Environmental News - Vinson & Elkins LLP

Environmental News 

September 2007 

2 

Court Grants Summary Judgment to Citizen 

Suit Plaintiff Based on Credible Evidence of 

Opacity Violations 

3 

TCEQ Issues Long-Awaited Small MS4 

Stormwater Discharge General Permit 

5 

Greenhouse Gas Update: Massachusetts and 

Maine Issue Draft Regulations Implementing 

the Regional Greenhouse Gas Initiative; and 

Western Climate Initiative Issues Statement of 

Regional Goal 

8 

Radioactive Waste Regulation Transferred 

From TDSHS to TCEQ 

9 

TCEQ Regulatory Watch 

12 

Calendar of Events 

7 

Court Allows Natural Resource Trustees 

Prospective Recovery of Assessment Costs 

as Incurred on Hanford Nuclear Reservation 

V&E Environmental News is a monthly newsletter focusing on environmental regulatory and policy developments. It is published by the Environmental 

and Administrative Law Section of Vinson & Elkins LLP. This newsletter is not intended to be legal advice or a legal opinion on any specific facts or 

circumstances. The contents are intended for general information purposes only. Application of the information reported herein to particular facts or 

circumstances should be analyzed by legal counsel. 

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information to Stephanie Schwausch 713.758.2131 sschwausch@velaw.com. 

© Copyright 2007 Vinson & Elkins LLP. All rights reserved. www.velaw.com


Court Grants Summary Judgment 

to Citizen Suit Plaintiff Based 

on Credible Evidence of 

Opacity Violations 

On August 27, 2007, a federal court in Alabama granted summary 

judgment to the Sierra Club in a citizen suit it brought 

against the Tennessee Valley Authority (TVA). The suit alleged 

thousands of violations of the 20 percent opacity standard at 

the TVA’s Colbert County, Alabama coal-fired power plant. The 

ruling by the Federal District Court for the Northern District of 

Alabama is notable, because it relied on continuous opacity 

monitoring system (COMS) data as “credible evidence” of the 

alleged violations, even though there were no violations 

demonstrated using the “authorized” method for measuring 

opacity (Method 9), and there was no evidence of any exceedence 

of the facility’s particulate matter (PM) emission limit. 

The credible evidence rule, as its name implies, allows 

any credible evidence of a violation to be used to demonstrate 

the existence of the violation. Previously, only “authorized” 

EPA monitoring techniques, such as Method 9, could be used 

to establish that a violation had occurred. The Sierra Club v. 

TVA opinion reportedly is the first instance following the adoption 

of the credible evidence rule that the rule has been used in 

a citizen suit against a power company. 

The underlying suit, which was filed in 2002, has had a 

complex procedural history. The motion for summary judgment 

decided on August 27 was urged following a 2005 appeal 

decided by the Eleventh Circuit. Among other things, the 

appeals court ruled that although Method 9 was the only 

method available to demonstrate an opacity violation until 

Alabama’s version of the “credible evidence” rule was approved 

by EPA, the credible evidence rule could be applied 

to any violation that occurred after that date. It held also that 

a particular provision of the Alabama air pollution rules, which 

authorizes a source to exceed its opacity limit for up to 2 percent 

of its operating hours each calendar quarter, was only an 

undocumented “interpretation” of the Alabama air rules during 

the relevant period; contravened the Clean Air Act’s mandate 

of continuous compliance; and had never been approved by 

EPA as part of Alabama’s state implementation plan. 

On remand, the Sierra Club moved for summary judgment 

on TVA’s liability for certain opacity exceedences measured by 

the COMS at the Colbert County plant that occurred between 

January 3, 2000 (the effective date of EPA’s approval of the 

Alabama credible evidence rule) and the cutoff date for the 

violations alleged in the Sierra Club’s complaint. The district 

court granted the motion in a lengthy opinion that addressed a 

number of arguments concerning the use of credible evidence 

to establish violations. 

Specifically, the court held that COMS data, by itself, is 

credible evidence of opacity violations, notwithstanding that the 

COMS readings could not be “correlated with” Method 9 opacity 

readings. As the court explained, “If COMS measurements 

have to be matched up to, correlated or related back to, or 

scientifically explained in terms of what a simultaneously taken 

Method 9 test would have shown, then the credible evidence 

rule is meaningless.” The court later went on to say that 

although it was not necessary to decide the motion for 

summary judgment: 

. . . even were TVA able to show at trial a series of Method 

9 tests performed contemporaneously with COMS readings, 

with the Method 9 readings under 20%, and the 

COMS over 20%, the court would not have to accept 

TVA’s technical or margin of error assertions. Advances in 

technology are not necessarily more accurate but, having 

received the voluminous filings and the declarations by 

various witnesses dealing with opacity testing methodology, 

the court finds that there is not a material factual 

dispute that COMS monitoring is, first, credible evidence, 

[and] second, a more accurate and reliable testing methodology 

[than Method 9] . . . . 

The court also held that the COMS data, by itself, was 

sufficient to find for the Sierra Club on a motion for summary 

judgment. For purposes of its summary judgment motion, the 

Sierra Club had agreed to drop its claims for opacity exceedences 

during “safe harbor” periods of startup, shutdown, 

and load change, and the TVA had agreed to waive any 

technical or permit defenses to opacity readings above 25 

percent. However, TVA apparently had argued that since 

Method 9 was accurate only to plus or minus 5 percent or 

since data collected more frequently than every six minutes 

might not show a violation, there were factual issues concerning 

whether any COMS readings between 20 and 25 

percent were actually evidence of violations. The court found 

that under the credible evidence rule, the COMS data showing 

opacity readings between 20 and 25 percent was sufficient 

evidence of a violation. Since there were no material factual 

disputes that the readings exceeded 20 percent, and since 

TVA’s COMS did not record data more frequently than every 

2

six minutes, there was sufficient evidence in the record to find 

TVA liable for these exceedences. 

TVA is exempt from civil penalties, because it is a federal 

agency, but it remains liable for injunctive relief. The court’s 

opinion addressed only the liability issues, so it remains to be 

seen what injunctive relief the court might find to be appropriate. 

The court expressed some sympathy to TVA for its result, 

since four of the Colbert facility’s units met the opacity standard 

99 percent of the time and the fifth met the opacity 

standard 99.5 percent of the time. But the court felt constrained 

by the 2005 appellate opinion and the credible evidence rule to 

find that TVA violated its opacity standard nearly 3,400 times 

between January 3, 2000 and September 26, 2002. 

That COMS data was found to be credible evidence is 

not surprising on its face, but the opinion is instructive because 

for all of the controversy surrounding the credible evidence 

rule, there have been few reported decisions that have addressed 

how the rule should be applied. This federal district 

court, at least, did not require any evidence using the prescribed 

compliance method, nor did it give much weight to 

attacks on the “credibility” of otherwise “credible evidence.” As 

a result, the owners of facilities with air emissions should be 

attentive to the implications of any data they may be generating 

that could be used to demonstrate a violation of an 

emission standard, even if authorized or other emission 

measurements demonstrate compliance. 

For more information about the Sierra Club v. TVA 

opinion or the credible evidence rule generally, please contact 

Vinson & Elkins lawyers Chris Amandes at 713.758.1146 

or Eric Groten at 512.542.8709. 

TCEQ Issues Long-Awaited Small 

MS4 Stormwater Discharge 

General Permit 

After an almost five-year wait, on August 13, 2007, TCEQ 

finally issued Texas Pollutant Discharge Elimination System 

(TPDES) General Permit TXR040000, which provides permit 

coverage for stormwater discharges associated with municipal 

separate storm sewer systems (MS4s) serving less than 

100,000 persons (small MS4s). These new regulations require 

regulated small MS4 operators to develop and implement a 

stormwater management program (SWMP) consisting of six 

comprehensive control measures designed to limit pollution 

discharged to surface waters in the state. Small MS4 operators 

that choose to obtain authorization under this general permit 

must submit a SWMP and a completed notice of intent (NOI) 

form to TCEQ on or before February 11, 2008. 

Background 

On September 14, 1998, TCEQ received authority from EPA to 

administer the TPDES program (which program includes the 

discharge of stormwater) as it relates to “surface waters in the 

State,” which term includes lakes, ponds, rivers, the Gulf of 

Mexico inside the territorial limits of the state, and all other 

bodies of surface water that are wholly or partially in Texas. 

On December 8, 1999, EPA published Phase II stormwater 

regulations that required regulated small MS4 operators to 

obtain permit coverage by March 10, 2003. These Phase II 

small MS4 regulations are in the federal rules at 40 C.F.R. 

Sections 122.30 through 122.37, which sections (other than 

the federal guidance in Sections 122.33 and 122.34) were 

adopted by reference as amended by TCEQ at 30 T.A.C. 

Section 281.25(b). Accordingly, TCEQ published notice of 

a proposed small MS4 general permit in the September 27, 

2002 issue of the Texas Register, with the original comment 

period ending on November 15, 2002. However, on 

September 15, 2003, the U.S. 9th Circuit Court of Appeals 

(Court), in Environmental Defense Center v. EPA, 344 F.3d 

832 (9th Cir., 2003) issued a revised panel decision that 

remanded portions of the federal Phase II rules affecting 

small MS4s to EPA. The Court found that portions of the 

federal regulations were not consistent with the federal Clean 

Water Act because the Phase II rules did not, among other 

things, address public participation in the permitting process, 

namely, not allowing the public to comment on NOIs submitted 

by applicants seeking permit coverage under the general permit. 

EPA responded by issuing a memorandum dated April 16, 

2004 in which EPA provided guidance for permitting authorities, 

such as TCEQ, on how to issue general permits consistent 

with the Court’s decision. TCEQ revised the proposed 

general permit in accordance with EPA memorandum and 

published notice of the revised proposed general permit on 

August 26, 2005. A public meeting on the revised proposed 

permit was held in Austin on September 29, 2005, and the 

comment period for the revised permit ended at the close of 

the public meeting. 

Who Is Eligible to Apply for Small MS4 General 

Permit Coverage? 

Stormwater permitting programs already exist for large MS4s 

(serving 250,000 or more persons) and medium MS4s (serving 

3


100,000 or more, but less than 250,000 persons) pursuant to 

the Phase I NPDES stormwater regulations adopted by EPA in 

the early 1990s. Small MS4s are considered Phase II sources 

and mean any MS4 not already covered under Phase I of the 

NPDES stormwater program, including specifically those MS4s 

serving populations of less than 100,000 in urbanized areas. 

Under the Phase II rules, small MS4 operators that are fully or 

partially located within an urbanized area (UAs) as determined 

by the 2000 Decennial Census conducted by the U.S. Bureau 

of Census must obtain authorization for their stormwater 

discharge runoff. Permit coverage is intended to be provided 

primarily under the small MS4 general permit. While permit 

coverage also is available under an individual stormwater 

permit, such coverage is generally undesirable, given the 

likely time delays and amounts of information that would be 

required in order to process such a permit. A map detailing 

UAs located in Texas is available at http://cfpub.epa.gov/ 

npdes/stormwater/urbanmapresult.cfm?state=TX. 

In addition, TCEQ has the authority to designate small 

MS4 operators who are outside an urbanized area as being 

subject to regulation. This designation may be made by TCEQ 

on a case-by-case basis only after it conducts an evaluative 

process using certain enumerated factors, which determines 

that controls are necessary to protect water quality. MS4 

operators designated as being subject to regulation will be 

notified in writing by TCEQ and must seek coverage under the 

MS4 general permit or, alternatively, an individual permit. 

Submitting an NOI and Providing Public Notice 

Small MS4 operators subject to regulation who are seeking 

coverage under the small MS4 general permit are required to 

submit a completed NOI and a SWMP by February 11, 2008. 

Operators of small MS4s who are subsequently designated by 

TCEQ to be subject to regulation are required to submit the 

NOI and SWMP within 180 days of being notified in writing by 

TCEQ of the need to obtain permit coverage. 

In addition, as a result of the Environmental Defense 

Center v. EPA court decision, after submittal of the NOI and 

SWMP and upon receipt of written instructions from TCEQ, 

the applicant is now required to publish notice of the executive 

director’s preliminary determination on the NOI and SWMP in 

the newspaper. The notice must provide opportunity for the 

public to submit comments on the NOI and SWMP, which 

comment period will remain open for a period of 30 days from 

the first date the notice is published. In addition, the notice 

must allow the public to request a public meeting. A public 

meeting will be held if TCEQ determines that there is 

significant public interest. 

Discharge authorization begins when the applicant is 

notified by TCEQ that the NOI and the SWMP have been 

administratively and technically reviewed and the applicant 

has followed the applicable public participation provisions. In 

the event an NOI and SWMP are not submitted until after the 

February 11, 2008 deadline, authorization by TCEQ will be 

granted only for discharges that occur after permit coverage 

is finally obtained. TCEQ reserves the right to take appropriate 

enforcement actions for any unpermitted discharges. 

An application fee of $100 must be submitted with each 

NOI. Moreover, a permittee authorized under the small MS4 

general permit must pay an annual Water Quality fee of $100 

pursuant to Texas Water Code Section 26.0291 and 30 T.A.C. 

Chapter 205. 

SWMP Is Required 

A critical part of complying with the small MS4 general permit 

is the development and implementation of a SWMP, which 

plan is intended to prevent pollution in stormwater to the 

“maximum extent practicable.” To satisfy this standard, TCEQ 

requires regulated small MS4 operators to develop and implement, 

at a minimum, six different programs designed to help in 

preventing stormwater pollution. These programs, which will 

require extensive participation by, and support of, the regulated 

MS4 operators, address: 

• public education and outreach on stormwater impacts; 

• public participation and involvement in the stormwater 

management program development and implementation; 

• illicit discharges detection and elimination; 

• construction site storm sewer runoff control; 

• post-construction stormwater management in new 

development and redevelopment activities; and 

• pollution prevention and good housekeeping for 

municipal operations. 

Regulated MS4 operators will be required to submit 

schedules describing the deadlines by which these programs 

will be implemented over the life of the general permit. The 

programs must be completely implemented by the expiration 

date of the small MS4 general permit, which is five years after 

its issuance (or within five years of a small MS4 operator being 

designated as being subject to regulation). Implementation of 

the SWMP is required to commence immediately following 

receipt of written authorization from TCEQ. 

4

As part of its implementation of these six measures, 

regulated small MS4 operators also will be required to develop 

a map of their storm sewer system. This map must include the 

location of all outfalls, the names and locations of all waters of 

the United States that receive discharges from the outfalls, 

and any additional information needed by the permittee to 

implement its SWMP. 

Waivers From Regulation Under the Small MS4 

General Permit Exist 

Certain operators of small MS4 systems may avoid regulation 

by means of a waiver authorized by TCEQ. Two forms of 

waivers exist. Under Waiver Option 1, an operator of an otherwise 

regulated small MS4 may be excused from performance if 

the MS4 meets all of the following conditions: 

• MS4 serves a population of less than 1,000 within an UA; 

• MS4 does not contribute substantially to the pollutant 

loadings of a regulated, physically interconnected MS4 

(whether small, medium, or large); or 

• if MS4 discharges any pollutant that has been identified as 

a cause of impairment to any water body to which the MS4 

discharges, stormwater controls are not needed based on 

the waste load allocation that is part of any EPA-approved 

or established total maximum daily load (TMDL) for that 

pollutant. 

By comparison, under Waiver Option 2, an operator of an 

otherwise regulated small MS4 may be excused from performance 

if the MS4 meets all of the following conditions: 

• the MS4 serves a population of less than 10,000; 

• TCEQ has evaluated all waters of the United States and 

has determined that stormwater controls are not needed 

for any pollutant of concern based on the TMDL or, if the 

TMDL has not been developed or approved, an equivalent 

analysis that determines sources and allocations for the 

pollutant of concern; or 

• TCEQ has determined that future discharges from the 

MS4 do not have the potential to exceed Texas surface 

water quality standards or cause other significant water 

quality impacts. 

If a small MS4 operator is eligible for a waiver under 

Waiver Option 1, then the operator must complete and submit 

a waiver certification form. Small MS4 operators seeking to be 

excused from performance under Waiver Option 2 must contact 

TCEQ to request a waiver. The waiver exclusion process 

under Waiver Option 2 will require a comprehensive evaluation 

of all receiving water bodies and, according to TCEQ, “may be 

difficult to obtain.” 

Small MS4 General Permit Workshops Are 

Being Sponsored by TCEQ 

TCEQ is currently offering workshops on the newly adopted 

small MS4 general permit. The workshops will present information 

on the general permit and application process as well 

as discussion on components of the SWMP. Seating is expected 

to be limited and thus interested parties should contact 

TCEQ at 210.403.4092 to reserve a seat. Two separate workshops 

will be held in Houston on November 6, 2007 at the 

Johnson Space Center: 8:30 a.m. to 12:00 p.m. and 1:00 to 

4:30 p.m. For a complete schedule, visit the TCEQ website. 

As stated above, the deadline for submitting an NOI and 

SWMP is February 11, 2008. It is imperative that small MS4 

operators begin planning now in order to meet this deadline. 

If you have any questions regarding the Small MS4 General 

Permit or on stormwater permitting in general, please call 

Vinson & Elkins lawyer Larry Pechacek at 713.758.2004. 

Greenhouse Gas Update: 

Massachusetts and Maine Issue 

Draft Regulations Implementing the 

Regional Greenhouse Gas Initiative; 

and Western Climate Initiative Issues 

Statement of Regional Goal 

As summer came to a close, several more developments took 

place with regard to the emerging body of state and regional 

greenhouse gas (GHG) regulatory initiatives. Massachusetts 

and Maine issued draft regulations implementing the Regional 

Greenhouse Gas Initiative (RGGI) and the Western Climate 

Initiative issued a statement of regional goal. As reported in the 

July and August 2007 issues of V&E Environmental News, 

there is a growing list of states, mostly on the east and west 

coasts, that have decided not to wait on federal GHG legislation 

but rather to pursue their own regulatory initiatives to 

control GHG. These state initiatives are viewed as possible 

models for future federal GHG legislation. 

5


Massachusetts and Maine Issue Draft 

Regulations to Implement Cap-and-Trade 

Program under RGGI 

Apart from the pre-proposal draft regulations published in 

New York last December, the Massachusetts and Maine draft 

regulations are among the first regulatory cap-and-trade 

proposals to be published for comment in any of the RGGI 

member states, bringing them closer towards the implementation 

of the first mandatory GHG control regime in 

the United States. RGGI is an effort among Connecticut, 

Delaware, Maine, Maryland, Massachusetts, New Hampshire, 

New Jersey, New York, Rhode Island, and Vermont to develop 

a regional carbon dioxide cap-and trade program that first 

stabilizes and then reduces carbon dioxide emissions from 

fossil-fuel-fired power plants, with the goal of reducing the 

2018 annual emissions budget to 10 percent less than the 

initial 2009 emissions budget. The RGGI members have 

agreed to a Memorandum of Understanding (MOU) and 

agreed upon a model rule to implement the cap-and-tradeprogram. 

The Massachusetts and Maine proposed regulations 

follow the model rule with some variation. 

The Massachusetts draft regulations, issued under 

existing legislation authorizing the Massachusetts Department 

of Environmental Protection (MassDEP) to regulate air emissions, 

will regulate carbon dioxide emissions from fossil-fuelfired 

power plants with a capacity of 25 megawatts or more 

effective January 1, 2009. For units in operation prior to 

January 1, 2005, only those where fossil fuel compromises 

more than 50 percent of total heat input will be subject to 

the rules, whereas for units starting operation on or after 

January 1, 2005, all units using fossil fuels for more than 

5 percent of total heat input will be subject to the rules. 

MassDEP reports that there are 32 sources classified as 

fossil-fuel-fired units that would be regulated under these rules. 

Massachuetts did not adopt the optional provision in the model 

rule that would exempt units that sell less than 10 percent of 

their net generating capacity. 

To stabilize and then reduce carbon dioxide emissions, 

the Massachusetts proposed regulations adopt the state carbon 

dioxide budget provided in the MOU, establishing a cap 

through 2014 and then cutting carbon dioxide emissions by 2.5 

percent per year. Massachusetts proposes to allocate its carbon 

dioxide allowances by auctioning 100 percent of them in a 

regional or statewide auction. This provision is likely to cause 

debate, as auctioning all the allowances may be viewed by 

some as likely to increase energy costs. Massachusetts 

responded to such concerns by indicating that it intends to use 

the auction proceeds, an estimated $25 million to $125 million 

per year, to fund energy efficiency, peak demand reduction, 

and other cost-cutting efforts. 

Massachusetts proposes to adopt offset provisions based 

on the model rule, providing carbon dioxide allowances to 

projects that represent carbon dioxide equivalent emission 

reductions or carbon sequestration that are real, additional, 

verifiable, enforceable, and permanent. Consistent with the 

model rule, Massachusetts’ proposed regulations would 

impose a cap on the number of offset allowances used by a 

power plant, allowing an affected power plant to cover only up 

to 3.3 percent of its reported emissions with offset allowances. 

Thus, a significant portion of the required carbon dioxide emission 

reductions must occur at the power plants and cannot be 

offset through other projects. 

However, only projects located in a RGGI participating 

state or in a state that has a cooperative agreement with 

Massachusetts will be eligible for offset credit. The draft regulations 

require that non-RGGI governmental authorities complete 

cooperative agreements with all RGGI participating states in 

order to be eligible as offset allowances in Massachusetts. 

The draft regulations also prevent smaller projects outside the 

RGGI region from being eligible for offset credit by requiring 

that projects outside of RGGI states exceed a minimum 

threshold of 20,000 tons of annual reduction carbon dioxide. 

The proposed regulations list five types of approved 

offset projects: (1) landfill methane capture and destruction; 

(2) reduction in emissions of sulfur hexafluoride; (3) sequestration 

of carbon due to afforestation; (4) reduction or avoidance 

of carbon dioxide emissions from natural gas, oil, or propane 

end-use combustion due to end-use energy efficiency; and 

(5) avoided methane emissions from agricultural manure 

management operations. 

The proposed regulations do contain price triggers if 

the costs of allowances are higher than expected. If the 12- 

month average price of a carbon dioxide allowance equals 

or exceeds $7.00 (in 2005 dollars), affected units will be 

allowed to increase their use of offsets from 3.3 percent to 5 

percent of their compliance obligation. If the 12-month average 

price of a carbon dioxide allowance equals or exceeds $10.00 

(in 2005 dollars), affected units will be allowed to expand their 

use of carbon dioxide offset credits to 10 percent of their 

compliance obligation. 

Maine’s proposed regulation generally parallels 

Massachusetts’ proposal with several limited exceptions. 

6

Unlike Massachusetts, Maine’s regulation will only become 

effective January 1, 2009 if the other states whose electrical 

utilities are administered by the same regional transmission 

organization as Maine have implemented similar cap-and-trade 

programs and the combined carbon dioxide emissions budget 

from those states is at least 35 million tons per year. Maine’s 

regulation also exempts plants that supply no more than 10 

percent of their electricity to a transmission and distribution 

utility annually as permitted by the model rule, unlike the 

Massachusetts regulation. 

Western Climate Initiative Issues Statement of 

Regional Goal 

On August 22, 2007, the six states and two Canadian 

provinces that make up the Western Climate Initiative (WCI) 

issued a GHG Reduction Goal statement in which they agreed 

to collectively cut greenhouse gas emissions to 15 percent 

below 2005 levels by 2020. The WCI consists of Arizona, 

California, New Mexico, Oregon, Utah, Washington, British 

Columbia, and Manitoba, and was created in February 2007 to 

implement a joint strategy to reduce greenhouse gas emissions. 

WCI partners were directed to develop a regional target 

for reducing greenhouse gases, to develop a market-based 

program to reach the target, and to participate in a multi-state 

registry to track and manage greenhouse gas emissions in 

their region. This regional goal is an aggregation of the goals 

all eight WCI partners established individually, but it does not 

replace the individual goals. By August 2008, the WCI will 

complete the design of a market-based mechanism to achieve 

this reduction goal. 

In addition to setting the regional GHG reduction goal, the 

statement sets forth standards for new entrants into the WCI, 

suggested emission reduction activities, and reporting requirements 

to the other WCI partners on their “climate action plan” 

and GHG emission inventories every two years. 

For more information on greenhouse gas regulation 

contact Vinson & Elkins lawyers Larry Nettles at 

713.758.4586 or Jessica Held at 202.639.6636. 

Court Allows Natural Resource 

Trustees Prospective Recovery of 

Assessment Costs as Incurred on 

Hanford Nuclear Reservation 

A federal district court in Washington State recently shook the 

landscape of Natural Resource Damages (NRD) litigation by 

issuing a declaratory order allowing trustees to recover assessment 

costs upon a showing of liability of one responsible party. 

In so ruling, the decision in Confederated Tribes & Bands of 

the Yakama Nation v. United States, No. CY-02-3105.LRS, 

2007 WL 2570437 (E.D. Wash. Sept. 4, 2007), became the 

first to grant natural resource trustees prospective relief under 

the Comprehensive Environmental Response, Compensation 

and Liability Act (CERCLA). 

Since CERCLA’s inception, the enormous up-front costs 

of performing injury assessments to prove damages — often in 

the millions of dollars — have in part kept the number of NRD 

cases few and far between. The district court in Confederated 

Tribes opens the door to prospective recovery of assessment 

costs by differentiating “costs” from “damages” under 

CERCLA, thereby placing assessment costs outside the 

strict limitations statute of CERCLA. According to the court, 

“costs” reimburse a party for certain expenses incurred (i.e., 

reimbursement for a damage assessment), whereas “damages” 

are intended to compensate for the actual injury or loss 

revealed by an assessment. By so differentiating, the court 

ruled that natural resource trustees can recover assessment 

costs already incurred, as well as additional costs, so long as 

“reasonable” to the court. 

The implications of this recent decision remain unclear. 

Although Confederated Tribes certainly marks a victory for 

NRD trustees, proof of liability will continue to be a significant 

hurdle in this controversial area of law. Nonetheless, by allowing 

natural resource trustees to recover their assessment costs 

independently from their claims for damages, the Confederated 

Tribes decision potentially reduces a major impediment to NRD 

litigation. If later courts expound upon this decision by shifting 

the significant costs of performing cost damage assessment to 

defending parties at a pre-liability stage, or if courts mandate 

that adverse parties share costs at the outset of litigation, the 

NRD landscape could be dramatically altered. 

If you have any questions regarding the potential 

implications of this federal district court decision, please 

7


contact Vinson & Elkins lawyers Sharon Mattox at 

713.758.4598 or Taylor Pullins at 713.758.3432. 

Radioactive Waste Regulation 

Transferred From TDSHS to TCEQ 

TCEQ has proposed changes to the rules that regulate 

radioactive waste www.tceq.state.tx.us/rules/prop.html. The 

rulemaking implements Senate Bill (SB) 1604 from the 80th 

Legislative Session www.legis.state.tx.us/tlodocs/80R/billtext/ 

pdf/SB01604F.pdf. SB 1604 mandates the transfer of 

regulatory and licensing responsibilities for uranium mining, byproduct 

disposal, and commercial radioactive substance processing 

from the Texas Department of State Health Services 

(TDSHS) to TCEQ. Currently, TDSHS regulates these activities, 

while TCEQ regulates other radioactive waste disposal, 

including disposal of low-level radioactive waste. SB 1604 

consolidates the regulatory jurisdiction of all these activities 

under TCEQ. Personnel from TDSHS have already relocated 

to TCEQ. 

Members of the regulated community impacted by the 

changes are radioactive waste storage and processing industries, 

uranium miners, and by-product disposal facilities. TCEQ 

has emphasized that the proposed changes should not impose 

new regulatory requirements on businesses or individuals or 

increase fiscal obligations for currently regulated businesses or 

individuals. Rather, the TCEQ’s rulemaking is intended simply 

to transfer regulation from TDSHS to TCEQ. 

In addition to the ministerial transfer of functions, 

contested hearings over license applications now will be held 

under TCEQ, not TDSHS, rules. The practical impact of this 

change is that TCEQ’s definition of “affected person” (30 TAC 

§ 55.3) is broader than TDSHS’s (25 TAC § 289.205) and thus 

will offer more opportunities for challenging such applications. 

The rulemaking alters four chapters of Title 30 of the 

Texas Administrative Code: (1) Chapter 37, financial 

assurance; (2) Chapter 39, public notice; (3) Chapter 281, 

applications processing; and (4) Chapter 336, radioactive 

substance rules. A public hearing regarding this rulemaking 

will be held in Austin on September 25, 2007. Public comments 

are being solicited through October 8, 2007. The anticipated 

adoption date for the rules is December 19, 2007. 

SB 1604 also amends the TCEQ’s underground 

injection control program for regulation of uranium mining 

and requires TCEQ to establish a new state fee for the 

disposal of radioactive waste. TCEQ does not address these 

statutory changes in this rulemaking but instead will develop a 

separate, future rulemaking. TCEQ also may take a fresh look 

at the by-product disposal rules within the next year. 

For more information on TCEQ radioactive 

waste rulemaking, contact Vinson & Elkins lawyers 

Lewis Sutherland at 713.758.2367 or Mary Conner 

at 713.758.3365. 

8


Air Rules 

The following significant new air rule adoption has been 

published since the August 2007 issue of the V&E 

Environmental News. 

New Proposed Rules 

General Air Quality Rules 

• 32 Tex. Reg. 5296 – August 24, 2007 

• 30 TAC Chapter 113 

• TCEQ proposes amendments to certain sections of 

Chapter 113. The proposed amendments to Chapter 113 

would incorporate amendments that EPA made to the 

National Emission Standards for Hazardous Air Pollutants 

(NESHAP) for Source Categories, under 40 Code of 

Federal Regulations (CFR) Part 63 and add six NESHAPs 

that have not previously been incorporated into Chapter 

113. The proposed amendments would incorporate by 

reference amendments that EPA made to NESHAP for 

Source Categories under 40 CFR Part 63. These are 

technology-based standards commonly referred to as 

the maximum achievable control technology (MACT) 

standards. The MACT standards are required by the 

Federal Clean Air Act Amendments of 1990 (FCAA), 

Section 112, which requires EPA to develop national 

technology-based standards for new and existing sources 

of hazardous air pollutants listed in Section 112. The 

MACT standards are generally required to be based 

on the maximum degree of emission control that is 

achievable, taking into consideration cost and any nonair 

quality health and environmental impacts and energy 

requirements. In addition, the proposed new sections 

would incorporate by reference six MACT standards that 

have not been previously incorporated into Chapter 113. 

EPA is developing these national standards to regulate 

emissions of hazardous air pollutants as required under 

FCAA, Section 112, as codified in 42 United States Code, 

Section 7412. 

• Comments due by: September 24, 2007 

• Need additional information? Please contact Vinson & 

Elkins lawyer Chris Amandes at 713.758.1146. 

Control of Air Pollution From Motor Vehicles 

• 32 Tex. Reg. 5315 – August 24, 2007 


• TCEQ proposes amendments to Sections 114.7, 114.62, 

114.64, 114.66, and 114.70. The Commission proposes 

these revisions in order to implement requirements of 

Senate Bill (SB) 12, authored by the Honorable Senator 

Averitt, passed during the 80th Legislature, 2007. During 

the 77th Legislature, 2001, the legislature adopted 

provisions, House Bill (HB) 2134, to assist low-income 

individuals with repairs, retrofits, or retirement of vehicles 

that fail emissions inspections. As required by HB 2134, 

the Commission adopted rules providing the minimum 

guidelines for counties to implement a low income vehicle 

repair assistance, retrofit, and accelerated vehicle retirement 

program (LIRAP). 



Elkins lawyer Larry Nettles at 713.758.4586. 

Control of Air Pollution by Permits for New Construction 

or Modification 

• 32 Tex. Reg. 6053 – September 7, 2007 


• TCEQ proposes amendments to Section 116.114. The 

proposed rule amendment is required by House Bill (HB) 

3732, passed by the 80th Legislature, Regular Session, 

which sets the deadlines and directed TCEQ to adopt corresponding 

rules no later than January 1, 2008. The intent 

of HB 3732 and the associated rules is to provide an 

incentive to encourage the development of certain types 

of electric power projects that meet stringent emission 

limits. The proposed rule amendment would establish 

deadlines for the Agency's review of air permit applications 

for Advanced Clean Energy Projects (ACEP), in order to 

ensure that those permits are issued in an expedited manner. 

The rule proposal would require that the executive 

director complete the technical review of an ACEP permit 

application within nine months of determining the application 

is administratively complete. The rule proposal also 

requires the Commission to issue a final order issuing or 

denying the permit within nine months of the date the 

executive director determines the application is technically 

complete. The Commission has discretion to extend this 

deadline by up to three months, if meeting the deadline 

would create an extraordinary burden on Commission 

resources. The Commission specifically invites comment 

on whether or not the executive director should directly 

refer all ACEP air permit applications to the State Office of 

9


Administrative Hearings in order to ensure that hearings 

and permit issuance or denial can be completed within the 

deadlines specified in Texas Health and Safety Code 

(THSC), Section 382.0566. 



Elkins lawyer Kristie Tice at 713.758.3653. 

Water Quality Rules 

The following significant new water quality rule adoption has 

been published since the August 2007 issue of the V&E 



Water Conservation Plans, Drought Contingency Plans, 

Guidelines and Requirements Water Conservation Plans, 

Drought Contingency Plans, Guidelines and Requirements 



• TCEQ proposes to amend Sections 288.1 and 288.30. 

The proposed rules implement the sections of Senate Bill 

(SB) 3 and House Bill (HB) 4, both of which were passed 

in the 80th Legislature, dealing with water conservation 

planning. These sections, as implemented by the proposed 

rules, would amend the Texas Water Code (TWC) 

and: mandate the Agency to require a retail public utility 

providing potable water service to 3,300 or more connections 

to submit a water conservation plan and annual 

progress reports to the executive administrator of the 

Texas Water Development Board; require any entity 

currently required to submit a water conservation plan 

to the Agency under other provisions of the TWC to also 

submit a copy of the plan to the executive administrator of 

the Board; and require all entities with water conservation 

plans to submit an annual progress report regarding water 

conservation plan implementation to the executive administrator 

of the Board. The Board must review these plans 

and annual reports to determine if they comply with minimum 

requirements. The Agency and the Board are 

required by the legislation and proposed rule to identify 

minimum requirements for water conservation plans, 

deadlines for annual report submission, and provide for 

enforcement of the proposed rules. 

• Comments due by: October 9, 2007 


Elkins lawyer Sharon Mattox at 713.758.4598. 

Waste Rules 

The following significant new waste rule adoptions have been 

published since the August 2007 issue of the V&E 



Financial Assurance 



• TCEQ proposes amendments to Sections 37.9001, 

37.9030, 37.9035, 37.9040, and 37.9045. The changes 

proposed to this chapter are part of a larger proposal to 

revise the Commission's radiation control rules. The 

primary purpose of the proposed rules is to implement 

Senate Bill (SB) 1604, 80th Legislature, 2007, and its 

amendments to THSC, Chapter 401 (also known as the 

Texas Radiation Control Act (TRCA)). The bill transfers 

responsibilities for the regulation and licensing of source 

material recovery, by-product disposal, and commercial 

radioactive substances storage and processing from the 

Texas Department of State Health Services (TDSHS) to 

the Commission. This proposed rulemaking intends to 

transfer the technical requirements for these programs 

from the TDSHS's rules Sections 289.254 and 289.260 

of 25 TAC into new subchapters of the Commission's 

radioactive substantive rules in Chapter 336. While the 

technical requirements remain the same, these new 

Commission programs will be integrated into and administered 

under the Commission's existing radioactive 

material program requirements for application processing, 

public notice, public participation, licensing fees, financial 

assurance, and enforcement. The proposed amendments 

to Chapter 37 establish the financial assurance requirements 

for licenses for uranium recovery, by-product 

disposal, and radioactive substances storage and processing. 

The Commission proposes that the existing 

financial assurance requirements of Subchapter T of 

Chapter 37 be used for the licensing programs subject 

to the transfer of jurisdiction in SB 1604. SB 1604 also 

establishes a new state fee for disposal of radioactive 

substances and amends underground injection control 

10


requirements for uranium mining. The Commission intends 

to address the new requirements in separate rulemaking 

actions. 



Elkins lawyer Mary Conner at 713.758.3365. 

Public Notice 



• TCEQ proposes amendments to Sections 39.702, 39.703, 

39.707, and 39.709. The changes proposed to this chapter 

are part of a larger proposal to revise the Commission's 

radiation control rules. The primary purpose of the proposed 

rules is to implement SB 1604, 80th Legislature, 

2007, and its amendments to THSC, Chapter 401 (also 

known as TRCA). The bill transfers responsibilities for the 

regulation and licensing of source material recovery, byproduct 

disposal, and commercial radioactive substances 

storage and processing from the TDSHS to the Commission. 

This proposed rulemaking intends to transfer 

the technical requirements for these programs from the 

TDSHS' rules in Sections 289.254 and 289.260 of 25 TAC 

into new subchapters of the Commission's radioactive 

substantive rules in Chapter 336. While the technical 

requirements remain the same, these new Commission 

programs will be integrated into and administered under 

the Commission's existing radioactive material program 

requirements for application processing, public notice, 

public participation, licensing fees, financial assurance, 

and enforcement. The proposed amendments to Chapter 

39, Subchapter M establish the public notice requirements 

for radioactive materials licenses issued under Chapter 

336. SB 1604 also establishes a new state fee for disposal 

of radioactive substances and amends underground 

injecttion control requirements for uranium mining. The 

Commission intends to address the new requirements in 

separate rulemaking actions. 


Need additional information? Please contact Vinson & Elkins 

lawyer Mary Conner at 713.758.3365. 

Applications Processing 



• TCEQ proposes amendments to Section 281.19. The 

changes proposed to this chapter are part of a larger 

proposal to revise the Commission's radiation control 

rules. The primary purpose of the proposed rule is to 

implement SB 1604, 80th Legislature, 2007, and its 

amendments to THSC, Chapter 401 (also known as the 

TRCA). The bill transfers responsibilities for the regulation 

and licensing of source material recovery, by-product 

disposal, and commercial radioactive substances storage 

and processing from TDSHS to the Commission. This 

proposed rulemaking intends to transfer the technical 

requirements for these programs from the TDSHS’ rules 

in Sections 289.254 and 289.260 of 25 TAC into new 

subchapters of the Commission's radioactive substantive 

rules in Chapter 336. While the technical requirements 

remain the same, these new Commission programs will be 

integrated into and administered under the Commission's 

existing radioactive material program requirements for 

application processing, public notice, public participation, 

licensing fees, financial assurance, and enforcement. The 

proposed amendments to Chapter 281, Subchapter A 

establish the procedural requirements for the technical 

review of radioactive material licenses under Chapter 336. 

SB 1604 also establishes a new state fee for disposal of 

radioactive substances and amends underground injection 

control requirements for uranium mining. The Commission 

intends to address the new requirements in separate rulemaking 

actions. 




Radioactive Substance Rules 



• TCEQ proposes amendments to certain sections of 

Chapter 336. The changes proposed to this chapter are 

part of a larger proposal to revise the Commission's 

radiation control rules. The primary purpose of the proposed 

rules is to implement SB 1604, 80th Legislature, 

2007, and its amendments to THSC, Chapter 401 (also 

known as TRCA). The bill transfers responsibilities for the 

regulation and licensing of source material recovery, byproduct 

disposal, and commercial radioactive substances 

storage and processing from TDSHS to the Commission. 

This proposed rulemaking intends to transfer the technical 

requirements for these programs from the TDSHS’ rules 

in Sections 289.254 and 289.260 of 25 TAC into new 

11


subchapters of the Commission's radioactive substantive 

rules in Chapter 336. While the technical requirements 

remain the same, these new Commission programs will be 

integrated into and administered under the Commission's 

existing radioactive material program requirements for 

application processing, public notice, public participation, 

licensing fees, financial assurance, and enforcement. 

Some proposed rule changes are needed for purposes 

of clarification or to conform to Secretary of State requirements 

for rule publication. SB 1604 also establishes a 

new state fee for disposal of radioactive substances and 

amends underground injection control requirements for 

uranium mining. The Commission intends to address the 

new state fee and underground injection control requirements 

in separate rulemakings. 




Multi-Media and General Rules 

There have been no significant new multi-media and general 

rule proposals or adoptions published since the August 2007 

issue of the V&E Environmental News. 

Calendar of Events 

October 15 -16, 2007 

Advanced Air Permitting Seminar 

Location: 500 East 4th Street, Austin 

Time: 

9:00 a.m. 

Cost: $225 on or before October 1 

URL: 

www.tceq.state.tx.us/assets/public/assistance/ 

events/seminars/10-07airpermitting.pdf 

The seminar will focus on the authorization of emissions from 

maintenance, startup, and shutdown activities and what the 

division has learned over the last year regarding this topic. For 

further information, please contact Sue Phillips of TCEQ at 

512.239.6327, by fax at 512.239.4877, or by e-mail at 

sphillip@tceq.state.tx.us. RSVP: Required. 

12

Environmental and Administrative Law Group 

NAME OFFICE E-MAIL ADDRESS PHONE 

Nikki Adame Winningham Austin nadame@velaw.com 512.542.8828 

Christopher B. Amandes Houston camandes@velaw.com 713.758.1146 

Matthew A. Axtell Washington maxtell@velaw.com 202.639.6588 

Michelle L. Bacon Houston mbacon@velaw.com 713.758.4470 

Teodoro (Ted) B. Bosquez, IV Houston tbosquez@velaw.com 713.758.2733 

Molly Cagle Austin mcagle@velaw.com 512.542.8552 

Chris Carr Washington ccarr@velaw.com 202.639.6764 

Carol E. Dinkins Washington cdinkins@velaw.com 202.639.6548 

Carol E. Dinkins Houston cdinkins@velaw.com 713.758.2528 

Kevin A. Gaynor Washington kgaynor@velaw.com 202.639.6688 

Eric Groten Austin egroten@velaw.com 512.542.8709 

Jessica M. Held Washington jheld@velaw.com 202.639.6636 

George C. Hopkins Washington ghopkins@velaw.com 202.639.6641 

John L. Howard, Jr. Austin jhoward@velaw.com 512.542.8564 

Keith W. Lapeze Houston klapeze@velaw.com 713.758.3811 

Patrick W. Lee Austin plee@velaw.com 512.542.8629 

Benjamin S. Lippard Washington blippard@velaw.com 202.639.6640 

Sharon M. Mattox Houston smattox@velaw.com 713.758.4598 

Bryan J. Moore Austin bmoore@velaw.com 512.542.8729 

Larry W. Nettles Houston lnettles@velaw.com 713.758.4586 

Larry J. Pechacek Houston lpechacek@velaw.com 713.758.2004 

Johnnie R. Randolph Houston jrandolph@velaw.com 713.758.4822 

John A. Riley Austin jriley@velaw.com 512.542.8520 

Gabrielle Anne Sitomer Houston gsitomer@velaw.com 713.758.2766 

John W. So Houston jso@velaw.com 713.758.2808 

Lewis C. Sutherland Houston lsutherland@velaw.com 713.758.2367 

Christopher C. Thiele Austin cthiele@velaw.com 512.542.8632 

Kristie M. Tice Houston ktice@velaw.com 713.758.3653 

Gregory R. Wall Washington gwall@velaw.com 202.639.6793 

George O. Wilkinson Houston gwilkinson@velaw.com 713.758.4834 

Megan M. Williams Houston mwilliams@velaw.com 713.758.2908 

Mara E. Zimmerman Washington mzimmerman@velaw.com 202.639.6778 

V&E Environmental News 

PRODUCTION EDITOR OFFICE E-MAIL ADDRESS PHONE 

Jennifer N. Kight Houston jkight@velaw.com 713.758.2706 

Vinson & Elkins LLP Attorneys at Law Austin Beijing Dallas Dubai Hong Kong 

Houston London Moscow New York Shanghai Tokyo Washington www.velaw.com

Environmental News - Vinson & Elkins LLP

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