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Mississippi Environmental Quality Permit Board

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Summary of Meeting Held July 14, 2020

The Mississippi Environmental Quality Permit Board (“Board”) convened at 9:00 a.m. on July 14, 2020.  This meeting was held through a telephone conference call and the public was invited to listen to the deliberations of the Board.  The Board first approved minutes from the previous meeting held on June 9, 2020 and the non-controversial actions/ certifications completed by the staff since the June meeting. Then, following a prepared agenda, the Board considered items as follows:

OFFICE OF GEOLOGY

Ron Porter (MDEQ Office of Geology, Mining and Reclamation) presented the MDEQ Staff’s recommendations and Board approved the following:

Surface Mining Bond Releases

Permittee County Permit Staff Recommendation
Hammet Gravel Company, Inc. Yazoo P05-029A 50% release

Surface Mining Transfer

Permittee County Permit
F&F Construction, Inc., to Gulf Breeze Construction, Inc. Harrison P07-035

Other Business

Roy Furrh, MDEQ Legal Counsel, informed the Board Members that an evidentiary hearing has been requested regarding the All South Construction Surface Mining Bond Release approved during the May Permit Board.  It is currently scheduled for November 10, 2020.  Mr. Furr reported that the Hearing Officer has not made a final decision regarding the Mississippi State Port Authority – North Port Property in Harrison County.

The next Permit Board meeting will be held on August 11, 2020, at 9 a.m.

This Newsletter is a publication of the Environmental Practice Group of the law firm of Brunini, Grantham, Grower & Hewes located in Jackson, Mississippi. This Newsletter is not designed or intended to provide legal or professional advice, as any such advice requires the consideration of the facts of the specific situation.

If you have any questions concerning the content of a newsletter, or if you would like further information about the matters addressed in a newsletter, please contact John Milner, the Brunini Firm Environmental Practice Group leader, at jmilner@brunini.com or (601) 960-6842.

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Mississippi Commission on Environmental Quality

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Summary of Meeting Held June 25, 2020

The Mississippi Commission on Environmental Quality (“MCEQ”) convened at 9:00 a.m. on June 25, 2020.  This meeting was held through a telephone conference call.  The public was invited to listen to the deliberations of the Commission on the conference phone line.  The Commission first approved minutes from the previous meeting held on May 28, 2020, 2020. Then, following a prepared agenda, the Commission considered items as follows:

Water Pollution Control Revolving Loan Fund (WPCRLF) Program Loan Interest Rate Reduction and Subsidy Eligibility Threshold Adjustment

The staff briefed the Commission on a planned reduction of the WPCRLF loan interest rates and adjustment of the subsidy eligibility thresholds for projects awarded in fiscal years FY-19, FY-20, and FY-21. These adjustments are intended 1) to help ease the economic impacts of the COVID-19 pandemic on communities needing to proceed with wastewater infrastructure projects, 2) to stimulate demand for WPCRLF loans due to the currently significant funds availability, and 3) to ensure that WPCRLF interest rates stay “below market rate” as required by federal and state law.

Certifications Approved since the last report 

Type Number
Asbestos Certifications 102 certifications
Lead Paint Certifications 31 certifications
Administrative Orders 24 Administrative Orders

The next Commission meeting will be held on August 27, 2020, at 9 a.m.

This Newsletter is a publication of the Environmental Department of the law firm of Brunini, Grantham, Grower & Hewes located in Jackson, Mississippi. This Newsletter is not designed or intended to provide legal or professional advice, as any such advice requires the consideration of the facts of the specific situation.

IRS Circular 230 Notice

To ensure compliance with requirements imposed by the IRS, we inform you that, unless specifically indicated otherwise, any tax advice contained in this communication (including any attachments) was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code, or (ii) promoting, marketing, or recommending to another party any tax-related matter addressed herein.

If you have any questions concerning the content of a newsletter, or if you would like further information about the matters addressed in a newsletter, please contact John Milner, the Brunini Firm Environmental Practice Group leader, at jmilner@brunini.com or (601) 960-6842.

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Mississippi Commission on Environmental Quality

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Summary of Meeting Held May 28, 2020

The Mississippi Commission on Environmental Quality (“MCEQ”) convened at 9:00 a.m. on May 28, 2020.  This meeting was held through a telephone conference call.  The public was invited to listen to the deliberations of the Commission on the conference phone line.  The Commission first approved minutes from the previous meeting held on April 23, 2020. Then, following a prepared agenda, the Commission considered items as follows:

FY2021 Title V Fee Recommendation

MCEQ Staff reported that a virtual public hearing concerning the FY2021 Title V Permit Fee was held on April 9, 2020. No comments were received. Therefore, MCEQ Staff recommended that the Commission set the fee at the proposed rate of $47.00 per ton of regulated air pollutants, which is the same as the previous year’s fee.  The Commission approved MCEQ Staff’s recommendation.

Commission Approval of Brownfield Agreement Completion

MCEQ Staff reported that the Commission reached a Brownfield Agreement (#6624-16) on February 26, 2016, with Stark Alan, LLC for the remediation of the Sunsations property located at 335 Hwy 12 in Starkville, Ms. On April 14, 2020, and in accordance with Rule 2.1.7.B of Part 3, Chapter 2: Final Regulations Governing Brownfield Voluntary Cleanup and Redevelopment in Mississippi, Stark Alan, LLC sent a petition to the Commission to make a determination as to the completion of Brownfield Agreement and as to the issuance of a “no further action” letter by the Executive Director. The MCEQ Staff has reviewed the petition, has conducted the required inspection of the Brownfield Agreement Site, and recommended that the Commission issue an order in accordance with the Brownfield Regulations concluding that Stark Alan, LLC has completed Brownfield Agreement #6624-16. The Commission approved the Brownfield Agreement Completion and the issuance of the no further action letter.

Commission Approval of Brownfield Agreement Completion

MCEQ Staff reported that the Commission reached a Brownfield Agreement (#6181-12) on October 1, 2012 with The Colle Company for the remediation of the Former Colle Towing Company property located at 3802 Port River Road in Pascagoula, Jackson County, Mississippi. This Brownfield Agreement required the adherence to the MDEQ approved Correction Action Plan, dated April 4, 2012. With the recording of an Environmental Covenant on this property on April 21, 2020, and after reviewing the Corrective Action Plan-Construction Report, it has been determined that all requirements set forth within the Brownfield Agreement (#6181-12) have been completed. Therefore, the MCEQ Staff hereby recommended that the Commission issue an order in accordance with the Brownfield Regulations concluding that Brownfield Agreement (#6181-12) has been completed and that a “no further action” letter be issued by the Executive Director. The Commission approved the Brownfield Agreement Completion and the issuance of the no further action letter.

Commission Approval of Brownfield Consulting Firm

MCEQ Staff reported that they had reviewed an application from a consulting firm requesting to be listed as a Brownfield Consulting Firm and determined it to be complete and acceptable. Therefore, MCEQ Staff recommended and the Commission approved the following firm as Brownfield Consulting Firm:

Leeaf Environmental, LLC

2301 Whitney Ave

Gretna, LA 70056

Certifications Approved since the last report

Type Number
Asbestos Certifications 457 certifications
Lead Paint Certifications 160 certifications
Underground Storage Tanks (UST) Certifications 9 certifications to those who install, alter, or remove underground storage tanks
Wastewater Operator Certifications 10
Emergency Clean-Up Expenses 6

Administrative Orders

Administrative Orders will be reflected on next month’s Commission meeting agenda.

The next Commission meeting will be held on June 25, 2020, at 9 a.m.

This Newsletter is a publication of the Environmental Department of the law firm of Brunini, Grantham, Grower & Hewes located in Jackson, Mississippi. This Newsletter is not designed or intended to provide legal or professional advice, as any such advice requires the consideration of the facts of the specific situation.

IRS Circular 230 Notice

To ensure compliance with requirements imposed by the IRS, we inform you that, unless specifically indicated otherwise, any tax advice contained in this communication (including any attachments) was not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax-related penalties under the Internal Revenue Code, or (ii) promoting, marketing, or recommending to another party any tax-related matter addressed herein.

If you have any questions concerning the content of a newsletter, or if you would like further information about the matters addressed in a newsletter, please contact John Milner, the Brunini Firm Environmental Practice Group leader, at jmilner@brunini.com or (601) 960-6842.

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BRUNINI WELCOMES MAGGIE K. DUFF

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Maggie Duff has joined Brunini, Grantham, Grower & Hewes in August of 2020 as an associate in the firm’s civil litigation department. Her practice focuses primarily in commercial litigation, personal injury and mass tort liability and labor and employment.

Maggie received her Juris Doctor from the University of Mississippi School of Law in 2020. Prior to attending law school, she received her Bachelor of Arts in Communications with an emphasis in Public Relation at Mississippi State University in 2016.

In law school, Maggie served as a Senior Articles Editor of the Mississippi Sports Law Review. Maggie was also a member of the Business Law Network and Student Bar Association. Maggie has volunteered for federal and local campaigns and also served in U.S. Congressman Steven Palazzo’s office in Washington, D.C. Maggie was a member of the Stennis Program for Congressional Interns nominated by Congressman’s Palazzo’s office. Additionally, during her time in law school, Maggie was a legal intern for the Mississippi Attorney General’s Office.

Sam Kelly, Managing Partner of the Brunini firm said, “We are excited to welcome Maggie to the Firm and are confident that she will be a wonderful asset to our team.”

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A CIRCUIT SPLIT ON TITLE V PERMITS UNDER THE CLEAN AIR ACT

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A split has formed between the United States Courts of Appeals for the Fifth and Tenth Circuits over requirements applicable to obtaining Title V permits pursuant to the Clean Air Act, 42 U.S.C. § 7401 et seq. (“the Act”). See Environmental Integrity Project v. EPA, —F.3d—, 2020 WL 4686995 (5th Cir. Aug. 13, 2020); Sierra Club v. EPA, 964 F.3d 882 (10th Cir. 2020).

The foundation for the disputes in both cases was the propriety of the past issuance of preconstruction permits, i.e., New Source Review (“NSR”) permits, which are issued pursuant to Title 1 of the Act. NSR permits must be obtained before building a new facility or modifying an old one, and they are issued by states through vehicles called “state implementation plans” (“SIPs”). A state must provide notice and an opportunity to comment before a preconstruction permit is granted. See 40 C.F.R. § 51.161(a).

The requirements of a NSR permit differ substantially depending upon whether the new source is deemed a “major source” or “minor source.” If “major,” then the review for a NSR permit and the requirements that must be met are detailed and difficult. If “minor,” then the bar is considerably lower. As a result, this designation is important to interested parties.

This is where Title V becomes important. Title V permits were added to the Act in 1990, well after the introduction of NSR permits in 1977. The purpose of Title V permits is to provide each source with a single permit that contains and consolidates all information needed to comply with the Act without imposing new substantive requirements, and they must be renewed every five years.

The permit must contain:

“enforceable emission limitations and standards, a schedule of compliance, a requirement that the permittee submit to the permitting authority, no less often than every 6 months, the results of any required monitoring, and such other conditions as are necessary to assure compliance with applicable requirements of this chapter, including the requirements of the applicable implementation plan.”

§ 7661c(a) (emphasis added).

The split concerns the meaning of “applicable requirements” when a Title V permit or renewal is sought after, sometimes even years after, having obtained a Title 1 permit. How are the Title 1 requirements incorporated into the Title V permit?

One interpretation is that “applicable requirements” means a Title V permit must incorporate all of the requirements in the previously granted Title 1 permit, but nothing more. Another is that it must include all of the requirements of the SIP, and not simply the requirements contained in the permit, and this means it includes the requirements for major NSR. See 42 U.S.C. §§ 7410(a)(2)(c), 7471, 7502(c)(5).

The difference in this interpretation is enormous. Under the former, a court only determines whether the Title V permit incorporates the requirements contained in the Title I permit as issued. Under the latter, a court can second-guess the issuance of the type of preconstruction permit, i.e., major or minor, at a later point in time.

The difficulty faced by the Fifth and Tenth Circuits is that § 7661c(a) does not define “applicable requirements.” The Tenth Circuit resolved this issue by looking to the definition of this term in 40 C.F.R. § 70.2, the regulation that implements § 7661c(a). Section 70.2 provides, in relevant part:

“Applicable requirement means all of the following as they apply to emissions units in a part 70 source…

(1) Any standard or other requirement provided for in the applicable implementation plan approved or promulgated by EPA through rulemaking under title I of the Act that implements the relevant requirements of the Act, including any revisions to that plan promulgated in part 52 of this chapter”

The Tenth Circuit reasoned “the applicable implementation plan” includes SIPs, and SIPs require major NSR.

The Fifth Circuit, by contrast, discussed (among other factors) the lack of a definition provided in the statute, legal authority indicating Title V does not impose new substantive requirements, and the EPA’s view before enacting § 70.2 that “the intent of [T]itle V is not to second-guess the results of any State’s NSR program.” Environmental Integrity Project, 2020 WL 4686995 at *3. It recognized that preconstruction permits are already subject to a notice and comment period and approval by the EPA, and adopting the petitioner’s view (the view adopted by the Tenth Circuit) could “make Title V a vehicle for the public to (again) challenge preconstruction permits” because it makes possible re-examining the substantive validity of underlying Title I preconstruction permits. Id. at 10. To private and other interested parties, this injects uncertainty in the permitting process because there is, resultantly, no finality to a permitting decision. A preconstruction permit issued in Year 1 could be re-litigated in Year 15 upon renewal of a Title V permit.

The Fifth Circuit decision is binding in Louisiana, Mississippi, and Texas, while the Tenth Circuit’s is binding in Colorado, Kansas, New Mexico, Oklahoma, Utah, and Wyoming. It is possible the split will not be resolved until the United States Supreme Court addresses the issue. However, because the Fifth Circuit rested its decision on the EPA’s interpretation of a statute, i.e., § 7661c(a), and the Tenth Circuit rested its decision on the EPA’s interpretation of a regulation, i.e., § 70.2, it is also possible the Fifth Circuit could revisit the issue and reframe its approach if future arguments raised before the court focus more closely on the EPA’s interpretation of § 70.2. Foundation for this suggestion can be seen in footnote 6 of the Fifth Circuit’s opinion.

IRS extends deadlines for additional returns and payments.

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In IRS Notice 2020-23 the IRS provides a list of additional returns and payments of tax that are due on or after April 1, 2020 for which filing and payment relief is provided.  The listed payment obligations and return filings are now due on July 15, 2020.

IRS extends deadline for filing applications to carryback NOLs arising in 2018 and 2019.

The CARES Act contained provisions amending IRC Section 172(b)(1) to carry back any NOL arising in tax years beginning after December 31, 2017, and before January 1, 2021, to each of the five taxable years preceding the tax year of the NOL.  However, the CARES Act did not amend the law extending the time  for taxpayers realizing NOLs to apply for a tentative carryback adjustment of the tax liability in the carryback year and accelerate the refund of any resulting overpayments.  In its Notice 2020-26, the IRS announced that it will grant a six-month extension of time to file a request for tentative carryback adjustment on Form 1045 or Form 1139 for an NOL arising in a taxable year that began during calendar year 2018 and that ended on or before June 30, 2019.  These forms must now be filed by June 30, 2020. IRS Notice 2020-26.

IRS provides additional guidance regarding NOL carrybacks under the CARES Act.

The IRS has issued a Revenue Procedure providing additional guidance for net operating losses arising in 2018, 2019 and 2020.  Under the CARES Act, such net operating losses may be carried back to the five taxable years immediately preceding the year of the loss.   The Revenue Procedure addresses taxpayer elections to forego the carryback period, elections related to years in which foreign income is included in the taxpayer’s income under I.R.C. Section 965 and taxpayer options for net operating losses in  tax years beginning before January 1, 2018, and ending after December 31, 2017.  Rev. Proc 2020-24, 2020-17 IRB.

IRS Allows Partnerships to Claim CARES Act Benefits via Amended Returns

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Under the centralized audit procedures for partnerships enacted by Congress in 2015, partnerships generally may not file amended returns without express authorization of the IRS.  To enable partnerships and partners to take advantage of certain retroactive law changes under the CARES Act, the IRS has issued its Revenue Procedure 2020-23 allowing partnerships that filed a Form 1065 and furnished all required Schedules K-1 for taxable years beginning in 2018 or 2019 before the date of the revenue procedure may file amended partnership returns and furnish corresponding Schedules K-1 to its partners before September 30, 2020.  Rev. Proc. 2020-23, 2020-18 IRB (April 8, 2020).

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Mississippi Department of Revenue suspends requirements under the International Registration Plan and International Fuel Tax Agreement

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In an Order of the Commissioner dated March 24, 2020, the Department of Revenue has suspended requirements associated with the International Registry Plan and the International Fuel Tax Agreement for any motor vehicle engaged in interstate emergency relief efforts and traveling through Mississippi as part of the emergency relief.  This includes motor vehicles carrying medical supplies or pharmaceuticals, supermarket products or food, or fuel.  Additionally, any apportioned registration issued under the International Registration Plan expiring on March 31, 2020, is suspended and the expiration date is extended to April 30, 2020.

The Order is effective for 60 days from its date.

CARES Act Provides Substantial Funding for States, Counties, and Municipalities

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The CARES Act provides $150 billion in Coronavirus Relief Funds for states, tribes and local governments.  It is a centerpiece of the state aid in the CARES package, with the funds to be used to reimburse expenses incurred by the states and local governments as a result of Covid-19.  Each state will receive funds based on population and at least $1.25 billion.  Mississippi is expected to receive approximately $1.3 billion.  The legislation provides that funding will be available directly to the states and to local governments serving populations over 500,000.  Forty-five percent of the funds provided to each state are set aside for eligible expenses of local governments.  With Mississippi not having a local government exceeding 500,000 in population, questions remain concerning access to funds by Mississippi cities and counties.

The CARES Act is the third COVID-19 relief package.  Even as the Act is going into effect, a new fourth relief package is being developed.  There have been numerous requests (1) for significant additional funds allocated to local governments with populations less than 500,000 or (2) to lower the threshold for direct Coronavirus Response Fund access through Section 5001 of the CARES Act.

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Statewide Shelter-in-Place Order in Plain English

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On Wednesday, April 1, 2020, Governor Tate Reeves announced that Executive Order 1466 (“E.O. 1466”) will go into effect on Friday, April 3 at 5 p.m. and remain in effect until Monday, April 20 at 8 a.m. E.O. 1466 is a shelter-in-place order, also referred to as a stay-at-home order. As the name implies, it orders residents to stay within their residencies, but it is subject to exceptions. Important points from E.O. 1466 include:

  • Essential businesses and operations “may remain open and shall operate as necessary to provide essential services and functions.” While these businesses are not subject to the prohibition on social gatherings in excess of 10 persons, they should take reasonable measures to comply with the Centers for Disease Control and Prevention (“CDC”) and Mississippi Department of Health (“MDOH”) recommendations, e.g., social distancing. Essential businesses and operations are defined by Executive Order 1463 and the Supplement to Executive Order 1463 (collectively “E.O. 1463”). The definition of essential businesses and operations is discussed below.
  • Non-essential businesses and operations are prohibited from operating except for performing minimum operations. Minimum operations are those operations necessary for the business to maintain the condition of its facilities, premises and equipment, value of business inventory, administer payroll and employee benefits, provide security, and facilitate remote working.
  • Essential activities by residents are permitted, and include performing tasks such as buying groceries, working for an essential business, caring for someone in a vulnerable population, and individual outdoor recreation, e.g., walking or running. People who are outside for exercise must follow social distancing guidelines of maintaining at least a 6-foot distance and groups of 10 or less.
  • Essential travel by residents is permitted, and includes travel related to an essential business or operation, an essential activity, care for dependents, minors, elderly, disabled, or otherwise vulnerable persons, picking-up distance learning materials from an educational institution, to and from place of residence, or that required by law enforcement, court order, or child custody arrangement.
  • Expressly prohibited activities include social and non-essential gatherings in excess of 10 persons where individuals are less than six feet from one another, and operating indoor and outdoor places of amusement and recreation, such as museums, movie theaters, playgrounds, children’s parties, social clubs, and parks including all beaches, lakes, and reservoirs (but not walking trails). These are mandated closed. Dine-in service at restaurants and bars is also prohibited, but restaurants and bars may remain open only for drive-thru, curbside pick-up, or delivery service.
  • Evictions are suspended, but individuals are not relieved of contractual obligations to pay rent, mortgage, or otherwise comply with other obligations of their tenancy or mortgage contract.

The Order provides that it may be enforced by all state, county, and local law enforcement, as well as other government entities, and that violations are subject to Miss. Code Ann. § 33-15-43, which provides for a fine of up to $500 or imprisonment not to exceed six months, or both. Nothing in E.O. 1466 prohibits a local government from taking more restrictive action except that it may not prevent an essential business or operation “from operating at such level necessary to provide essential services and functions.”

An important initial question raised by many residents is what constitutes an “essential business or operation.” E.O. 1463 defines this term by providing 19 categories of essential businesses and operations. Although E.O. 1463 provides more specificity to the list below by providing specific examples of businesses that fall within each category, the categories are, in brief:

  1. Essential government functions such as those related to public safety, health, and corrections.
  2. Essential healthcare operations such as hospitals, laboratories, and nursing homes. The term is meant to be construed broadly but does not include gyms, spas, salons, barber shops, and similar personal care and grooming facilities.
  3. Essential infrastructure such as power generation, fuel and transmission, communications networks, and airports.
  4. Manufacturing such as food processing and production, medical equipment, and household products.
  5. Agriculture and farms such as food cultivation, livestock, gas, diesel, and farmer’s markets.
  6. Essential retail such as supermarkets, pharmacies, and hardware.
  7. Essential services such as trash collection, mail services, home repair, automotive sales and repair, laundromats/laundry service, and warehouse, distribution, and fulfillment centers.
  8. Media such as newspapers, television, digital, and radio.
  9. Education such as educators supporting distance learning, performing critical research, or providing free and reduced meals.
  10. Financial services such as banks, insurance, and accounting.
  11. Professional Services such as legal services, accounting, insurance, and real estate.
  12. Providers of basic necessities to economically disadvantaged populations (e.g., non-profits, businesses, and churches providing these necessities).
  13. Construction and construction related services such as building and construction, lumber, electricians, cleaning and janitorial, or skilled trades.
  14. Essential services necessary to maintain safety and sanitation of essential businesses and operations and residencies.
  15. Defense Industrial Base including businesses and workers who provide essential products and services required to meet national security commitments to the Federal Government and the U.S. Military.
  16. Vendors providing essential services and products needed to ensure the continued operations of essential businesses and operations, government, and provide for the health, safety, and welfare of the public.
  17. Religious entities, provided they adhere to CDC and MDOH guidelines.
  18. Categories of workers identified by the U.S. Department of Homeland Security, Cybersecurity & Infrastructure Security Agency (“CISA”) in its “Memorandum of Identification of Essential Critical Infrastructure Workers During COVID-19 Response.” Note CISA updated its guidance over the weekend of March 28, 2020.
  19. Other categories as deemed necessary by MDOH, Mississippi Emergency Management Agency, or other state agency

If you have questions about any of the above, including whether your business qualifies as an essential business or operation, it is recommended you read E.O. 1463, the Supplement to E.O. 1463, and E.O. 1466, all of which provide more specificity, and also consult with an attorney.

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