Legal rights of owners/operators when faced
with citizen suit and government enforcement
actions under U.S. Environmental laws
Barry M. Hartman
K&L Gates LLP
barry.hartman@klgates.com
23 March 2010
Copyright © 2010 by K&L Gates LLP. All rights reserved.
Subjects of Discussion
ƒ Why worry about environmental enforcement
ƒ Case study: Cosco Busan
ƒ Recent new requirements
1
Why Worry About Environmental
Enforcement?
ƒ Profits
ƒ Publicity
ƒ Prison/Penalties
2
Profits
$$$$$$$$$$
3
Profits
Criminal Sentencing: Disgorgement of Profits
Civil Enforcement: Economic Benefit of
Noncompliance
4
Profits
AES Discloses Oklahoma Plant Filed
False Pollution Reports; Stock Plunges
5
Publicity
6
Publicity
ƒ 07/24/08
Felony charges for ship’s management
ƒ 08/17/09
Ship Operator to Pay $10 Million to Settle Criminal
Charges in San Francisco Bay Spill
ƒ 12/09/09
Shipping Firm Ordered to Pay $2.7 Million,
Banned From U.S. Waters for Three Years
7
Prison
8
EPA Criminal Enforcement Program
FY 2004 – FY 2008
450
400
350
300
250
2004
2005
2006
2007
2008
200
150
100
50
0
N u m b er O f
C ases
In it ia t e d
N u m b er of
D e fe n d a n ts
C h a rg e d
S e n te n c e s
(Y e a rs )
F in e s ( $ M il ,
In f l a t io n
A d ju s te d )
9
Kinds of Criminal Offenses
Misdemeanors < 1 yr
Felonies > 1 yr
10
Criminal Liability May be Based on Negligence
ƒ Lack of ordinary care
ƒ Potential focus on failure of management / training
11
The Law
ƒ Clean Water Act (33 U.S.C. § 1319(c)(1)(A); 33 U.S.C.
§ 1321(b)(3))
ƒ Elements
ƒ Defendant discharged a harmful quantity of oil into U.S. waters;
ƒ Defendant was negligent; and
ƒ Defendant’s negligence was a proximate cause of the discharge.
ƒ “Ordinary” Negligence = misdemeanor
ƒ “Knowing violation = felony
ƒ Includes faiure to report an oil spill
12
Clean Water Act “Negligence”
ƒ United States v. Hanousek, 176 F.3d 1116
(9th Cir.1999), cert denied, 528 U.S. 1102 (2000)
ƒ Clean Water Act requires only “ordinary” negligence
not “gross” or “criminal” negligence
ƒ Criminal sanctions for ordinary negligence do not
violate Due Process
ƒ Thomas, J., dissent from denial of certiorari
ƒ Concern that Hanousek will affect ordinary industrial
activities
13
The Law (cont.)
ƒ United States v. Franklin Hill, et al. (D. Mass.)
ƒ Defendant responsible for the navigation of the tugboat; Left his post
for 15 minutes without hand-held radio; no one else on the bridge;
barge crashes into rocks that were clearly marked on the electronic
and paper charts.
ƒ Defendant sentenced to five months imprisonment.
ƒ Hanousek v. United States (9th Cir.)
ƒ During rock removal operations a backhoe operator accidentally struck
high pressure pipeline near railroad tracks, spilling between 1,000 and
5,000 gallons of oil into the river.
ƒ Supervisor of project was off duty and at home when the accident
occurred. Convicted under the Clean Water Act for negligently
discharging oil into the river; sentenced to six months imprisonment/
six months in a halfway house.
14
The Law (cont.)
ƒ Migratory Bird Act (16 U.S.C. §§ 703, 707(a))
ƒ Elements
ƒ killing of a migratory bird including Brown Pelicans
(Pelecanus Occidentalis), Marbled Murrelets
(Brachyramphus Marmoratus), and Western Grebes
(Aechmophorus Occidentalis); and
ƒ Without permission or authority.
ƒ Strict Liability – No need to prove negligence.
ƒ Various State Laws
ƒ Crime to negligently or intentionally spill oil or fail to
report spills.
15
The Law (cont.)
ƒ Seafarers’ Training, Certification and Watchkeeping
Code (STCW)
ƒ Navigation with pilot on board
ƒ The Master is always in charge of his ship.
ƒ Presence of pilots on board does not relieve the master
or ship’s officers from their obligation to keep the ship
safe.
ƒ The master and pilot must have a meaningful exchange
of information before the ship leaves the dock.
ƒ The master and his officers must cooperate closely with
the pilot and maintain an accurate check on the ship’s
position and movement.
16
17
Numquam debes purgamentum
dare rustico cui nomen
Bubbarum et qui carrum utilem
invehit.
18
Never Give Your Waste to a Man
Named Bubba Driving a Pick-Up Truck.
19
Individual Criminal Liability
Vicarious Liability of Ship Owner/Captain/Supervisors
for Conduct of Crew
ƒ Responsible Corporate Officer Doctrine
ƒ Corporate officers may be liable for the acts of their
employees where they “stand[] in responsible relation
to a public danger”
ƒ United States v. Rivera, 131 F.3d 222 (1st Cir. 1997)
ƒ Officers may be liable for sending unseaworthy vessel
to sea based on vicarious liability
20
Corporate Vicarious Liability
CORPORATION
FACT F
FACT
H
FACT G
GENERAL COUNSEL VP OPERATIONS
VP ENVIRONMENT
FACT D
FACT C
CAPTAIN
CHIEF ENGINEER
FACT B
FACT A
FIRST MATE OILER
21
Federal Sentencing Guidelines
22
23 © 2006 K&L Gates
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24 © 2002 K&L Gates
24
25 © 2002 K&L Gates
25
Base Level Offenses Factors
ƒ Offenses involving “knowing endangerment” of others;
ƒ Offenses involving mishandling of hazardous or toxic
substances (including related recordkeeping
offenses);
ƒ Offenses involving mishandling of “other” (nontoxic)
pollutants (including related recordkeeping offenses);
ƒ Offenses involving specially protected fish, wildlife,
and plants
26
Base Level Offenses Factors (cont.)
ƒ Base Level for an Environmental Violation: 8
ƒ Possession of 250 grams of marijuana: 8
ƒ Murder: 43
ƒ Robbery: 20
27
Enhancements to Base Level
ƒ 6 level enhancement of continuous and ongoing
violation, USSG §2Q1.2(b)(1)(A);
ƒ 4 level increase if the violation involved permit
requirements, USSG §2Q1.2(b)(4);
ƒ Whether the person has committed prior crimes,
USSG §4A1.1
ƒ 4 levels for substantial expenditures for clean up;
USSG §2Q1.2(b)(3);
ƒ Special Skills contributed to violation
28
Enhancements to Base Level (cont.)
ƒ Proof of actual contamination or harm may or may
not be required depending on court.
ƒ United States v. Ferrin, 994 F.2d 658 (9th Cir. 1993);
United States v. Hoffman, 2000 U.S. App. LEXIS
5185 (4th Cir. 2000); United States v. Cunningham,
194 F.3d 1186 (11th Cir. 1999); United States v.
Liebman, 40 F.3d 544 (2d Cir. 1994);United States
v. Goldfaden, 959 F.2d 1324 (5th Cir. 1992
29
Enhancements to Base Level (cont.)
ƒ Whether the defendant was the supervisor
ƒ 4 levels if more than five persons involved.
USSG §3B1.1;
ƒ 2 levels for 2 persons
ƒ United States v. Okoli, 20 F.3d 615 (5th Cir. 1994)
defendant must have been the “organizer, leader,
manager, or supervisor of one or more other
participants.” Need not demonstrate was personally
in charge of five or more participants.
30
Reductions to Enhanced Level
ƒ Whether the offense involved recordkeeping only,
USSG §2Q1.2(b)(6); or
ƒ Whether the defendant cooperated in the
investigation, USSG §3E1.1
31
Downward Departures
ƒ Is the case outside the “heartland of environmental
cases.” USSG §5K2.0.
ƒ United States v. Elias, 32 ELR 20,218, 269 F.3d
1003 (9th Cir. 2001)
32
Other Factors
ƒ Standing in community not normally relevant.
ƒ Committing crime to avoid a greater harm not
normally relevant.
33
Applying the Guidelines
Nature of Offense
Increase/Decrease
Offense Level
Offense involving a toxic waste
8
Increase based supervisory
position
+4
Increase based on permit
violation
+4
Decrease because defendant pled
guilty/cooperated
-2
Total value assigned to offense
14
34
Applying the Guidelines (cont.)
Criminal History 1
35
36 © 2006 K&L Gates
36
Other Relevant Statutes
ƒ False Statements – 18 U.S.C. § 1001
ƒ Conspiracy – 18 U.S.C. § 371
ƒ Obstruction of Justice – 18 U.S.C. §§ 1505-1510
ƒ Aiding and Abetting – 18 U.S.C. § 2
ƒ Accessory After the Fact – 18 U.S.C. § 3
37
Case Study – Cosco Busan
38
Damage to the Cosco Busan
39
Damage to the Bay Bridge Pier
40
Oil Slick on SF Bay
53,500 gallons of oil spilled
2,500 birds killed
ƒ Also delayed opening crab season until after Thanksgiving
41
The Scene
November 7, 2007
(with thanks to Charles Schultz)
Source: http://www.gordoncarroll.com/main/images/stories/snoopy.jpg
42
Actually it was a very foggy morning…
43
The Cosco Busan’s bridge was equipped with radars,
electronic chart, and manned by the ship’s Master, two
officers, and an experienced San Francisco Bar Pilot.
44
Ferries & Other Vessels on the S.F. Bay that Morning
45
What Happened
ƒ Timeline of Key Events
ƒ 6:20 a.m. Pilot boarded the vessel
ƒ 6:24 a.m. Initial exchange of information with the
ship’s Master
ƒ 6:37 a.m. Coast Guard Vessel Traffic Service (VTS)
notified of ship’s intended passage through the
“Delta-Echo” opening of Bay Bridge
ƒ 7:44 a.m. Cosco Busan leaves dock in heavy fog
ƒ 8:30 a.m. Cosco Busan scrapes the Bay Bridge Pier
and begins to leak bunker fuel
46
Reliance on Basic Assumptions
ƒ Pilot – The Master and his bridge officers know their
ship and their equipment. They will follow the basic
international standards relating to a ship leaving
port in the fog
ƒ Master – The Pilot is the local expert who will take
over and navigate us safely from the Oakland Port,
through the Bay, and out to sea
ƒ Coast Guard VTS – There is an experienced pilot
on board who knows what he is doing
47
Chain of Errors
ƒ Lack of Compliance/Training
ƒ Master/Crew not well trained; did not know how to operate
ship’s equipment (including the electronic chart)
ƒ There was no real pre-sailing voyage planning even
though it was otherwise required by law and company
protocols
ƒ The Master and his officers did not follow international
standards or ship’s procedures relating to lookouts,
monitoring of ship’s position, and interactions with Pilot
ƒ Master and officers falsified various ship records after the
incident
48
Chain of Errors (cont.)
ƒ Failure to Communicate
ƒ Exchange of information between Pilot and Master incomplete
ƒ Master and Pilot misunderstood key symbols on the ship’s electronic
chart
ƒ Master “guessed” at their meaning
ƒ He was wrong in his guess
ƒ Ship ultimately badly out of position to safely transit through the
opening of the Bay Bridge span
ƒ No warning from ship’s Master or crew
ƒ Coast Guard’s VTS failed to warn
ƒ Knew pilot’s intention to sail through “Delta – Echo” portion of Bay Bridge
span
ƒ Actively monitored ship’s progress
ƒ Timely warning – even in the last minute – could have avoided the accident.
49
50
51
Electronic Chart
(“Red Triangles” and “Center of Bridge”)
52
53
54
55
56
57
Investigation and Prosecuting Agencies
ƒ
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Coast Guard Investigative Service
The Environmental Protection Agency’s Criminal Investigation Division
Federal Bureau of Investigation
U.S. Fish and Wildlife Service
Silicon Valley Regional Computer Forensics Laboratory
California Department of Fish and Game, Office of Spill Prevention and
Response.
Coast Guard
ƒ District 11 Legal Office, Sector San Francisco, Office of Investigations and
Analysis, Office of Maritime and International Law, Office of Vessel Activities,
Electronics Support Unit Alameda, and the Marine Safety Laboratory
ƒ
ƒ
ƒ
ƒ
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U.S. Attorney's Office for the Northern District of California
Justice Department's Environmental Crimes Section
Local District Attorney
National Transportation Safety Board
Licensing Authorities
58
Other Players
ƒ Representatives of Ship Owners/Operators
ƒ Insurance companies
ƒ Media
ƒ Politicians
59
The Media – Someone Must Be Held Accountable
ƒ Pilot
ƒ Bar Pilot on Errant Ship Had Several Mishaps in Past
(San Francisco Chronicle, November 9, 2007)
ƒ State Charges Bay Spill Pilot with Misconduct (San
Francisco Chronicle, December 7, 2007)
ƒ Role of Pilot’s Sleep Medication Probed (San
Francisco Chronicle, January 19, 2008)
60
The Media – Someone Must Be Held Accountable
(cont.)
ƒ Ship’s Master and Crew
ƒ Probe into Cargo Ship Bay Bridge Crash Focuses on
Communication (San Jose Mercury News, November
9, 2007)
ƒ Federal Prosecutors Charge Shipping Company in
Bay Oil Spill (San Jose Mercury News, July 23, 2008)
ƒ Felony Charges for Ship’s Management (San
Francisco Chronicle, July 24, 2008)
61
The Media – Someone Must Be Held Accountable
(cont.)
ƒ Coast Guard
ƒ Response to Fuel Spill under Bay Bridge Called
‘Unusually Slow’ (San Francisco Chronicle, November 9,
2007)
ƒ Coast Guard Monitors Didn’t Warn Ship’s Crew (San
Francisco Chronicle, November 16, 2007)
ƒ Senators Blast Coast Guard Response to Bay Oil Spill
(San Francisco Chronicle, November 15, 2007)
ƒ Coast Guard May Be Neglecting Its Maritime Mission (San
Francisco Chronicle, November 16, 2007)
ƒ Oil Spill Report Berates Coast Guard (San Francisco
Chronicle, January 28, 2008)
62
A few headlines from one Trade Reporter
ƒ
02/22/2010: Enforcement: Fleet Management to Pay $10 Million Fine For Role in 2007 San Francisco Bay Oil Spill
ƒ
01/22/2010: Oil Spills: Trustees to Develop Restoration Plan For Areas Affected by Cosco Busan Spill
ƒ
09/16/2009: Oil Spills: Coastal Oil Spills Have Declined 86 percent Over Last 20 Years, Coast Guard Official Says
ƒ
08/31/2009: Oil Spills: Coast Guard Proposal Would Require Spill Response Plans for Non-Tank Vessels
ƒ
08/17/2009: Enforcement: Ship Operator to Pay $10 Million to Settle Criminal Charges in San Francisco Bay Spill
ƒ
07/20/2009: Enforcement: California Ship Pilot Convicted for Oil Spill Sentenced to 10 Months in Federal Prison
ƒ
06/17/2009: Oil Spills: House Science Subcommittee Approves Bill For Research Into Spill Prevention, Mitigation
ƒ
05/15/2009: Enforcement: Ship Operator Involved With Oil Spill Into San Francisco Bay Offers Plea Deal
ƒ
03/09/2009: Enforcement: California Ship Pilot Enters Guilty Plea For Oil Discharge Following Bridge Collision
ƒ
02/20/2009: Oil Spills: Medication, Communication Cited in 2007 Bay Spill
ƒ
01/08/2009: Enforcement: California Sues Over San Francisco Bay Spill That Polluted Coastline, Killed Birds in 2007
ƒ
10/02/2008: Oil Spills: Schwarzenegger Signs Bills to Improve California's Oil Spill Response, Prevention
ƒ
07/31/2008: Oil Spills: Grand Jury Indicts Operator of Ship Involved in San Francisco Bay Spill
ƒ
04/23/2008: Enforcement: More Charges Filed Against Harbor Pilot Accused in San Francisco Bay Oil Spill
ƒ
04/11/2008: Oil Spills: Subcommittee Examines Cleanup of Spill In San Francisco Bay, Coast Guard Response
63
The Allegations
ƒ 12 specific negligent acts alleged in criminal indictment
including:
ƒ Ship’s Master and crew inadequately trained
ƒ Pilot and ship’s Master/crew failed to navigate an accident free
course
ƒ There was an inadequate review before departure of the ship’s
navigational charts and the proposed course
ƒ The ship departed in heavy fog
ƒ The ship’s Master failed to ensure that adequate lookouts were
posted
ƒ The ship’s Master/crew failed to notify the Pilot that the ship was
off-course
ƒ The ship’s operating company is vicariously liable for the acts
of the ship’s Master/crew
64
65
Clean Water Act “Negligence”
ƒ United States v. Hanousek, 176 F.3d 1116
(9th Cir.1999), cert denied, 528 U.S. 1102 (2000)
ƒ Clean Water Act requires only “ordinary” negligence
(i.e., civil definition), not “gross” or “criminal”
negligence (i.e., involuntary manslaughter definition)
ƒ Criminal sanctions for ordinary negligence do not
violate Due Process where statute is a public welfare
statute
ƒ Thomas, J., dissent from denial of certiorari
ƒ Concern that Hanousek will affect ordinary industrial
activities
66
Clean Water Act “Negligence” (cont.)
ƒ United States v. Cota, 2008 U.S. Dist. LEXIS 65911
ƒ District Court applied Hanousek to an oil spill from a
containership in the San Francisco Bay
ƒ Held that CWA is a “public welfare” statute, and
therefore criminalizes ordinary civil negligence
ƒ Rejected argument that heightened or gross
negligence should apply to defendant’s conduct
ƒ Defendant pled guilty pursuant to an agreement
67
The Result:
Individual
ƒ Cota indicted on two felonies and two misdemeanors
ƒ Pled guilty to two misdemeanors
ƒ Sentenced to 10 months in jail
68
The Result:
Management Company
ƒ Pled guilty to obstruction, false statement and
violation of OPA
ƒ $10 Million fine
ƒ $2 Million to SF Bay projects
ƒ “Comprehensive Compliance Plan”
69
The Result:
Master and Crew
70
How does a company defend itself?
ƒ Clean-up response is paramount
ƒ Understanding/key evidence – What happened? Why?
Who’s at fault?
ƒ Drug testing of key personnel
ƒ Preserving paper and electronic evidence
ƒ Interviewing key personnel
ƒ Hiring lawyers to represent witnesses/subjects/ targets
ƒ Managing the public relations nightmare
71
How does an individual defend him/herself?
ƒ You need legal advice – preferably before you say
anything.
ƒ Who is representing your personal interests?
ƒ Are your interests aligned with company?
ƒ Who is going to pay for your legal expenses?
ƒ What does the company expect you to do?
ƒ Whatever you do, only tell the truth?
ƒ Is there an obligation to answer questions?
72
How does an individual defend him/herself? (cont.)
ƒ Only tell the truth.
ƒ Do not change or alter evidence even if you are
asked/ordered to do so.
ƒ Don’t try to “get your story straight” without counsel.
ƒ Assume that oil spills will be investigated as a crime.
ƒ Usually the Coast Guard is the lead investigative
agency.
ƒ Even a case that is initially civil can be criminal.
ƒ Coast Guard investigators may have varying degrees of
training/experience.
73
Lessons learned
ƒ
Accidents usually involve a Chain of Errors
ƒ Lots of errors here: – Pilot, Ship’s Master and Officers, Ship’s operating
company, the United States Coast Guard (VTS and Captain of the Port)
ƒ Only the Pilot and Ship’s operating company were charged with crimes
ƒ
Lack of an effective Compliance and training program for the ship’s crew
ƒ
ƒ
ƒ
ƒ
ƒ
Volumes of written policies
Most in English and almost all of the crew were not proficient in English
Conflicting responsibilities made it impossible to follow all of the procedures
Crew did not have time to review and absorb the procedures
Vessel Traffic Service (VTS) (failure to Communicate a clear warning)
ƒ Inadequate exchange of information between maritime professionals can be
devastating
74
Lessons learned (cont.)
ƒ Assume that any oil spill that damages the
environment will be considered a Crime
ƒ Consult with counsel as early as possible
ƒ Make an informed decision before deciding whether
you are going to Cooperate
ƒ Compare Captain Cota’s treatment where he
voluntarily Cooperated vs. ship’s master and crew
who were eventually granted immunity despite false
statements
75
If you spill oil and kill birds, will you go to jail?
ƒ Sentencing Guidelines
ƒ Standardized system designed to equalize
sentencing in all federal courts.
ƒ Intentional conduct treated more harshly than
negligence.
ƒ Applicable Sentencing Range – (as high as) 10-16
months (statutory maximum for negligence – 1 year).
ƒ Intentional acts can be punished with up to 5 years
imprisonment.
76
If you spill oil and kill birds, will you go to jail?
(cont.)
ƒ Judge Illston’s Comments at Sentencing
ƒ “The Exxon Valdez was an object lesson to
everyone.”
ƒ “…What happened [in the Cosco Busan case] is
exactly what was meant to be protected against by
the statutes. The consequences are just exactly as
severe as you might expect….
77
Citizen Lawsuits
ƒ Section 505 of CWA
ƒ Gives private citizens and groups the power to
enforce the law when government chooses not to
do so using all of the same powers given the
government except criminal enforcement.
78
Citizen Suit Enforcement
ƒ Recovery of attorneys’ fees and costs if the plaintiff
“prevails”
ƒ Need not have harm to violate the CWA
ƒ Penalties go to government
ƒ Supplemental projects do not go to government
79
Citizen Suit Enforcement
“environmental law is written in such a
way that a cartel of environmental
advocacy groups is formed and
maintained through citizen suits.”
Benson, “Unnatural Bounty: Distorting the Incentives of
Major Environmental Groups,” PERC Policy Series,
Issue Number PS-37, July 2006 at 9.
http://www.perc.org/perc.php?id=842
80
Civil Enforcement Actions
ƒ Liability (Did you do it?)
ƒ Penalty ( How much will the fine be?)
ƒ Injunctive Relief (How much will it really cost?)
81
Criteria for Assessment of Civil Penalties
ƒ Seriousness of violations
ƒ Economic benefit of noncompliance
ƒ History of violations
ƒ Good faith efforts to comply
ƒ Economic impact on violator
ƒ Other factors as justice may require
82
Economic Benefit of Noncompliance Resources
ƒ EPA Enforcement Economic Models:
http://www.epa.gov/compliance/civil/econmodels/index.html
ƒ BEN Model: calculates violator’s economic savings
in delaying or avoiding pollution control measures
83
Clean Water Act: Penalty Policy
ƒ Penalty =
Economic Benefit from noncompliance
+ Gravity of violation
+/- Gravity Adjustment Factors
- Litigation Considerations
- Ability to Pay
- Supplemental Environmental Projects
84
Penalty Policy
ƒ Gravity = $1000 x (a + b + c + d)
ƒ A—Significance: the degree of exceedance of
effluent limits (scale of 0 to 20)
ƒ B—Environmental and Health: real or potential harm
to humans or environment (scale of 0 to 50)
ƒ C—Number of violations: how many limits in the
permit were violated (scale of 0 to 5, based on
percentage)
ƒ D—Significance of non-limit violations
85
Insurance Coverage and Enforcement Actions–
Check your Policy
ƒ Does insurance cover company/employees for a pollutioncausing incident?
ƒ Will the policy cover the fees to hire criminal counsel?
ƒ Criminal cases–remediation costs–conditions of probation
ƒ Is there a Pollution Exclusion and Buyback clause? If so, you
may need to establish
ƒ
ƒ
ƒ
ƒ
(a) accidental;
(b) occurred during the policy period;
(c) became known within seven days; and
(d) insurance company was notified within 90 days.
ƒ Even if you are supposed to be indemnified by another, your
insurance should provide you with the means to hire counsel of
your own choosing
86
New Requirements
ƒ Vessel General Permit (water pollution)
ƒ Current permit applies to large vessels
ƒ Recent study precursor to expansion to fishing
vessels and smaller vessels
ƒ New Emissions Control Zones (air pollution)
87
Vessel General Permit – Basics
ƒ Clean Water Act requires a permit for discharge of
any pollutant into waters of the US from a point
source unless exempted
ƒ Pollutant – dirt, hot water, toxics, sediment, and even
different water – this is NOT ONLY ABOUT OIL OR
BALLAST WATER
ƒ Point source – a pipe or a vessel including run off
from a deck
88
Vessel General Permit – Basics (cont.)
ƒ Six Parts to Permit
ƒ
ƒ
ƒ
ƒ
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General Conditions
Effluent Limits
Corrective Action Requirements
Monitoring, Inspection, Recordkeeping, Reporting
Vessel-Specific Requirements
State and Other Supplemental Requirements
89
Vessel General Permit – Basics (cont.)
What is Required?
ƒ Sets requirements for the management of 26 kinds
of discharges
ƒ Modifies and adds to requirements based on kind of
vessels
ƒ Imposes some notification requirements on some
vessels
ƒ Contains inspection and self reporting obligations
90
The Final Vessel General Permit
Where must you comply?
ƒ “waters of the United States”—up to 3 miles
seaward from low tide mark
ƒ Applies no matter the flag of the vessel, and no
matter how many times or for what length of time,
the vessel is in waters of the United States
ƒ Likely applies to vessels in port and idle for
seasonal periods (“in transportation”)
91
The Final Vessel General Permit
Why It Matters
ƒ Not just about ballast water
ƒ Consent to inspect and search
ƒ EPA enforcement NOT COAST GUARD
ƒ Public access to compliance records
ƒ Serious civil and criminal penalties
ƒ Citizens may sue for violations
92
Vessel General Permit
26 Discharges
1. Deck washdown and runoff and 9. Controllable pitch propeller above water line hull cleaning
hydraulic fluid and thruster hydraulic fluid/other oil sea 2. Bilge water
interfaces including discharges
3. Ballast water
from paddle wheel propulsion, 4. Anti‐fouling leachate from anti‐
stern tubes, thruster bearings, fouling hull coatings
stabilizers, rudder bearings, azimuth thrusters, and propulsion 5. Aqueous film forming foam (AFFF)
pod lubrication
6. Boiler/economizer blowdown
10. Distillation and reverse osmosis
7. Cathodic protection
brine
8. Chain locker effluent
11. Elevator pit effluent
12. Firemain systems
13. Freshwater layup
93
Vessel General Permit
26 Discharges (cont.)
14. Gas turbine wash water
15. Graywater
20. Seawater piping biofouling prevention
21. Small boat engine wet exhaust
16. Motor gasoline and compensating discharge
22. Sonar dome discharge
17. Non‐oily machinery wastewater
23. Underwater ship husbandry
18. Refrigeration and air condensate 24. Welldeck discharges
discharge
25. Graywater mixed with sewage 19. Seawater cooling overboard from vessels
discharge
26. Exhaust gas scrubber wash water discharge
94
Vessel General Permit
What Is Not Covered?
ƒ Discharges not subject to the
former NPDES permit
exclusion
ƒ Sewage
ƒ Used or spent oil
ƒ Rubbish, trash, garbage
ƒ Photo processing waste
ƒ Effluent from dry cleaning
operations
ƒ Medical waste
ƒ Noxious liquids
ƒ Tetrachloroethylene
(perchloroethylene)
degreasers
ƒ Discharges currently or
previously covered by
another permit
95
Vessel General Permit
What Is Not Covered? (cont.)
ƒ Discharges NOT covered by this permit are
prohibited unless another permit allows them
ƒ Ballast tank clean out was an incidental discharge
and is not allowed by this permit
96
Vessel General Permit Requirements
A Closer Look
ƒ Notice of intent to comply
ƒ Inspection and identification of discharge streams
ƒ Best Management Practices to manage 26 streams
ƒ Reports of noncompliance
ƒ Corrective action
97
The Final Vessel General Permit
Who Must File NOI?
ƒ Owners / Operators of vessels delivered on or before
September 19, 2009
ƒ Must file no later than September 19, 2009
ƒ Authorization granted until that date; if an NOI is filed
prior to September 19, 2009, uninterrupted coverage
continues
ƒ Owners may probably file for all their vessels rather
than have operators of their vessels file
98
How Do I Comply?
ƒ No fixed formula for compliance
ƒ EPA has set standards for how each of the 26
incidental discharge streams must be managed:
ƒ Some require removal of the pollutant prior to
discharge
ƒ Some require prevention of the discharge itself
99
How Do I Comply? (cont.)
ƒ Planning
ƒ Training
ƒ Management
ƒ Documentation
100
Best Management Practices (“BMPs”)
ƒ best practicable control technology currently
available
ƒ best available technology economically
achievable
101
Best Management Practices (“BMPs”) (cont.)
ƒ Non-mandatory language may still be mandatory
102
Best Management Practices (“BMPs”) (cont.)
ƒ “Consistent with all other relevant laws”
ƒ “Consistent with good marine practices that
prevents excessive discharge….”
ƒ “Minimize by practicing proper maintenance”
ƒ Exchange ballast water “as early as practicable”
103
Best Management Practices (“BMPs”) (cont.)
ƒ “Owner/operators must use these non-fluorinated
substitutes for training when practicable and
achievable.”
ƒ “Most effective BMP is to conduct maintenance and
training activities as far from shore as possible.”
ƒ “Not all biodegradable soaps are appropriate.”
104
Best Management Practices (“BMPs”) (cont.)
ƒ “Using visual observations ...”
ƒ “Vessels that generate wet exhaust must be
maintained in good operating condition”
ƒ BMP encourages all waste to be collected and
disposed of properly
ƒ Require that the seals or fittings be maintained in
good working order to prevent leakage
105
How Do I Develop BMPs?
ƒ Develop a BMP working group
ƒ Identify and assess discharge streams
ƒ Institute a BMP policy statement for each BMP
ƒ Ensure good housekeeping
ƒ Preventive maintenance is key
ƒ Incorporate an inspection and training program
ƒ Ensure it is implemented and followed
ƒ Keep detailed records
ƒ Regular reevaluation of BMP based on data
106
How Do I Develop BMPs? (cont.)
ƒ EPA and international resources:
ƒ PPIC
ƒ ICPIC
ƒ Industry associations
ƒ AWO
http://www.klgates.com/FCWSite/ballast_water/Guidance/
AWO_BMP_Manual.pdf
ƒ Marshal Islands
http://www.klgates.com/FCWSite/ballast_water/Guidance/
Marshall_Isl_VGP_Guidance.pdf
107
BMPs and Recordkeeping
ƒ The EPA will expect the permit holder to prove it was
using Best Management Practices
ƒ Often this means keeping records to document
compliance
ƒ Regulations require that records be maintained and
presented if requested
ƒ EPA has five years to bring enforcement actions
ƒ False statements on record books are punishable by up
to five years in prison
108
Special Requirements in Certain States
ƒ The VGP contains special conditions for 28 states
ƒ Applies to discharges in those states’ waters
109
Special Requirements in Certain States—
Examples
ƒ Florida: stricter effluent limits on oil, fuel, and oily
mixture discharge
ƒ Guam: avoidance of discharge in coral spawning
areas during spawning
ƒ Great Lakes states – ballast water treatment
110
Inspection and Reporting Obligations (§ 4)
ƒ Inspection
ƒ
ƒ
ƒ
ƒ
Routine visual inspections – requires sampling
Analytical monitoring
Comprehensive annual vessel inspections
Dry-dock inspections
ƒ Reporting
ƒ Records of violation
ƒ Recordkeeping
ƒ Annual non-compliance report – was due in February
111
Certifications Required for Submissions to EPA
“I have no personal knowledge that the
information submitted is other than true,
accurate, and complete.”
112
Training
ƒ Paperwork necessary but not necessarily sufficient
ƒ Be careful of training modules, software and pitches
113
Corrective Action Obligations (§ 3)
ƒ VGP requires “corrective action”
ƒ Triggers for corrective action – noncompliance
ƒ Corrective action assessment
ƒ Deadlines for corrective action
ƒ Effect of corrective action
114
Enforcement
ƒ Civil Enforcement
ƒ Civil penalties of up to $37,500 per day of violation
ƒ Injunctive relief could:
ƒ prohibit vessel from operating until violation corrected
ƒ require that action be taken to correct harm from
violation
ƒ require that other compensatory action be taken to
address environmental impacts related to the violations
115
What’s Next?
ƒ Legal Challenges
ƒ LCA/AWO/CSA v. EPA
ƒ Northwest Envir. Advocates v. EPA
ƒ NRDC v. EPA
ƒ Issues
116
Expectation for Enforcement
ƒ 24,000 vessels expected to be subject to permit
ƒ If 1% have some violative condition = 240
ƒ If 10% = 2400
117
New Air Pollution limits
ƒ Limits sulfur dioxide emissions severely
ƒ Based on IMO requirements
118
QUESTIONS?
http://www.klgates.com/practices/vessel_discharge_resources/
barry.hartman@klgates.com
202.778.9338
Copyright © 2010 by K&L Gates LLP. All rights reserved.