United States: PA Environmental Hearing Board's Recent Decisions Give Renewed Emphasis to PA Constitution's Article I, Section 27, Carrying Significant Implications for All PADEP Permit Programs

When the Pennsylvania Department of Environment Protection (PADEP) issues an environmental permit — such as a National Pollutant Discharge Elimination System (NPDES) stormwater construction permit for a new commercial or residential development — that final action may be appealed to the Pennsylvania Environmental Hearing Board (EHB) within 30 days of receiving notice by any person with standing to challenge the action, which generally includes any individual or organization claiming to be directly and substantially impacted. That allows municipalities, environmental groups and private individuals to submit appeals to the EHB, arguing that the PADEP's action was arbitrary and capricious, an abuse of discretion or contrary to law.

Until now, the EHB's primary focus would be on whether the PADEP's issuance of the permit complied with the applicable statutes and regulations. In arguing that the PADEP's action was contrary to law, appellants would routinely add an allegation that the PADEP's action violated Article I, Section 27 of the Pennsylvania Constitution, which states that the "people have a right to clean air, pure water and to the preservation of the natural, scenic, historic and esthetic values of the environment."

Historically, it has been extremely difficult for appellants to win an appeal based on an alleged violation of Article I, Section 27, because long-standing EHB case law held that as long as the PADEP complied with the applicable regulations issuing the permit, and those regulations were adopted pursuant to Article I, Section 27 (which they all have been since 1971), then the Article I, Section 27 challenge would be unsuccessful.

In two recent cases, however, the EHB denied motions for summary judgment filed by permit holders seeking to dismiss Article I, Section 27 challenges. The EHB held in these cases that a demonstration of compliance with the applicable regulations will no longer be deemed adequate to satisfy Article I, Section 27. Although neither case resulted in a ruling on the merits, they potentially leave the PADEP permits vulnerable to challenges on the basis that the PADEP should have used its discretion and imposed additional conditions to reflect its responsibility to implement Article I, Section 27.

The most recent case where this issue came up was Justin Snyder et al. v. PADEP and Columbia Gas Transmission, LLC, which was decided by the EHB on December 21, 2015. In that case, the PADEP had approved an air quality plan for a natural gas compressor station in Pike County. A group of neighbors challenged the permit in an appeal to the EHB. Among the arguments raised in the appeal, the neighbors contended that the PADEP's action violated Article I, Section 27 of the Pennsylvania Constitution, asserting they had a right to clean air which was not taken into consideration.

The permittee asserted that its compliance with all of the applicable statutory and regulatory requirements automatically constituted compliance with Article I, Section 27 and sought to dismiss that claim in a motion for partial summary judgment. In rejecting the permittee's argument and allowing the Article I, Section 27 claim to proceed to a hearing, EHB Judge Bernard A. Labuskes referred to his prior ruling in Sludge Free UMBT v. DEP, decided on July 1, 2015, in which he had written extensively regarding the test to be used from here forward by the EHB for determining compliance with the constitutional provision.

As noted by Judge Labuskes, the Commonwealth Court in Payne v. Kassab, 312 A.2d 86 (Pa. Cmwlth. 1973), affirmed 361 A.2d 263 (Pa. 1976) first articulated a three-part test for analyzing whether the PADEP's final action comports with Article I, Section 27. The Payne test consists of the following questions:

  • Was there compliance with all applicable statutes and regulations relevant to the protection of the Commonwealth's public natural resources?
  • Does the record demonstrate a reasonable effort to reduce the environmental incursion to a minimum?
  • Does the environmental harm that will result from the challenged decision or action so clearly outweigh the benefits to be derived therefrom that to proceed further would be an abuse of discretion?

In Sludge Free UMBT, Judge Labuskes emphasized the second and third prongs of the Payne test, which had previously been largely ignored by the EHB. In his decision, he stated that perfect compliance with the minimum regulatory requirements "may not always be enough" if the PADEP can be shown to have unreasonably exercised its discretion. The judge indicated that, going forward, the EHB would address all three questions set forth in the Payne test in cases in which the appellants claim that the PADEP's action violates Article I, Section 27, which would open the door for greater scrutiny to be placed on PADEP's permitting decisions.

So what do these recent EHB decisions regarding Article I, Section 27 mean for developers applying for and receiving environmental permits from PADEP? They mean that the permitting process must be considerably more thoughtful on the part of both the PADEP and the permit applicant.

Let me provide an example of what I mean by thoughtful. Suppose a residential developer is going to construct 200 homes on 100 acres and is applying to the PADEP for an NPDES stormwater construction permit. Ordinarily, the developer's engineer would prepare an application, paying close attention to the requirements under the applicable statutes, regulations and PADEP guidance. It would submit that application to the PADEP, and the PADEP's review would focus primarily on whether the application complies with the applicable statutes, regulations and guidance.

Given the EHB's recent rulings on Article I, Section 27, however, both the permit applicant and the PADEP would be well advised to consider whether additional efforts, such as voluntarily agreeing to include additional BMPs as conditions in the permit, should be taken to establish in the administrative record that "reasonable efforts" were undertaken to further "reduce to a minimum the environmental incursion of the project under review." Moreover, both the permit applicant and the PADEP might want to highlight areas in the permit application that specifically identify the "benefits" of the project and the efforts being undertaken to minimize any potential environmental harm.

While those things might have been taken into consideration previously by both the PADEP and the permit applicant and its consultants, the most recent EHB decisions focusing on Article I, Section 27 would now compel the PADEP and the permit applicant to affirmatively undertake those efforts, do more to highlight such information in the permit application so the EHB can clearly see it later if the permit is appealed, and consider whether to voluntarily include conditions in the permit that would not necessarily be "required" by the regulations, but would demonstrate to the EHB that the PADEP exercised its discretion and took additional efforts to reduce any environmental incursion to a minimum.

Again, while neither of the recent cases involved decisions on the merits of the underlying Article I, Section 27 claims, the PADEP and permit applicants would do well to anticipate such claims and marshal all of the ammunition possible for the EHB to later find, if it comes to that, no violation of Article I, Section 27 based on the thoughtfulness of both the PADEP and the permit applicant in doing more than is minimally necessary under the applicable statute and regulations and reflecting that in the permit itself and the underlying administrative record.

It is clear that permits issued by the PADEP are slightly more vulnerable to challenges based on Article I, Section 27 than they were before. Both the PADEP and permit applicants need to be aware of those recent decisions and act accordingly.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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