Jenner & Block: Another Federal Circuit Adopts Five-Year Limit On NSR Enforcement Actions

The U.S. Court of Appeals for the Third Circuit recently joined the Seventh, Eighth, and Eleventh Circuits in finding that U.S. EPA is required to bring New Source Review (NSR) enforcement proceedings within five years of the alleged violation. On August 21, 2013, in United States of America, et al. v. EME Homer City Generation, LP [enhanced version available to lexis.com subscribers], the court dismissed an enforcement proceeding brought by U.S. EPA against the owners of a coal-fired power plant for failing to have obtained an NSR permit for modifications that were made over a decade ago.

Although U.S. EPA acknowledged that its current enforcement proceeding was filed more than five years after the plant modifications were made, it argued that a new violation occurred each day that the plant operated without a valid NSR permit. The court rejected this argument, noting that nothing in the text of the NSR rules required the facility to obtain an NSR permit to "operate". Rather, the court noted that the operative language of the Clean Air Act required that a permit be obtained prior to "construction" and/or "modification" of a facility. As such, according to the Third Circuit, enforcement actions premised on a failure to have obtained such a permit must be brought within five years of plant construction and/or modification. The court also rejected U.S. EPA's policy arguments that such a ruling would impair U.S. EPA's ability to enforce the Clean Air Act, finding that when "more than five years have passed since the end of construction and the facility has been taken over by new owners and operators, the Clean Air Act protects their reasonable investment expectations."

  By Steven M. Siros, Partner, Jenner & Block

Read more at Corporate Environmental Lawyer Blog by Jenner & Block LLP.

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