An Imminent Threat

Note:  The following, or some version similar to it, will be hand delivered to Skagit County Planning and Development Services, as well as emailed to the office of the governor. By way of background, all four refineries in Whatcom and Skagit Counties plan to refine Bakken crude or are already doing so. Three (BP and Conoco Phillips at Cherry Point, and Tesoro Anacortes) are permitted. Protect Whatcom, other groups, and citizens requested the counties withdraw those permits and re-open the threshold SEPA determinations, based on new information, and conduct full environmental review. Both counties refused. Tesoro has been receiving Bakken crude for over a year; BP's rail infrastructure expansion is nearly complete; and Conoco Phillips has broken ground. Shell Anacortes just received a mitigated determination of nonsignificance from Skagit County for a raili expansion proposal to receive Bakken crude. Combined, the four refineries claim they will only receive 3 trains per week, and that vessel traffic will not increase because the Bakken crude would offset imports, primarily from Alaska. As discussed in the letter below, that may be an erroneous assumption, and the refineries may act as crude terminals, if they are not already. 

WHAT YOU CAN DO:  Call the governor's office today and ask the state to intervene as lead agency in the SEPA review for the Shell permit application. Among others, they are applying for a Shoreline Substantial Development Permit. The state is co-lead with local agencies for GPT and the Millennium Bulk Logistics coal terminals, as well as the Grays Harbor crude-by-rail terminal proposals (Imperium and Westway). It should have intervened earlier in the refinery proposals, and should do so now. Contact Ted Sturdevant, Executive Director of Legislative & Policy Office, (360) 902-4105, ted.sturdevant@gov.wa.gov. 

UPDATE: On May 14, 2014, Skagit County PDS announced it is re-opening the threshold determination. Text of the announcement is in a comment below.

May 9, 2014

VIA HAND DELIVERY:
Leah Forbes
c/o Skagit County Planning and Development Services
1800 Continental Place
Mount Vernon, WA 98273

VIA ELECTRONIC TRANSMISSION:
Gov. Jay Inslee
ATTN:  Ted Sturdevant, Executive Director of Legislative & Policy Office
ted.sturdevant@gov.wa.gov

RE: Equilon Enterprises LLC dba Shell Oil Products US (Shell)
File # PL13-0468, Application for Variance for Shoreline Substantial Development Permit
Request for Reconsideration of MDNS

Dear Ms. Forbes:

The undersigned submitted their comment on the proposed Shell crude by rail proposal, application for variance for shoreline substantial development permit on January 30, 2014 (attached and incorporated by reference). Today we respond to the county’s issuance of a mitigated determination of nonsignificance,[1]  ask that you reconsider conducting a full environment impact analysis, particularly considering cumulative impacts of rail and vessel traffic, and ask the state to intervene as lead agency.

Rail Jurisdiction/Expertise

The county’s April 22, 2014, Findings accompanying the April 24, 2014, MDNS, stated that the Federal Railroad Administration has jurisdiction over the following components of the proposal:

1. Safety of Rail Bridge over Swinomish Channel
2. Safety of Rail Curve in Burlington
3. Tank Car Safety (along with the Pipeline and Hazardous Materials Safety Administration)

SEPA does provide that denial of a permit or mitigation measures must be based on an agency’s policies, plans, rules or regulations in effect when the DNS or DEIS is issued, WAC 197-11-660, but this is not a jurisdictional element to conduct an EIS. Rather, SEPA directs agencies, in the threshold determination analysis, to consider the following:

       "(3) In determining an impact's significance (WAC 197-11-794), the responsible official shall take into account the following, that:

              (a) The same proposal may have a significant adverse impact in one location but not in another location;

              (b) The absolute quantitative effects of a proposal are also important, and may result in a significant adverse impact regardless of the nature of the existing environment;

              (c) Several marginal impacts when considered together may result in a significant adverse impact;

              (d) For some proposals, it may be impossible to forecast the environmental impacts with precision, often because some variables cannot be predicted or values cannot be quantified.

              (e) A proposal may to a significant degree:

                    (i) Adversely affect environmentally sensitive or special areas, such as loss or destruction of historic, scientific, and cultural resources, parks, prime farmlands, wetlands, wild and scenic rivers, or wilderness;

                    (ii) Adversely affect endangered or threatened species or their habitat;

                    (iii) Conflict with local, state, or federal laws or requirements for the protection of the environment; and

                    (iv) Establish a precedent for future actions with significant effects, involves unique and unknown risks to the environment, or may affect public health or safety."

WAC 197-11-330.  An agency must consider whether a proposal will impact the environment, WAC 197-11-060(4), considering direct, indirect, and cumulative impacts, WAC 197-11-792(2)(c), including reasonably foreseeable future impacts that are probable. WAC 917-11-782. The mere fact that another agency has jurisdiction does not absolve the county of responsibility to consider the potential impacts of the rail activity; at the very least, the threshold review requires a discussion of potential impacts, and consideration of whether other agencies’ permit requirements are adequate to mitigate those impacts. Quinault Indian Nation, et al. v. City of Hoquiam, et al., Wash. Shorelines Hearing Board No. 13-012c, Order of Summary Judgment, Nov. 12, 2013, at 35. Further, the county was required to at least discuss the fact that this new commodity – Bakken crude – may have different characteristics when spilled from other types of crude previously handled at the Shell facility, and what that would mean for cleanup methods in the event of a spill in transit or at the refinery.  See id. at 34. That may be a reversible omission where, as here, a single incident could have catastrophic impacts. Id. At 34-35.

Lead agencies are responsible for complying with SEPA’s procedural requirements, WAC 197-11-758, and if they lack the requisite expertise with respect to an environmental element, WAC 197-11-444, they are required to consult with “an agency with special expertise on the environmental impacts involved in a proposal or alternative significantly affecting the environment.” WAC 197-11-714(2). The place at which the impact will occur is irrelevant; the issue is whether a likely (“probable”) impact is significant, WAC 197-11-060(4)(a), regardless of whether that impact occurs within the agency’s jurisdiction or even the state. WAC 197-11-060(4)(b).

Skagit County considered only rail impacts “within the refinery boundaries,” and apparently concluded any impacts associated with a derailment there could be addressed by the Refinery Emergency Response Plan. There is precedent for an incident at the refinery. On December 14, 2009, six cars on a BNSF train carrying liquefied petroleum gas derailed on tracks maintained by Shell Anacortes.[2]  Luckily there was no spill,[3]  but if those cars had contained Bakken crude, the situation might have been much worse, as with last week’s derailment in downtown Lynchburg, Virginia.  There, city firefighters had to allow the fire to burn out; city buses and sheriff’s deputies evacuated residents; the Virginia Dep’t of Emergency Management, State Police, and Dep’t of Fire Programs were coordinating as one neighboring city and Lynchburg volunteer firefighters responded; the governor dispatched the Deputy Secretary of Public Safety and Homeland Security; and a Virginia congressperson promised “whatever federal help they need[ed].”[4]  Does Shell’s “Response Plan” address this level of coordinated response? What of a derailment not within the refinery boundaries? According to SEPA, significant impacts must be considered wherever they occur, which means that someone must scope potential derailments/explosions/fires between Shell and the Bakken shale beds, as well as spill cleanup on land and waterways (at least in Washington state).  Further, Skagit County conducted no cumulative impacts analysis that considers all reasonably foreseeable future impacts, and makes assumptions about train numbers only by remaining within the four corners of the permit application. As discussed below, this is arbitrary and erroneous.

SEPA requires agencies to treat severe impacts as significant, regardless of whether they have a relatively small probability of occurring. WAC 197-11-794. That is the case here, as described above and in the attached comment. In the cumulative analysis context, the risk increases because of the known increase in fossil fuel proposals in the region.[5]  If all reasonably foreseeable proposals were completed and operating at capacity, over 18 additional trains per day would pass through Skagit County loaded with liquid petroleum gas, Bakken crude, coal, etc. This requires a traffic analysis that not only considers threats posed to the environment and human health, but also traffic impacts and potential interruption of shipment of intermodal goods, including Skagit County farm products.

The MDNS gave only the most cursory consideration of potential impacts to wildlife near the proposal. While it did discuss potential impacts to the March Point herons, in a letter dated May 8, 2014, attached and incorporated by reference, Wildlife Biologist _________ takes exception with the assumption the colony is growing, and the methodology relied upon to reach that conclusion, citing issues that must be studied to know if herons in the region are actually thriving or in decline.  Given that the MDNS states noise in excess of 92 decibels is an “unusually loud activity” which would impact herons, there should be at least a discussion of the fact that train horns range from 96 – 110 decibels, 49 CFR Part 222, and the county must determine where horns will be sounded relative to heron nesting grounds. Similarly, there should be a discussion of proximity of the nesting grounds to the rail in the context of the risk of derailment, spill, explosion, and fire.

Marine Impacts

The March 22, 2014, analysis of Marine Vessel Traffic states that the proposal “would … be expected to lead to less crude oil marine vessel traffic.” That may be the beginning of the discussion, if it were substantiated by data or regulation limiting the ability to use the terminal for crude exports, but it may not be the end of one. A proper analysis would consider a range of scenarios that considers, among other things:

1. foreign and domestic demand for refined and unrefined product derived from various sources (Alaskan crude, foreign imports, Alberta tar sands, Bakken crude, etc.);
2. effects of costs and supply by various modes of transport (tanker, bunker barge, pipeline, rail);
3. potential for the refinery to act as crude terminal (tar sands crude, domestic crude for domestic export, and/or domestic crude for foreign export if export ban were lifted as American Petroleum Institute is lobbying Congress for [6]);
4. changes in supply, e.g. based on increased drilling in Alaska, an expansion of pipeline capacity for Alberta tar sands, etc.; and
5. cumulative impact of vessels under various scenarios in the region (existing traffic; increases due to completion of pipelines, construction or expansion of other facilities for crude, coal, intermodal, etc.)

Failure to consider a range of scenarios – particularly the potential to act as crude terminals – is arbitrary and clear error. The Ninth Circuit Court of Appeals recently held in Native Village of Point Hope v. Jewell[7] that failure to base an analysis on the full range of likely scenarios is arbitrary and erroneous. Id. “A best case scenario ‘skew[s] the data toward fewer environmental impacts, and thus impedes a ‘full and fair discussion of the potential effects of the project.’” Id., citing Native Ecosystems Council v. U.S. Forest Serv., 418 F.3d 953, 965 (9th Cir. 2005).  That would apply as well to the expectation that volume of exported refined product will remain the same because Shell stated in its permit application it does not plan to expand capacity. Regulators are required to get out of the four corners of the application and consider other information of which they are aware, such as the fact that Shell has obtained in the past, and likely will in the future, new NPDES permits that allow it to expand refining capacity.

Further, it is clearly erroneous not to consider cumulative vessel impacts for this proposal. Unrelated projects’ “individual cumulative impacts must be analyzed together in order to make a significance determination.” Quinault Indian Nation, et al. v. City of Hoquiam, et al., Wash. Shorelines Hearing Board No. 13-012c, Order of Summary Judgment, Nov. 12, 2013, pp. 22-23.[8]  The proposal requires 45 tankers to ship out refined product,[9]  but that assumes only the best case – static – scenario. It does not consider the other current and reasonably foreseeable future vessels that may be passing the Straits of Juan de Fuca and Rosario, and that number could increase by over 1200 vessels if all fossil fuel transportation proposals in the Puget Sound are completed and operate as described by their proponents.[10]

Assuming, arguendo, that the total number of vessels calling on the Shell pier were to remain constant, the MDNS is lacking the requisite discussion of Bakken crude’s different characteristics when spilled. See Quinalt at 34. The MDNS does not consider two scenarios in which the Shell refinery could act as a terminal exporting Bakken crude:

• transfer to tanker or barge tow for transfer to other refineries on the west coast of the U.S., or
• transfer to tanker or barge tow for export to foreign markets if the export ban were lifted.

The latter scenario is not mere speculation; as mentioned above, the American Petroleum Institute is currently lobbying to lift the ban.[11]  Failure to address these scenarios may be a reversible omission where, as here, a single incident involving a vessel loaded with a combination of Bakken crude, bunker fuel, and diesel fuel could have catastrophic impacts. Id. At 34-35.

The MDNS does not discuss the Padilla Bay Ecological Research Reserve[13] and its significance to supporting marine life. The project application[12] describes four species listed under the Endangered Species Act that are known to occur in Padilla Bay near the project site: Puget Sound Chinook salmon, Puget Sound steelhead, bull trout, and marbled murrelet. Also present in the water are eelgrass beds and spawning grounds for herring and other forage fish that support wildlife in the area. The MDNS fails to discuss at all the potential of marine vessel impacts, which agency has jurisdiction, spill response plans, or the effect of impacts under various scenarios on the environment, particularly endangered and threatened species. This clearly controverts the Quinault standard for threshold determination analysis and Ninth Circuit jurisprudence.

Other Impacts

The MDNS is silent or inadequately addresses other impacts or forces which could lead to impacts, including but not limited to:

1. Seismic Events.  The threshold determination must include a discussion of seismic activity in the region and potential to lead to an event, including catastrophic events, during rail or vessel transport, or at the facility. 
2. Cultural Resources.  There is no indication the county sought input from the Dep’t of Archaeology and Historic Preservation, much less that there was an analysis of possible impacts to cultural resources. If it is known that there are no such resources in the vicinity of the proposal, including along shipping paths, then the MDNS should have addressed that fact.
3. Greenhouse Gas Emissions. The MDNS contains a cursory discussion of this impact, and generally dismisses it, as it does other impacts, as governed by another agency’s permit.

As the Quinault case made clear, the public deserves an analysis that describes the consideration that was given to potential impacts of the projects. It is not sufficient to cite to other regulatory bodies’ jurisdiction and permit requirements; SEPA requires an analysis of the adequacy of those laws to address potential impacts. Quinault at 35.

2014 Marine and Rail Oil Transportation Study

The state legislature is concerned enough about the movement of Bakken crude through the state that it appropriated $300,000 for the Department of Ecology to study the risks posed by all proposals state-wide when transported by rail and vessel.[14]  The state describes that study thusly:

"Scope of Study
"Puget Sound, Grays Harbor, and the Columbia River will be included in the marine portion of the study. The inland portion of the study will include the entire oil transportation corridor. The study looks at:

• the current and anticipated transportation pictures for marine and rail.
• the current and anticipated safety pictures for marine and rail.
• any existing gaps.

 "Based on these findings, the study will inform recommendations for public health, safety and environmental concerns; statement of safety benefits vs. the cost of implementation; recommendation for funding programs; and a risk communication strategy."[15]

 The 2014 Marine and Rail Oil Transportation Study is, for all intents and purposes, a limited regional cumulative EIS. This information is important enough to the state to study it, and it should inform the decision whether to permit the Shell crude-by-rail proposal. Further, the state, based on that information, may determine that existing permits for Tesoro, BP, and Conoco Phillips should be withdrawn, MDNS’s re-opened, and new analysis conducted based on this and other new information. Quinault made clear that an after-the-fact determination of mitigations based on pending studies is not adequate; that information should inform threshold determinations.

The federal government recently announced in an Emergency Order:

"Upon information derived from recent railroad accidents and subsequent DOT investigations, the Secretary of Transportation (Secretary) has found that an unsafe condition or an unsafe practice is causing or otherwise constitutes an imminent hazard to the safe transportation of hazardous materials.  Specifically, a pattern of releases and fires involving petroleum crude oil shipments originating from the Bakken and being transported by rail constitute an imminent hazard under 49 U.S.C. 5121(d)."[16]

[Emphasis added.] Given that transport of Bakken crude is an “imminent hazard,” it is obviously a significant risk to the people of Skagit County and the State of Washington, and a “significant impact” within the meaning of SEPA. Local jurisdictions cannot continue to focus on their own jurisdictional authority and refuse to consider the broader implications of their permit decisions.  

For all of the reasons described above, and because Skagit County lacks the jurisdiction and expertise to conduct a proper SEPA threshold determination, in accordance with WAC 197-11-948, we ask that the State assume lead agency status, and that Skagit County withdraw the MDNS and conduct the level of analysis warranted by a threshold determination for a proposal with the severity of impact the Shell crude-by-rail project entails. We then ask that the County consider all risks that may not be adequately mitigated by permit requirements of other agencies, and that the proponent post a bond sufficient to reimburse the county and the state for costs associated with its relative contribution to reasonably foreseeable future impacts. Finally, we ask that any permits be predicated on maintaining current vessel numbers, specifically prohibiting the foreign export of domestic crude.

Thank you very much for your consideration. Please accept electronic signatures as you would originals.

Sincerely,

s/

cc: VIA ELECTRONIC TRANSMISSION
Council on Environmental Quality, Nancy Sutley, Dir., Nancy_H._Sutley@ceq.eop.gov
Skagit County Commissioners, commissioners@co.skagit.wa.us
Steve Sexton, Mayor, Burlington, steves@burlingtonwa.gov
Mt. Vernon City Council, council@mountvernonwa.gov

1. County webpage for this proposal is located at [url=http://www.skagitcounty.net/Departments/PlanningAndPermit/shellpermit.htm]http://www.skagitcounty.net/Departments/PlanningAndPermit/shellpermit.htm[/url]. Skagit County Planning and Development Services Mitigated Determination of Nonsignificance (MDNS), Shoreline Substantial Development/Variance Permit PL13-0468 & Forest Practice Conversion Permit PL14-0079 For Shell Puget Sound Refinery, Apr. 24, 2014, [url=http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/PL13-0468%20MDNS.pdf]http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/PL13-0468%20MDNS.pdf[/url]; SEPA Staff Findings, April 22, 2014, [url=http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/SEPA%20Staff%20Report%20April%2022,%202014.pdf]http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/SEPA%20Staff%20Report%20April%2022,%202014.pdf[/url].
2. FRA Accident/Incident No. NW1209110.
3. Marta Murvosh, “Petroleum-filled tanker cars derail,” Skagit Valley Herald, Dec. 14, 2009, [url=http://www.goskagit.com/news/petroleum-filled-tanker-cars-derail/article_9017c4bc-8541-54cf-b786-2ce336c33f07.html]http://www.goskagit.com/news/petroleum-filled-tanker-cars-derail/article_9017c4bc-8541-54cf-b786-2ce336c33f07.html[/url].
4. Brandon Tassone, “Train derails in downtown Lynchburg,” The Roanoke Times, Apr. 30, 2014, [url=http://www.roanoke.com/news/virginia/train-derails-in-downtown-lynchburg/article_09f354b1-04f5-51fe-9160-7d1b9f03efe1.html]http://www.roanoke.com/news/virginia/train-derails-in-downtown-lynchburg/article_09f354b1-04f5-51fe-9160-7d1b9f03efe1.html[/url]
5. See table of fossil fuel transportation proposals in the regions, and support, at [url=http://protectwhatcom.files.wordpress.com/2013/09/website-infographic-terminals-table-4-17-14.pdf]http://protectwhatcom.files.wordpress.com/2013/09/website-infographic-terminals-table-4-17-14.pdf[/url]. The table contained in the attached comment has been updated to include new liquid petroleum gas proposals, and to more accurately reflect the higher numbers now reported by proponents of the Grays Harbor proposals.
6. Kyle Isakower, API VP for Regulatory and Economic Policy, Press Conference on Crude Oil Exports,  March 31, 2014, [url=http://www.api.org/news-and-media/testimony-speeches/2014/kyle-isakower-press-briefing-on-crude-oil-exports]http://www.api.org/news-and-media/testimony-speeches/2014/kyle-isakower-press-briefing-on-crude-oil-exports[/url].
7. 44 ELR 20016, No. 12-35287, 9th Cir., Jan. 22, 2014. That is a NEPA case, but NEPA jurisprudence informs Washington interpretation of SEPA. Public Util. Dist. No. 1 of Clark Cty v. Pollution Control Hearings Bd., 137 Wn.App. 150, 158, 151 P.3d 1067, 1070 (2007).
8. [url=http://earthjustice.org/sites/default/files/files/Crudebyrail.orderonsummaryjudgment.pdf]http://earthjustice.org/sites/default/files/files/Crudebyrail.orderonsummaryjudgment.pdf[/url]
9. See table in the original comment, and online at [url=http://protectwhatcom.files.wordpress.com/2013/09/website-infographic-terminals-table-4-17-14.pdf]http://protectwhatcom.files.wordpress.com/2013/09/website-infographic-terminals-table-4-17-14.pdf[/url].
10. Id.
11. Kyle Isakower, API VP for Regulatory and Economic Policy, Press Conference on Crude Oil Exports,  March 31, 2014, [url=http://www.api.org/news-and-media/testimony-speeches/2014/kyle-isakower-press-briefing-on-crude-oil-exports]http://www.api.org/news-and-media/testimony-speeches/2014/kyle-isakower-press-briefing-on-crude-oil-exports[/url].
12. Joint Aquatic Resources Permit Application, Dec. 12, 2013, sec. 9l, [url=http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/JARPA.pdf]http://www.skagitcounty.net/PlanningAndPermit/Documents/ShellPermit/JARPA.pdf[/url]
13. [url=http://www.padillabay.gov/]http://www.padillabay.gov/[/url].
14. [url=http://www.ecy.wa.gov/programs/spills/oilmovement/2014MRstudy.html]http://www.ecy.wa.gov/programs/spills/oilmovement/2014MRstudy.html[/url]
15. [url=http://www.ecy.wa.gov/programs/spills/oilmovement/2014MRstudy.html]http://www.ecy.wa.gov/programs/spills/oilmovement/2014MRstudy.html[/url].
16. Anthony R. Foxx, Secty. Of Trans., U.S. Dep’t of Transportation Emergency Restriction/Prohibition Order, Petroleum Crude Oil Railroad Carriers, Docket No. DOT-OST-2014-0067, May 7, 2014, [url=http://www.dot.gov/briefing-room/emergency-order. ]http://www.dot.gov/briefing-room/emergency-order. [/url]; See also Dep’t of Transportation Press Release DOT 40-14, May 7, 2014, [url=http://www.dot.gov/briefing-room/us-dot-takes-new-emergency-actions-part-comprehensive-strategy-keep-crude-oil]http://www.dot.gov/briefing-room/us-dot-takes-new-emergency-actions-part-comprehensive-strategy-keep-crude-oil[/url].