Senators want documents from EPA in Mingo Logan Coal case

Sen. David Vitter, R-La., top Republican on the Environment and Public Works Committee, and Sen. Joe Manchin, D-W.Va., a member of the Senate Energy and Natural Resources Committee, sent an Aug. 29 letter to the U.S. Environmental Protection Agency about the always controversial Spruce No. 1 mine permit case.

The two senators wrote to EPA regarding its decision to revoke a Clean Water Act section 404 permit previously issued by the U.S. Army Corps of Engineers to the Mingo Logan Coal unit of Arch Coal (NYSE: ACI) for the 2,278-acre Spruce No. 1 strip mine in Logan County, W.Va.

Arch Coal won a U.S. District Court decision on an appeal of that decision, then lost at a federal appeals court, and is now pursuing the matter at the U.S. Supreme Court.

“EPA’s revocation came despite Mingo Logan’s faithful compliance with the permit’s terms, and the Corps’ position that permit revocation was not warranted,” wrote the senators. “We want the EPA to provide information on the circumstances that led to the agency’s extreme approach and also whether the Corps as the permitting agency supported EPA’s actions.”

In 2007, the Corps issued a Section 404 permit to Mingo Logan in West Virginia authorizing the company to discharge dredged and/or fill material into waters of the U.S. during mining activities. Two years later, the Corps rejected an EPA request for the Corps to suspend, revoke, or modify the issued permit. After being rejected by the Corps, EPA in 2010 claimed the authority to unilaterally revoke Mingo Logan’s permit under Section 404(c) of the Clean Water Act (CWA).

“In 2009, EPA alleged that ‘new information and circumstances’ justified the Corps’ reconsideration of the Section 404 permit and requested that the Corps ‘suspend, revoke or modify the permit issued’ to Mingo Logan,” the letter said. “The Corps declined EPA’s request because ‘there were no factors that currently compelled it to consider permit suspension, modification, or revocation.’ Likewise, in considering a contemporaneous third-party challenge to the Section 404 permit, a federal court recognized that EPA ‘[did] not provide substantial new information concerning the Spruce No. 1 permit.’”

EPA finalized its revocation of Mingo Logan’s Section 404 permit in January 2011. “EPA’s revocation came despite the significant resources Mingo Logan had invested in applying for and obtaining the Section 404 permit, the company’s faithful compliance with the permit’s terms, and the Corps’ position that permit revocation was not warranted,” the senators added.

The senators asked for the following information:

  • Any correspondence from EPA or Corps personnel questioning whether EPA had the authority to exercise 404(c) after the Corps issued the Section 404 permit.
  • Any correspondence from EPA or Corps personnel who expressed any concern over whether new information existed regarding the Section 404 permit.
  • Any correspondence from EPA or Corps personnel who expressed any concern over EPA’s decision to exercise 404(c) after a Section 404 permit had been issued.
  • Any and all correspondence from environmental groups or other third-parties urging or requesting EPA to utilize Section 404(c) for the Spruce No. 1 mine.
  • Any correspondence from EPA requesting that the Corps support EPA’s decision to exercise Section 404(c) after the permit had been issued.
  • Any correspondence from the Corps concerning whether to support EPA’s decision to exercise Section 404(c) after the permit had been issued.

Arch Coal plans to take its case to the Supreme Court

Arch Coal said in its Aug. 8 Form 10-Q report that it lost a bid to get a dispute over its Spruce No. 1 mine reviewed by a full appeals court and that it now intends to ask that the U.S. Supreme Court take up the matter.

In January 2011, the EPA issued its “Final Determination” under Section 404(c) to withdraw the specification of two of the three watersheds approved in the current Section 404 permit as a disposal site for dredged or fill material. By separate action, Mingo Logan sued the EPA in April 2010 in federal court in Washington, D.C. seeking a ruling that the EPA has no authority under the Clean Water Act to veto a previously issued permit.

In March 2012, the U.S. District Court granted Mingo Logan’s motion for summary judgment, denied the EPA’s cross-motion for summary judgment, vacated the Final Determination and ordered that the Section 404 permit remained valid and in full force.

In May 2012, EPA filed a notice of appeal to the U.S. Court of Appeals for the D.C. Circuit. On April 23, a three-judge panel of the appeals court reversed the district court on the threshold issue and remanded the matter to the district court to address the merits of Arch’s Administrative Procedures Act (APA) challenge to the Final Determination. On June 6, Mingo Logan filed a petition for rehearing before the full appeals court and on July 25 the court denied the petition. “Mingo Logan intends to seek further review of this case and will file a petition for writ of certiorari in the Supreme Court of the United States,” said the Form 10-Q.

Said Mingo Logan’s unsuccessful June 7 request for hearing before the full appeals court: “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. Congress gave the Corps the ultimate authority to grant, modify, or revoke permits, and the ultimate authority to decline to do so. This Court should not upend that regime on as slender a reed as section 404(c). Congress does not generally ‘hide elephants in mouseholes,’ Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001), and did not do so here.”