Hazardous Substances Emissions Found Not Reportable Under CERCLA: U.S. Steel and Common Sense Prevail at Third Circuit

Saul Ewing LLP

Saul Ewing Arnstein & Lehr LLP

When a fire, spill or explosion causes pollutants to escape to the environment, responsible parties must quickly grapple with whether and when to report to authorities, which statutes and regulations apply, which agencies to notify and what to disclose. One key law that commonly triggers reporting obligations is Section 103 of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. § 9603. Section 103 mandates that a person in charge “immediately notify the National Response Center” as soon as they know that a reportable quantity of a hazardous substance was released. Importantly, CERCLA exempts from reporting “a federally permitted release.” The Third Circuit Court of Appeal’s recent opinion in Clear Air Council v. United States Steel Corporation, 2021 WL 2521588 (3d Cir. June 21, 2021), clarifies that emissions governed by a federal air permit may fall within this exception to the CERCLA release reporting requirement, even when they violate a facility’s air quality control permit.

U.S. Steel faced a reporting dilemma after fires at its Clairton Plant near Pittsburgh shut down two control rooms that removed pollutants from raw coke-oven gas. The company used that gas as fuel for its two nearby steel-making plants. After the fires, it could not fully process the raw gas to remove pollutants, but the company kept burning it as fuel. U.S. Steel held major source air emissions permits issued pursuant to the Clean Air Act (CAA) for its steel-making and coke-oven gas facilities, and the company reported the fire related emissions to the Allegheny County Health Department to comply with those air permits and air regulations.

U.S. Steel did not report the release to the National Response Center, concluding that the emissions qualified as an exempt “federally permitted release,” defined in section 101(10) of CERCLA. The Clean Air Council (the Council) disagreed and sued U.S. Steel for violating CERCLA, alleging that the company released reportable amounts of benzene and hydrogen sulfide. The federal district court for the Western District of Pennsylvania found that the federally permitted release reporting exemption applied, and the Council appealed to the Third Circuit. Judge Bibas authored the affirming opinion.

While acknowledging that burning raw coke-oven gas “belches” benzene, hydrogen sulfide and other pollutants into the air, the circuit court’s opinion focused on the statutory language defining federally permitted release. That definition includes eleven paragraphs exempting different types of permitted releases. These include, for example, “discharges in compliance with a permit” under the Federal Water Pollution Control Act (§ 9601(10)(A) & (D)), and “releases in compliance with a legally enforceable final permit” under the Solid Waste Disposal Act (§ 9601(10)(E)). However, as to air emissions, CERCLA defines “any emission into the air subject to a permit or control regulation under” the Clean Air Act or state Plans implementing it, as a federally permitted release. (§ 9601(10)(H))

The Council argued that the air emissions must be reported under CERCLA § 103 because “subject to” means “obedient to,” and only emissions that comply with permits qualify as federally permitted. U.S. Steel countered that “subject to” means “governed or affected by.” The court reasoned that “subject to” cannot mean “obedient to” because the latter means “in compliance with.” Had Congress intended “subject to” to mean “in compliance with,” it would have used “in compliance with” to describe the CAA exemption, just as it did elsewhere in the same definition.  

Thus, based on the plain language of the federally permitted release definition, the court found Congress intended to exempt emissions that are governed or affected by a CAA permit. The Third Circuit panel found this interpretation to be consistent with other provisions of CERCLA and the CAA. And, given that the plain language of the statute was clear, the court declined to rely on legislative history or to defer to administrative interpretations. The court next skirted deciding whether the reporting exception was an affirmative defense, and proceeded to evaluate the hydrogen sulfide and benzene emissions in the context of U.S. Steel’s CAA permits. The panel determined the emissions were covered by the federal permits and thus exempt from section 103 release reporting, handing U.S. Steel a victory.

Determining whether and how a release must be reported is often not straightforward, as demonstrated in Clear Air Council v. United States Steel Corporation

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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