News

Plaintiff Won’t Drop TVA Tree Suit, Despite Concessions

Plaintiffs suing the Tennessee Valley Authority over its tree-clearing policies won’t back off their fight, despite TVA promises to stop applying the policy, Knoxnews reports. Attorney for the plaintiffs Don K. Vowell filed a response Wednesday in U.S. District Court requesting that the TVA explain what policy they will use instead of the old one. The controversy centers around TVA’s “15-foot-rule,” in which any tree in a transmission line right of way that could grow over 15 feet is deemed a potential threat to the line and should be removed.
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Symposium Looks at Aftereffects of Wildfires

Experts in risk management, environmental impacts and the law gathered at a wildfire symposium Thursday at Lincoln Memorial University's Duncan School of Law in downtown Knoxville. WBIR reported that much of the discussion focused on November's deadly Sevier County wildfires, which left 14 people dead and damaged or destroyed some 2,500 structures.

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No Further Action Letters; Know Their Limitations

As most of you know, the Department of Environment and Conservation has, on a historical basis, utilized “no further action” letters to acknowledge and document the Department’s determination that it will not require a liable or responsible party [1] to take further environmental response action at a site. Before the amendment to the voluntary oversight and assistance program statute (T.C.A. §68-212-224) in 2001 that authorized the Department to enter into brownfield voluntary agreements and brownfield consent orders, a “no further action” letter was the established method that the Department could provide any comfort or assurance that a party had taken the appropriate action at a contaminated property.

But how comforting or assuring is a “no further action” letter? Environmental practitioners can read a typical “no further action” letter and understand that it has limited effect. “No further action” letters typically contain cautionary language to the effect that if additional information should be discovered concerning the site, the Department reserves the right to reevaluate the no further action status of the site. I counsel clients and other parties that a “no further action” letter is simply an “administrative closure” and is limited in effect. It is not a contractual commitment, and it does not commit the Department to any course of conduct. Another potentially limiting effect of a “no further action” letter is that it may be issued to address a specific action undertaken in a limited area of a contaminated site. In simplest terms, a “no further action” letter cannot be read as indicating that the property has no other environmental conditions or that no additional environmental response action will be required.

Despite the limitations of a “no further action” letter, they do serve to reduce the risk for a property owner or a prospective property owner. And like many of you, I have been involved in real estate transactions where a “no further action” letter was one of the conditions of closing. However, many people associated with real estate transactions do not appreciate the limitations of a “no further action” letter—they assume that a “no further action” letter provides a promise that no additional environmental response action will be required at a property.

How a “no further action” letter can be misunderstood can be observed in the following scenario. An owner of a gasoline retail store decides to sell the property to a drug store chain. The store owner removes the underground storage tanks, and in the process, petroleum contamination is discovered. Some soil removal work is completed, and a “no further action” letter is issued by the Division of Underground Storage Tanks following a review of sampling results. As is the typical case, some contamination remains at the property. The drug store acquires the former gasoline retail store property and the neighboring parcel (from a separate owner) for the development of a drug store. As the drug store chain starts site work, they are advised that the remaining contamination at the property will complicate the site work (a substantial amount of soil “cutting” work was required to level the construction site). Both parties to the contract were surprised by the effort that was going to be required to deal with the remaining petroleum contamination at the site, and a dispute developed as to the extent to which the drug store chain would be entitled to an adjustment of the purchase price established in the contract.

In this scenario, the parties simply did not fully understand the effect of the “no further action” letter. They assumed that the “no further letter” would lead to little complication of the site work associated with the construction of the drug store. The parties may have been warned about the effort that would be needed by language found in the “no further action” letter. That language, found near the end of the “no further action” letter, provided that “if soils are excavated and removed from the UST site for use at another location, then the Division of Solid Waste Management must be contacted regarding the proper disposal and/or use of those soils.”

If the use of property was going to remain the same (gasoline retail store), then there would have likely been little impact on the site work. However, in this situation, the property was going to be used for a different commercial purpose. A separate property (not associated with the former underground storage tank site) was being incorporated into the development, and the existence of contaminated soils on the former underground storage tank site limited, without the Department’s approval, the use of the contaminated soils on the other property. In addition, any contaminated soils not required for the site work associated with the drug store had to be treated as waste and transported for disposal at a permitted disposal facility.

What is the lesson? Despite their accepted use, “no further action” letters do present some level of risk and uncertainty. As long as everyone involved in a particular transaction or remediation effort appreciates that risk and uncertainty, then “no further actions” letters will continue to have a part in many responses to environmental conditions at a site.


[1]For purposes of this article, when I refer to a “responsible party,” I do not necessarily mean a party that is or may be liable under federal and/or state law for an environmental condition at a property. I refer also to a party (such as a prospective purchaser or innocent purchaser) who may voluntarily undertake environmental response actions in order to put a property to beneficial use.


— Randall B. Womack practices with Glankler Brown PLLC in Memphis

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Thanks To Our Sponsor

Geosyntec is a specialized consulting and engineering firm that works with private and public sector clients to address new ventures and complex problems involving our environment, natural resources, and civil infrastructure. 

For more detailed information, visit the Geosyntec website.

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Winning The Brownfields Gambit

Urban landscapes in most cities show the pockmarks of long-gone industry in the form of derelict buildings, silent factories, and fenced vacant lots fenced. These properties tend to cause several problems for their host communities ranging from lost tax revenue to havens for the homeless to convenient locations for illicit transactions. Transforming these properties is not for the faint of heart; however, buyers and sellers who understand Brownfields regulations and the costs and liabilities associated with the environmental management of old industrial sites can achieve successful redevelopment and reasonable return on their investment. Multi-party “win” outcomes should be the goal of every Brownfields project with favorable outcomes for buyers, sellers, cities, and the general public. As more communities work toward revitalizing areas fallen into disuse and developers recognize the value of these latent real assets, attorneys will see increasing opportunities to support buyers, sellers, communities, and lenders both directly and in collaboration with environmental consultants and constructors.

Brownfield Redevelopment

Since many Brownfields properties exist in desirable locations, putting the land back into productive use is a high priority for federal, state, and local governments. The United States Environmental Protection Agency (USEPA) and most states, including Tennessee, have Brownfields programs that encourage redevelopment of these properties because of the positive impacts to the local communities.

The Small Business Liability Relief and Brownfields Revitalization Act (a.k.a the Brownfields Law) set up a grants program administered by the USEPA for the purpose of assisting communities, states, redevelopment agencies and other quasi-governmental agencies set up by local or state governments, regional councils, tribes, and land clearance authorities in real property revitalization. Specific areas available for grant funding include assessments, revolving loan fund grants, cleanup grants, Brownfields area-wide planning programs, and environmental workforce development and job training grants. Assistance for private developers is limited; however, in certain cases municipalities and counties may be willing to make special provisions to assist high value developments. Tax increment funding, new market tax credits, rezoning, and local infrastructure improvements that aid the development are ways the public may choose to help a private developer.

The State of Tennessee offers technical assistance to prospective buyers and sellers of Brownfields properties through the Tennessee Department of Environment and Conservation (TDEC). Key outcomes from involving TDEC early include a greater degree of engagement by TDEC in the project’s success, early guidance on cleanup requirements, metrics for declaring the site either clean or adequately managed to allow development and reuse, and avoidance of consent orders and other state mandated actions which often complicate the cleanup process. TDEC also controls another critical piece in the Brownfields redevelopment process — the “No Further Action” letter. From a lender/investor perspective, no further action eliminates from the project’s financial strategy a hard to understand and difficult to estimate liability.

A Brownfields Voluntary Agreement (BVA) involving the new owner, sometimes the previous owner who has responsibility for environmental conditions predating the sale (or lease), and TDEC is negotiated. The BVA offers an innocent owner liability protection for real or perceived contamination; protection for third party contributions; and concurrence from TDEC’s regulatory experts that a property is safe for future planned uses.

The process of taking a potentially contaminated site from a state where it is unfit for reuse to a condition that allows either unencumbered or restricted reuse can take several paths that are best navigated with the help of an attorney and an environmental consultant including: (i) the party responsible for site contamination assesses and remediates the site under TDEC guidance through the Voluntary Cleanup, Oversight, and Assistance, Program, or a consent agreement; (ii) the responsible party and the buyer negotiate a BVA with TDEC to articulate the seller’s responsibility and the buyer’s lack of responsibility for existing environmental issues with the seller retaining liability; (iii) the buyer seeks a BVA with TDEC, independent of the seller, and based on his own due diligence; or (iv) working with or without a BVA, a savvy buyer may estimate the cost to remediate a contaminated site, negotiate a reduction in the sale price, and conduct the cleanup himself.

Once TDEC has determined the site to be clean or remediated to the extent practicable, TDEC may issue a “No Further Action” or “Action Complete.” Caveats may accompany the letter such as: (i) “No further action at this time” allows remediation activities to cease but the case is left open so TDEC can require additional actions if conditions change; and (ii) “No further action at this time with long term monitoring” statements issued for sites where remediation was unable to fully cleanup the site but risk assessments indicated that potential exposures to residual contamination are acceptable with long term monitoring in place to assure that exposure risks remain acceptable.

For those sites where residual contamination persists but not to an extent that would prevent certain reuse plans, a Soil (or Environmental) Management Plan defines how contaminated media on the property will be handled. This critical document should be written with an eye toward constructability, flexibility in disposal options, cost implications, and protection of workers and the public. The important point for the developer is to recognize early on that contaminated soil, possibly contaminated surface water or groundwater, and vapor mitigation can impart significant costs to the project.

Case Study

Readers familiar with the University of Tennessee may recall the old Fulton Bellows factory situated on Kingston Pike between the Agricultural Campus and the Main Campus. Metalworking and foundry operations were the principal activities conducted at that property from at about 1917 until 2005. At one time the factory lead the world in metal corrugation and precision welding technology while employing hundreds of workers. However, time and technological advances bypassed the factory until all that was left was the environmental legacy of soil and groundwater contamination. The property owner set out to carefully characterize site contamination and understand how to best manage the environmental liability associated with this surplus property. Following detailed site investigations, focused remediation, and demolition of buildings down to the slabs, TDEC agreed that environmental conditions could be managed through administrative controls, proper environmental health and safety and worker notification procedures, and mitigation measures for potential vapor intrusion. 

TDEC-approved land use restrictions (LUR) were finalized for the property and recorded with the deed. Additionally, a BVA was achieved for the site. The LURs imposed requirements for any future development of the property and these were reiterated without modification in the BVA and included:

1.     At the completion of property redevelopment, soil should remain covered to the current extent to limit infiltration of precipitation and potential contaminant leaching to groundwater.

2.     Certain activities (e.g., installation of foundation elements and utilities) may require contact with soil and groundwater that may be contaminated. These activities must be conducted under a TDEC-approved Environmental Health and Safety Plan that describes how workers, the public, and the environment will be protected from potential contamination and how soil and groundwater will be managed to prevent environmental releases. 

3.     The LURs indicated that future occupants of the site must be protected from potential exposures to vapors emanating from the soil. The purchase agreement further clarified this requirement by stating that an area with known high soil vapor concentrations would not have ground level occupied space (this area was used as a parking area below second story retail space, i.e., not enclosed space and, therefore, compliant with the requirement). Ground level enclosed/occupied space was allowed elsewhere on the property with an active vapor mitigation system installed beneath the floor to eliminate potential vapor intrusion into the buildings.

The property which had achieved “no further action at this time with long-term monitoring” was sold to a buyer who met the seller’s criteria for understanding the environmental liabilities of the site. The purchase agreement contained provisions aimed to protect the seller from acts of negligence by the buyer that could exacerbate environmental liabilities and the buyer from existing contamination that remained at the site. The buyer engaged an environmental attorney and shared the seller’s environmental consultant to finalize the BVA; prepare the Notice of Intent to Develop, Health and Safety, and Environmental Management Plans; and preserve knowledge of environmental conditions by linking the environmental consultant to the property rather than either the buyer or the seller.

The project, known as University Commons, was a private Brownfields development and; therefore, not eligible for any federal Brownfields funding. However, the City of Knoxville recognized the value of the development and contributed to the success of the project through the creation of a Redevelopment Area, Tax Increment Financing  valued at $10M, New Market Tax Credits of $15M, modifications of zoning and parking requirements, and $1.5M in capital funds for the purpose of assisting with public infrastructure to the site including a bridge and traffic signals.

Complications from the site environmental conditions increased the development costs by approximately $2M and included: (i) 3,500 cubic yards of soil disposed under a special waste permit at a subtitle D landfill; (ii) proper off-site disposal of over 800,000 gallons of contaminated groundwater produced during foundation installation; (iii) onsite health and safety oversight to protect workers from potential exposures to contaminated media; and (iv) design and installation of a vapor mitigation system beneath all ground level occupied space.

In spite of considerable risks, the care exercised by the seller and buyer and assistance from the City resulted in a project where the seller received a good price for the property, the developer successfully transformed the property into a profitable development, and the City gained a new source of tax revenue and a base for additional economic development in the area. The project created more than 620 construction jobs during the 18 months of construction. Among a big box retailer, a large grocery store, and the numerous smaller businesses occupying the site, over 1,080 permanent service and retail jobs have been created. The annual community payroll impact has been estimated at approximately $50M.  The total economic impact to the area is estimated to be more than $220M annually. This project demonstrates the value to all involved parties of a well-conceived Brownfields redevelopment project that starts with a responsible seller, a committed developer, and a City willing to cooperate and assist.


 — Duane Graves, Geosyntec Consultants Inc.

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Registration Now Open: Environmental Show of the South

Make your plans now to attend the Environmental Show of the South scheduled for May 17-19 at the Chattanooga Convention Center. The CLE portion of the program, sponsored by the TBA Environmental Law Section, will focus on updates on government/industry developments and trends, with a particular focus on solid and hazardous waste issues. 

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USEPA Under The Trump Administration: What Will Happen When Reality Hits...

With all the controversy surrounding the election of Donald Trump as our president and his promise to roll back environmental regulations, specifically, the Clean Water Act and the implementation of regulations, I offer the following analysis regarding what is likely to unfold. What will happen when reality sets in?

I predicate this note by saying I have spent over 40 years working with regulatory issues ranging from obtaining environmental permits for farm ponds to nuclear power plants. These years include the better part of a decade working as a senior scientist for a federal agency, serving on U.S. Environmental Protection Agency (USEPA) committees establishing water quality criteria, peer reviewing USEPA research grants, and managing USEPA-funded research. The other 30+ years were spent in the private sector working with the same regulatory issues. In summary, I have had “up close and personal” experience with USEPA and other federal regulatory agencies – how they work and how they have changed and how they have reacted to political dicta. First, I share with you the experience of a noted USEPA scientist regarding his experience with employee activism within his agency.

Almost a quarter century ago a retired USEPA scientist published a chapter in a book titled Predicting Ecosystem Risk[1]. Dr. Donald Mount was a highly respected USEPA scientist among his federal agency and academic peers, and I knew him through various interagency meetings and task force groups while serving as a senior scientist for TVA back in the 1980s. In his paper, written following his retirement, he attempted to answer the question of “What evidence of ecosystem risk is necessary to influence regulatory decisions?” I remember the paper well and it has stuck with me all these years because he addressed, head on, the role environmental activism and lack of accountability played in biasing the decision-making process by USEPA regulatory staff during his tenure. What is so remarkable about his analysis is that it is just as valid, maybe even more so today as it was then; not just at USEPA, but other federal agencies involved in environmental decision making. The following is taken from the section of his paper titled, “Accountability”:

As my time in USEPA grew to 30 years of service, I became more and more impressed with the role of relatively low level staff in shaping decisions of widespread geographic scope and even policy. Because bias does play such a decisive role in decision making, motivated individuals can wield untold power in shaping regulatory action. The list of decisions that were so shaped would fill volumes.

There is almost no need to observe that the motivated individual is the key to the power that environmental activist groups hold. Such people, whether in public agencies or in pressure groups, rely heavily on the saying “You cannot unring a bell”. We are fortunate to have had the 1970 Earth Day era. Without it, cleanup in the United States might not have happened or might have been slowed to a snail’s pace. The power of “the motivated individual” is clearly present in regulatory agencies as well. These people probably chart the agency course and set policy to a greater extent than the policy makers themselves.

More directly, with regard to accountability, a careful study of who really makes most of the environmental decisions would reveal a characteristic about the decision maker not generally appreciated. Most of the day-to-day decision making is performed by mid-level to entry-level staff in regulatory agencies who will feel no direct effect of the decisions made. They are almost totally insulated by management from the consequences. The end result of this situation is that the individual making the decisions feels no true responsibility for the consequences of the decision. Many times I have discussed with such folks their actions. Their response showed how detached they themselves felt from the impact of the decision. To them they had a mandate, given or self-imposed, to be as hardnosed on dischargers as possible and “By God that is what they were doing.” When that happens, management and nominal decision makers fell (sic) frustrated and out of control. They then spend all their energy on the defensive, protecting the policy they get locked into and never really decide if the decision is correct.

The accountability issues involved here are not unlike a politician making decisions — but, a politician who never has to face re-election! I hope, as environmental decision making matures and more experienced staff emerge, that this lack of accountability can be corrected. If it can be, the United States will move to a much more lofty plateau of sophisticatio — a benefit to the environment for certain.

My experience mirrors that of Dr. Mount. Unfortunately, his hope that these issues would be corrected has not turned out to be the case. Environmental activism is rampant within today’s regulatory world, so for those who are looking to the Trump administration to rein-in USEPA regulators, don’t count on it. What you are more likely to see is an increase in conflict among agency personnel, i.e., politically appointed upper management may change policy but getting the white collar lower level career management to carry it out will not go smoothly[2]. Neither will all state environmental agencies follow USEPA’s lead; remember that in enacting the Clean Water Act, Congress purposefully allocated varying levels of regulatory and enforcement responsibility to the states. When you consider this, along with the fact that local and national environmental activist groups will challenge any attempt by USEPA to weaken or avoid compliance with the federal Clean Water Act, the likely outcome, at least in the beginning, could easily result in regulatory chaos and increased litigation. Where things go from there is anybody’s guess, but I would bet that USEPA will survive.


[1] Predicting Ecosystem Risk (Advances in Modern Environmental Toxicology) by John Cairns (Author), B. R. Niederlehner (Author), David R. Orvos (Editor) Specialist Journals (June 1992).

[2] EPA employees are represented by the American Federation of Government Employees Council 238, a union that represents thousands of EPA employees. “People are upset. Some people took the day off because they were depressed,” said John O’Grady, president of American Federation of Government Employees Council 238. After Election Day, “people were crying,” added O’Grady, who works in EPA’s Region 5 office in Chicago. “They were recommending that people take sick leave and go home.” http://www.eenews.net/stories/1060045642

Richard C. Young is a consulting natural resource scientist in Nashville, TN. 

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Message From the Chair

With the transition of administrations, it is clear that there will be significant shifts in federal environmental and energy policies. While the political climate regarding environmental regulation may be uncertain, I am encouraged by companies that continue to push forward with sustainable practices and scientists and concerned citizens who work tirelessly to solve our global environmental problems from cleaning up our air, land and water to pushing for clean energy to heat our homes and drive our transportation needs.

This January, we held our annual 2017 Environmental Law Forum. Topics included land redevelopment and remediation considerations in commercial real estate transactions, an update on solar power initiatives, and security considerations in an evolving legal market. Thank you to our speakers, who shared a wealth of information as experts in their fields. If you were unable to attend, but would like to view the programs, the videos will be available soon online at TBA.org. As always, our section's goals and purpose include promoting dialogue among environmental agencies and practitioners, staying abreast of emerging legal trends, and promoting legal education on a variety of environmental issues.

I encourage our members to stay connected and involved in section events. This spring TDEC's annual Environmental Show of the South will be held in Chattanooga and there will opportunities for education and socializing among our members. Please make plans to attend!

Willa B. Kalaidjian of Chambliss Bahner in Chattanooga is chair of the TBA Environmental Law Section

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Gas Pipeline Company Sues Metro Nashville

The company behind an embattled $124 million gas compressor filed suit against Metro Nashville on Friday, the Nashville Post reports. In addition to the lawsuit, the Tennessee Gas Pipeline Co. also asked the federal district court in Nashville for an injunction after the Metro Nashville Council passed ordinances that would hinder the company’s ability to begin construction. In both filings, the company argues Metro's regulatory purview is subordinate to that of the federal government.
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TBA Mashup and Mini Legal Hackathon this Friday

In conjunction with the Law Tech UnConference CLE this Friday, the TBA is also offering a variety of free events and programs for lawyers we’re calling a Mashup. One program will teach you about Legal Hackathons and see one in action. A Legal Hackathon is a collaborative effort of experts in the legal profession collaborating with a computer programmer to find a technology assisted solution to a problem in the legal industry. Join the TBA Special Committee on the Evolving Legal Market for a mini legal hackathon that will demonstrate the power of collaborative minds at work. We will have tasty beverages and snacks to help you get your collaborative juices flowing.  
 
Other programs that will be a part of the Mashup include Pro Bono In Action which will show you various pro bono programs you can participate in to help your fellow Tennesseans and Member Benefit Programs that will provide you information on  Fastcase 7, health insurance options for small firms, ABA retirement funds and professional liability insurance.
 
Please sign up now to let us know you are coming.

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Lawmaker Requests AG Opinion on Parks Privatization

Tennessee Sen. Janice Bowling, R-Tullahoma, has requested an opinion from Attorney General Herbert Slatery III on whether Gov. Haslam’s plans to privatize hospitality services at parks violate state procedures. The Times Free Press reports that Bowling, whose district includes the Falls Creek Falls state park, asked for the opinion at the request of park employees.
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Federal Clean Water Lawsuit Against TVA Set for Pretrial Motions

The Nashville Scene has an in-depth cover story about the lawsuit against the Tennessee Valley Authority (TVA), which is set for pretrial motions next week in U.S. District Court. Judge Waverly Crenshaw will hear the suit, which centers around the Gallatin Fossil Plant, located on the banks of the Cumberland River, and the way TVA stores the facility’s toxic coal ash byproduct. Environmental groups are concerned about potential contamination to the Cumberland and the area surrounding the site.
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Have You Heard About the TBA Mashup?

Interested in observing a legal hackathon or getting a hands-on demonstration of the new Fastcase 7 platform? Both will be part of the first TBA Mashup, a full-day of activities and free programming set for Feb. 17 at the Tennessee Bar Center in conjunction with the annual TBA Law Tech UnConference CLE program.

In addition to the hackathon and Fastcase 7 demo, the TBA Mashup will feature sessions on: 

  • Current State of Health Insurance for the Small Firms
  • Professional Liability Insurance - What to look for in YOUR Policy
  • A Demo of Fastcase TopForm, a powerful bankruptcy filing software
  • Retirement Planning Guidance from the ABA Retirement Funds
  • Pro Bono in Action: How to help with pro bono events and how to take part in online options

At the annual TBA Law Tech UnConference CLE program, you can take as many or as few hours as you need. Registration will be open all day. Payment will be determined at checkout based on the hours you need. Topics will include: 

  • Bill & Phil Tech Show
  • Ethical Considerations for Cyber Security in Law
  • Evolution of the Legal Marketplace
  • Making e-Discovery Affordable 
  • Drone Law
  • Encryption for Lawyers

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Environmental Law Writing Competition Underway

The TBA Environmental Law Section has announced the 10th annual Jon E. Hastings Memorial Award writing competition for law students enrolled in a Tennessee law school in 2016 or 2017. The competition is held in memory of one of the section's outstanding founding members and has a cash prize pool of $1,200. It is a juried competition for the best legal writing on a topic of Tennessee or federal environmental law. Entries are due by April 1. The competition rules and announcement are available here in downloadable format.

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Did Government Err in Oregon Occupation Case?

Seven defendants were caught on camera taking over and occupying an Oregon wildlife refuge, many with guns, yet last week a jury acquitted all of them on weapons charges and conspiracy to intimidate federal workers. Many in the legal profession are wondering how that happened, Today's General Counsel reports. One juror offered his thoughts to the Oregonian: “All 12 jurors felt that this verdict was a statement regarding the failure of the prosecution to prove ‘conspiracy’ in the count itself – and not any form of affirmation of the defense’s various beliefs, actions or aspirations.” An opinion piece in the Los Angeles Times suggests the verdict should remind the U.S. Justice Department that a case, and a conspiracy, that might seem obvious to a prosecutor, is not necessarily obvious to a jury.

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Bundy’s Lawyer Tasered, Arrested after Acquittals

The lawyer representing Ammon Bundy was shocked with a Taser, tackled and arrested after he objected to his client’s continued detention after a jury last week acquitted Bundy and six others of occupying a wildlife refuge in Oregon. The judge in the case refused to release Bundy after the acquittal, saying there is a U.S. Marshal’s hold on him due to a pending federal indictment in Nevada. Bundy’s lawyer, Marcus Mumford, yelled at the judge and struggled with marshals while continuing to argue his client should be released. The ABA Journal has the story and links to other media coverage.

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Judge Approves $15B Volkswagen Settlement

A federal judge has approved one of the largest consumer settlements in U.S. history, a nearly $15 billion deal that sets in motion a massive vehicle buyback program and environmental remediation effort. According to the Tennessean, U.S. District Court Judge Charles Breyer approved the sweeping agreement between consumers, the government, California regulators and the German automaker Volkswagen. The settlement comes about a year after the company admitted rigging 11 million vehicles worldwide with software designed to evade emissions standards. The company is still facing investigations by the U.S. Justice Department and German prosecutors, which could lead to additional financial penalties and criminal indictments. Those impacted can visit VWCourtSettlement.com for more information.

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Registration Now Open: Environmental Law Forum 2017

Make your plans now to attend the Environmental Law Forum 2017 scheduled for Jan. 26 at the Tennessee Bar Center in Nashville. The program, sponsored by the TBA Environmental Law Section, will touch on transactional liability, redevelopment issues, environmental considerations in real estate and updates in solar power and energy. 

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Thank You To Our Sponsor

Burr & Forman’s environmental team provides advice and services, including litigation, associated with all aspects of environmental law. Our attorneys seek to assure compliance with statutory and regulatory requirements, and we help clients avoid and defend against enforcement actions and litigation before regulatory agencies and in court. We are intimately familiar with the applicable state and federal statutes, regulations, and applicable case law. In addition, we are very familiar with state and federal enforcing agencies and their personnel.

 

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Creative Settlement Solution Partnership in Bristol Results in Improved Livability

From the largest college football venue, to a country music museum, to the world’s fastest half mile, Bristol is a city in Northeast Tennessee that values its roots while expanding on future possibilities. Although there are many positives, Bristol, like any city, also faces some negatives, including local regulated industries violating state permits and being subject to enforcement.

Steven Stout, an attorney with the Tennessee Department of Environment and Conservation’s (TDEC) Office of General Counsel (OGC), used a bit of creativity to develop a positive solution in the negative context of an environmental enforcement action that matched financial settlement resources to those who needed and deserved it most in Bristol. Then, he was able to rely upon the expertise, resources, dedication, and enthusiasm of the TDEC Office of Energy Programs and the Office of Sustainable Practices through the Bristol city government to deliver needed support to affected residents in Bristol.

TDEC and EPA entered into a settlement of air pollution regulatory violations against King Pharmaceuticals LLC (King), which operates a pharmaceutical manufacturing plant in Bristol, in August 2013, through a Consent Decree in federal court (United States of America and the State of Tennessee v. King Pharmaceuticals, LLC , E.D. Tenn. Civil Action 2:13-cv-00178). King was a wholly-owned subsidiary of Pfizer Inc. Just a few months before the Consent Decree was finalized, the plant was sold to another company, UPM Pharmaceuticals Inc., which continues to operate the plant in Bristol.

The state project, which is similar to an environmental mitigation project and a supplemental environmental project, was envisioned by Stout who represented TDEC in negotiation of the Consent Decree in conjunction with the Tennessee Attorney General’s office.

The 2011 Clean Air Act settlement with the Tennessee Valley Authority (TVA) had provided the genesis for the state’s Clean Tennessee Energy Grant (CTEG) program. Through experience in working with the Office of Sustainable Practices in the development and administration of CTEG, Stout was aware of demonstrated cost-effective benefits of grants to promote energy efficiency and conservation measures to reduce emissions from generation of electricity. With this in mind, Stout researched and discovered an existing program in the City of Bristol that provided housing repair assistance to economically disadvantaged homeowners.

In designing the settlement, Stout envisioned deserving applicants in the existing Bristol program being served through funding from the settlement. Home energy audits would determine opportunities for energy saving investments, and the geographic scope was limited to Bristol with a particular focus on the one mile radius around the King plant. The residents in the immediate area of the plant were the most impacted from excess emissions above permitted levels resulting from the violations included in the Consent Decree.

As hoped, TDEC was able to partner with Bristol and its existing program. The advantage of using the existing city program was that it provided the applicants who needed help and was a ready-made group of people to be targeted for support under the King Consent Decree funding.

On June 3, 2014, a kickoff ceremony was held for the Bristol Energy Efficiency Assistance Program in the community at Anderson Park adjacent to the former King Pharmaceuticals, LLC building. TDEC Commissioner Bob Martineau presented the check to city leaders as TDEC committed settlement funds to complete homeowner energy efficiency improvement measures under the Consent Decree. The scope of work consisted of replacement of windows, doors, insulation, heating and air systems, refrigerators, and electrical upgrades. The program was designed with strong evaluation, measurement, and verification elements to allow it to provide data regarding residential energy usage in the area over time.  As part of this program, Energy Star certified light bulbs were also offered to program participants.

TDEC’s Office of Energy Programs’ Angela McGee and Office of Sustainable Practices’ Jan Compton worked in partnership to oversee the program’s implementation process and to serve as technical advisors to Bristol throughout the project. There were several challenges such as changes in personnel. But, ultimately the project was too important to not continue.  Bristol Community Development Specialist, Donna Malone, came on board for Bristol and was instrumental in organizing the residential projects through contractor bids and oversight, customer focused service, and coordination with TDEC.

Malone was popular with the residents and determined to complete her daily tasks due to the influx of calls concerning when the project would be started. The city had secured qualifying residents to participate in the energy efficiency upgrades through public meetings and forums.  Applications had been distributed months earlier to determine if the customer met the requirements of income level, home ownership, and location within one-mile of the King Pharmaceutical LLC building.

Bristol Tennessee Essential Services provides electrical services to the area and participated as a crucial partner on the project by providing energy audits to each of the qualifying applicants to establish need and eligibility for energy efficiency and conservation improvements to be provided. While personnel challenges caused a delay in the contract work beginning, ultimately homeowners were rewarded with quality work from participating contractors allowing for each home to be more energy efficient.

Residents were interviewed during site visits while the contract work was in progress at each home as well as after completion of the work.  The two primary contractors, Associated Builders and Redpoint LLC, received high accolades for their work, customer service, professionalism, and dependability from all homeowners participating in the program.

Not only were environmental benefits gained from the energy efficiency projects, other environmental and health benefits will be recognized over time. For example, some homes did not have HVAC units and residents were struggling in extreme heat and cold conditions to adequately control the temperature in their home before the needed upgrades. In addition, residents were able to discontinue the use of wood and coal stoves and kerosene heaters, which have direct negative air quality and human health effects.  

At the close of the grant contract on June 30, 2016, 47 homes benefited from this program and the entire budget of $630,000 was spent. The deserving and grateful recipients included people with intellectual disabilities, blind individuals, single parents, cancer patients and others. This collaboration between Bristol, local contractors, and TDEC’s Office of General Counsel, Division of Air Pollution Control, Office of Energy Programs and Office of Sustainable Practices is an example of how TDEC works daily to serve the people of Tennessee and to carry out its environmental mission.


— Jan Compton serves in the Office of Sustainable Practices for the Tennessee Department of Environment and Conservation

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Message From The Chair

I am excited to serve as Chair of the Environmental Law Section for the 2016-2017 year and look forward to another great year with the Section. I want to extend a special thank you to Darlene Marsh for her leadership and contributions to the section this last year as chair and to the others in our section who contribute their time and energy to the activities and events organized each year. Participation in this section has exposed me to a wealth of resources and expertise that has broadened my knowledge of environmental matters and inspired my practice of law.

We are already busy planning the annual January CLE, to be held in Nashville on Jan. 26. Please save the date and we look forward to providing more information on our speakers and topics in the coming weeks. We welcome attendance and involvement from our members and those who practice in other areas of the law, interested in learning more about environmental legal issues.

This coming year has numerous opportunities for Section members to get involved. If you are interested in presenting or serving on a CLE panel, there are opportunities both through the January CLE and the annual TDEC Solid Waste Conference, which will be held this spring in Chattanooga. Our newsletter is an important way that we connect with our members and share emerging and relevant environmental issues. We are always looking for articles from our members and sponsors of the newsletter. If you have written on an environmental topic recently for a client, presentation, or other publication, we encourage you to submit your article for publication in our newsletter. Sponsorship of the newsletter provides an opportunity to reach our broad membership and supports the Section's annual John Hastings Memorial Writing Competition and other outreach activities throughout the year.

I look forward to working with the Environmental Law Section members. If there are other initiatives you would like to see our Section undertake this year, please let me know.

— Willa B. Kalaidjian of Chambliss Bahner in Chattanooga is chair of the TBA Environmental Law Section

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UT Law Hosts Environmental and Social Justice Conference

The University of Tennessee College of Law will host the Appalachian Environmental and Social Justice Conference this weekend in Knoxville. The international, three-day conference will focus on environmental and social justice throughout the Appalachian region. Law school alumna and federal judge Pamela L. Reeves will deliver the Saturday keynote address on “Mediating the Kingston Coal Ash Spill.” Registration is $35 per day or $60 for the entire weekend. The conference is free to all undergraduate and graduate students. Register online here.

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Some VW Owners Slam Emissions Deal

Several angry Volkswagen owners told a federal judge yesterday that a proposed $10 billion settlement does not adequately compensate them for the automaker’s emissions cheating scandal. One owner, for example, demanded the full purchase price of his car as well as part of his registration fee, the Associated Press reports. The settlement calls for the car maker to spend up to $10 billion to buy back or repair about 475,000 Volkswagens and Audi vehicles with 2-liter diesel engines and pay owners an additional $5,100 to $10,000 each. The deal also requires the company to pay $4.7 billion for environmental mitigation and to promote zero-emissions vehicles. The Memphis Daily News has the story.

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Special Master Seeks Hearing in Mississippi Water Case

Eugene E. Siler Jr., the special master appointed by the U.S. Supreme Court to oversee Mississippi’s $615 million water-rights lawsuit against Memphis and the state of Tennessee, says the case could be decided by a limited hearing on the issue of whether an aquifer connected to the Memphis Sand is an interstate resource. Siler has filed a memorandum of decision calling for such a hearing, the Commercial Appeal reports. David Bearman, an attorney representing Memphis, said he was heartened by the arguments made in the memorandum, saying Siler “appears to agree with the basis of our position.” Attorneys for Mississippi also appeared pleased, saying a hearing would give them the chance to prove that the aquifer is not an interstate resource.

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VW Likely to Face Criminal Penalties

Volkswagen is expected to face criminal and civil penalties for circumventing Clean Air Act standards, but prosecutors have not yet decided the specific criminal charges they might bring against the automaker, according to the Wall Street Journal. The paper reported today that the Justice Department is negotiating a settlement with the car maker but those familiar with the matter said there will be “significant” financial penalties. The Chattanooga Times Free Press has a summary of the article.

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