dn 75-1 agreement

7/24/2019 DN 75-1 Agreement

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SETTLEMENT AGREEMENT

Kentucky Waterways Alliance, Sierra Club, Appalachian Voices, Kentuckians for the

Commonwealth, Center for Biological Diversity, and Defenders of Wildlife (Plaintiffs); the UnitedStates Environmental Protection Agency, Gina McCarthy, Administrator of the United States

Environmental Protection Agency; and Heather McTeer Toney, Regional Administrator of the United

States Environmental Protection Agency Region IV (collectively, EPA); and The Commonwealth ofKentucky (Kentucky)along with Kentucky Chamber of Commerce and Kentucky Coal Association

(Industry-Intervenors) hereby enter into this Settlement Agreement with respect to an action originally

filed by Plaintiffs on December 13, 2013. Plaintiffs, EPA, Kentucky, and Industry-Intervenors arehereafter collectively referred to as the Parties.

The Parties hereby state:

WHEREAS, Plaintiffs filed the above-referenced law suit on December 13, 2013, a First

Amended Complaint on February 28, 2014, and a Second Amended Complaint on August 13, 2014 (W.D.

Ky. Case 3:13-CV-1207-GNS-DW);

WHEREAS, PlaintiffsSecond Amended Complaint asserts that the EPAs approval under 33

U.S.C. 1313(c) on November 15, 2013, of changes to Kentuckys water quality standards regarding

selenium, eutrophication, and nutrients contained in Kentucky Administrative Regulations 401 KAR10:001 Section 1 (30) and 401 KAR 10:031 Section 6 was inconsistent with the federal water quality

standards regulations and the Clean Water Act (CWA), was arbitrary, capricious and otherwise contrary to

law, and was made without the requisite consultations under Section 7 of the Endangered Species Act(ESA);

WHEREAS, on October 2, 2014, the Parties entered into court-ordered mediation;

WHEREAS, on October 17, 2014, Plaintiffs moved for summary judgment in this matter;

WHEREAS, on April 29, 2015, EPA sent a revised biological evaluation to the United States Fishand Wildlife Service (FWS) requesting initiation of formal consultation on EPAs approval of

Kentuckys revised narrative nutrient criterion and revised definition of eutrophication (401 KAR 10:001

Section 1 (30), 10:031 Section 6);

WHEREAS, on June 23, 2015, EPA sent a revised biological evaluation to the FWS requesting

initiation of formal consultation on EPAs approval of Kentuckys amendments to the Commonwealths

water quality standards regulations adopting revised chronic water quality criteria for selenium of 8.6 g/gdry weight of whole fish tissue (401 KAR 10:031 Section 6);

WHEREAS,state and authorized tribal standards adopted on or after May 30, 2000 do not become

the applicable standards for CWA purposes until they are approved by EPA, standards adopted by statesand authorized tribes on or after May 30, 2000 must be approved by EPA before they are the basis for

action under the CWA, and once a standard becomes an applicable water quality standard for CWA

purposes, it remains such until EPA approves a change;

WHEREAS,EPA has stated, in its 2014 and 2015 draft aquatic life selenium criterion documents,

Case 3:13-cv-01207-GNS-DW Document 75-1 Filed 10/30/15 Page 1 of 12 PageID #: 759


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that fish tissue criterion elements should override water column criterion elements when both fish tissueand water concentrations are measured, that states and tribes should express a multi- part criterion in a

manner that explicitly affirms the primacy of fish tissue criterion elements over water column criterion

elements, that inclusion of water column elements ensures protection when fish tissue measurements are

not available, and that external scientific peer review affirms these assertions;

WHEREAS,Kentuckys interpretation and implementation of its current selenium criterion

elements for protection of aquatic life affirm the primacy of fish tissue criterion elements over watercolumn criterion elements;

WHEREAS,Kentucky, at least through the period of remand established by this SettlementAgreement (Agreement), intends to interpret and implement the current selenium criterion elements for

protection of aquatic life (which were previously approved by EPA) as affirming the primacy of fish tissue

criterion elements over water column criterion elements;

WHEREAS,at least through the period of remand established by this Agreement, EPA supports

Kentuckys implementation of the current selenium criterion elementsfor protection of aquatic life (which

were previously approved by EPA) affirming the primacy of fish tissue criterion elements over water

column criterion elements;

WHEREAS,EPA anticipates that Kentucky will adopt new or revised water quality standards to

explicitly clarify the relationship between any fish tissue chronic criteria for selenium and any watercolumn chronic criteria for selenium and EPA intends to take action on these new or revised water quality

standards pursuant to CWA Section 303(c);

WHEREAS,the Parties have agreed to a settlement of all counts contained in the Second

Amended Complaint in the above-captioned case without any admission of fact or law, which they

consider to be just, fair, adequate and equitable resolution of the claims raised in the Complaint;

WHEREAS,the Parties and their respective counsel consent and enter into this Agreementwithout trial, adjudication, or admission of any issue of fact or law with respect to Plaintiffs claims or

allegations and without admission of any fact, allegations, or legal argument contained in Plaintiffs sixty(60) day notice, Complaint, Amended Complaint, or Second Amended Complaint in this action;

WHEREAS,it is in the interest of the public, the Parties, and judicial economy to resolve theabove-referenced action without protracted litigation.

NOW, THEREFORE, IT IS HEREBY AGREED that:

I. Parties

1. The Parties to this Settlement Agreement are Plaintiffs, EPA, Kentucky, and

Industry-Intervenors. The Parties understand that (a) Gina McCarthy and Heather McTeer Toney are suedin their official capacities as Administrator of the United States Environmental Protection Agency and

Regional Administrator of United States EPA, Region 4, respectively and (b) the obligations arising under

this Agreement are to be performed by EPA and not by Gina McCarthy or Heather McTeer Toney (or theirsuccessors and assigns) in their individual capacities.



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2. This Settlement Agreement shall apply to, and be binding upon, the Parties, and upon thesuccessors and assigns of the Parties.

II. EPA Actions

3. Within 7 days of the effective date of this settlement agreement, the Parties will file a motion

requesting a stay ofKentucky Waterways Alliance, et al. v. McCarthy, No. 3:13-cv-1207-GNS-DW (W.D.

Ky.) and requesting that the court remand without vacating via a proposed Agreed Order (attached asExhibit ---) to be filed with the motion for stay (hereafter referred to as the Agreed Order) the following

parts of EPAsNovember 15, 2013 decision pursuant to CWA Section 303(c):

a. Approving amendments to Kentuckys water quality standards regulations adopting

a revised definition of eutrophication and revised narrative nutrient criterion (401 KAR 10:001

Section 1 (30), 10:031 Section 6); and

b. Approving amendments to Kentuckys water quality standards regulations that 1)

removed Kentuckys water column chronic criterion for selenium of 5.0 g/L, and 2) adopted

revised chronic water quality criteria for selenium of 8.6 g/g dry weight of whole fish tissue or

19.3 g/g dry weight of fish egg/ovary tissue (401 KAR 10:031 Section 6).

4. The Agreed Order will provide that in the event that EPA does not disapprove Kentuckys

removal of the water column criterion within 90 days of the courts entry of the Agreed OrderremandingEPAs November 15, 2013 approval of the removal of Kentuckys water column chronic criterion of 5.0

g/L, that approval will be vacated. If EPAs approval of the removal of the seleniumwater column

chronic criterion is vacated and the water column criterion becomes an applicable element of Kentuckysselenium criterion, the Parties acknowledge that Kentuckys action adopting fish tissue criterion elements,

and EPAs approval of those fish tissue criterion elements, recognizes the primacy of fish tissue criterion

elements over water column criterion elements.

5. EPA will complete ESA Section 7 consultation before affirming any portion of theNovember 15, 2013 approval decision pursuant to CWA Section 303(c).

6. Upon entry of the Agreed Order, EPA will take the following actions:

a. Within 120 days of EPA receiving a final Biological Opinion from the FWS or theFWSs concurrence with EPAsNot Likely to Adversely Affect (NLAA) determination on theeutrophication definition and revised narrative nutrient criteria (401 KAR 10:001 Section 1 (30),

10:031 Section 1, respectively), EPA will take action pursuant to CWA Section 303(c) either to

affirm the Agencys November 15, 2013 approval decision or to disapprove the definition andcriteria (401 KAR 10:001 Section 1 (30), 10:031 Section 1, respectively).

b. Within 120 days of EPA receiving a final Biological Opinion from the FWS or the

FWSs concurrence with EPAsNLAA determination on the whole fish tissue chronic criterion forselenium, EPA will take action pursuant to CWA Section 303(c) either to affirm the Agencys

November 15, 2013 approval decision or to disapprove that criterion;

c. EPA will reconsider the Agencys November 15, 2013 decision approving the

removal of Kentuckys selenium water column chronic criterion. Upon reconsideration, if EPA



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disapproves the removal of Kentuckys selenium water column chronic criterion, EPA will issuethat decision within 90 days of entry of the Agreed Order. If EPA disapproves Kentuckys removal

of the selenium water column chronic criterion and that criterion becomes an applicable element of

Kentuckys selenium criterion, the Parties acknowledge that Kentuckys action adopting fish tissue

criterion elements, and EPAs approval of those fish tissue criterion elements, recognizes theprimacy of fish tissue criterion elements over water column criterion elements. If EPA does not

disapprove the removal of the selenium water column chronic criterion within 90 days of entry of

the Agreed order, EPA will complete an effects determination and revised biological evaluation onthe removal of Kentuckys selenium water column chronic criterion and, as appropriate, send a

request to again initiate consultation under the ESA to the FWS within 120 days of entry of the

Agreed Order. Within 120 days of EPA receiving a final Biological Opinion from the FWS or theFWSs concurrence with EPAsNLAA determination on removal of the water column chronic

criterion, EPA will take action pursuant to CWA Section 303(c) to either affirm the Agencys

November 15, 2013 approval decision or to disapprove the removal of the water column criterion;

d. EPA will reconsider the Agencys November 15,2013 decision approving

Kentuckys selenium criterion for warm water aquatic habitat of 19.3 g/g dry weight of fish

egg/ovary tissue (401 KAR 10:031 Section 6). Upon reconsideration, if EPA disapproves

Kentuckys selenium criterion for warm water aquatichabitat of 19.3 g/g dry weight of fishegg/ovary tissue (401 KAR 10:031 Section 6), EPA will issue that decision within 90 days of entry

of the Agreed Order. If EPA does not disapprove within 90 days of entry of the Agreed Order, EPA

will complete an effects determination and revised biological evaluation and, as appropriate, send arequest to again initiate consultation under the ESA with the FWS within 120 days of entry of the

Agreed Order. Within 120 days of EPA receiving a final Biological Opinion from the FWS or the

FWSs concurrence with EPAsNLAA determination on the fish egg/ovary tissue criterion, EPAwill take action pursuant to CWA Section 303(c) either to affirm the Agencys November 15, 2013

approval decision or to disapprove that criterion.

7. Within 10 days of the completion of the decisions detailed in Paragraph 6, the Parties shall

file a stipulated dismissal of this case with prejudice (except for claims for attorneys fees as covered inparagraph 9).

III. Stay of Litigation and Covenant Not to Sue

8. This Settlement does not impair any right Plaintiffs, Kentucky, or Industry-Intervenors mayhave to bring a subsequent action challenging EPAs decision in connection with EPAs approval ordisapproval of any State-submitted water quality standard. The Parties agree that any challenge to EPAs

future decisions in approving or disapproving any State-submitted water quality standard must be brought

in an action for review under the Administrative Procedure Act or under the citizen suit provision of theESA, and be based on the certified administrative records, if appropriate, for such decisions. EPA

preserves all its defenses to any such challenges.

IV. Fees and Costs

9. EPA agrees that Plaintiffs are both eligible and entitled to recover from the United States their

costs of litigation, including reasonable attorneys fees, incurred in connection with this action. At the timePlaintiffs submit the motion to dismiss the claims with prejudice referenced in Section II, EPA and

Plaintiffs shall jointly request that the Court extend by 90 days the deadline for filing a motion for costs of



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litigation, including reasonable attorneys fees. During this period, EPA and Plaintiffs shall seek to resolveinformally any claim for costs of litigation, including reasonable attorneys fees. Nothing in this paragraph

shall diminish EPAs right to object to the amount of the costs of litigation, including reasonable attorneys

fees, claimed by Plaintiffs, including the hourly rates claimed by Plaintiffs in connection with such claim.

V. Effect of Settlement

10. This Agreement was negotiated between the Parties in good faith and was jointly drafted bythe Parties. Accordingly, the Parties hereby agree that any and all rules of construction to the effect that

ambiguity is construed against the drafting party shall be inapplicable in any dispute concerning the terms,

meaning, or interpretation of this Agreement. This Agreement shall not constitute or be construed as anadmission or adjudication by the United States or EPA of any question of fact or law with respect to any of

the claims raised in the this matter. Nor is it an admission of violation of any law, rule, regulation, or policy

by the United States or EPA. This Settlement Agreement shall not be admitted for any purpose in any

proceeding without prior notice to and the express consent of EPA and Kentucky.

VI. Dispute Resolution

11. In the event of a disagreement between the Parties concerning the interpretation orcompletion of any aspect of this Agreement, the dissatisfied party shall provide the other party with written

notice of the dispute and a request for negotiations. The Parties shall meet and confer in order to attempt

to resolve the dispute within 30 business days of the written notice, or such time thereafter as is mutuallyagreed. If the Parties are unable to resolve the dispute within 45 days of such meeting, Plaintiffs sole

remedy is to file a motion to lift the stay and re-assert the claims of the Second Amended Complaint. The

Parties agree that contempt of court is not an available remedy under this Settlement Agreement.

VII. Modification

12. This Agreement may be modified by written agreement of the signatories to the Agreement

without notice to the court. If a subsequent change in law alters or relieves EPA of its obligationsconcerning matters addressed in this Agreement, then the Agreement shall be amended to conform to such

changes. Any dispute regarding invocation of this provision shall be resolved in accordance with thedispute resolution provisions of Section VI.

VIII. Notice

13. Any notice required or made with respect to this Agreement shall be in writing and shall be

effective upon receipt. For any matter relating to this Agreement, the contact persons are:

For Plaintiffs:

Benjamin A. Luckett

Appalachian Mountain AssociatesP.O. Box 507

Lewisburg, West Virginia 24901

(304) 645-0125 (telephone)(304) 645-9008 (facsimile)

[email protected]



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For the United States, on behalf of EPA:

JAMES A. MAYSONETTUnited States Department of Justice

RFK 2633

P.O. Box 7415Washington, D.C. 20044

CAROL F. BASCHONU.S. Environmental Protection Agency

Region 4

61 Forsyth Street SW

Atlanta, GA 30303

ALEXIS WADE

U.S. Environmental Protection Agency

Office of General CounselMail Code 2355A

1200 Pennsylvania Avenue, N.W.

Washington, DC 20460

For Kentucky

CHRISTOPHER R. FITZPATRICK

Office of General Counsel

Energy and Environment Cabinet

200 Fair Oaks Lane, 1stFloor

Frankfort, KY 40601

For Industry-Intervenors:

JOHN C. BENDER

RICHARD CLAYTON LARKINDinsmore & Shohl, LLP250 West Main Street, Suite 1400

Lexington, KY 40507

Upon written notice to the other Parties, any party may designate a successor contact person for any matter

relating to this Settlement Agreement.

IX. Compliance With Other Laws

14. No provision of this Agreement shall be interpreted as or constitute a commitment or

requirement that EPA obligate or pay funds in contravention of the Anti-Deficiency Act, 31 U.S.C. 1341,or take actions in contravention of the Administrative Procedure Act, 5 U.S.C. 551-559, 701-706, the

CWA, the ESA, or any other law or regulation, either substantive or procedural.



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X. Agency Discretion

15. Nothing in this Agreement shall be construed to limit or modify the discretion accorded EPA by

the CWA, 33 U.S.C. 1251 et seq., or by general principles of administrative law.

XI. Force Majeure

16. The possibility exists that circumstances outside the reasonable control of EPA could delay

compliance with this Agreement. Such situations include, but are not limited to, a government shutdown

as occurred in 1995, 1996, and 2013, a natural disaster, or catastrophic environmental events requiring animmediate and/or time consuming response by EPA. EPA will provide Plaintiffs with reasonable notice

in the event that EPA invokes this term of the Settlement Agreement.

XII. Representative Authority

17. The individuals signing this Agreement on behalf of the Parties hereby certify that they are

authorized to bind their respective parties to this Agreement.

XIII. Choice of Law

18. This Agreement shall be governed and construed under the laws of the United States.

XIV. Termination

19. Upon the fulfillment of EPAsand Plaintiffsobligations under Paragraphs 37 and 9 of this

Agreement, this Agreement shall be terminated.

XV. Final Agreement

20. This Agreement constitutes the final, complete and exclusive agreement and understanding

between the Parties with respect to the matters addressed in this Agreement. There are no representations,agreements or understandings relating to this settlement other than those expressly contained in this

Agreement.

XVI. Effective Date of Settlement Agreement

21. The Effective Date of this Agreement shall be the date of the last signatory to the Agreement.

The Agreement may be executed in counterparts with signatures transmitted by facsimile or scannedelectronically and transmitted by electronic mail.

WHEREFORE, after reviewing the terms and conditions of this Agreement, the Parties hereby

consent and agree to the terms and conditions of this Agreement.

FOR THE PLAINTIFFS:

Dated: ______, 2015 ________________________________



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BENJAMIN A. LUCKETTAppalachian Mountain Associates

FOR EPA:

Dated: ______, 2015 ________________________________

JAMES A. MAYSONETT

United States Department of Justice

FOR KENTUCKY:

Dated: ______, 2015 ________________________________

LEONARD K. PETERS

Secretary, Energy and Environment Cabinet

Commonwealth of Kentucky

FOR INTERVENOR KENTUCKY COAL ASSOCIATION:

Dated: ______, 2015 ________________________________WILLIAM BISSETT

President

FOR INTERVENOR KENTUCKY CHAMBER OF COMMERCE:

Dated: ______, 2015 ________________________________BRYAN SUNDERLAND

Senior Vice President, Public Affairs



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dn 75-1 agreement

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