Julie H. McConnell has successfully represented clients in litigation, enforcement and compliance matters in federal and state courts and before the Federal Energy Regulatory Commission (FERC). Her experience includes complex energy and environmental cases involving the Federal Power Act, the Interstate Commerce Act and the Clean Air Act, as well as disputes involving the Civil Rights Act, the Fair Labor Standards Act, public accommodations under the Americans with Disabilities Act and state accessibility laws, tort claims and contract claims. Read Julie H. McConnell's full bio.

In the United States, the federal Clean Air Act (CAA) requires all “major sources” of air pollution, such as power plants, refineries and other large industrial facilities, to obtain permits detailing the conditions under which those sources are allowed to operate. Such “Title V” operating permits, as they are commonly known, are typically issued by state environmental agencies but are subject to pre-issuance review by the federal Environmental Protection Agency (EPA). In fact, EPA is required to object to any proposed permit that it determines is inadequate, and the CAA also contains a public participation backstop to EPA’s oversight: where EPA fails to object to a permit, any member of the public that believes the permit is inadequate can petition EPA to make an objection.

In recent years, environmental organizations have increasingly used the petition process to challenge proposed permits, especially with respect to alleged inadequacies concerning greenhouse gas emissions. By statute, EPA is supposed to respond to such petitions within 60 days. But EPA routinely misses that deadline and now faces a sizeable backlog of pending petitions.

In late August, EPA published a proposed rule, which, if finalized, would create a series of new requirements for the submission and handling of Title V petitions. Most notably, the proposed rule would:

  • Create a new, mandatory, procedure for submitting Title V petitions to EPA;
  • Require each petition to follow a standardized format and contain certain minimum content; and
  • Impose a new requirement on state permitting agencies—a requirement that those agencies prepare written responses to all “significant comments” received from the public during the permit drafting stage.

EPA’s announcement of the proposed rule also includes a summary of EPA’s general approach to handling Title V petitions. The announcement includes, for example, a short summary of prior EPA applications of the CAA’s Title V provisions, as well as a list of “recommended practices” for state permitting agencies to follow when preparing proposed permits.

EPA is soliciting comments on its proposed rule. Comments must be received on or before October 24, 2016.

On July 1, 2016, the US Environmental Protection Agency (EPA) issued an interim final rule that modifies statutory civil monetary penalty amounts for statutes administered by the agency. EPA’s interim final rule, which becomes effective on August 1, 2016, implements requirements of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act) and, according to EPA, is designed to increase EPA’s statutory civil monetary penalties to reflect inflation – significantly, in some cases – and to ensure civil penalties maintain their deterrent effects. EPA has stated that its adjusted civil penalty amounts will not necessarily affect the process it uses to assess penalties or the amounts it will ultimately assess, but EPA’s adjusted statutory penalty amounts could result in significant penalties in some enforcement cases. In some cases, EPA now has authority to impose penalties of hundreds of thousands of dollars per day per violation.

Since 1990, the EPA, like other federal agencies, has been required to review and, as appropriate, to revise its statutory monetary penalty amounts every four years to account for inflation. In practice, however, certain agencies did not follow this quadrennial requirement. The 2015 Act provides that, beginning on January 15, 2017, federal agencies, including the EPA, will be required to provide for annual cost-of-living adjustments to their statutory penalty amounts to reflect inflation.

In the interim, however, the 2015 Act requires agencies to provide for initial “catch-up” cost-of-living adjustments for civil penalty amounts through their interim final rulemakings. The “catch-up” amounts may not, by statute, exceed 150 percent of the penalty amounts in effect on November 2, 2015.

Consistent with the 2015 Act and the Office of Management and Budget’s (OMB) February 24, 2016 guidance, EPA calculated “catch-up” amounts for over 66 statutory penalties and announced the adjusted penalties in Table 2 of the interim final rule. EPA’s new, adjusted statutory civil penalty amounts vary by penalty. For example, the interim final rule increases the previous maximum $37,500 per-day penalty for violating requirements of implementation plans or permits for affected sources, major emitting facilities, or major stationary sources under the Clean Air Act (CAA) to a maximum of $93,750 per day per violation. Similarly, the interim final rule increases EPA’s civil monetary penalty under the Clean Water Act (CWA) for oil or hazardous substance discharges – previously set at a maximum of $37,500 per day per violation – to $44,539 per day per violation.

The ranges of statutory civil penalties under Table 2 of the interim final rule are, by statute:

EPA-Administered Statute Range of Statutory Civil Penalties for Violations that Occurred After November 2, 2015 and Assessed on or After August 1, 2016
Clean Air Act $8,908 – $356,312
Clean Water Act $1,782 – $257,848
Comprehensive Environmental Response, Compensation, and Liability Act $53,907 – $161,721
Resource Conservation and Recovery Act $14,023 – $93,750
Safe Drinking Water Act $9,375 – $1,311,850
Toxic Substances Control Act $8,908 – $37,500

EPA can assess its adjusted penalty amounts on or after August 1, 2016 for statutory violations that occurred after November 2, 2015; parties should consult Table 2 of the interim final rule for guidance on penalty amounts for such violations. However, for statutory violations that occurred on or before November 2, 2015, or for violations that occurred after November 2, 2015 but for which EPA assesses penalties before August 1, 2016, parties should continue to consult EPA’s existing civil penalty amounts, located in Table 1 of 40 C.F.R. § 19.4.