Arch Coal vs. EPA, Limits of Authority



It should be safe to say that most people view the environment as important. However, it is safer to say that most people would like to have available energy. The classic battle between an energy source and claims of environmental danger has been rising up between Arch Coal and the Environmental Protection Agency (EPA). The battle has been going for 15 years as Arch Coal has been trying to expand its mining operations in West Virginia. The problem right now is that although a permit was already issued, the EPA is attempting to revoke the permit retroactively, an action that is largely believed to be outside its legal capabilities.

The EPA is citing the Clean Water Act as the source for their legal right to revoke this permit. However, in the documents prepared for the court hearing, Arch’s Coal said, “Allowing EPA perpetual and unrestricted lisence to modify a permit after its issuance – even when the agency authorized to modify the permit has concluded there are no grounds to justify doing so – would destroy the certainty that the permit is intended to provide and upset Congress’s allocation of regulatory authority among the Corps, the State, and EPA…Congress did not give EPA such unbridled power.”

The issue has been taken to the US Court of Appeals, where Robert Rolfe, the attorney for Arch Coal, stressed that the EPA has recognized role in the process of approving a permit, but this role ends as soon as the permit is issued and should never be used retroactively. In response, EPA Assistant Administrator Peter Silva wrote, “The EPA does not take such action lightly.” Along those lines, the EPA further argued that it has only retroactively revoked permits on two other occasions, one in Florida in 1981 and the other in Virginia in 1992. Likely feeling the pressure from the industry, Silva said that the EPA’s decision “does not threaten the tens of thousands of permits and authorizations that are issued by the U.S. Corps of Engineers every year.”

In 2007, when the permit was being issued, the EPA cited reservations, but did not choose to veto the permit. The permit was then issued later that year. In 2010, however, the EPA claimed there was “new information” and ruled that it would withdraw the permit that was issued three year earlier. They claimed that the withdrawal of this permit was necessary for the prevention of “adverse chemical, physical, and biological effects.”

The first round in court came when Arch Coal sued the EPA. Arch Coal won this round as US District Judge Amy Berman Jackson stated that the Clean Water Act “does not give the EPA power to render a permit invalid once it has been issued by the Corps.” Despite the admittedly awkward and unclear wording in the law, she remained strong on her statement that there was no statement of provision for a post-permit veto.

Unsurprisingly, this issue has caused quite a stir in the realm of industry. The U.S. Chamber cautions that, “billions of dollars in economic activity could be adversely affected if EPA’s unprecedented grab for veto authority goes unchecked.” This statement has found support from mining and manufacturing organizations such as the Alabama Mining Association to the National Association of Manufacturers.

As this issue continues to rise up in the courts, Arch Coal will continue to push that the law nowhere gives the EPA power to act retroactively when vetoing permits, while the EPA will continue to state that the law gives them power to act whenever they want. With both sides pushing forward, it is unclear what the final outcome will be, but very clear that that the effects will be long lasting.