Looking Ahead To 2012.

5 Jan 2012

Wetland Rules at the Federal Level.  The Sacketts bought a $23,000 residential lot in Idaho and filled it in with dirt and rocks in preparation for building a home. The EPA fined the Sacketts claiming that the property is a wetlands that cannot be disturbed without a permit.  Next week, the U.S. Supreme Court will take up the Sacketts’ case, not to redefine wetlands, but to decide whether landowners are entitled to a hearing before a judge when they are confronted by the EPA. The case is being closely watched by developers and environmentalists.

Further, as Arthur has blogged about a number of times, it will be interesting to continue to watch how the federal government interprets the 2006 Rapanos decision regarding federal jurisdiction over wetlands.  Since no single Rapanos opinion garnered a majority of the Justices’ votes, it is unclear which opinion sets forth the controlling test for wetlands jurisdiction and fights and court cases will continue to follow.

EPA Greenhouse Gas Rules vs. Congress.

Last month, the EPA released new rules under the 1990 Clean Air Act which were aimed at coal burning power plants.  More than a dozen electric power companies, municipal power plant operators and states had sought to delay the rules due to, among other things, the over 2 billion dollar price tag.  Last week, a federal appeals court in Washington approved their request.  Republicans claim that the rules would shutter some older, coal-fired power plants and kill jobs.  Obama and the EPA claim that the investments would be far outweighed by the hundreds of billions of dollars in health care savings from cleaner air.  The court is asking that oral arguments take place by April 2012.

Coal Ash – Hazardous Materials?

The EPA is currently considering several options on how to regulate coal ash, from giving it a special status as a hazardous waste to classifying it as a solid waste. The industry has said that even a solid waste classification would prompt the closure of some existing coal ash ponds and landfills, costing jobs and raising energy bills.  Last Halloween, a Wisconsin utility had a section of cliff the size of a football field give way, creating a mudslide that sent equipment and coal ash spilling into Lake Michigan.  I suspect a greater level of pressure on the EPA to characterize coal ash as hazardous or otherwise ramp up regulation of coal ash impoundments in 2012.

Fracking Debate Rages On.  The proliferation of hydraulic fracturing, also known as fracking, across the U.S. in 2011 sparked protests and debates over its utility and side effects.  Last May, the State of Michigan issued new requirements for the process (Michigan enters the “fracking” fray).  In November 2011, the EPA announced plans to expand federal oversight of fracking fluids after an EPA study revealed that an aquifer in Wyoming, which had seen extensive gas drilling, contained several cancer-causing compounds, and at least one chemical commonly used in fracking fluids.  The fracking debate is sure to rage on in 2012.

Keystone Pipeline.  President Obama and Congress are starting the new year locked in a politically charged dispute over the Keystone XL pipeline, a proposed 1,700-mile oil pipeline from Canada to Texas.  Republicans and some unions claim that the pipeline will create thousands of jobs. Environmentalists fear it could lead to an oil spill disaster.  The pre-Christmas agreement between Obama and Congress temporarily extending the payroll tax cut included language forcing Obama to make a speedy decision on whether to allow the building of the pipeline.  The $7 billion pipeline poses a political trap for Obama because it divides his supporters (environmentalists oppose the project while most labor unions support it).

Redevelopment Incentives in Michigan – Trying to Do More with Less.  Last year, the wildly successful MEGA, Brownfield and Historic tax credits were eliminated and replaced with two downsized programs.  This was a major disappointment as these incentives encouraged the redevelopment of blighted and polluted properties in Michigan.  So what will builders, developers and investors turn to in 2012?  Will Ann Arbor’s PACE legislation thrive and become a model for other communities?  Those seeking redevelopment in Michigan will certainly be trying to do more with less in 2012.  Hopefully, the MEDC and municipalities will assist developers and businesses to find creative ways to encourage investment, revitalization, and rehabilitation in the State.


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