Recent action, both governmental and non-governmental, suggests that the U.S. Department of Justice (“DOJ”) will be less inclined to include mitigation projects or Supplemental Environmental Projects (“SEPs”) in environmental enforcement settlements.
In a prior Alert, I discussed the June 5, 2017 memorandum issued by Attorney General Jeff Sessions (“the Sessions Memo”), which stated that DOJ will no longer agree to settlements that include “payments” by a defendant to a third party organization. In another Alert, I discussed comments that certain EPA and DOJ officials made regarding the Sessions Memo. Recent activity indicates that DOJ policy will continue to develop, potentially in a way that discourages environmental projects as part of settlements.
New Memo from Attorney General Sessions
It appears that the Attorney General remains interested in the issue. On July 28, 2017, he issued another memorandum, directing all DOJ Component Heads and United States Attorneys to compile a list of all civil or criminal settlement agreements that include payments to third parties that would be prohibited by the Sessions Memo. They are to provide this information by the end of August.
Articles from the Press and Public Policy Organizations
Non-governmental events also indicate an ongoing interest. Recent articles in Breitbart and other news organizations have denounced settlements that created what these articles depicted as “slush funds” for left wing groups. An article posted by the Competitive Enterprise Institute (“CEI”) in its Energy and Environment section specifically mentions settlements in environmental cases, describing them as a “Billion Dollar Green Energy Rip-Off.” The CEI article identifies 18 settlements that required companies to pay “$1.55 billion in private sector funding on renewable energy, energy efficiency, and electric vehicles.” The article demands that the EPA and DOJ “make clear that these settlements are no longer permitted.” For a copy of the CEI article click here.
Proposed “Mitigation” Projects and SEPs May Get a Closer Look
The Sessions Memo specifically does not apply to projects that remedy environmental harm from the violations. By definition, “mitigation” projects are only supposed to be used to remedy past harm. Some commentators have questioned both the appropriateness of labeling some of the projects as “mitigation” and their effect of supporting alternative energy or other goals not in line with current administration thinking.
The Attorney General may order a broader review of environmental projects contained in settlements, in part to determine if the “mitigation” projects actually meet that definition. Those who object to the projects, regardless of them being identified as “mitigation” projects or SEPs, will continue to demand that DOJ cease including them in environmental enforcement settlements.