Maryland Court Rejects Exelon’s Conowingo Dam Lawsuit

Baltimore Sun article (2018-10-11) reported that a Baltimore Circuit Court judge has rejected Exelon’s lawsuit against the state of Maryland over proposed requirements for the Conowingo Dam. As previously reported on Conduit Street, Exelon has appealed the State’s water quality certification requirements, which is needed as part of the dam’s federal relicensing process, both administratively and judicially. The article stated that Judge Pamela White ruled that Exelon must first exhaust its administrative remedies before appealing to Maryland’s courts. The ruling does not affect Exelon’s administrative appeal or its federal court lawsuit.

From the article:

[Maryland Governor Larry] Hogan said “historic progress” at improving the Chesapeake Bay’s health could be put at risk “if we do not pursue a comprehensive regional approach to reducing pollution in the Susquehanna River.”

Maryland environment Secretary Ben Grumbles called the ruling “great news for clean water and a step forward in the restoration of the Chesapeake Bay.”

Exelon officials said they plan to continue to contest the state permit, known as a water quality certification, because it “sets a precedent of assigning sole responsibility for pollution to the Conowingo Dam.”

Useful Links

Prior Conduit Street Coverage of the Conowingo Dam

Board Bumps Up Revenue Projections $400 Million for FY 20

The Board of Revenue Estimates voted today to write up the revenue projections for the State of Maryland for Fiscal Year 2019 by $325 million, representing a 4.1 percent increase over prior estimates. The Board also unveiled the first official estimates for fiscal year 2020, which is projected to be $18.7 billion, representing a 3.3 percent increase over fiscal year 2019 and a $407 million increase over the prior planning numbers.

See the Board’s report, including the details of the revenue estimates, online.

The actions are primarily influenced by changes in federal tax law – specifically the federal tax cuts enacted by Congress, and the Supreme Court ruling on South Dakota v. Wayfair – as well as positive developments in the state’s economy, such as low unemployment and wage growth.

Comptroller Peter Franchot indicated the following in a statement:

This action comes just weeks after we closed the books on Fiscal Year 2018 with $503 million above our original projections. Much of this good news is attributable to changes in federal tax law – specifically the federal tax cuts enacted by Congress, and the Supreme Court ruling on South Dakota v. Wayfair – as well as positive developments in our state’s economy, such as low unemployment and wage growth.

Nonetheless, it is impossible to view these numbers as anything other than good news for the health and stability of our state’s economy. Veteran attendees of these Board meetings can attest to the fact that we have never voted on a revenue write-up of this magnitude during my tenure. And today’s projected revenue increases should provide increased optimism for Maryland taxpayers and small businesses that we’re heading in the right direction.

But despite today’s great news, we cannot and must not take our eye off the ball by departing from the fiscally-prudent policies that allowed us to weather through several years of economic volatility.

I think back to my very first BRE meeting that I attended, shortly after I became comptroller-elect in December 2006 … when the economy was doing very well and our nation was experiencing a massive housing boom. This was the environment in which I was elected.

Two years later, when the housing market crashed and the stability of the global economy was far from certain I presided over this Board when we decreased our revenue projections by more than $1 billion.

So, I’ve seen the highs and the lows, if you will, and I can tell you that while we have much to celebrate with today’s revenue projections, it is also incumbent upon us to refrain from fiscal decisions that will compromise the significant progress we have made.

We must continue to hold the line on new and higher taxes … we must continue to hold the line on soaring debt … and we must continue to hold the line on wasteful and unsustainable spending.

If we want to continue the positive trends that our state is currently experiencing, our state’s fiscal and economic policymakers must not veer from footpaths that we have followed in recent years. We must continue to embrace policies that ensure our fiscal stability and security, regardless of what the nation’s economic future may have in store.

Maryland Plans to Sue Trump Administration After EPA Denies Air Emissions Request

Baltimore Sun article (2018-09-17) reported that Maryland will challenge a recent decision of the United States Environmental Protection Agency (EPA) denying Maryland’s request for limitations on coal plant emissions from upwind states. EPA’s decision marks a setback in the Maryland Department of the Environment’s efforts to curb significant amounts of ozone pollution that migrates from other states.

An estimated 70 percent of Maryland’s ozone pollution originates in other states. In response, Maryland petitioned EPA under the federal Clean Air Act to require coal power plants in 5 states to run already installed ozone emission controls between the months of May and September. Affected states include Indiana, Kentucky, Ohio, Pennsylvania, and West Virginia. Maryland submitted its petition in November of 2016 and EPA initially proposed denying the petition in May of 2018. EPA finalized its denial on September 14.

The article noted that Maryland will challenge EPA’s denial in federal appeals court. From the article:

Now, “litigation is the next step,” said Ben Grumbles, secretary of the Maryland Department of the Environment. …

The “EPA’s decision is wrong,” [Maryland Attorney General Brian] Frosh said. “If it is allowed to stand, the air Marylanders breathe will be dirtier, especially on the hottest days of the summer — through no fault of ours.”

The article also stated that most of Maryland’s congressional delegation support the State’s legal appeal.

Useful Links

Prior Conduit Street Coverage

Court of Special Appeals Hears Montgomery Pesticide Preemption Case

A panel of Maryland Court of Special Appeal judges will determine whether state law preempts counties from regulating pesticide applications after hearing oral arguments in the case of Montgomery County v. Complete Lawn Care on September 11, 2018. MACo and the Maryland Municipal League, concerned about the broader local preemption issues involved in the case, submitted an amicus brief to the Court of Special Appeals on June 21, 2018. The brief argued that local governments should not be preempted in enacting public health and safety measures that go beyond state minimums.

As previously reported on Conduit Street, the Montgomery County Council passed a ban on the use of EPA-registered lawn-care pesticides for public and private property. The ban  covered areas such as lawns, playgrounds, recreation areas, and child  care centers but exempted agricultural usage. The ban also contained exceptions for treating noxious or invasive weed species, addressing human health concerns, or preventing significant economic damage.

In response, Complete Lawn Care and other several other businesses and county residents filed suit in Maryland Circuit Court challenging the ban. Circuit Court Judge Terrence McGann issued a decision on August 3, 2017, finding that state law preempted the Montgomery County ordinance. The County appealed the Circuit Court’s decision to the Maryland Court of Special Appeals.

The three judges hearing the case included Donald Beachley, Alexander Wright, and Robert Zarnoch (retired). Edward Lattner from the Montgomery County Attorney’s Office argued that the County’s law was not impliedly preempted by state law as state law was primarily concerned with registration and labeling of pesticides and the licensing of applicators while the County law focused on putting further safety requirements on pesticide usage. Lattner noted that the General Assembly has three times previously considered and rejected legislation to explicitly prohibit local regulation of pesticides.

Plaintiff’s attorney Timothy Maloney and the counsel for Complete Lawn Care jointly argued that the County was impliedly preempted because there was a “very comprehensive state occupation” of the pesticide field, noting that the Maryland Department of the Environment also conducts numerous enforcement and inspection actions. They also argued that the  County ordinance essentially prohibited the use of pesticides approved for use in the state by both the United States Environmental Protection Agency and the Maryland Department of Agriculture.

Based on questions by the judges, Zarnoch appeared the most sympathetic to the County’s argument, noting that even an approved and registered pesticide could still harm humans. Wright appeared the most skeptical, questioning whether the General Assembly’s three rejections of express preemption legislation constituted an argument against the broad regulatory authority already possessed by the State through statute.

A decision in the case could come within several months. The case could be appealed by either party to the Court of Appeals. Additionally, the federal Farm Bill currently before Congress contains a provision that would expressly prohibit all local government regulation of pesticides across the nation. If the provision were to pass, the Montgomery County case would be rendered moot.

MACo remains extremely concerned about the broad and somewhat subjective common law test used by Maryland courts to determine implied preemption. As previously reported on Conduit Street, MACo has tentatively adopted addressing implied preemption as one of its 2019 Legislative Initiatives (the Initiatives will be formally adopted in January of 2019 after new and returning county elected officials are sworn in).

Useful Links

MACo and MML Amicus Curiae Brief

Circuit Court Decision – Complete Law Care v. Montgomery County (2017)

Prior Conduit Street Coverage of Montgomery Pesticide Ban

Conduit Street Article on 2019 Legislative Initiatives

LGIT Offers Implicit Bias Training For Local Law Enforcement Members

LGIT Leader article (2018-09 issue) reported that the Local Government Insurance Trust (LGIT) has partnered with Dr. Kris Marsh of the University of Maryland to offer a one-day course on implicit bias for local law enforcement agencies. The course was developed after the release of the final report of the President’s Task Force on 21st Century Policing in May of 2015 that highlighted the importance of implicit bias training and education for law enforcement agencies.

The LGIT course is based on a successful pilot course developed by Marsh and others for a local law enforcement agency. From the article:

The one day program created by Dr. Marsh is multi-faceted. It includes three main approaches: 1) Lectures and interactive exercises to establish understandings of prejudice and discrimination; 2) Computerized Implicit Association Tests (IATs) to help officers uncover their potential biases; and 3) Virtual reality simulations to assess behavior in real-life scenarios.

The classes are designed to teach officers:

  • The definition of implicit bias and its related concepts, and how to identify implicit bias in everyday life.
  • How implicit biases are measured, formed, and affect judgement and behavior.
  • Strategies to reduce unlawful bias and discrimination.
  • The differences between community and police perspectives related to bias, discrimination, and use of force. …

The goal of LGIT’s partnership with Dr. Marsh is to help police officers recognize biases that may affect their performance. Officers that complete the program should be able to understand how biases can and do have a negative impact on communities, especially minority and marginalized communities. This understanding should give police officers the capacity to show more empathy to the communities they police. Over time, this training should help improve police – community relationships across the state for the better.

LGIT members will receive a discounted of $50 per person and can apply for a LGIT training grant to further assist with the cost of the course. For further information on the course, including dates and registration, please contact Everett Sesker, Law Enforcement Loss Control Consultant, at EverettS@lgit.org.

Useful Links

LGIT Website

LGIT Training Grant Application

Special Appeals Court Holds PSC Preempts Local Zoning on Solar Siting

The Maryland Court of Special Appeals issued an unreported decision on August 28, 2018 that highlighted the complicated, multi-pronged test Maryland Courts use when determining when state law has prohibits local government regulation of a subject through implied preemption. Specifically, Board of County Commissioners of Washington County v. Perennial Solar, LLC held that state law allows the Public Service Commission (PSC) to preempt by implication the zoning of a local government when granting a certificate of convenience and public necessity (CPCN) for solar energy generating systems (SEGS). A CPCN is a state approval for the siting of large scale solar projects.

Two important points: First, the case is an “unreported decision” which means that it may not be cited as either precedent or persuasive authority. This limits the holding of the case to the specific matters contained in the case. Second: the decision is based on State law that was in existence prior to the adoption of HB 1350 of 2017, which now requires the PSC to give due consideration to: (i) the consistency of the application with the comprehensive plan and zoning of each county or municipal corporation in which any portion of the generation station is proposed to be located; and (ii) the efforts by affected parties to resolve any issues presented by such a county or municipal corporation.

The Facts of the Case

In 2015, Perennial Solar filed an application for a special exception and variance with the Washington County Board of Zoning Appeals to construct a SEGS on 86 acres of land zoned by the County as Agricultural (Rural). After a public hearing, the Board granted Perennial’s application. Perennial subsequently applied for a CPCN through the PSC, which was approved.

Several affected property owners challenged the PSC’s action in Circuit Court. The Circuit Court dismissed the action on a motion by Perennial, finding that the PSC decision preempted local zoning. The property owners and the Washington County Board of County Commissioners appealed the Circuit Court’s dismissal to the Court.

The Court’s Holding

There are two types of preemption – express and implied. Express preemption is where the General Assembly has clearly stated in statute that only the state is allowed to legislate in a particular policy area. Implied preemption, which is at the heart of this case, is where the General Assembly has acted with such force that an intent by the State to occupy the entire field must be implied. The case first outlined the complicated factors Maryland Courts use when reviewing implied preemption and then applied those factors to the facts of the case:

Although there is no specific formula to determine whether the General Assembly intended to preempt an entire area, Maryland courts have considered the following secondary factors relevant to whether a local law is preempted by implication:

  1. whether local laws existed prior to the enactment of the state laws governing the same subject,
  2. whether the state laws provide for pervasive administrative regulation,
  3. whether the local ordinance regulates an area in which some local control has traditionally been allowed,
  4. whether the state law expressly provides concurrent legislative authority to local jurisdictions or requires compliance with local ordinances,
  5. whether a state agency responsible for administering and enforcing the state law has recognized local authority to act in the field,
  6. whether the particular aspect of the field sought to be regulated by the local government has been addressed by the state legislation, and
  7. whether a two-tiered regulatory process existing if local laws were not preempted would engender chaos and confusion. …

Based on the comprehensiveness of §7-207 [of the Public Utilities Article], local zoning regulations and comprehensive plans are impliedly preempted by state law for SEGSs requiring a CPCN. The statute grants the PSC broad authority to determine whether and where the SEGS may be constructed and operated. It is even more evident that the Legislature intended to have the state govern SEGS approval by requiring local government input into the state’s final decision.

The Court of Appeals reached the same conclusion in Howard County v. Potomac Electric Power Co., 319 Md. 511 (1990). There, the Court considered whether the authority granted to the PSC under Article 78 (now PUA §7-207) preempted local land use and
zoning ordinances regulating the location and construction of certain transmission lines.

The Court also considered and rejected an argument by Washington County that the PSC law does not apply to Perennial Solar because it is not a “public service company.”

The Take Away

While this case is nominally about solar siting and local zoning, the broader issue for local governments is the vague and somewhat arbitrary “test” Maryland Courts use when determining implied preemption. Absent a clear rule about when a policy area is preempted by the state, local governments face uncertainty in many policy areas where both state and local regulation currently coexist.

 

Useful Links

HB 1350 of 2017

 

Troubled Waters? Talented Attorneys Talk Water Law at #MACoCon

Maryland counties are rich with water, both in terms of waterfront access and in sustainable water and wastewater infrastructure. Counties benefit from this — but along with these assets come great responsibilities and risks.

At the MACo Summer Conference session, Like a Bridge Over Troubled Water: Know Your Water Law, attendees learned about how conflicts that arise over responsibilities for water-related assets cannot often be shrugged off as “water under the bridge,” but require proactive planning and protection.

Attorney General Brian Frosh kicked off the session by discussing the myriad of moves he has taken, both as an attorney general and as a legislator, to protect Maryland’s environment, and specifically, the Chesapeake Bay. One of his proudest achievements on the Senate, he stressed, was championing legislation to prohibit offshore drilling.

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Attorney General Brian Frosh moderates MACo’s session on water law

Lisa Ochsenhirt, Esquire, Attorney, AquaLaw PLC provided a deeply informative overview on the legal challenges facing Maryland’s 100 or so water and sewer systems – and how meeting those challenges is only getting harder.

Dana Cooper, Esquire, Attorney, Cooper Moores LLC discussed what happens when counties get flushed down into issues concerning those systems, and how she worked with the U.S. Environmental Protection Agency to revise the Baltimore City sewer system’s consent decree.

Finally, John Mattingly, Esquire, County Attorney’s Office for Calvert County brought us back from the bowels of troubled waters by teaching county officials about how they can use riparian rights as a tool to protect their waterfronts’ aesthetic.

The presentation took place on Thursday, August 16, 2018 at 3:30 pm. The Honorable Brian Frosh, Maryland Attorney General moderated the session.

The 2018 MACo Summer Conference, “Water, Water Everywhere,” was held August 15-18 at the Rowland Powell Convention Center in Ocean City, Maryland.

Comptroller Swiftly Proposes Online Sales Tax Regs

Following the Supreme Court’s June decision in the Wayfair case allowing states to collect sales and use taxes on purchases made online, the Comptroller’s office swiftly submitted draft emergency regulations providing a conceptual framework for what would trigger collection of such taxes here in Maryland. The regulations could take effect as early as the end of this month.

The regulations would subject online sales transactions to the State’s 6 percent sales and use tax if the sale is made by a retailer who, either within the previous or current calendar year, made at least 200 sales transactions within the state, or the retailer earned at least $100,000 in gross revenue on sales in Maryland.

South Dakota v. Wayfair – a much-followed case by jurisdictions depending on sales tax revenue for their general funds – overturned Quill Corp. v. North Dakota. In Quill, the Supreme Court held that states cannot require retailers with no in-state physical presence to collect sales tax. Now, they can – but first, states must enact regulations similar to North Dakota’s in order to ensure that tax collections and remittance are not overly burdensome on retailers.

The Comptroller’s Office indicated that they “looked … very carefully” at the North Dakota regulations first.

The State’s head tax collector filed both emergency and proposed regulations with the General Assembly’s Joint Committee on Administrative, Executive, and Legislative Review (AELR),  which reviews draft regulations for conformity with statutory authority and legislative intent.

Emergency regulations bypass the normal public notice and comment period, and only remain in effect for 180 days or less, to provide time for the regulating agency to submit regular proposed regulations. Emergency regulations are not published in the Maryland Register before adoption, like regular proposed regulations are. However, notice of AELR’s receipt of the draft emergency regulation are posted on the Maryland General Assembly website. In addition, the requesting agency must post the draft regulations on its website within three business days of submission to the committee.

If an AELR member requests a public hearing on the emergency adoption of a regulation, the committee must hold the hearing. If no member makes such a request, committee staff may “poll on the emergency regulation” 10 business days after the draft’s receipt, and it takes effect at that time.

The regulations could result in the State’s General Fund receiving a significant, yet indeterminable, influx of funds. A recent Department of Legislative Services analysis estimated that uncollected sales taxes from remote sales to Maryland residents (including online sales, as well as catalog and mail order sales) could have totaled approximately $320 million in fiscal 2017.

 

 

Judge Adkins Announces Retirement From Court of Appeals

Judge Sally Adkins (Source: Maryland Manual Online)

A Daily Record article (2018-07-30, subscriber access only) reported that Maryland Court of Appeals Judge Sally Adkins has announced she will retire on October 31, leaving a vacancy on the seven-member court. Adkins represents the 1st Appellate Judicial Circuit and her replacement must be a judge or attorney living on the Eastern Shore. Adkins, who is 68, announced her retirement prior to reaching the mandatory retirement age of 70.

A native of Salisbury, Maryland, Adkins graduated from the University of Maryland Francis King Carey School of Law in 1975. After interning under Court of Appeals Judge Marvin Smith, Adkins spent roughly 20 years in private practice before becoming a Wicomico County Circuit Court Judge in 1996. Adkins was appointed to the Maryland Court of Special Appeals in 1998 and former Governor Martin O’Malley appointed her to the Court of Appeals in 2008. Adkins has also served as the President of the Wicomico County Bar Association and the Eastern Shore Chapter of the Women’s Bar Association of Maryland.

From the article:

“In a year and four months, they’re going to kick me out,” said Adkins, 68, who has served on the state’s top court since June 25, 2008. “No reason to wait until I get kicked out.”

But Adkins said she will miss being a judge, particularly “being a part of the discussion and the debate and writing about the cutting-edge legal issues” that come before the high court.

The article stated that the Appellate Judicial Nominating Commission will be accepting applications for the vacancy through August 22. The Commission will then review submissions in mid-October and then send a list of recommended candidates to Governor Larry Hogan. While Hogan is not required to nominate a candidate from the Commission’s list, that has been the standard practice for decades. Hogan’s nomination could immediately take their seat on the Court of Appeals but would be subject to a final confirmation process by the Maryland Senate in January, 2019.

Adkins plans to keep busy by traveling, doing charity work, and becoming a mediator.

Useful Links

Judge Sally Adkins Web Page

Feds Go Silent Following Airplane Noise Complaints

In response to two petitions filed by the State of Maryland against them regarding flight path issues, the Federal Aviation Administration (FAA) has cut off all communication with the DC Metroplex BWI Community Roundtable and the Maryland Aviation Administration.

The petitions, announced late June, seek judicial and administrative review over changes to flight paths which have resulted in many Marylanders agitated over added noise.

From the Attorney General’s release:

The first action is a petition for review in the United States Court of Appeals for the District of Columbia Circuit regarding the Federal Aviation Administration’s (FAA) implementation changes to the approach flight path for Runway 19 at DCA. The second is an administrative petition, filed with the FAA, that requests a supplemental environmental assessment as well as revisions to area navigation routes and procedures for BWI. Attorney General Frosh noted that the FAA failed to conduct the necessary environmental reviews prior to implementing the new flight paths.

WBAL reports:

“If the government will routinely stop communicating with the citizens as soon as they petition the government, it seems something is wrong with that,” said Jesse Chancellor, vice chair of the roundtable. …

Chancellor described the noise as a highway in the sky.