June 9, 2011
On May 31, 2011, New York Attorney General Eric Schneiderman followed through on his threat to file a lawsuit seeking environmental review under the National Environmental Policy Act (“NEPA”) prior to the issuance of final natural gas development regulations by the Delaware River Basin Commission (“DRBC”). The DRBC is a federal-interstate entity formed by compact and concurrent legislation by the federal government, Delaware, New Jersey, Pennsylvania, and New York to manage the water resources of the Delaware River Basin. The DRBC released draft natural gas development regulations on December 9, 2010 which, if finalized, would potentially open up large portions of the New York City watershed for natural gas drilling. While further action by New York State would likely be necessary for such natural gas drilling within New York, the complaint also alleges several harms to New York from natural gas development within Pennsylvania. In particular, the complaint alleges that development within Pennsylvania would contribute to air pollution in New York City and hinder efforts to meet air quality goals required under the Clean Air Act.
The lawsuit names the Army Corps of Engineers, which has a seat on the DRBC, as well as the Fish and Wildlife Service, the National Park Service, the U.S. Department of the Interior, and the Environmental Protection Agency as defendants. It asks these federal agencies to prepare an Environmental Impact Statement before the DRBC finalizes the regulations. It specifically asks the agencies to consider the alternative of prohibiting development within the portion of the Delaware River Basin that is within the New York City watershed.
The main legal issue in the lawsuit will likely be whether the regulations are a “federal action” within the meaning of NEPA. According to the complaint, the DRBC responded to Schneiderman’s initial request for an environment impact statement with a letter stating that the DRBC is not a federal agency subject to NEPA. However, the complaint alleges that the Army Corps of Engineers and the other federal agencies involved in the development of the DRBC regulations are subject to NEPA. The complaint also alleges that the Council on Environmental Quality (“CEQ”), which oversees implementation of NEPA, has determined that the DRBC is subject to NEPA.
Mark Lebel is a Summer Associate at Sive, Paget & Riesel
June 6, 2011
The nation’s first tidal energy power plant may take shape in New York’s East River, under a pilot project recommended for approval last month by the Federal Energy Regulatory Commission (“FERC”). In December 2010, Verdant Power applied for a license to install 30 underwater turbines between Roosevelt Island and Queens, which would enable tidal power to be sold over the national electric grid for the first time ever.
Tidal power represents an often-overlooked but growing renewable energy source, more predicable than wind or solar power, but often encumbered by high start-up costs. The strong, fluctuating currents in the East River – which is actually a tidal strait between the New York Harbor and the Long Island Sound – make this water body an ideal location for the generation of tidal energy. Verdant previously tested six tidal turbines in the proposed project location; they were used to power a Gristedes supermarket and a parking garage on Roosevelt Island.
The need for FERC licensing and other federal approvals triggered the National Environmental Policy Act (“NEPA”), requiring an analysis of the project’s significant, adverse environmental impacts. On May 3, FERC released an Environmental Assessment reporting no such impacts, thereby allowing the project to move forward without a more intensive Environmental Impact Statement. In particular, with respect to local fisheries, FERC based its Finding of No Significant Impact on its finding of only “minimal impacts on aquatic resources” from Verdant’s prior turbines, and on the company’s plans to conduct additional monitoring throughout the phase-in of its new plant. The results of this monitoring, however, could affect analysis under NEPA for future tidal projects.
May 25, 2011
On Tuesday, May 24, a New York State Supreme Court judge rejected a legal challenge to the redevelopment of the former Domino Sugar refinery in Williamsburg, Brooklyn, clearing the way for the transformative, mixed-use project to begin construction as early as next year. David Paget and Jennifer Coghlan of Sive, Paget & Riesel, P.C. successfully defended the project on behalf of its developer, an affiliate of CPC Resources, Inc.
Ruling from the bench following oral argument, Judge Eileen A. Rakower upheld the State Environmental Quality Review Act (“SEQRA”) analysis and municipal approvals for the project. The Court rejected claims that the City Council and City Planning Commission had been misled about the developer’s plans and upheld their decision not to compel disclosure about project financing, citing longstanding SEQRA precedent that such disclosure is not required absent “compelling evidence of a sham transaction or that financial sponsors are unwilling or unable to fulfill their obligations.”
The “New Domino” project, which is anticipated to break ground in 2012, will convert a vacant, formerly industrial site along the East River into an integrated development containing open space, community facilities, and commercial and residential properties, including a substantial affordable housing component. It would provide waterfront access on site for the first time in over a century, while preserving many of the former refinery’s historic structures, including the iconic “Domino Sugar” sign.
For more information about the recent decision, contact David Paget or Jennifer Coghlan.
April 22, 2011
On April 18, 2011, New York Attorney General Eric Schneiderman threatened to sue the Delaware River Basin Commission (“DRBC”), if it did not, within 30 days, commit to conducting an environmental review of its draft natural gas development regulations pursuant to the National Environmental Policy Act (“NEPA”). The DRBC is a federal-interstate entity formed by compact and concurrent legislation by the federal government, Delaware, New Jersey, Pennsylvania, and New York to manage the water resources of the Delaware River Basin. According to Schneiderman’s press release, “[t]he Basin includes the New York City watershed and portions of Broome, Chenango, Delaware, Schoharie, Greene, Ulster, Orange and Sullivan Counties, and provides approximately 50 percent of the drinking water used by over nine million New York residents and visitors every day.”
The DRBC released its draft natural gas development regulations on December 9, 2010, over the objection of former New York Governor David Paterson. Paterson had cautioned that DRBC’s regulations “did not have the advantage of the full investigations and public deliberations taking place in New York, and could conflict with or complicate any protocols ultimately established by New York after it completed its pending review of the environmental impacts of high volume hydraulic fracturing.”
In his public statement, Schneiderman criticizes DRBC’s failure to comprehensively assess the environmental impacts of its proposed regulatory scheme – in particular, the consequences of allowing hydraulic fracturing within the Basin – before releasing them in draft form.
March 22, 2011
Mayor Michael R. Bloomberg and City Council Speaker Christine C. Quinn recently released a sweeping plan to revitalize and capitalize on New York City’s 520 miles of shoreline. In addition to a three-year action agenda to complete 130 already-funded projects, it also provides specific plans and goals for various waterfront areas throughout the City.
The plan focuses not only on waterfront access and redevelopment of waterfront sites, but also improving water quality, restoring and enhancing waterfront habitats, and improving coordination between governmental agencies with overlapping jurisdiction over waterways and waterfront sites – one of the major stumbling blocks that has stood in the way of effective action. The plan also recognizes the need to consider and address the potential impacts of climate change and sea level rise in waterfront projects.
To advance these goals, the plan identifies site-specific projects in 22 reaches of the City’s waterways, and identifies several additional waterfront redevelopment sites. The plan also includes specific steps that should be taken to implement NYHarborWay, the Bloomberg Administration’s initiative to make New York Harbor a major recreational destination, and to connect Brooklyn Bridge Park, Governors Island, Hudson River Park, The Battery, Ellis Island, Statue Liberty Island, the East River Esplanade and Liberty State Park by ferry and/or bike greenways.
SPR has successfully guided many major waterfront projects to completion, and the plan includes several current projects on which SPR has served or currently serves as counsel, including: completion of Brooklyn Bridge Park, the redevelopment of the Admiral’s Row site at the Brooklyn Navy Yard, redevelopment of the former Domino Sugar factory in Williamsburg, the proposed expansion of the New York Container Terminal on Staten Island, the next phase of development of Arverne by the Sea in the Rockaways, redevelopment of the Battery Maritime Building in Lower Manhattan, and redevelopment of Pier A in Battery Park.
The City will track the progress of its various waterfront initiatives on its website on an ongoing basis. The plan and the updates can be accessed here.
February 2, 2011
On January 14, 2011, the White House Council on Environmental Quality (“CEQ”) finalized new guidance on the use, documentation and enforcement of mitigation measures under the National Environmental Policy Act (“NEPA”). While the Guidance – which was initially proposed in draft form last February – is non-binding, its interpretation of existing authority could effectively create additional, mitigation-related requirements for project applicants and lead agencies under NEPA.
Unlike New York’s State Environmental Quality Review Act (“SEQRA”), NEPA imposes no substantive requirement to mitigate a project’s adverse environmental impacts. When a federal action would have significant adverse impacts, however, the lead agency must prepare an Environmental Impact Statement (“EIS”) which analyzes, among other subjects, the “means to mitigate” those impacts. More commonly, an applicant will incorporate mitigation measures into its project design in order to avoid triggering NEPA’s EIS requirements, resulting in a Finding of No Significant Impact (“FONSI”).
The new Guidance endorses the use of these “mitigated FONSI[s]” when accompanied by “enforceable mitigation measures.” However, the Guidance warns that “failure to document and monitor mitigation may … undermine the integrity of the NEPA review.” Accordingly, CEQ recommends a series of steps to ensure that mitigation commitments are expressly stated and adhered to, and calls upon individual agencies to supplement its Guidance with their own procedures that make “relevant funding, permitting, or other agency approvals … conditional on performance of mitigation commitments.”
First, the Guidance advocates the identification of specific mitigation measures within an EIS or Environmental Assessment (“EA”), including measurable performance standards or expected results. To the extent that federal funding is required to implement these mitigation commitments, NEPA documentation must analyze the likelihood of whether or not such funds are expected to be available throughout the life of the project.
For certain “important cases” where mitigation eliminates the need for an EIS, the Guidance calls for monitoring of a project’s mitigation commitments after its approval. Not all mitigated FONSIs require formal monitoring, and the Guidance does not provide a definition of “important cases,” relying on agencies to use their judgment in making such determinations. The party who will be performing the mitigation is responsible for developing and implementing the monitoring program, drawing upon public input and informing the public of the results and progress of such monitoring where appropriate.
Finally, the Guidance discusses remedies for ineffective or non-implemented mitigation measures. While NEPA does not require mitigation of adverse impacts, mitigation failures may give rise to adverse impacts which were not considered during the initial review process, triggering the need for an EIS (in the case of a mitigated FONSI) or supplemental EIS (if an EIS was already prepared) in the event that additional federal approvals or actions are anticipated. Even when supplemental documentation is not appropriate, agencies are encouraged to incorporate monitoring results into future NEPA analyses, so as to avoid relying upon mitigation measures that have proven ineffective in the past.
With this document, CEQ has now finalized two of the three NEPA Guidance documents released in draft form last year. The last in the series – Draft NEPA Guidance on Consideration of the Effects of Climate Change and Greenhouse Gasses – is expected to be finalized later this year.
 See CEQ, Final Guidance for Federal Departments and Agencies on the Appropriate Use of Mitigation and Monitoring and Clarifying the Appropriate Use of Mitigated Findings of No Significant Impact (“Mitigation Guidance”), Jan. 14, 2011.
 See, e.g., 40 C.F.R. § 1502.16(h).
 Mitigation Guidance at 7, n. 18. While mitigated FONSIs have long been accepted as a matter of practice, prior CEQ Guidance from 1981 had cast doubt upon their legitimacy under NEPA. Id.
 Id. at 2.
 Id. at 8.
 Id. at 9. In some cases, failure to provide such disclosure could result in delays and preparation of a supplemental EIS should the necessary funding later become unavailable. Id.
 Id. at 10.
 Id. at 12.
 Id. at 15.
 See CEQ, Draft NEPA Guidance on Consideration of the Effects of Climate Change and Greenhouse Gas Emissions, Feb. 18, 2010.
December 14, 2010
On December 13, Governor David A. Paterson issued Executive Order No. 41, effectuating a moratorium on horizontal hydraulic fracturing drilling for natural gas (known as “fracking”) until at least July 1, 2011, but allowing vertical fracking. Two days earlier, the Governor vetoed legislation that would have imposed a moratorium on horizontal and vertical fracking until May 15, 2011.
The Governor’s Executive Order requires the New York State Department of Environmental Conservation (“NYSDEC”) to finish its review of public comments submitted to a Draft Supplemental Generic Environmental Impact Statement (“SGEIS”) analyzing the impacts of fracking, and make any necessary revisions. The NYSDEC must also publish a revised Draft SGEIS by June 1, 2011, accept public comments on that document for at least thirty days, and issue a report to the Governor identifying any regulatory conditions that must be included in fracking permits to protect public health and the environment.
In a press release issued December 11, Governor Paterson stated that he vetoed the legislation because, although it “was well intentioned, [it] would have a serious impact on our State if signed into law. Enacting this legislation would put people out of work – work that is permitted by [NYSDEC] and causes no demonstrated environmental harm, in order to effectuate a moratorium that is principally symbolic.”
Representatives of the oil and gas industry applauded Governor Paterson’s veto of the bill. While praising the Executive Order’s moratorium on horizontal fracking and its requirement of additional public review, some environmental groups expressed concern that the Order includes a loophole for vertical drilling by oil and gas companies. The Natural Resources Defense Counsel (“NRDC”) stated that oil and gas companies may drill vertical wells now, with the intention of converting them to horizontal wells later, which could potentially circumvent the on-going environmental review process. NRDC also expressed concern that the industry could drill a number of closely spaced vertical wells in lieu of one horizontal well, creating “significant additional surface disturbance and environmental impacts.”
NYSDEC reviewed over 14,000 comments to the Draft SGEIS over the course of several months. Because the Draft SGEIS must now be revised and re-released for public comment, which NYSDEC must review, the issuance of the Final SGEIS will most likely be delayed until at least the fall of 2011.
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