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March 26, 2012
Ruling to Revoke EPA’s Decision on Mining Permit Relies on Analysis Authored by Brattle Consultant

A U.S. District Court ruling to overturn the Environmental Protection Agency’s (EPA) decision to revoke a permit issued to a West Virginia coal mine relied heavily on an analysis authored by Brattle principal David Sunding, which examined the economic incentive effects of the EPA’s ex post veto of the permit. U.S. District judge Amy Berman Jackson ruled Friday that the EPA’s decision in January 2011 to rescind a water disposal permit for the Spruce No. 1 mine, owed by Arch Coal and located in Logan County, WV, exceeded the agency’s authority and violated federal law. At the time, the EPA used its authority under the Clean Water Act to revoke the legally issued permit, a rare step that had only been taken twice in 40 years and never for a coal mine. The agency claimed that mining would cause unacceptable damage to rivers, wildlife, and communities, and would have buried hundreds of miles of streams under residue. In the ruling, Judge Jackson wrote that the EPA’s assertion that it has the right “to unilaterally modify or revoke a permit that he been duly issued by the corps” is incorrect and unreasonable. Judge Jackson’s ruling supported the findings of Dr. Sunding’s report, which analyzed the effects of the EPA's ex post veto of the Clean Water Act discharge permit. Filed with an amicus brief from the U.S. Chamber of Commerce, Dr. Sunding’s report concluded that the EPA’s ex post veto would have made it more difficult for project developers to rely on permits when making investment or development decisions. According to Dr. Sunding, the Court’s ruling establishes the finality of permits, which will assure applicants that if they are in compliance, they will be able to continue operating without the possibility of the government overturning their permit. “Since the beginning of the Clean Water Act, compliance with a valid permit has equated to compliance with the Act. If the EPA can veto permits after the fact, even if the applicant is in compliance with the permit terms, then that bedrock principle is no longer valid,” Dr. Sunding says.