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April 14, 2017

Federal Court Invalidates Air Reporting Exemption For Large-Scale Livestock Operations

The ACTA Group

On April 11, 2017, the U.S. Court of Appeals for the District of Columbia issued a decision vacating the U.S. Environmental Protection Agency’s (EPA) rule exempting livestock feeding operations from air reporting requirements under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and the Emergency Planning and Community Right-to-Know Act (EPCRA). Large-scale animal feeding operations that confine, for example, more than 1,000 cattle, 2,500 hogs, or 125,000 chickens are categorized as concentrated animal feeding operations (CAFO) for regulatory purposes. Animal waste from CAFOs is collected in lagoons that release ammonia and hydrogen sulfide into the air. Ammonia and hydrogen sulfide are classified as “hazardous” under CERCLA, and “extremely hazardous” under EPCRA. Under both statutes, the reportable quantity is 100 lbs/day. EPCRA’s parallel reporting requirement mandates notification of releases to state and local authorities. In 2008, EPA promulgated the CERCLA/EPCRA Administrative Reporting Exemption for Air Releases of Hazardous Substances from Animal Waste at Farms. 73 Fed. Reg. 76948. The final rule exempted all farms from CERCLA reporting requirements for air releases from animal wastes. In response to concerns raised in public comments, EPA scaled back a similar proposed EPCRA exemption, and required CAFOs to continue reporting air emissions under EPCRA.

Environmental groups led by Waterkeeper Alliance challenged the final 2008 rule and an industry coalition led by National Pork Producers Council (NPPC) intervened. Waterkeeper asserted that EPA does not have authority under either CERCLA or EPCRA to carve out exemptions, and that the exemption was arbitrary in treating CAFOs separately from other sources like waste at zoos or slaughterhouses. NPPC asserted that the exception requiring EPCRA reporting from CAFOs goes beyond the statutory purpose of facilitating emergency response as EPA based its decision on the public’s interest in information. NPPC and others also pointed to legal precedent for recognizing an agency’s de minimis authority to create certain categorical exceptions to a statute “when the burdens of regulation yield a gain of trivial or no value.” EPA noted that notifications of air releases from animal waste have never resulted in response action, and it could not foresee future enforcement “because in all instances the source (animal waste) and nature (to the air over a broad area) are such that on-going releases makes an emergency response unnecessary, impractical and unlikely.”

The D.C. Circuit Court disagreed with EPA’s assertion that the reporting requirements would yield no regulatory benefit. The court cited numerous scenarios raised in public comments which support that the reports will be helpful in meeting statutory goals, including cases where people have become seriously ill or even died from the rapid release of hydrogen sulfide and ammonia during manure pit agitation for pumping purposes. The court noted the role of information in enabling a response from local and state authorities. The court also highlighted EPA’s broad response authority, including remedial and removal actions under CERCLA. The court was also not persuaded by cost-benefit arguments (i.e., the final rule estimated a ten-year cost savings of $60 million for operators, and 160,000 hours and $8 million in federal resources). It is unclear at this time whether EPA or the industry litigants will appeal the decision.

Although the exemption at issue applies to livestock operations, the decision could be used as precedent for challenges to other federal agency exemptions from statutory requirements. With an Administration in favor of regulatory rollbacks, any rules that carve out regulatory exemptions are likely to be met with strong opposition by environmental groups. Even in cases where enforcement may be impractical, if the requirement creates a public benefit or ameliorates a potential harm, then an agency will need to rely on more than practicality to justify an exemption. With an estimated 15,500 feeding operations impacted nationwide, there is sufficient need for technological advancements that will control and mitigate hazardous emissions from manure pits. The U.S. Department of Agriculture Agricultural Research Service (USDA-ARS) published research in 2010 in 2010 demonstrating ammonia removal and recovery from liquid manure using gas-permeable membranes. USDA-ARS subsequently filed a patent to develop the technology and is seeking a commercial partner to develop the technology.