Agency.

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.