Livestock Producers Must Evaluate Benefits and Risks of the EPA Air
Emission Consent Agreement
June 9, 2005
by Todd Palmer, Esq.
DeWitt Ross & Stevens S.C.
Operators of animal feeding operations have a big decision to make in
the summer of 2005 - whether to sign a Consent Agreement with EPA
to resolve their potential liability stemming from air emissions emitted
by their operations. The Agreement is now final and producers have until
August 12, 2005 to make up their minds whether they will sign the
document. Those who do sign will commit themselves to abide by the
results of future air emission studies and will likely be required to
obtain air permits from the WDNR as well as file reports with the EPA.
The ultimate decision should not be made lightly.
Background of the Final Consent Agreement
For nearly three years, activist groups have been suing livestock
producers alleging that their operations emit air emissions which
violate environmental laws. These lawsuits have been costly to defend.
Although these legal theories are novel, several courts have sided with
the activists and thereby have encouraged the proliferation of these
lawsuits throughout the country. A "copycat" legal
proceeding was threatened here in Wisconsin but was never filed.
In an effort to bring more clarity to the situation, representatives
of the livestock, hog and poultry industries have been working to get a
"safe harbor" agreement for air emissions from farms. These
negotiations are complete and the final Agreement was published in the
Federal Register on January 31, 2005. Producers must now make a decision
whether to take the safe harbor offered by EPA or "go it
alone" with these issues. Participation is voluntary.
EPA received numerous adverse comments on the Agreement and four
organizations have filed a lawsuit in the United States Court of Appeals
for the District of Columbia seeking to have the Agreement
nullified.
The Final Agreement and related information has been posted at www.dewittross.com/practice_areas
under the Environment practice area of the website.
Key Provisions of the Agreement
The Agreement is being offered to animal feeding operations
("AFOs") as defined under the Clean Water Act. AFOs which
choose to participate will pay a penalty ranging from $200 to $100,000
depending on the size and number of AFOs that the source operates.
Single farms that have less than 700 mature dairy cows or 1000 dairy
heifers must pay a $200 penalty. If a dairy producer owns more than one
farm, each farm with less than 700 mature dairy cows or 1000 dairy
heifers is assessed a $500 penalty and each farm with a greater number
of animals is assessed a $1,000 penalty. The maximum penalty any
producer must pay is $100,000. These penalties must be paid within
thirty (30) days of EPA executing the Agreement with the producer.
In addition to a fine, a participating producer must contribute to a
fund that will be used to develop and implement a national emission
study. Each producer must pay the lesser of $2,500 per farm or the
producer's pro rata share to fully fund the study for its group.
Participating facilities must make their operations available for this
national monitoring study.
Participating operations must agree to apply for all applicable air
permits and comply with those permit conditions as dictated by the
results of the monitoring studies. If emissions are large enough, the
source may be required to install pollution control technology which
can, in some circumstances, be rather costly. In addition, participating
AFOs agree to report any qualifying releases of ammonia, hydrogen
sulfide or other air contaminants as required by the CERCLA laws within
120 days after EPA publishes the emission estimating factors from the
national studies.
AFOs that participate in this Agreement will receive from EPA a
covenant not to sue for past violations of:
- The Clean Air Act permitting requirements associated with various
air pollutants which emanate from animal confinement structures and
agricultural livestock waste lagoons.
- The CERCLA and EPCRA hazardous substance reporting requirements
arising from releases of ammonia and hydrogen sulfide from the same
structures and lagoons.
Notably, this covenant would not prevent EPA from prosecuting cases
that "may present an imminent and substantial endangerment to
human health" or emissions from land application of animal waste.
The covenant would also not affect air permits required for new
construction or modifications of AFOs (i.e., facilities
undergoing expansion during the time period covered by the agreement).
The covenant would also not apply to: waste-to-energy systems;
generators; open cattle feedlots for beef production; and requirements
that are not triggered by the quantity, concentration or rate of
emissions of VOCs, H 2S, PM 2.5, TSP, PM 10, or ammonia.
It is uncertain whether the covenant not to sue would extend to
citizen suit actions (which could be filed by environmental groups) or
state enforcement actions.
Dairy May Not Be Allowed to Participate Under the Agreement
It remains uncertain as to whether the dairy industry will be
eligible to participate under the Agreement. Individual dairies can
apply to participate under the Agreement during the sign up period which
ends July 1, 2005. However, EPA has reserved the right to decide –
after the sign up period – whether a sufficient number of dairies
have applied to fully fund the associated monitoring study and provide a
representative sample base for developing emission factors. If the total
number of dairy participants is insufficient for either purpose, EPA can
refuse to finalize any of the individual dairy agreements and the
industry may not be allowed to participate.
Notably, the Agreement seems to be written such that the EPA could
chose to limit participation to a discrete geographic region or type of
dairy operation. Accordingly, Wisconsin or upper Mid-West dairies may be
able to participate if a sufficient number of operations from that
region sign the Agreement prior to the deadline.
Time Period for Making a Decision
To participate in this Agreement, the source must first determine its
eligibility. Eligible sources must fill out and sign the Agreement. The
signed Agreement must be returned to EPA prior to July 29, 2005.
No later than thirty (30) days after the end of the sign-up period,
EPA will decide whether to proceed with all, part, or none of the
monitoring studies and will sign the agreements. The signed Agreements
will be forwarded to the EPA's Environmental Appeals Board for
final approval. The pending lawsuit challenging the Agreement could
affect these deadlines.
Conclusion
Producers have much information to take in during a very short time.
However, many operators have known that this Agreement was coming. The
only uncertainty has been when the Agreement would become final and its
exact terms.
AFOs of any significant size or that have experienced local
opposition should seriously evaluate participating in this program.
However, there are many consequences of signing the Agreement which are
not readily apparent to the casually reader and which could profoundly
impact operators in the future.
From a practical standpoint, operations which choose not to
participate in the Agreement will still need to determine their
compliance obligations under the environmental laws. If those sources do
not use the emission factors developed by EPA, they will need to base
their decisions on some other emission-related information. There is
always the possibility that courts will ultimately decide that these
environmental laws do not apply to AFOs. But at this point, the
appellate courts that have considered the issue have ruled against
agriculture.
Agricultural/Agribusiness
Law Section
