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Environmental Insurance Part 1

27 Sep

Business leaders should be aware that prior to 1973, environmental contamination was covered by most general liability policies. The transition from little or no exclusionary language began in 1973, when insurance companies began utilizing qualified pollution exclusions to actively discourage pollution of the environment. Following the passage of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), known more commonly as Superfund, in 1980, general liability insurance policies began to discontinue coverage of pollution related incidents. This trend accelerated following the passage of the Superfund Amendments and Reauthorization Act (SARA) in 1986, due to the insurance industry’s concerns over the strengthened strict liability provisions within the amendments. This form of social policy was in response to the burgeoning environmental movement of the 1970’s, which saw the passage of the Clean Water Act, the National Environmental Policy Act, the Clean Air Act, and the creation of the Environmental Protection Agency. All of these legislative and administrative acts resulted in a vacuum for environmental issues in the insurance world. Therefore, increasingly, between 1973 and the passage of SARA in 1986, new insurance policies adopted qualified or complete pollution exemption provisions.

Following the 1986 SARA amendments, complete pollution exclusion provisions were written into most, if not all, general liability insurance policies. Therefore, a new form of insurance, commonly known as environmental insurance was created in order to address the needs of industries with potential pollution related liabilities. In the following weeks we will post blogs on mining historical insurance policies for coverage and the forms of environmental insurance currently available.

If you have questions concerning environmental insurance, please contact Thorn & Associates at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

OSHA Silica Rule Making

28 Aug

The Occupational Health and Safety Administration (OSHA) is currently reviewing its rules concerning exposure to silica. As demand for silica sand increases due to its use in hydraulic fracturing, OSHA has determined that existing standards need to be reviewed so that workers and others with potential exposure to silica dust are protected. Silica, when ingested or inhaled, leads to serious health consequences including, but not limited to, lung disease, renal (kidney) disease, and scleroderma, a disease which affects skin, joints, blood vessels and skeletal muscles.

If you have questions concerning OSHA’s silica rule making process or any other questions related to silica mining, please contact Thorn & Associates at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Chicago Urban Agriculture

7 Aug

Urban agriculture represents an innovative and ecofriendly method of growing and consuming food. In the city of Chicago, urban agriculture is regulated under section 17-2-0207 of the Chicago Zoning Ordinance. The Ordinance updates use categories and details the size and types of urban agriculture sites. Specifically, the Ordinance lays out different requirements for community gardens, rooftop gardens, and urban farms.

If you have questions concerning zoning requirements for urban agriculture or any other questions related to urban agriculture, please contact Thorn & Associates at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Phase 1 Environmental Assessments

31 Jul

Often those completing a real estate transaction on a potentially environmentally contaminated property seek to limit liability under federal Superfund statute (CERCLA). A Phase I environmental site assessment is an initial step in determining whether an environmental risk exists. When reviewing a completed Phase I assessment be sure to ascertain whether the document contains the following 10 elements.
1. Result of environmental professional’s inquiry
2. Interviews with past and present owners, operators, and occupants
3. Reviews of historical sources of information
4. Searches for recorded environmental cleanup liens
5. Federal, State, Tribal, and local government record review
6. Visual inspections of the facility and of adjoining properties
7. Prospective landowner’s specialized knowledge or experience
8. Relationship of purchase price to uncontaminated property value
9. Commonly known or reasonably ascertainable information
10. Degree of obviousness and ability to detect property contamination

Each of these ten steps should be completed within one year, according to 40 C.F.R.  §312.21, which sets the standard for Phase I assessments. Upon completion of the Phase I assessment the environmental professional will offer recommendations as to whether further assessments, such as a Phase II environmental assessment, is necessary. A Phase II assessment involves taking samples of the soil, and if applicable, water that exists on the property in order to identify contamination.

If you have any questions regarding phase 1 environmental assessments please contact Thorn & Associates at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Illinois Water Systems Notice of Violations

24 Jul

Within the past year Illinois EPA has issued numerous violation notices to water systems for failing to check chlorine residue and fluoride levels daily. When issuing these violations, IEPA cites both 35 IAC 653.605 and 35 IAC 653.704, and their reference to daily monitoring reports, as justifying the requirements for daily sampling and testing of these chemicals. However, such a reading is clearly inconsistent with the language of the regulatory framework as a whole. In regards to Chorine residue sampling, 35 IAC 653.604 (b) clearly states that tests must be performed at “frequent and regular intervals” rather than daily. Additionally, 35 IAC 653.703 states that fluoride test must be conducted on a monthly, rather than daily, schedule.

If you are concerned about the additional and unnecessary costs of these sampling requirements, or if you have any additional questions regarding IEPA enforcement and Notice of Violation (NOV) letters, please contact Thorn & Associates at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Brownfield redevelopment funds via Brownfields Redevelopment and Intermodal Promotion Act

8 Jul

The Illinois General Assembly passed the Brownfields Redevelopment and Intermodal Promotion Act, HB 2212, at the end of the 2013 Spring Session.  The statute creates the South Suburban Cook County Brownfield Redevelopment Zone in Posen, Dixmoor, Riverdale, Doloton, Markham, Harvey, Phoenix, South Holland, Hazel Crest, East Hazel Crest, Thornton, and Homewood.  The statute’s goal is to redevelop brownfields in the zone by leveraging the existing infrastructure around the CN Intermodal Terminal and the Union Pacific Intermodal Terminal.  As a result, eligible projects are limited to those classified by the Urban Land Institute as: warehouse distribution, manufacturing (light or metal fabrication), or freight forwarding.  The statute further lists eligible secondary categories under each of those primary categories.

The statute creates the South Suburban Brownfields Advisory Council to oversee implementation of the statute.  The statute would create funds for the Council to distribute by  collecting the incremental individual income tax generated from employees in the zone, up to $3 million annually.  The Council could reimburse eligible developers for a variety of eligible activities, including: environmental studies and remediation; land acquisition and demolition; recruiting and training minority residents of the zone; and, upgrading the public infrastructure.

If you have questions about the advantages of redeveloping brownfields and the Brownfields Redevelopment and Intermodal Promotion Act, contact us at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

 

Illinois Benefit Corporation Law passed but not yet effective

5 Sep

Governor Quinn signed the Benefit Corporation bill on August 2, 2012 (Public Act 97-0885).  The new law does not go into effect, however, until January 1, 2013.

Benefit Corporations, also known as B Corps, are a new type of corporation in Illinois which actively adopt a general public benefit or one or more specific public benefits as a corporate goal (or a combination of a general and specific goals).  Legally speaking, this allows B Corps to pursue purposes other than maximizing profits without fear of a shareholder derivative lawsuit and, u nlike L3C s, a B Corp still make significant profits.  From a public relations standpoint, it allows a business to attract like-minded consumers.

The statute places ongoing reporting responsibilities on Benefit Corporations which are undertaken by a Benefit Director and a Benefit Officer.  The statue also creates a “benefit enforcement proceeding” as a means of making sure the general or specific goals of the B Corp are met.

If you have questions about B Corps, wish to create a B Corp, or wish to conert your existing business to a B Corp, contact us at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

White House Issues Hydrofracking Executive Order

17 Apr

On April 13, the White House issued an executive order entitled “Supporting Safe and Responsible Development of Unconventional Domestic Natural Gas Resources.”  For the full text of the order click here.  The Executive Order is a direct response to the ever growing number of federal, state, and local agencies that are regulating or contemplating the regulation of hydrofracking.  The order creates an interagency working group, chaired by the Director of the Domestic Policy Council, lists 13 federal agencies that will be represented on the task force, and allows the Chair to appoint members of other agencies as needed.  The task force is charged with coordinating agency policy and information exchange as well as promoting interagency communication with stakeholders.  That being said, the task force does not have any regulatory authority itself.

If you have any questions regarding the interagency working group or hydrofracking, contact us at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Hydraulic fracturing in Illinois

5 Apr

The potential environmental damage, primarily groundwater contamination, from capturing natural gas through hydraulic fracturing (aka hydrofracking and fracking) has captured national media attention.  Most of that attention has been focused on current events in Pennsylvania, although the Marcellus Shale present in Pennsylvania also extends under New York, Ohio and West Virginia.  That being said, hydraulic fracturing was utilized previously in numerous other western states such as Texas, Utah, Wyoming and Colorado.  Now it appears that there is the potential for hydraulic fracing to occur in downstate Illinois where the New Albany shale formation is located as oil and gas companies are currently moving to secure mineral leases on properties over this formation.

Hydraulic fracturing utilizes custom blends of water and various chemicals, the exact formulation of which are closely guarded secrets.   When injected under high pressure the fracking fluid cracks the bedrock such that otherwise trapped natural gas can escape and be collected.  Environmental concerns have revolved primarily around groundwater contamination by the natural gas or the fracking fluid and the disposal of fracking fluid.  One of the more notable claims of groundwater contamination was shown in the documentary Gasland in which tapwater was ignited.  The exact source of the natural gas in well water can be difficult to determine.  Shale and coal formulations can have naturally occuring methane (one only needs to consider the number of explosions in underground coal mines).  Often the methane is produced by naturally occuring methanogen bacteria.

In 2005, Congress amended the Safe Drinking Water Act to exclude from regulation “the underground injuect of fluids or propping agents (other than diesel fuels) pursuant to hydraulic fracturing operations related to oil, gas, or geothermal production activities.”  However, the change in political climate as well as the extension of fracking to the eastern U.S. has put hydrofracking under renewed scrutiny.  On the federal level, a US House of Representatives Committee on Energy and Commerce Minority report released in April 2011, Chemicals Used in Hydraulic Fracturing, concluded that 650 of the fracking fluid products contained chemicals that are known or possible human carinogens, regulated under the Safe Drinking Water Act, or listed as hazardous air pollutants.  US EPA is undertaking a scientific study with initial results in 2012 and an additional report due in 2014.  Many state and local governments are not waiting for federal oversight.  Instead, they are implementing their own statutes and regulations to ban or regulate the practice.

If you have any questions regarding hydrofracking or hydrofracking in Illinois, contact us at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

Greenhouse Gas Performance Standards for New Stationary Sources

4 Apr

On March 27, 2012, Lisa Jackson (the EPA Administrator) signed a notice that the agency will propose a new rule to implement Greenhouse Gas (GHG) performance standards for new electric utility generating units which the agency has dubbed a “Proposed Carbon Pollution Standard for New Power Plants.”  The proposed regulation has not yet been published in the Federal Register and, thus, the notice period for comments has not commenced.  That being said, EPA has already made the draft language publicly available as well as provided summary fact sheets.

As noted above, the rule would only apply to new plants and would not apply to currently operating and newly permitted plants that begin construction over the next year.  Furthermore, the plant would only apply to fossil-fuel electrical utility generating units (EGUs), inlcuding fossil-fuel-fired boilers, integrated gasification combined cycle units and stationary combined cycle turbine units that generate electricity for sale and are larger than 25 megawatts.  Thus, EGUs burning other fuels, such as biomass would not be regulated under this rule.

EPA is considering an output-based standard of 1,000 lbs of CO2 per megawatt-hour.  The agency notes that approximately 95% of new natural gas combined cycle power plants already meet this standard without additional emissions controls.  Power plants utilizing coal would require some sort of carbon capture and storage, although this would not impose an additional burden upon utilities in states that already include carbon capture and storage (including Montana and Illinois).

In order for facilities to implement and optimize their control technology, EPA is proposing to allow facilities to use their 30-year average CO2 emissions to determine compliance.  Utilizing a 30-year average instead of an annual standard would allow new facilities time to tweak the performance of their equipment since initial emissions exceedences could be offset by subsequent compliance.

If you have any questions regarding the Proposed Carbon Pollution Standard for New Power Plants or other environmental regulation of utilities, contact us at 773-609-5320, info@thornenvironmentallaw.com, or through our web contact form.

Disclaimer: This article cannot, and does not, create any attorney/client or consultant/client relationship.

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