Environmental Law Section February 1998 Newsletter Articles

 

Meet Rick M. Sinclair, Ph.D.
Interview Conducted by J. Wayne Cropp

Brownfields Project Update
by Jim Wright

From the Chair
by Susan Lee

The following is an interview with Dr. Sinclair, conducted by J. Wayne Cropp, of the Chattanooga law firm of Grant, Konvalinka & Harrison, P.C., on December 16, 1997. The interview has been edited to accommodate length restrictions.

Rick M. Sinclair, Ph.D., is the Deputy Commissioner, Tennessee Department of Environment and Conservation (“TDEC”), a position he has held since 1997. In this position, he has responsibility for the environmental regulatory, non-regulatory, and conservation programs of the Department, as well as the State’s 51-State Park and Natural Areas. Dr. Sinclair has held a number of positions within the Department, including Acting Administrator, Assistance and Support Administration, TDEC (1995-1996); Assistant Commissioner, TDEC (1992-1995); Director, Division of Superfund, TDEC (1990-1992); Deputy Director, Division of Water Pollution Control, TDEC (1988-1990); and Engineer/Biologist, Division of Water Pollution Control, TDEC (1972-1988). Dr. Sinclair obtained his Ph.D. in Environmental Science from Vanderbilt University (1989), based upon a dissertation regarding a site specific copper standard for the Duck River. He also obtained his Master’s in Environmental Science from Vanderbilt (1981). Dr. Sinclair obtained his B.A. in Biology from David Lipscomb University.

Cropp: Rick, with more than 25 years of experience in the environmental field, what is your analysis about the progress we have made in cleaning up our air and our water?

Sinclair: I think that most scientists will acknowledge that we have made tremendous progress over the last 25 years. In terms of air quality, the most dramatic examples are in our major cities. At one point, most of our major cities were in non-attainment with the Clean Air standards.

My background is water, and certainly the major rivers in East Tennessee and a lot of the smaller streams throughout the State were biological deserts — the Wautaga River, the South Fork of the Holston — my job was to go sample those rivers, and they were dead. Now, today, the Wautaga is a world-class trout fishery. The South Fork of the Holston is a great shell cracker and bluegill fishery. We have made tremendous progress.

Unfortunately, if you ask the general public, they feel the environment has gotten progressively worse during those 25 years, so there is a real disconnect between the progress that has been made, and the general public opinion.

Cropp: What is the Department doing to address that disconnect?

Sinclair: We have a two-fold mission in this Department. One is to protect the environment. But, we also have a responsibility to educate Tennesseans about the status of their environment. Soon, we will be going to press with the updated version of Tennessee’s Report on the State of the Environment. This document highlights the achievements we have made and explains technical matters on a layman’s level. This will help tell the story. The air quality story is particularly impressive, as in 1980, over 50% of Tennesseans lived in non-attainment areas and now over 99% breathe air that is healthy.

Cropp: Tell me what your job is all about.

Sinclair: My job entails a lot of administrative assistance to Commissioner Hamilton. Some of my most rewarding duties are to work on Governor Sundquist’s main environmental initiative, to create a single point of entry and re-engineering the way our permits are issued. Over the past 25 years, our separate environmental statutes evolved with very little coordination between environmental programs. What we are doing now is purposely coordinating those. When someone comes in seeking a permit, we do not let their lack of knowledge drive the situation. We let our understanding drive it. Also, re-engineering helps the environment, because now we are helping the regulated community make sure they get all the proper permits at the proper time.

What we are doing now is evaluating what permits are required to protect the environment. At one point, we had 52 different kinds of permits. You cannot convince me that 52 permits are needed to meet our statutory requirements, and protect the environment. Some of them may have only existed to generate a fee, or may have otherwise outlived their usefulness. If it is obsolete, we want to do away with it.

Cropp: How are going to go about training your personnel to handle these multi-media issues?

Sinclair: That is going to be one of our biggest challenges, getting people to understand the breadth of this program. The first thing that we did is that we put it all together in an environmental permitting handbook that is available to the public, and to our own staff. So, for the first time, our staff can understand the typical permits required for any basic industry classification. Now, we have a template, published in hardback and on our web site.

Cropp: A major change like this is going to create upheaval. What kind of problems do you anticipate?

Sinclair: Well, we have not worked out all of the details. But already, we are hearing some criticisms, so it is clear to me that we need to have input in the whole process from many different stakeholders. For instance, there has been a lot of discussion about moving permitting out to the Regions, rather than having it done in the Central Office. There could be some good reasons why, in specific instances, we may not want to do that. A good example may be the TVA Steam Plants. Right now, those are handled, at least for water permitting, out of the Central Office. You have better consistency right now by having one person do all of the TVA Steam Plants. We would have to look very hard at putting that out in the Regions where you would have to coordinate even more carefully. I am not saying that we will not do that, but I am saying that we will have to make sure that we actually give the customer a better focus by doing it.

Cropp: What are the hot environmental topics in the upcoming legislative session?

Sinclair: Right now, it looks like waste tires, hazardous waste transportation, and stream rechannelization, including sinkholes, will be on the legislative agenda.

Cropp: Regarding stream rechannelization and the ARAP permit program, what type of legislation do you see? Is there going to be any Administration sponsored legislation on that, or is it all going to be coming out of the legislative committee process?

Sinclair: That effort is primarily coming out of the legislative committee process. We feel that our re-engineering will address some of the legislators’ concerns. We want to make sure that the permitting that we are doing is environmentally effective, and that it meets our standard for customer service. As we change our field offices to environmental assistance centers, we are going to attempt, and we’re making good progress I think, to change the thinking of the staff to be more focused on environmental outcomes, rather than on “enforcement beans.” In the past, there was some concern that the focus was primarily on enforcement, rather than on results. However, if the problem requires enforcement to achieve the desired outcome, certainly the Commissioner will not hesitate to proceed.
Cropp: How big an issue will the transportation of hazardous and radiological waste become in Tennessee this year?
Sinclair: Well, there are quite a variety of federal and state laws that govern the transport of hazardous and radioactive materials. This Department does not regulate the transport of hazardous material. That is regulated by the federal Department of Transportation. The iceberg below the surface is hazardous material. The small portion above the surface is hazardous waste. I think there was some confusion among some members of the legislative committee as to what is a hazardous waste and what is a hazardous material.
The smallest percentage is hazardous waste, and the larger percentage is hazardous material — gasoline, raw products, feed stocks — going to different companies. When the public sees the hazardous material sign on there, they do not understand that hazardous waste is different from hazardous materials. Actually, the waste is less hazardous in a lot of cases, because it is mixed with sand or water, for example.

Cropp: So, the current legislative effort that you see coming down the road (no pun intended), will it affect both hazardous wastes and hazardous materials?

Sinclair: I don’t know what the end result will be. I really feel that it was initiated because of Tennesseans’ concern about the amount of toxic releases that are reported every year, and that is a concern of ours as well.

In 1989, we were the second highest discharger of toxic chemicals. I think that one of the outcomes of the legislative committee working on this issue will be to provide support for the Governor’s Clean Air Initiative, which really addresses the toxic release issue. Tennessee’s businesses have done a remarkable job in voluntarily reducing the amount of toxic chemicals that are released. What we have done with our Clean Air Initiative is make sure that the remaining toxic releases (102 million pounds a year) are not discharged in a way that falls outside the regulatory net. Some environmentalists and some legislators are concerned about chemicals that were not covered under the toxic release inventory (“TRI”) list of chemicals. About 80% to 90% of those 102 million pounds are discharged to the air and not to the water. Most of these air releases fall under the 1990 Clean Air Act (“CAA”) Amendments. However, manganese has one of the highest risk factors, but it is not even considered hazardous under the CAA. Our Clean Air Initiative will allow the Tennessee Air Board to regulate manganese through a Best Available Control Technology (“BACT”) type approach, whereas all of the others (hazardous air pollutants) will fall under the more generic Maximum Achievable Control Technology (“MACT”) approach, to which federal guidelines will apply.

Cropp: Is there a major manganese source in Tennessee, or is this a combination of sources?

Sinclair: That source is primarily in New Johnsonville, Tennessee. That is where most of the manganese comes from.

Cropp: I was not sure how the 102 million pounds break down in terms of air emissions versus total releases — water, land — in terms of the inventory.

Sinclair: If you look at the 102 million pounds of total air, land and water releases, probably 90% of that is air, so for all intents and purposes, the TRI in Tennessee is air. We have dropped in national standing from being #2, as far as having the highest releases, to being 5th last year. Much of that has been accomplished by voluntary reductions.

Cropp: Regarding the Governor’s new Clean Air Initiative, please give me a little more detail about where that is headed. Is the Governor’s Clean Air Initiative only speeding up the federal process that is already in effect, or is there some substantive regulatory control over and above the federal requirements?

Sinclair: In order to understand the Governor’s Clean Air Initiative, you really need to break it down into its three components.

The first part truly does speed up implementation. We are the first state in the nation to implement the federal program to control newly constructed sources of toxic air pollution. This affects the small window of time between now and the federal deadline for implementing that new program.

The second part simply acknowledges the federal MACT program and supports the new federal standards as they are adopted by EPA. They will be presented to the Air Board and adopted here in Tennessee.

The third part is what is different. It applies to the 11% of the TRI chemicals that are toxic, but are not considered hazardous, according to EPA classification. So, for that 11% of the TRI chemicals, a regulatory proposal will be made and presented to the Board. We feel that closes the loop for these chemicals. For the vast majority of industries, it will not be more stringent than federal requirements. It will be invisible to them. But for the environment and for Tennesseans’ health, in those few areas where there was no regulation, we will provide that regulation.

Cropp: If I am hearing what you are saying, for the 11% of the TRI chemicals that are not hazardous air pollutants under § 112 of the CAA, you will be adopting case-by-case BACT determinations, do I have that correct?

Sinclair: That’s correct.

Cropp: Will this new regulatory initiative apply only to major sources, generally 10 tons of a single regulated pollutant or an aggregate of 25 tpy for the combination of regulated pollutants as under the federal hazardous air pollutant program?

Sinclair: I do not know that we have made a decision to limit that regulation only to major sources. What we are trying to do is make sure that industrial classifications and chemicals that are not covered under the federal act will be properly regulated.

Cropp: I am not sure that I understand the second point that you refer to, that TDEC will be supporting EPA in terms of MACT development. Is this just general support for MACT development, or is there some issue of state law that you are going to resolve?

Sinclair: The second point is simply a reaffirmation that EPA has adopted the best approach — utilizing a technology approach (MACT) on the front end of the process. Some states have passed separate health-based standards that require industry to jump through two regulatory hoops, perhaps with two different deadlines for compliance that can completely waste resources. What we are saying is that we feel that the national approach of utilizing technology based standards is the appropriate approach for the vast majority of industries, and we support that effort.

Cropp: Explain to our readers what is happening on the Pigeon River and the agreement reached among EPA, the State of North Carolina, the State of Tennessee and Champion International.

Sinclair: In a nutshell, the way the water permitting program works in both North Carolina and Tennessee, is that a permit is issued for five years. The last time North Carolina issued a permit for Champion Paper, Tennessee objected strenuously and fought the proposed North Carolina permit. Those efforts resulted in a major mill modernization to the tune of $300 million, and there was considerable cleanup effected. When that permit was reissued for another five years last year, North Carolina approved a permit that did not provide for incremental improvements over the last permit. Tennessee’s approach, historically, has been to effect progress incrementally. North Carolina was going to issue a permit with EPA’s concurrence. Tennessee again objected. The State has been in negotiations with North Carolina and EPA, and North Carolina and EPA have basically accommodated Tennessee. I believe this will be one of the most important accomplishments in environmental protection that has been made by this Department.

Cropp: Another important issue is the Great Smoky Mountains. Tennessee recently signed a Memorandum of Understanding (“MOU”) with the Department of Interior. How do you see the MOU affecting economic development in East Tennessee?

Sinclair: As it has been said many times before, the Smoky Mountains are, in themselves, a source of many jobs and a tremendous economic benefit to the State. So, it is in our best interest to protect that resource. I believe a much more serious impact to business is caused by the new ozone standards, and the § 126 CAA petitions that some of the northeastern states have filed against Tennessee.

I believe that with the 35% reduction in Nox that is going to be required by the SIP call and the lowered ozone standard, that many counties are not going to be in attainment any longer. We have not been shown as a State that those standards are necessary to protect human health and the environment. My concern is much more with the ozone standard going from .12 to .08, and Nox emissions being reduced by at least 35% than with the MOU with the Department of Interior.

Cropp: What do you see happening under the new ozone and particulate standards at this point?

Sinclair: We have no choice but to move into the implementation phase. I was just in a meeting last week in Washington, D.C., where we talked about whether we would have 8-hour standards and 1-hour standards for the same county. My concern now is that is exactly the case. We have some counties that may be required to continue to plan to meet a 1-hour standard, as well as the new 8-hour standard. I believe it is going to be very difficult to meet the new 8-hour standard. I know that EPA hopes that regional controls will cause these counties to come into attainment. I doubt that very seriously. I do not think that regional controls alone will help you meet an .08 standard. I am concerned about the level of local controls that will be required to achieve the standards.

Cropp: I know the Commissioner is proud of the fact that there has been more criminal enforcement this year than ever before. Enforcement is also a topic for discussion because of the Comptroller’s report which was critical of TDEC’s enforcement program. What is your response to that?

Sinclair: As you are aware, the Department was criticized rather sharply in an audit this year. One thing that we were unable to explain, as satisfactorily as I would have liked to, is that at any given time, we are dealing with about 800 enforcement cases — from criminal violations to the nonpayment of fees. There is a wide gamut. There are “technical” violations, and then there are willful violations, some of which may even endanger the public’s water supply. What we do, and what I think the public wants us to do, is prioritize our response. The Commissioner is proud of the fact that we have had 14 criminal convictions this year, which are more than during the entire history of this program.

As far as the audit, one criticism was that it took 200 days on average to complete an enforcement case from the time a violation is found until an Order is signed. We do not think time should be the sole determinative of whether we are doing a good job. We are certainly looking at that, and EPA has certain time clocks to which we must adhere. But what we want to do is to communicate to the public that we are prioritizing the severity of our enforcement response.

Cropp: I understand that the Department is also moving from Commissioner’s Orders to Director’s Orders.

Sinclair: Director’s Orders will now be issued in the following Divisions: Water Supply, Underground Storage Tanks, Water Pollution, Hazardous Wastes, and Superfund. Right now, we are working on clarifying which kinds of enforcement actions can be taken unilaterally by a Director as opposed to the Commissioner.

Cropp: So, you will still rely on Commissioner’s Orders?

Sinclair: Absolutely. In fact, most of the civil penalties that were assessed this year, over $2 million assessed in approximately 200 orders, were in Commissioner’s Orders.

Cropp: I did not hear the Air Pollution Control Division mentioned as one of the Director’s Orders. Why is that?

Sinclair: The Technical Secretary already issues the Orders for air pollution control based upon statutory authority under the Tennessee Air Quality Act.

Cropp: What else would you like to say about the enforcement issue?

Sinclair: We want to make sure the public knows about the new environmental crime hotline that was created for the first time this year. We have already had 41 calls made to the hotline for the period of May through November.

Cropp: Is there anything else that you want to mention?

Sinclair: Well, I would mention the Governor’s Initiative to acquire new natural areas in Tennessee. We acquired four natural areas last year, and we anticipate that a similar effort will be made this year. One of the primary environmental issues facing Tennessee is the preservation of some of the last wild places in the State. The environment is well served by the preservation of areas such as the Ghost River section of the Wolf River in West Tennessee, and the Devil’s Backbone area in Lewis County, and the Walker Branch Preserve in Hardin County. Those type places are where we all need to go to restore our souls and appreciate what is important about Tennessee’s environment.

As reported in the last issue of Environmental Law, the Section has established a special Committee on Brownfields. This Committee has been working for several months, but it is certainly not too late to join in the effort. If interested, please call Jim Wright at Butler, Vines & Babb.

The Committee has begun defining its short term goals, while working on long term goals. As part of the short term goal development process, the Committee has undertaken an analysis of the current regulatory and statutory authority for the Tennessee Department of Environment and Conservation to provide prospective purchasers with assurances that they will not be subject to substantial liability upon purchasing a contaminated property. Meetings with TDEC counsel have begun to develop a consensus as to the usefulness of existing authority for brownfields redevelop
ment.

As a result of these recent meetings, TDEC has agreed in principle that the Commissioner may in appropriate circumstances enter into a consent order (outside the Voluntary Oversight and Assistance Program) fixing the liability of a prospective purchaser, or may issue a “comfort letter” on a purchaser’s liability, under the apportionment authority of Tenn. Code Ann. § 68-212-207. Though this mechanism has not yet been used, the purchaser of a site that will be returned to productive use, creating jobs, and on which the purchaser is willing to conduct some environmental remediation may be able to receive concrete assurances concerning state superfund liability in a relatively short period of time.

Another existing but dormant tool for brownfields development is the defense to liability in Tenn. Code Ann. § 68-212-202(3)(F)(i)(c) for purchasers that exercise “due care” in buying contaminated property. It may be argued that due care in a prospective purchaser scenario would include creating no significant increase in the risk of release or harm as a result of the future operations or activities. The Commissioner could find, through the apportionment provision, that the prospective purchaser is exercising due care with respect to the hazardous substance concerned.

As to a long term goal, the Brownfields Committee has recommended to the Section a legislative proposal that would establish an environmental easement or restrictive covenant. This would allow the Commissioner, in exchange for the imposition of restrictions on the use of the site that would be filed with the Register of Deeds where the property is located, to use site-specific standards and alternative cleanup. Future owners of the property would have notice of the use restrictions, and would be prohibiting attempting any change in use which might increase the risk from the hazardous substances on the site. Several other states have adopted similar provisions.

The Committee anticipates further input from the various sub-groups, and these will in turn be reported to the Section through this newsletter. Future areas of focus regard economic incentives that may be available to spur brownfields redevelopment, and the use of Tenn. Code Ann. § 68-212-202(E)(i), which excludes units of state or local government that obtain property involuntarily from the definition of a liable party for the site. Perhaps this section could be used, along with an apportionment order, to create greater protection for a prospective purchaser.

Our mid-year meeting successfully moved the ball forward on a number of important matters involving the membership. A discussion concerning the membership benefits that work, as well as those ideas that have not worked out, resulted in general agreement that the Environmental Law Forum and the newsletters are valuable tools for the members. On the other hand, in general, the membership did not support attempts to hold quarterly brown-bag luncheon meetings. It was agreed that a reception at the Annual Solid and Hazardous Waste Conference (held this year April 15-17) was a good idea and a suggestion was made that an attempt be made to obtain CLE credit for at least a portion of the conference. That suggestion is being investigated by Joe Sanders and Jim Wright.

A portion of the mid-year meeting was spent discussing the goals and work of the Brownfields Committee and there is a separate report contained in this newsletter concerning the Brownfields Committee. I thank all of the members of that committee for their diligent efforts.

I regretfully announce that Steve Stout has decided to leave the Tennessee Department of Environment and Conservation and to focus his career in an area of the law that does not principally involve the environment. As a result, Steve resigned his leadership as an officer of the Section and as co-chair of the Brownfields Committee. We certainly appreciate Steve’s hard work, and he will be greatly missed as a leader of the Section.

Ed Callaway was elected to replace Steve as the Secretary/Treasurer. I am grateful to Ed, who has been the newsletter Editor, for his commitment to the Section. I am also grateful to Sharon Jacobs of Wyatt, Tarrant & Combs, who has agreed to replace Ed as the newsletter Editor.

I again encourage any member who would like to become more involved in the Section to contact me. There are a number of committees and projects that could use some fresh ideas and hard work!