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Guest Column: Liability on the horizon from Air Consent Orders

Today’s $100 billion a year
farming industry in America includes 238,000 farms that are considered
confined animal feeding operations (CAFOs) – and that number is
growing. As such operations expand, so do the emissions they generate
from animal housing structures and manure storage areas.
Today’s $100 billion a year farming industry in America includes 238,000 farms that are considered confined animal feeding operations (CAFOs) – and that number is growing. As such operations expand, so do the emissions they generate from animal housing structures and manure storage areas.

The U.S. Environmental Protection Agency (EPA) has said that CAFOs, regardless of their size, “can have a negative impact on nearby residences, particularly with respect to objectionable odors… other nuisance problems… [and] possible health effects.” A 2008 Congressional report singled out particulate matter, ammonia, hydrogen sulfide and methane as farming emissions linked to health problems in extremely elevated doses. The impetus for increased regulatory scrutiny on commercial agriculture is unclear, but negative public perception, fueled largely by misinformation and urban sprawl, likely plays a role. The result is that the EPA is pushing to monitor, quantify and model CAFO air emissions, which will impose obvious regulatory burdens on commercial agriculture. A second, and less obvious, burden to be shouldered by America’s farmers will be the costs associated with increased civil litigation. First, let’s look at the regulatory oversight.

With CAFO air emissions on its radar screen, the EPA seeks to limit their sources. Ultimately, the government intends to subject CAFOs to the limitations and reporting requirements imposed by the Clean Air Act (CAA), the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) and the Emergency Planning and Community Right-To-Know Act (EPCRA). Such regulation is unachievable without the identification and quantification of actual CAFO air emissions. With the determination of baseline emissions, mathematical models will allow commercial farmers to estimate their annual emissions for reporting purposes. Enter the Air Compliance Agreements, through which the EPA and certain livestock, swine and poultry farmers have commenced a nationwide emissions monitoring study. The EPA believes this route to be “the quickest and most efficient way to address the current uncertainty” regarding emissions from CAFOs and to bring all participating CAFOs into compliance with “all applicable regulatory requirements.”

How will the proposed regulatory scheme impact CAFOs in the future? Take, for example, the CAA which regulates certain types of air emissions, including some directly linked to CAFOs. CAFOs emit particulate matter and nitrogen dioxide, which are classified as criteria pollutants, volatile organic compounds that are considered Hazardous Air Pollutants, and ammonia, which is a regulated air pollutant. Generally speaking, the CAA regulates “major sources” that exceed threshold quantities of regulated pollutants, and does not exempt livestock producers and other agricultural sources. The CAA assumes that most agricultural operations are “minor sources.” However, the EPA’s proposed air modeling may ultimately label some facilities as “major sources” and subject them to federal regulation, permitting and reporting requirements. Regardless of whether a CAFO is ultimately considered “major” or “minor” for CAA purposes, today’s farmer must also be aware of certain notice requirements triggered by both CERCLA and EPCRA.

CERCLA is best known for the remediation of abandoned hazardous waste sites. It also imposes criminal penalties for a failure to immediately notify the National Response Center when a reportable quantity of certain hazardous substances (including hydrogen sulfide and ammonia) is released into any part of the environment. EPCRA serves to inform communities and citizens of chemical hazards in their areas. A reportable CERCLA release triggers EPCRA notification as well, which go to both the state and the local emergency planning committees for any area likely to be impacted by the release. Local emergency planning committees consist of members of the community – including neighbors of CAFOs – as well as representatives from environmental groups and the media.

When the EPA establishes baseline air emissions, some CAFOs, depending on their size and emissions level, may be required to file annual Toxic Release Inventories, which detail the types and amounts of chemicals released into the environment. Such reports will be publicly accessible to anyone with an internet connection, and serve to empower citizens to hold companies and local governments accountable in terms of how toxic chemicals are managed.

Everyone generally agrees that disclosure makes for good public relations in any industry. A public armed with facts is less prone to speculation, rumor and exaggeration. As an added benefit, knowing that one’s operations are open to public scrutiny also serves to push owners to operate more efficiently, reduce emissions and comply with applicable laws, statutes and regulations.

However, no good deed goes unpunished. A likely (and unintended) effect of regulatory-driven public disclosure is the arming of potential plaintiffs (or their lawyers) with the information needed to attack farming operations. This phenomenon is nothing new to those industries already subject to these laws, as regulatory submissions are routinely used against manufacturers to prove wrongdoing. While CAFOs may already face complaints concerning odors and dust, future reporting requirements will likely raise the bar by putting farms in the direct path of litigation.

Luckily, time is on the farmer’s side, as the air monitoring efforts are just underway. It will be some time until the models are available and statutory reporting becomes a reality. Knowing that the EPA intends to reduce
emissions, farmers should capitalize on this lull by identifying and resolving emissions that could cause future compliance issues and fuel unwanted litigation. To that end, farmers should treat the EPA’s current study as an early warning of things to come.

William M. Barnes is a partner in the Litigation Department at the law firm of Wildman Harrold (Chicago). He can be reached at barnesw@wildman.com