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California Air Board at it Again - Despite Losing at Ninth Circuit

The California Air Resources Board just voted to regulate shipboard emissions again - just several months after an earlier attempt was struck down by the Ninth Circuit Court of Appeals.  The proposed rules and the Board's "authority" to enact such rules are available here.

Some quick problems:

Board Is Regulating Beyond California territory:

“Regulated California Waters” means all of the following (A) all California internal waters; (B) all California estuarine waters; (C) all California ports, roadsteads, and terminal facilities (collectively “ports”); (D) all waters within 3 nautical miles of the California baseline, starting at the California-Oregon border and ending at the California-Mexico border at the Pacific Ocean, inclusive; (E) all waters within 12 nautical miles of the California baseline, starting at the California-Oregon border and ending at the California-Mexico border at the Pacific Ocean, inclusive; (F) all waters within 24 nautical miles of the California baseline, starting at the California-Oregon border to 34.43 degrees North, 121.12 degrees West, inclusive; and (G) all waters within the area, not including any islands, between the California baseline and a line starting at 34.43 degrees North, 121.12 degrees West; thence to 33.50 degrees North, 118.58 degrees West; thence to 32.65 degrees North, 117.81 degrees West; and ending at the California-Mexico border at the Pacific Ocean, inclusive.

Legal Authority - Air Resources Board's aggressive reading of the Supremacy Clause

Under State and federal law, the Air Resources Board (ARB or Board) can regulate both criteria pollutant and toxic diesel PM emissions from marine vessels. State law authorizes ARB to regulate marine vessels to the extent such regulation is not preempted by federal law. The proposed regulation is not preempted under the Ports and Waterways Safety Act (PWSA), and it does not conflict with the implementing U.S. Coast Guard regulations. Federal authorization under the Clean Air Act (CAA) is required for regulating new marine engines and for requiring retrofits on existing engines. However, no CAA authorization is required for implementing in-use operational requirements on existing marine vessel engines, such as the in-use emission limits in the proposed regulation. As a nondiscriminatory regulation with substantial benefits, the proposed regulation does not violate the Commerce Clause. And federal and state cases support ARB’s authority to regulate both U.S. and foreign-flag vessels within “California Coastal Waters.”

This issue and State's attempts to regulate in traditionally federal areas is the subject of an amicus brief we filed in the UFO Chuting v. Smith case (original post is here, Ninth Circuit opinion is here, cert petition is here), presently pending review of UFO's petition for a writ of certiorari at the U.S. Supreme Court. 

As we pointed out to the Supreme Court, (quoting our brief) even within their waters (baseline to 3 nautical miles seaward) states do not possess "police power" under the Submerged Lands Act to regulate navigation: 

The Act limits the ability of the states to enact regulations which interfere with commerce, navigation, defense, and international affairs. While states were granted regulatory powers over the submerged lands, and waters above those lands from the coast line to three nautical miles seaward, the Act expressly provides that federal law regulating interstate commerce and navigation is “paramount” to any state’s attempts to concurrently regulate these resources. The Act provides:

The United States retains all its . . . powers of regulation and control of said lands and navigable waters for the constitutional purposes of commerce, navigation, national defense, and international affairs, all of which shall be paramount to, but shall not be deemed to include, proprietary rights of ownership, or the rights of management, administration, leasing, use, and development of the lands and natural resources which are specifically recognized, confirmed, established, and vested in and assigned to the respective States.

43 U.S.C. § 1314(a) (2000) (emphasis added).

Lots to digest here, I imagine Pacific Marine Shipping Association has a complaint drafted for a federal court lawsuit already.

Ninth Circuit Strikes Down EPA Exemption on Vessel Discharges

The Ninth Circuit Court of Appeals struck down the Environmental Protection Agency's 30+ year old regulation exempting vessel "discharges" from the Clean Water Act's permit requirement.

In Northwest Environmental Associates v. U.S. Environmental Protection Agency (opinion here), at issue was a 35 year old regulation which set forth various vessel discharges that did not require a Clean Water Act permit listing them as follows:  Any discharge of sewage from vessels, effluent from properly functioning marine engines, laundry, shower, and galley sink wastes, or any other discharge incidental to the normal operation of a vessel.  40 C.F.R. 122.3(a).

The text of the Clean Water Act, as analyzed by the Court, provides:

Section 301(a) of the CWA provides that, subject to certain exceptions, “the discharge of any pollutant by any person shall be unlawful.” Id. § 1311(a). One of these exceptions is for discharges authorized by a permit granted pursuant to the National Pollutant Discharge Elimination System (“NPDES”), a system set forth in section 402 of the Act. Id. §§ 1311(a), 1342. The combined effect of sections 301(a) and 402 is that “[t]he CWA prohibits the discharge of any pollutant from a point source into navigable waters of the United States without an NPDES permit.” N. Plains Res. Council v. Fid. Exploration & Dev. Co., 325 F.3d 1155, 1160 (9th Cir. 2003).

Slip. Op. at 9029.

An enviromental group brought suit, (background posted at Marten Law Group site here), alleging that this regulation was ultra vires and ought to be struck down.  This regulation exempted three classes of discharge: marine engine discharge, graywater and discharges incident to vessel operations, i.e. ballast water.  The sewage portion of the regulation was addressed elsewhere.

The environmental group was urging the EPA to pass regulations regarding ballast water, a threat vector for aquatic invasive species.  The District Court agreed and ordered the EPA to bring the voided-regulation-exempt discharges into compliance with the permit requirements.  On appeal, the Ninth Circuit agreed and, without further appeal, the EPA must by September 30, 2008 grant permits for these formerly exempted discharges or presumably take action to abate the discharges.

This is a far reaching case that could impact every boat, ship, and barge nation-wide.  Very recently, the EPA began rule-making efforts to comply with the District Court order.  This rule-making project would provide general permits to various vessel types to authorize continued discharges (i.e. outboard motor exhaust, marine diesel exhaust, graywater, etc).  Stay tuned.

Beach Valuation - Exactions for Beach Loss Projected After Seawall Construction

Real Estate and Construction Law Blog has an interesting post on the estimated value of a beach, projected to be lost after the construction of a sea wall in Monterey Bay.

The case, Ocean Harbor House v. California Coastal Commission (opinion here), involves a condominum project seeking a permit from the Commission to build a seawall.  Erosion threatened the structure of the condos and a seawall was necessary to protect it.  Using a lost recreational value model for a 50 year period, the Commission required a mitigation fee of $5.3 million. 

In upholding the fee, the California Court of Appeals discussed the constitutional issues relating to this "exactions" and found the fee to be constitutionally proportional to the property taken:  "It is beyond dispute that California has a legitimate interest in protecting and maintaining its beaches as recreational resources."

United Nations Closing in on Regime for Cargo Carriage Disputes

A United Nations Committee has published a regime to resolve disputes arising from the carriage of cargo at sea.  This regime will assist the member states grapple with the increasingly globalization of maritime trade and provide a framework for dispute resolution.