Environmental Justice Update (April 2024)

This alert describes significant developments in federal and state initiatives relating to environmental justice (EJ). Our prior update was issued in August 2023 and can be found here.

Federal Updates

State Attorneys General Petition EPA to Repeal Anti-Discrimination Regulation

In April 2024, a group of 23 attorneys general, including from Florida, Idaho, and Texas, filed a petition asking the US Environmental Protection Agency (EPA) to repeal one of its longstanding anti-discrimination regulations. At issue is EPA’s disparate impact regulation, which does not allow entities receiving federal funds to take actions that “have the effect of subjecting [a person] to discrimination” based on their race, color, or national origin. The rule does not require a showing that the entity intended to discriminate; all that must be shown is that the entity’s actions had a discriminatory effect.

The disparate impact regulation has been on EPA’s books for decades. It was originally promulgated in 1973 in response to the passage of Title VI of the Civil Rights Act of 1964. However, according to the petition, EPA has not historically enforced it, with enforcement actions only picking up in recent years due to the agency’s increasing focus on EJ. The petitioners argue that the rule is unconstitutional and propose removing all reference to it from the relevant sections of the Code of Federal Regulations. EPA’s response to the petition will be followed closely, especially in light of the recent ruling in Louisiana v. US Environmental Protection Agency, et al. (discussed below). Meanwhile, other states are taking the opposite approach and forging ahead with their own state-level EJ initiatives, including New York’s new permitting rule discussed below.

EPA Launches Audit of its Brownfields Program

In January 2024, EPA initiated an audit of its Brownfields Program, which provides grants and technical assistance to help clean up contaminated properties around the nation. The audit will ensure that the Brownfields Program is using its funds, including the large influx of cash it received under the 2021 Infrastructure Investment and Jobs Act (US$1.5 billion), in accordance with the Biden Administration’s Justice40 Initiative, which requires that 40% of certain federal investments be used to benefit disadvantaged communities that are overburdened by pollution. The audit will also keep track of EPA’s progress toward integrating and implementing EJ more generally throughout 2024.

Ruling in Louisiana Case May Undercut Federal EJ Efforts

In January 2024, a federal court in Louisiana barred EPA and the US Department of Justice (DOJ) from enforcing their disparate impact regulations against the state. The case, Louisiana v. Environmental Protection Agency, et al., was filed in response to an EPA investigation into Louisiana’s permitting processes, which the agency believed were resulting in a disparate impact on Black neighborhoods. Although the agency ultimately dropped the investigation, the lawsuit continued and was decided in favor of Louisiana. The ruling could be a serious setback to EPA’s EJ enforcement efforts and may make the agency less inclined to seek disparate-impact-based enforcement in certain states.

EPA to Distribute US$2 Billion in EJ Grants

In November 2023, EPA announced the Environmental and Climate Justice Community Change Grants Program. The program plans to provide US$2 billion in grants to community-based projects aimed at reducing pollution and building climate resilience in areas that have been adversely impacted by climate change, legacy pollution, and historical disinvestments. Applications will be accepted through November 21, 2024, with average awards expected to be upwards of US$10 million each (not to exceed US$20 million each). Entities eligible to apply for a grant are: (1) partnerships between two community-based nonprofit organizations (CBOs) and (2) partnerships between one CBO and a local government, an institution of higher education, or a Federally Recognized Tribe. Other entities may be eligible to participate in the program as collaborating subrecipients or procurement contractors.

DOJ Releases its First EJ Enforcement Annual Report

DOJ’s recently created Office of Environmental Justice issued its first-ever Comprehensive Environmental Justice Enforcement Strategy Annual Report on October 13, 2023. The report states that DOJ has been directing its attorneys to “prioritize cases that will reduce…environmental harms to overburdened and underserved communities.” The report also highlights some of the agency’s recent successes in cases involving EJ concerns, including:

• Securing settlements with several processors of natural gas for violations of the Clean Air Act, which will reduce air pollution in EJ communities across 12 states;
• Reaching an interim resolution agreement related to allegations that the Alabama Department of Health operated some of its wastewater disposal programs in a discriminatory manner;
• Indicting companies for illegally dumping construction waste into the wetlands of Puerto Rico; and
• Securing an agreement that requires the City of New York to clean up radioactive materials stored in city-owned properties.

In light of DOJ’s recent commitment to prioritizing EJ, it is reasonable to expect EJ-focused enforcement litigation to continue across the US for years to come.

State Updates

New York to Incorporate EJ Considerations into Permitting Process

In September 2023, the New York State Department of Environmental Conservation (NYSDEC) published a draft policy that seeks to incorporate EJ considerations into NYSDEC’s permitting processes. Under the draft policy, if a proposed project will (1) result in greenhouse gas or co-pollutant emissions and (2) “disproportionately burden” a disadvantaged group, then the developers of the project will be required to prepare a Disproportionate Burden Report (DBR). The DBR, which will be made public, must include an analysis of the benefits and burdens of the proposed project as well as any measures that could be implemented to mitigate its anticipated emissions. NYSDEC will review the DBR along with the project’s permitting application, and the report’s findings will be factored into NYSDEC’s deliberations. The draft policy also requires developers to prepare a Public Participation Plan and solicit input from members of the affected community about the project’s proposed design.

Pennsylvania Updates EJ Policy and Environmental Mapping Tool

In September 2023, the Pennsylvania Department of Environmental Protection (PDEP) released an interim final EJ policy, along with a new mapping tool that weighs more than 30 indicators to identify areas in need of greater environmental protection (EJ Areas). Under the interim rules, if a proposed project is (1) located in or near an EJ Area and (2) “of significant public concern” due to its potential effects on public health or the environment, then it will be subject to heightened public participation requirements before it can be approved. In each case, PDEP may hold public meetings or hearings regarding the project, or it may provide opportunities for additional public comment. PDEP also plans to establish an enforcement and compliance team to prioritize monitoring and inspections of projects located in EJ Areas. A final policy is expected to be issued in 2024.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. John Rousakis, an O'Melveny partner licensed to practice law in New York; Eric Rothenberg, an O'Melveny of counsel licensed to practice law in New York and Missouri; Chris Bowman, an O'Melveny associate licensed to practice law in California; and David Safarian, an O'Melveny associate licensed to practice law in California, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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