The Seward Phoenix Log - News of the Eastern Kenai Peninsula since 1966

By Fern Greenbank
LOG Editor 

Clean Water Act ruling overturned

Seward Coal Loading Facility at center of complex case

 

LOG File Photo

Aurora Energy Services operates a conveyor system that carries coal to waiting vessels. Coal has been falling off the conveyor belt into Resurrection Bay, sparking a lawsuit by environmental groups.

The Alaska Chapter of the Sierra Club and Alaska Community Action on Toxics are celebrating a victory after the Ninth Circuit Court overturned a lower district court ruling last week on allegations of Clean Water Act violations by Aurora Energy Services and the Alaska Railroad at the Seward Coal Loading Facility.

The appellate decision issued Sept. 3 by a three-judge panel, says the reversal was based on the type of permit governing the Seward Coal Loading Facility and the non-stormwater discharges allowed under the Multi-Sector General Permit for Stormwater Discharges Associated with Industrial Activity (MSGP). The environmental groups argued that coal is not a dischargeable pollutant covered under the facility's National Pollution Discharge Elimination System permit (NPDES).

Also at issue, does the shield protection afforded under the Clean Water Act apply in this case and others like it?

Also at issue, who's in charge, the Environmental Protection Agency or the Alaska Department of Environmental Conservation?

Also at issue, where is the balance between environmental concerns and commerce?

The case will be returned to the district court where there are a variety of options on the table. The defendants, Alaska Railroad Corporation (ARRC) and Aurora Energy Services (AES), can appeal the decision to the full 11-panel Ninth Circuit Court of Appeals. If they do not, the district court will address alleged violations and assign remedies that could range from nothing to additional permitting, new requirements and/or changes to the facility to stop coal from falling into the bay.

Alaska Railroad Corporation Chief Executive Officer Bill O'Leary said in a formal statement after the ruling that the railroad and Aurora Energy were not found liable for any violations of the Clean Water Act.

"Notably, this ruling represents a small portion of a much larger lawsuit, all of which was dismissed by the U.S. District Court and most of which was not appealed by the plaintiffs," said O'Leary.

Based on court documents, it appears the case is less about coal spilling into Resurrection Bay and more about regulatory powers on one hand and coal as an energy source on the other. The case pits the Environmental Protection Agency (EPA) against the Alaska Department of Environmental Conservation (ADEC) and has far reaching impact if the reversal stands, according to briefs filed on behalf of Aurora Energy and the railroad. The case also pits industrial business against environmental concerns.

The United States Justice Department stepped in on behalf of the environmental groups with its own amicus brief to argue for the Environmental Protection Agency's interests.

Reducing coal spillage from loading facilities is not the ultimate goal of the plaintiffs, Sierra Club and Alaska Community Action on Toxics. For years, the Sierra Club has been conducting a "Beyond Coal" campaign nationwide, which aims to eradicate all coal loading or coal powered facilities in the United States.

"We can't let up until we have stopped every single coal export facility," Sierra Club Executive Director Michael Brune has written. "Big Coal's window of opportunity is closing."

The Sierra Club is currently touting a "big victory" in Oregon where a permit was denied to a facility to build a coal export facility over concerns of migrant coal dust emanating from open railway cars.

Members of Alaska Community Action on Toxics have said in the past that closing down the Seward facility was not their goal. Rather, members said they just wanted Aurora Energy and the railroad to adopt measures that would eliminate coal dust and eliminate the possibility that coal could fall into the bay. But this directly conflicts with the position taken by the Sierra Club and Alaska Community Action on Toxics separate from this case. In the Sierra Club's press release following the reversal order, the executive director of Alaska Community Action on Toxics said the ruling spoke to a bigger issue.

"The latest developments in this case raise the larger question of why coal companies continue to push their dirty product overseas from Alaska," said Pam Miller, executive director for Alaska Community Action on Toxics. "Globally, coal prices are in decline and demand is dropping. It makes no sense to be a bad neighbor to Seward and threaten Alaskan waters for short-term gains."

Seward resident Russ Maddox, who is largely responsible for leading the charge to rid the bay of coal, said he is not optimistic about the lower court taking decisive action.

"We've been down this route before," said Maddox. He said winning at the appellate level doesn't guarantee the lower court judge will admit he was wrong and force Aurora and the railroad to get a permit for the discharge of coal and force them to take measures to eliminate coal dropping into Resurrection Bay.

Maddox said he knows the Sierra Club and Alaska Community Action on Toxics has a bigger goal in mind, ridding the country of coal as a fuel, but he reasserts that for Seward, he and others locally concerned about the impact of the discharge, just want to see Aurora apply new procedures and improvements to the facility.

"We want to see them enclose the conveyors," said Maddox.

Maddox said he also believes that total victory may not be achievable because the lower court district judges are political appointees and it just depends on who you get to hear your case. In the Seward case, Judge Timothy Burgess is felt by Maddox to lean in the direction of less government control over environmental issues.

While the Sierra Club and Community Action on Toxics are concerned about coal being used for any purpose, the EPA and the DEC argued the Clean Water Act case based on the way each agency interprets the permitting process. The EPA, say court filings, is changing its position, one held since the inception of the Clean Water Act, and accusing the DEC of improperly permitting in Alaska.

Because the attorneys aren't talking, citing "ongoing litigation," the court rulings and filed briefs do speak to the issues and each agency's position on them.

Although the defendants in the case are Alaska Railroad and Aurora Energy, the case boiled down to permitting; Aurora Energy's permits had been renewed with the knowledge that coal spilled from the conveyor belt into the bay and, on inspection, on multiple occasions, no violations were noted. The EPA attorneys argued in its plaintiff supportive amicus brief that the DEC improperly permitted and supervised the Seward Coal Loading Facility. DEC attorneys, on the other hand, argued that the EPA approved of the Seward Loading Facility method of operation for two decades and is only now changing its tune at the end of a long lawsuit.

Aurora Energy and the railroad's attorneys argued that a "permit shield" provision protects them from liability. The permit shield provision is in place to protect businesses from excessive litigation when it is in compliance with its permits. The shield applies when pollutants that are not listed in the permit are ruled not to be violations of the Clean Water Act if the discharges were disclosed to the permitting authority or the permitting authority reasonably should have anticipated the discharge. In this case, Aurora and the railroad argued that the EPA, and then the DEC, both knew coal was falling from the conveyor belts at times into Resurrection Bay. This scenario, they argued, triggers the shield provision.

"The soul issue on appeal is whether defendants' alleged non-stormwater discharge of coal from the Seward Facility's conveyor system and ship loading area into Resurrection Bay is covered by the General Permit," wrote Ninth Circuit Court Judge Jerome Farris.

Farris wrote that the list of non-stormwater discharges allowed under the General Permit did not include coal. He said the EPA explicitly refers to a finite and inclusive list of allowable discharges. Because coal is not an allowable discharge under the facility's permit, wrote Farris, the defendants were not shielded by the permit shield provision.

Attorneys representing the EPA, the DEC, Aurora Energy Services and Alaska Railroad did not return calls. Lorali Simon, vice president for external affairs for Alaska Railroad Corporation did issue a short statement.

"We are very disappointed in the decision and are taking time to evaluate our next steps,"said Simon.

 

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