Thursday, May 24, 2018

EPA and City of Colorado Springs negotiating end to Clean Water Act lawsuit?

Posted By on Thu, May 24, 2018 at 4:13 PM

click to enlarge City stormwater manager Rich Mulledy stands in a cavern created by faulty drainage facilities, as it appeared last September. - PAM ZUBECK
  • Pam Zubeck
  • City stormwater manager Rich Mulledy stands in a cavern created by faulty drainage facilities, as it appeared last September.
Despite protests from fellow plaintiffs, the Environmental Protection Agency has agreed to revisit a possible settlement with the city Colorado Springs over alleged Clean Water Act violations caused by the city’s longterm neglect of stormwater management, according to documents obtained by the Independent.

The renewed negotiations come as U.S. District Judge Richard Matsch scheduled an August trial in the lawsuit on May 22, the day after the state’s lead attorney in the case was reportedly fired for a reason the Colorado Attorney General’s Office won’t discuss.

Margaret “Meg” Parish, first assistant attorney general in the Natural Resources & Environment Section, wrote several scathing letters to the EPA in recent months, calling the EPA’s action “shocking and extraordinary” and expressing “deep concern and disappointment” that the agency would unilaterally reopen settlement discussion without consulting co-plaintiffs. Besides the Colorado Department of Public Health and Environment (CDPHE), those include Pueblo County and the Lower Arkansas Valley Water Conservancy District.

The move was particularly alarming, she noted, because the state and EPA had signed an agreement in which both agreed not to communicate with the city without the presence of the other.

Some who couldn’t comment on the record due to confidentiality rules called the latest moves — reopening negotiations and the firing of Parish — as “pure politics” in an era when the EPA’s reputation is pivoting from protecting the environment to serving polluters.

EPA Administrator Scott Pruitt, who has long-standing and close ties to the oil and gas industry and is under investigation for multiple alleged ethics breaches, met with the Housing and Building Association of Colorado Springs in October when the HBA paid for his night’s stay at The Broadmoor.

A few months later, on March 19, the EPA wrote a letter to the city “as a follow up to the City’s recent request to re-initiate settlement negotiations.”

The EPA’s co-plaintiffs were given two days notice that the letter would be sent to the city’s legal counsel, reportedly fueling outrage among those partners. Pueblo County has harbored distrust of the city of Colorado Springs for decades regarding sewage discharges and raging stormwater flows in Fountain Creek, which befouls the creek and threatens levees at Pueblo where the creek joins with the Arkansas River. Farmers in the Lower Ark region have complained for years that sediment blocks their irrigation headgates interfering with raising crops.

The dismissal of Parish, who couldn’t be reached for comment, has precipitated the likelihood of a court hearing on May 30 or 31 to replace her as the state’s lawyer in the case.

Mayor John Suthers campaigned vigorously last fall in favor of stormwater fees, saying repeatedly that voters’ approval would help the city end the EPA lawsuit, but now correspondence suggests the fee money won’t be enough, according to the documents obtained by the Indy.

Asked about the latest maneuver to negotiate a settlement, Suthers tells the Indy in a statement that the city has always expressed a desire to “sit down with all parties in the case and review the tremendous progress that’s been made in its [the city’s] stormwater program....”
But Suthers side-stepped questions about what influence he exerted on the EPA in general or Pruitt in particular.

Rather, he repeated a past comment, noting he’d rather spend money on compliance than litigation, adding, “A settlement agreement can give the parties all the assurances they need in regard to future compliance.”

The EPA declined to comment, as did Pueblo County Commission Chair Terry Hart and Lower Ark District General Manager Jay Winner.

The Attorney General’s Office told the Indy via email it wouldn’t comment on Parish’s departure but added the office represents CDPHE in the case and will continue to do so “with the highest level of professionalism and with the focus remaining on what is in the best interest of the citizens of Colorado.”

On March 14, the DOJ sent the state, Pueblo County and Lower Ark a proposed letter to the city about revisiting a settlement, giving them two days to provide input. In an emailed response on March 16, Martha Rudolph, CDPHE’s director of environmental programs, said neither Pueblo County nor the Lower Ark could sign on without their boards’ approvals, and the earliest that could happen was March 21.

Noting the state had worked in good faith with all parties, Rudolph said, “The decision by EPA and DOJ to suddenly shift course to pursue settlement now without first conferring with co-plaintiffs unfortunately risks eroding our good working relationship.”

On March 19, DOJ trial attorney Heidi Hoffman sent the proposed letter to the city. The letter commended the city for its “significant improvements that the City intends to achieve through its Stormwater Program Implementation Plan (November 2016)” as well as the November 2017 stormwater fees ballot measure. But Hoffman also noted those “positive events” don’t comprise full compliance or address water quality problems stemming from years of failed efforts. She also said the city is responsible for funding and carrying out the “technically difficult and potentially costly” steps necessary to become compliant.

“With this in mind,” Hoffman wrote, “the United States is willing to meet with the City to learn about any alternative measures or additional work the City is willing to undertake in order to come into compliance with its permit and address the water quality impacts of its MS4 system.” She also said the DOJ hoped the conversation “will advance settlement discussions and lead to a mutually accepted path forward for resolving this case.” She closed by saying the other plaintiffs will be invited to participate in any negotiations.

On March 26, Rudolph, Winner and Hart signed a letter to the EPA asking the agency to “recommit to working in partnership” (News, May 9, 2018).

In a separate March 26 letter to several EPA officials in Denver and Washington, D.C., Parish cited her “deep concern and disappointment” that the EPA failed to “work with or respect” the CDPHE. She also noted the confidentiality agreement, to which the state has complied, and the “thousands of hours” and “considerable expertise” the state has brought to the case.
“This partnership is bearing fruit: we are on the verge of a trial that is likely to be highly successful for EPA and the State of Colorado,” she wrote, “leading to an outcome wherein the City will finally remedy its ongoing damage to Colorado’s waters, public health, and downstream communities.”

But EPA’s behavior, she says, “throws this partnership into doubt” and has undermined chances of securing a “strong settlement” that would force the city to comply and correct damage it caused to Fountain Creek.

Parish also noted EPA promotes an image of an agency that wants to work with states on enforcement matters, but then undercuts such cooperation. Finally, Parish writes that the state reserves the right to object to any proposed consent decree or voluntary dismissal of claims proposed by the EPA.

The EPA and CDPHE filed the lawsuit in November 2016 after the city flunked inspections in 2013 and 2015 of compliance with its MS4 permit (Municipal Separate Storm Sewer System).

The lawsuit alleged multiple and ongoing violations of the Clean Water Act by the city, which failed to force developers to install proper storm drainage infrastructure, gave waivers to others and didn’t adequately inspect and monitor its drainageways. The city spent only $1.6 million a year on those tasks from 2011 to 2014, a pittance considering some estimates set the city’s stormwater needs at upwards of $1 billion.

In April 2016, when the city prepared to activate its $825 million Southern Delivery System water pipeline from Pueblo Reservoir, Pueblo County threatened to pull the construction permit it issued years before unless the city dealt with its flood waters. After enacting stormwater fees in 2007 only to abolish them in 2009, the city agreed at the behest of Pueblo County to spend $460 million over 20 years.

Suthers then sought and received voter approval of stormwater fees in November 2017 to fund the agreement. It’s worth noting the ballot measure states that City Council can raise the fees without voter approval “to the extent required to comply with a valid court order, federal or state permits, federal or state laws, or any intergovernmental agreement to which the City is a party which was entered into before June 1, 2016.”

That means whatever verdict is imposed in the lawsuit, including a settlement, could translate to fee hikes for residents.

According to a February 5 letter to the EPA and DOJ after word leaked the EPA would reopen settlement talks, those costs could be significant. Noting the city’s agreement with Pueblo County and that the new stormwater fees are “far from enough to remedy the damage the City has already caused,” Parish said in the letter, “Remedying this ongoing damage and ending the City’s ongoing noncompliance will be neither easy nor cheap. Unless the City is willing to pass these costs on to developers, fixing and installing these controls and otherwise remedying the damage will be very expensive because that damage has been so widespread.”

Despite more than a year of settlement efforts, which ended last year, Parish noted the parties “were unable to come to basic understandings on bedrock permit issues, like the City’s responsibility to ensure that stormwater controls are operational and maintained.”

Parish proposed five conditions to resurrecting negotiations, including requiring the city to fix “missing and nonfunctional stormwater controls,” mandating all litigants be present during negotiations, keeping the lawsuit going until “a broad settlement agreement” is in place, and proceeding with the August trial, which she predicted would be resolved in the plaintiffs’ favor.

Parish also noted the lawsuit was filed under federal authority, i.e., the Clean Water Act, and the state can’t legally bring such an action on its own. Shifting the case to state court under the Colorado Water Quality Control act, she noted, “would cause a host of procedural problems which would cripple and likely destroy the case.”

“Without EPA’s participation in this litigation,” she wrote, “this case likely vanishes — and with it, years of time and effort” by the plaintiffs. Worse, she added, without the lawsuit, the city will continue to violate its MS4 permit and harm Colorado’s waters and communities.

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