The EPA Abuses First, Apologizes Later

by Mario Loyola

The regulatory state’s biggest bully beats up another victim.

Last summer, I wrote about the Environmental Protection Agency’s shameful persecution of a Texas natural-gas company, Range Resources Corp. The year before, EPA had slapped the company with an “emergency order” under the Safe Drinking Water Act, alleging that it “caused or contributed to” the contamination of two water wells west of Fort Worth. Almost immediately, however, EPA was forced to admit that Range had no connection whatsoever to the contamination in question. It nonetheless insisted on the company’s obedience to the original order.

I argued then that this was all a shameful abuse of power. Well, just last week, after a nearly two-year odyssey in which the company has spent $4.2 million defending itself, EPA agreed to drop the whole thing. The withdrawal of the emergency order was officially announced at the end of last week, where the government usually tries to bury its embarrassments. But the question remains: Why now?

EPA should never have issued the order in the first place. From the start, EPA staff admitted that they had no theory of how methane could have migrated into the shallow aquifer in question from Range’s natural-gas well a mile underground. It quickly became clear that the methane in the aquifer had migrated naturally from an entirely different geological formation than the one from which Range was pumping gas, and that the area’s water wells had long contained small quantities of natural gas. Texas regulatory authorities, which conducted their own vastly more professional investigation in short order, concluded that Range was not related to the gas contamination in any way.

Rather than withdrawing its order at any of these points, EPA’s regional office raised the ante, seeking enforcement of the original order, along with fines that soon totaled millions of dollars. Confronted with incontrovertible evidence that the source of the gas had nothing to do with Range Resources, EPA claimed that the law didn’t require it to prove or even allege any connection between Range and the contamination.

Strictly speaking, that astonishing position appeared to be correct. Under Section 1431 of the Safe Water Drinking Act, the EPA administrator may “take such actions as he may deem necessary” when he knows of a possible contamination of drinking water, including “issuing such orders as may be necessary to protect the health of persons.” Among the key things left unclear in the statute is, well, almost everything: (a) exactly what group of people can be compelled to do something under that emergency order; (b) what they can be compelled to do; (c) what EPA must establish to have a reasonable basis for its order; and (d) what the target of the order can do to challenge it.

The statute is so vague that the only natural way to read it is as a grant of power for EPA to commandeer anybody — totally at random if EPA so chooses — and force him to clean up, at his own expense, a problem that he can immediately prove he had nothing to do with.

As EPA sought enforcement and penalties in district court, the company filed a petition for review of the original order at the Fifth Circuit Court of Appeals, which heard oral argument in the case in October of 2011. The tenor of that oral argument (listen to it here) suggests one reason that EPA decided to withdraw the order: the fear that it might lose its emergency-order authority under the Safe Drinking Water Act altogether.

The company’s lawyers restricted themselves to arguing that Section 1431 was unconstitutional only “as applied” to them. But the three-judge Fifth Circuit panel was much tougher on EPA, and focused instead on what EPA thought it had the power to do under the law. The tenor of the oral argument was such that EPA must have been worried that Section 1431 might get struck down entirely, as unconstitutional on its face, not just ruled unconstitutional as applied to Range Resources.

It’s easy to understand why. The company’s lawyers argued that the order was arbitrary and capricious as it applied to them, but in fact emergency orders under Section 1431 will be arbitrary and capricious in virtually every case, because of the way the statute is written. It is almost impossible to know, for example, who is subject to the statute. Even if EPA had procedures in place to guarantee minimum due process for emergency orders (which it doesn’t), you would still have a statute that is not limited in any way to people connected with any contamination. EPA can issue emergency orders to anybody.

The Supreme Court’s recent decision in Sackett v. EPA, which insisted that citizens hit with an EPA order must have their day in court, may also have weighed heavily on the EPA. At the very least, the justices seem finally awake to the grave danger that EPA’s emergency and remedial authorities pose for the due-process rights of private citizens. That subtext to the Sackett opinion is one that the lower courts (who try to avoid being overruled) can read as clearly as EPA. 

Congress should subpoena Al Armendariz, the EPA’s regional administrator, to come explain how this whole fiasco happened. Congressional hearings on the case of Range Resources and others like it will quickly reveal the need to curtail the EPA’s statutory authorities and put a stop to its increasingly brazen abuses.

Range Resources has in essence been deprived of $4.2 million dollars, not to mention the damage to its reputation, without due process or recourse of any kind. Many environmentalists apparently think oil and gas companies shouldn’t have due-process rights and deserve to be targeted for arbitrary abuse by the authorities. But as the case of the Sacketts shows, the EPA’s next victim could be any one of us.

— Mario Loyola is director of the Center for Tenth Amendment Studies at the Texas Public Policy Foundation.