Coleman & Horowitt Assists Client With CFATS Compliance.

Attorneys at Coleman & Horowitt recently assisted a client in discussions with the Department of Homeland Security (DHS) regarding compliance with the Chemical Facility Anti-Terrorism Standards (CFATS) program. Specifically, they assisted the client in explaining how certain chemicals, including chemicals of interest (COI), were being used to grow crops and therefore subject to the extension from CFATS for agricultural activities (Ag Extension). The practical aspect of this outcome is that the client will not be subject to potentially cost prohibitive security measures for fertilizers used in crop production. Please continue reading for a brief discussion of CFATS and the Ag Extension. If you have received correspondence from an analyst or investigator with DHS regarding CFATS, Lee N. Smith and Craig A. Tristao of our office are experienced in discussions and can help you navigate compliance.

The CFATS Program.

To protect the nation from the exploitation of hazardous chemicals, Congress authorized the Department of Homeland Security (DHS) to create the Chemical Facility Anti-Terrorism Standards (CFATS) program (6 CFR Part 27) in order to identify and regulate high-risk chemical facilities to ensure they have security measures in place to reduce the risk of a terrorist attack associated with certain chemicals of interest (COI) that can be used to create explosive devices or otherwise cause us harm.

The CFATS regulation lists more than 300 COIs, which if held in specified quantities or concentrations known as standard threshold quantities (STQ), trigger reporting requirements to DHS via an online questionnaire called a Top-Screen. Facilities are required to report their chemical holdings within 60 days of coming into possession of a COI. However, DHS has given certain agricultural facilities a time extension for that reporting requirement.

The Ag Extension.

In January 2008, the Department published in the Federal Register a December 2007 letter granting a time extension for certain farmers and other agricultural users who are otherwise required to report their COI holdings and submit a Top-Screen survey under CFATS (see 73 Fed. Reg. 1640 January 9, 2008).

The Ag Extension provides in pertinent part:

(1)        Until further notice, or unless otherwise specifically notified in writing by DHS, the Top-Screens will not be required for any facility that is required to submit a Top- Screen solely because it possesses any Chemical of Interest, at or above the applicable screening threshold quantity, for use—

(a) in preparation for the treatment of crops, feed, land, livestock (including poultry) or other areas of an agricultural production facility; or

(b) during application to or treatment of crops, feed, land, livestock (including poultry) or other areas of an agricultural production facility; This extension applies to facilities such as farms (e.g., crop, fruit, nut, and vegetable); ranches and rangeland; poultry, dairy, and equine facilities; turfgrass growers; golf courses; nurseries; floricultural operations; and public and private parks.

(2)        This extension does not apply to chemical distribution facilities, or commercial chemical application services.

(3)        This extension does not apply to chemical distribution facilities, or commercial chemical application services.

DHS Fact Sheet on the Ag Extension that Potentially Misinterprets the Extension.

Although the Ag Extension appears straightforward, agricultural businesses that utilize COIs may receive inquiries about how the COI’s are being utilized. This is because of a lack of understanding by DHS staff as to how COI’s are used in agricultural operations, and a DHS Fact Sheet which purports to exclude storage from the extension.

In November 2017, DHS issued a “Fact Sheet” on the Ag Extension. The Fact Sheet purports to identify situations when the Ag Extension does not apply. It provides:

“When the   Extension Does Not Apply.

The extension does not apply to agricultural production facilities that use a COI at or above the applicable STQ for purposes other than those listed above. For example…● If an agricultural facility stores and/or distributes a COI…...

These facilities must submit a Top-Screen within 60 days of coming into possession of a COI.”

The intention of DHS is logical, they want to know what security measures are in place at an agricultural facility that possesses a COI. However, you maybe contacted because DHS’ Fact Sheet is overbroad with regard to storage of chemicals, and in addition it may not be obvious that the chemicals at issue are being used to grow crops, as staff are likely not be as familiar with agricultural operations as they are with industrial operations.

Notwithstanding the language in the Fact Sheet, the Ag Extension, by its terms, applies to “farms…; ranches…”  Moreover, it appears the intent of the letter was only to exclude “chemical distribution facilities, or commercial chemical application services” from the Ag Extension and to not exclude the Ag Extension to locations used by farming operations as part of their crop production activities – see the Ag Extensions reference in (1)(a) “in preparation for the treatment of crops…”.

Further, although the language “store” is not used in the Ag Extension, the word “possess” is used frequently (see, i.e., section (1)”…will not be required for any facility that is required to submit a Top- Screen solely because it possesses any Chemical of Interest...”) and certainly implies that “storage” at least for an interim basis, is included.

Additionally, in reviewing whether storage or possession is actually allowed under the Ag Extension letter, it is useful to compare the Ag Extension letter, which identifies operations subject to the letter as CFAT facilities, to the actual CFATs regulations.  The definition of a facility under the regulations also contains the language “possess.”

Chemical Facility or facility shall mean any establishment that possesses or plans to possess, at any relevant point in time, a quantity of a chemical substance determined by the Secretary to be potentially dangerous or that meets other risk-related criteria identified by the Department. As used herein, the term chemical facility or facility shall also refer to the owner or operator of the chemical facility. Where multiple owners and/or operators function within a common infrastructure or within a single fenced area, the Assistant Secretary may determine that such owners and/or operators constitute a single chemical facility or multiple chemical facilities depending on the circumstances.

            6 CFR Chapter I, Part 27.

As such, the Fact Sheets’ use of “store” is overbroad if it is applied to facilities that hold a COI as part of crop production activities– the exception would swallow the exemption, and your farm should not be required to provide a “Top-Screen” for the COI.

What to do When You Receive an Inquiry?

If you receive an inquiry from DHS, you should contact counsel to discuss how to best respond. Counsel can assist you in communications with the agency, analyze whether any extensions apply to your use of a COI, and help you comply with the CFATS program if necessary.

Coleman & Horowitt LLP World Ag Expo Reception

We are having a reception at the World Ag Expo, please contact us if you wish to attend.

Proposed Rule Redefining Wetlands under the Federal Clean Water Act

 On Tuesday December 11, 2018,  the Environmental Protection Agency released the long awaited (promised by President Trump) proposed rule that would reduce the types of areas covered by the wetlands programs under the federal Clean Water Act.

( Pre-publication version of the Federal Register notice, the supporting analyses and fact sheets are available at: https://www.epa.gov/wotus-rule)

The proposed rule from the U.S. Environmental Protection Agency and the U.S. Army Corps of Engineers reduces the types of waterways that are covered as compared to the 2015 Obama era rule that was the subject of controversy because of the scope of the reach of jurisdiction. The more restrictive interpretation included in the proposed rule is based on a 2006 opinion by Supreme Court Justice Scalia, in Rapanos v. United States 547 U.S. 715 (2006). who opined that the federal Clean Water Act only applied to relatively permanent waters; while the other areas, should be regulated by states.
Of particular interest is the section that discussed crop land:

   Prior converted cropland.

§  This longstanding exclusion for certain agricultural areas would be continued under the proposal, and the agencies are clarifying that this exclusion would cease to apply when cropland is abandoned (i.e., not used for, or in support of, agricultural purposes in the preceding five years) and has reverted to wetlands.

The proposed rule creates six exclusive categories of areas that fall under federal jurisdiction. This text if from the EPA Fact Sheet:

        o   Traditional navigable waters (TNWs)

§  Under the proposal, traditional navigable waters would be large rivers and lakes, tidal waters, and the territorial seas—such as the Atlantic Ocean, the Mississippi River, the Great Lakes, and tidally influenced waterbodies, including wetlands, along coastlines—used in interstate or foreign commerce. 

o   Tributaries

§  In the agencies’ proposal, tributaries would be rivers and streams that flow to traditional navigable waters—such as Rock Creek, which feeds to the Potomac River in Washington, D.C.

§  Under the proposal, these naturally occurring surface water channels must flow more often than just when it rains—that is, tributaries as proposed must be perennial or intermittent. Ephemeral features would not be tributaries under the proposal.

§  Tributaries can connect to traditional navigable waters directly, through other “waters of the United States,” or through other non-jurisdictional surface waters so long as those waters convey perennial or intermittent flow downstream.

o   Certain ditches

§  A ditch under the proposed rule would be an “artificial channel used to convey water.”

§  Under the proposal, ditches would be jurisdictional where they are traditional navigable waters, such as the Erie Canal, or subject to the ebb and flow of the tide.

§  Ditches may also be jurisdictional where they satisfy conditions of the tributary definition as proposed and either 1) were constructed in a tributary or 2) were built in adjacent wetlands.

o   Certain lakes and ponds

§  Lakes and ponds would be jurisdictional where they are traditional navigable waters, such as the Great Salt Lake in Utah or Lake Champlain along the Vermont-New York border.

§  Lakes and ponds would be jurisdictional where they contribute perennial or intermittent flow to a traditional navigable water either directly, through other “waters of the United States,” or through other non-jurisdictional surface waters so long as those waters convey perennial or intermittent flow downstream, such as Lake Pepin in Minnesota or Lake Travis in Texas.

§  Lakes and ponds would be jurisdictional where they are flooded by a “water of the United States” in a typical year, such as many oxbow lakes.

o   Impoundments

§  Under the proposal, impoundments of “waters of the United States” would be jurisdictional.

o   Adjacent wetlands

§  Under the proposal, wetlands that physically touch other jurisdictional waters would be “adjacent wetlands,” such as Horicon Marsh in Wisconsin.

§  Wetlands with a surface water connection in a typical year that results from 1) inundation from a “water of the United States” to the wetland or 2) perennial or intermittent flow between the wetland and a “water of the United States” would be “adjacent.”

§  Wetlands that are near a jurisdictional water but don’t physically touch that water because they are separated, for example by a berm, levee, or upland, would be adjacent only where they have a surface water connection described in the previous bullet through or over the barrier, including wetlands flooded by jurisdictional waters in a typical year.

·         The proposal also clearly outlines what would not be “waters of the United States,” including:

o   Waters that would not be included in the proposed categories of “waters of the United States” listed above—this would provide clarity that if a water or feature is not identified as jurisdictional in the proposal, it would not be a jurisdictional water under the Clean Water Act.

o   Ephemeral features that contain water only during or in response to rainfall.

o   Groundwater.

o   Ditches that do not meet the proposed conditions necessary to be considered jurisdictional, including most farm and roadside ditches.

o   Prior converted cropland.

§  This longstanding exclusion for certain agricultural areas would be continued under the proposal, and the agencies are clarifying that this exclusion would cease to apply when cropland is abandoned (i.e., not used for, or in support of, agricultural purposes in the preceding five years) and has reverted to wetlands.

o   Stormwater control features excavated or constructed in upland to convey, treat, infiltrate, or store stormwater run-off.

o   Wastewater recycling structures such as detention, retention and infiltration basins and ponds, and groundwater recharge basins would be excluded where they are constructed in upland.

o   Waste treatment systems.

§  Waste treatment systems have been excluded from the definition of “waters of the United States” since 1979 and would continue to be excluded under this proposal; however, waste treatment systems are being defined for the first time in this proposed rule.

§  A waste treatment system would include all components, including lagoons and treatment ponds (such as settling or cooling ponds), designed to convey or retain, concentrate, settle, reduce, or remove pollutants, either actively or passively, from wastewater or stormwater prior to discharge (or eliminating any such discharge).  

This article is based on preliminary reporting- we will update this report further on this as we  review the related documents that were released. There is a sixty day comment period for the proposed rule.