Commonwealth Court ruling limits pollution fines after spills into streams, groundwater

Fines for spills into state streams and groundwater must be based on how long the initial release lasts and not on how many days the pollution lingers, Pennsylvania’s Commonwealth Court ruled Wednesday in a decision that upends state environmental regulators’ longstanding practice for calculating penalties.

A three-judge panel sided with Downtown-based EQT Corp. and rejected the state Department of Environmental Protection’s contention that environmental fines should continue to mount when pollution remains in water or moves from one area of water to another after an active leak is plugged.

DEP’s interpretation of the state Clean Streams Law “would result in potentially limitless continuing violations” for a single spill as long as any remnant of the pollution stays in state waters or until state-approved remediation was completed, Judge P. Kevin Brobson wrote for the court.

“To rule otherwise would be tantamount to punishing a polluter indefinitely, or at least for as long as the initially-released industrial waste remains in the waters of the Commonwealth, for the same violation,” he wrote.

In a statement, EQT applauded the court’s decision and said it “correctly captures the problem with the DEP’s interpretation, which is that it creates uncertainty and leads to the absurd result of never-ending and unquantifiable liability in cases of this nature.”

DEP spokesman Neil Shader said Wednesday the department “is extremely disappointed in the Commonwealth Court decision” and will be appealing to the Pennsylvania Supreme Court.

The ruling relates to one part of the Clean Streams Law, section 301, which applies to releases of industrial waste.

Judge Brobson wrote that the decision “does not mean that there are no consequences for leaving industrial waste in the waters of the Commonwealth following a release” because the law allows DEP to take legal action to stop violations and gives the agency authority to revoke permits or halt operations.

EQT brought the case to contest DEP’s proposed fine for a breached liner in a 6 million-gallon wastewater holding pit at a Marcellus Shale drilling site in Tioga County in 2012.

DEP has recommended a penalty of at least $4.5 million for the leak, which the agency said in legal filings was the worst that its oil and gas program has experienced. Wastewater from the pit polluted high quality streams, an exceptional value wetland and an expansive area of groundwater, and triggered an unprecedented $11 million cleanup, DEP said.

EQT says the leak was caused by a third-party contractor and its environmental effects were minimal. The company said it worked cooperatively with DEP to limit damage from the release and is cleaning up the surrounding groundwater based on state standards.

The state Environmental Hearing Board is currently deciding how much to fine EQT for the leak and the Commonwealth Court’s decision will sharply narrow the scope of the possible fine.

In November 2016, DEP calculated that the maximum possible penalty under its now-rejected interpretation of the Clean Streams Law would be $157 million for each of three violations that continued for more than 1,500 days.

Under the Commonwealth Court ruling, the company can only be penalized for the days that wastewater seeped from holes in the pit before it was emptied, which could be as few as 12 days or more than 42 days, depending on who is counting.

EQT has argued to the hearing board that the most it can be fined is $10,000 per day for the 12 days between when it reported the leak and when it emptied the pit, which would amount to a total penalty of $120,000 or less.

Laura Legere:

First Published January 11, 2017 12:56 PM

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