The opinion of the court was delivered by: Honorable Mikel H. Williams United States Magistrate Judge
MEMORANDUM DECISION ON PLAINTIFFS' MOTION FOR REMEDIES
Plaintiffs Idaho Conservation League and the Northwest Environmental Defense Center ("Plaintiffs") filed this action against Atlanta Gold Corporation ("AGC") seeking an injunction, declaratory relief, and civil penalties pursuant to the Clean Water Act ("CWA") 33 U.S.C. § 1251 et seq. The litigation centers around discharges of water containing high levels of arsenic and iron issuing from a historic mining tunnel known as the 900 Level Adit ("the Adit")*fn1 The Adit is located alongside a stream known as Montezuma Creek, on lands within the Boise National Forest. (Complaint at ¶¶ 32-33, Dkt. 1)
Currently pending before the Court is Plaintiffs' Motion for Remedies (Dkt. 60), which was filed on March 22, 2012. Also pending in connection with that motion is a Motion to Strike (Dkt. 72), filed by AGC on April 16, 2012. All parties previously consented to the exercise of jurisdiction by a United States Magistrate Judge pursuant to 28 U.S.C. § 636(c). (Dkt. 12).
In accordance with the parties' Stipulated Litigation Plan, this litigation was bifurcated into two separate phases, a liability phase and a remedial phase. (Scheduling Order, Dkt. 17). In a Memorandum Decision filed on January 9, 2012 (Dkt. 54), the Court granted partial summary judgment in favor of Plaintiffs on the issue of liability, holding that AGC's discharges from the Adit violated the effluent limitations for both arsenic and iron contained within a National Point Source Discharge Elimination System Permit (the "NPDES Permit" or "the Permit") issued by the EPA in August of 2009.
The Plaintiffs now ask that this Court enter an injunction, effective ninety days from the date of this Order, prohibiting AGC from discharging pollutants into Montezuma Creek in violation of the NPDES Permit. They have also requested that the Court impose a civil penalty of some $3,694,000, as authorized under 33 U.S.C. § 1319(d), for daily violations of the effluent limitations for both arsenic and iron that have occurred since the issuance of the NPDES Permit. AGC acknowledges that civil penalties are mandatory under 33 U.S.C. § 1319(d), but argues that nothing more than a de minimis penalty should be imposed. It also argues that because it is already working with the Forest Service to implement a plan to treat the water and eventually close the Adit, that an injunction at this point would be futile.
The Court has reviewed the voluminous submissions of the parties on these motions,*fn2 and entertained oral argument on the matter on June 4, 2012. The Court has also reviewed the reports the parties submitted on June 27, 2012, describing the results an informal meeting that occurred between the parties, their attorneys, and representatives of the United States Forest Service and the EPA in which the feasibility of AGC's current plans to treat the water and close the 900 Adit were discussed.*fn3 Having reviewed all these materials, the Court now issues the following ruling.
Gold was first discovered near Atlanta, Idaho in 1863 and the area has undergone various periods of metal production since then. (Simmons Aff. at ¶ 2, Dkt 20-5). AGC is a mining company in the business of mineral exploration and development and has extensive interests in a historic mining site (the "Project Site") located at the top of Atlanta Hill. (Id. at ¶ 3, Dkt. 20-5). The Project Site was previously known as the Talache Mine and consists of various patented and unpatented mining claims, lode claims, and mill site claims, which total approximately 2,159 acres. (Id. at ¶ 4).
The 900 Adit that is the subject of this litigation was first drilled as a haulage tunnel in 1917 and is part of the historic Talache Mine. (Id. at ¶¶ 6 & 7, Dkt. 20-5). The Adit is situated alongside Montezuma Creek, which flows through the town of Atlanta approximately a mile downstream from the Adit. Montezuma Creek is a tributary of the Middle Fork of the Boise River. (Complaint at ¶ 33, Dkt. 1). The Boise River flows through the City of Boise, and its waters eventually reach the Snake and Columbia River systems.
AGC first attained an interest in the Adit site in 1985. (Simmons Aff., at ¶ 2, Dkt 20-5). From 1999 until 2011, AGC conducted operations at the site under the auspices of a "Mining Lease and Option to Purchase Agreement" that it entered into with Monarch Greenback, LLC in 1999. (Points Aff. at ¶ 2, Dkt. 20-3). Although AGC has never actually processed or produced ore at the Adit site, it has, over the years, conducted exploratory activities such as core drilling and excavation. (Id. at ¶ 2 & 5). These ventures began in 1988, when AGC reopened about 200 feet of the previously collapsed Adit. (Glaspey Aff. at ¶¶ 8-11 & Hawley Decl., Exh. 26, Dkt. 22-5). In 1994, as part of a joint venture with Ramrod Gold USA, AGC submitted a Plan of Operation to the Forest Service for an exploration program at the Project Site, which included opening and further excavation of the 900 Adit. (Id. at ¶ 19). Once these activities were completed, the Adit portal was kept open to allow for future exploration. (Id. at p. 21.) In 1998, the Forest Service approved another Plan of Operations to conduct exploratory drilling. (Hawley Decl., Exh. 26, Dkt. 22-5). As components of both the 1994 Plan and the 1998 Plan, the Forest Service required AGC to treat the water issuing from the Adit to a level consistent with applicable state and federal water quality standards. Id.
For many years, AGC treated the Adit waters either by piping them through a single settling pond to filter out suspended solids or by using a land-application system of disposal. (Glaspey Aff. at ¶¶ 9, 15, & 19-21, Dkt. 20-12 & Hawley Decl., Exh. 26, Dkt. 22-5). In 2005, the company was working with the EPA to draft a Consent Order covering various discharges within the Project Site, including those from the 900 Adit. (Simmons Aff. at ¶¶ 8-10, Dkt. 20-5). However, before that Consent Order could be finalized, the Idaho Conservation League filed a lawsuit alleging that AGC was illegally discharging pollutants from the 900 Adit in violation of the CWA. See Idaho Conservation League v. Atlanta Gold Corp., Case No. 1:05-cv-212-EJL. This prior litigation between ICL and AGC was resolved by means of a Consent Decree in which AGC agreed to construct a Pilot Water Treatment Facility ("the PWTF") to treat the waters issuing from the 900 Adit. (Simmons Aff. at ¶ 12 & Exh. A, Dkt. 20-5 & 20-6). Also as part of this Consent Decree, AGC agreed to apply to the EPA for an NPDES Permit that would authorize discharges of pollutants from the 900 Adit. (Id., Exh. A, Dkt. 20-6). This Permit, which was eventually issued on August 6, 2009 with an effective date of July 1, 2007, lists the applicable effluent limitations at 10 μg/L for arsenic and 1,000 μg/L for iron. (Hawley Decl., Exh. 1, pp. 4-5 & 7, Dkt. 22-1).
The PWTF consists primarily of two lined settling ponds and associated pipeworks. A third pond predates the PWTF but is apparently not in use at this time. Water coming out of the Adit is routed through these ponds and allowed to remain long enough for a significant amount of pollutants to precipitate out, a process that is aided by the addition of a chemical coagulant mixture. After being treated in the settling ponds, the waters are discharged into Montezuma Creek. (Simmons Aff., Exh. 1, Dkt. 20-6, p. 9).
Though the PWTF does remove a significant amount of toxic materials from the Adit waters, it has never been able to meet the effluent limitation standards imposed in the NPDES Permit, and indeed, AGC acknowledges that it was not designed to do so. (Id. at ¶¶ 26 & 27.) As part of the Permit's requirements, AGC must monitor, among other things, the amounts of arsenic and iron in the discharge flow. (Torf. Decl., at ¶¶ 8-9). Data is recorded on a weekly basis and forwarded to the EPA in monthly "Discharge Monitoring Reports" ("DMRs"). (Id. at ¶ 10.) These records show that the arsenic levels in the discharge waters have ranged from three to three hundred times greater than the 10 μg/L effluent limitation. (See id., at ¶¶ 7-17 & 21, andBenner Decl. at ¶¶ 14-19, Dkt. 63.) On average, the discharge waters have contained 265 μg/L of arsenic---over twenty-six times the allowable amount. (Benner Decl. at ¶ 16, Dkt. 63.) The situation with iron is similar: all monthly DMRS for the period beginning in August of 2009 reflect numbers far in excess of the 1000 μg/L effluent limitation. (Torf Decl. at ¶ 13, Dkt. 25 & Hawley Decl., Exhs. 16-21, Dkt. 22-3).*fn4
Turning to the condition of the affected streams, in 2009, the Idaho Department of Environmental Quality designated tributaries of the Middle Fork of the Boise River as impaired water bodies, due to arsenic pollution in Montezuma Creek. (Hayes Decl., Exhs. 3 & 4, Dkt. 22-1 &Third Hayes Decl. at ¶ 18, Dkt. 62). Though the 900 Adit contributes to this problem, it is by no means the sole source of pollution. Approximately 3,000 feet downstream of the Adit is a Superfund Site known as the Talache Mine Tailings Reclamation Site, which, according to AGC, is a source of direct discharges into Montezuma Creek that consistently reflect arsenic levels of 1,000 μg/L. (Simmons Aff. at ¶ 33, Dkt. 20-5).
The State of Idaho regulates both Montezuma Creek and the Middle Fork of the Boise River to protect certain beneficial uses of their waters.*fn5 For Montezuma Creek, the beneficial use known as "primary contact recreation" requires "water quality appropriate for prolonged and intimate contact by humans or for recreational activities when the ingestion of small quantities of water is likely to occur." IDAPA 58.01.02(100)(02)(a). Primary contact recreation includes uses such as swimming, water skiing, or skin diving. Id. In addition, Idaho's water quality standards recognize that Montezuma Creek could be used as an agricultural water supply and, therefore, the "water quality [must be] appropriate for the irrigation of crops or as drinking water for livestock." IDAPA 58.01.02.100.03(b). Consistent with this designation, the inhabitants of Atlanta use the creek's waters to irrigate their crops and lawns. (Third Hayes Decl., at ¶ 29, Dkt. 62). Citizens of Atlanta also have unrestricted access to the waters of Montezuma Creek, because it is diverted into open irrigation ditches that run directly through the town. Id.
Water quality standards for the Middle Fork of the Boise River include criteria to support several designated uses, including primary contact recreation and the protection of aquatic life. (Third Hayes Decl. at ¶ 10; See also, IDAPA 58.01.02(140)(09)). The Middle Fork of the Boise River is also subject to the "domestic water supply" designation, which means that water quality must be appropriate for drinking supplies. (Third Hayes Decl. at
¶ 19; see also, IDAPA 58.01.02(140)(09) & 58.01.02(100)(03)(a)).
At the time that it was constructed, the PWTF was not intended to be a permanent solution to arsenic and iron pollution from the 900 Adit. (See, Atlanta Gold's Statement of Material Facts at pp. 8-9, Dkt. 20-2; see also Fereday Aff., Exh. F, Dkt. 20-11 and Hawley Decl., Exh. 13. p. 2 & Exh. 14, p. 6, Dkt. 21-2). Though the PWTF does remove significant amounts of pollutants from the Adit waters, as constructed, it was never designed to meet the applicable arsenic effluent limitation of 10 μg/L contained within the NPDES Permit. (Simmons Aff. at ¶ 27, Dkt. 20-5). In fact, AGC had originally intended to operate the PWTF only until November 15 of 2008, by which time it anticipated constructing a more permanent water treatment facility. (Simmons Aff. at ¶¶ 19 & 20, Dkt. 20-5, & Exh. E at p. 33, Dkt. 20- 6). During the years following the construction of the PWTF, AGC made several representations to governmental agencies regarding its intentions to take more permanent steps to address contamination at the 900 Adit. For example, in the 2006 Supplemental Plan of Operations (the document under which the Forest Service authorized the construction and operation of the PWTF), AGC stated that the more permanent facility would be constructed by November of 2008. Id. In October of 2009, AGC stated in a Quality Assurance Project Plan that was circulated to the EPA and Idaho Department of Environmental Quality, that "the PWTF was built as a temporary structure which will be replaced in the near future by a permanent WTF." (Hawley Decl., Exh. 14 at p. 6, Dkt. 22-2 at p. 30).
Though AGC never did install such a facility, over the years, the company contacted a number of contractors and/or engineering firms who submitted various proposals designed to address water treatment issues on a more permanent basis. (Third Reuther Decl., Exhs. 43-49, Dkt. 64). Some of these predate the construction of the PWTF and some do not. In 2005, AGC commissioned a study from a company known as Blue Water Technologies, which conducted a bench-scale test of water samples taken from the Project Site and succeeded in lowering arsenic levels to less than the applicable 10 μg/L standard. (Id., at Exh. 46, pp 1-3).*fn6
In 2009, AGC commissioned a report from a company known as "AdEdge," which set up a pilot test at the Adit site and succeeded in lowering the arsenic levels to "between non- detectable and 10 ppb." Id., Exh. 47 at p. 6, ¶ 8. This pilot test consisted of a temporary filtration system that was installed at the Adit site and run for approximately eight hours a day for a period of three weeks. Id. at p. 4. In its summary of findings following this test, the AdEdge report states:
The current treatment process employed using coagulation/lime addition and gravity settling (using the impoundments as clarifier(s)) does appear to provide some benefit for reducing arsenic from the raw Adit 900 water. However, this treatment alone is clearly not achieving the desired targets. Additional or substitutionary treatment is needed. AGC could elect to utilize a combination of this existing treatment system coupled with the AdEdge AD26/E33 integrated system for a total solution or eliminate the pretreatment altogether if desired. (Id., at p. 5, ¶ 2.) Also in 2009, AGC also purchased a water treatment plant from a company called Newmont ("the Newmont Plant"), which it represented to the EPA would be installed to treat Adit waters by 2012. (Third Ruether Decl., Exh. 52, pp. 18-20, Dkt. 67-2). However, as with the other proposed treatment systems, the Newmont Plant was never installed. (Id. at pp. 17-37).
Though it is fair to say that each option for treating the water involved some degree of logistical difficulty,*fn7 it is also critical to understand that AGC anticipated that construction of the more permanent water treatment facility would occur in conjunction with the commencement of active mining operations. (Third Ruether Decl, Exh. 51 at p. 14, Dkt. 67-1; See also, Simmons Aff. at ¶ 20, Dkt. 20-5). Indeed, the company has insisted that long-term water treatment can only be a component of a mine plan. (Id., at ¶ 43).
In 2006, AGC represented that it would construct a more permanent water treatment facility to replace the PWTF as part of its future plan to conduct a heap leach mining operation. According to a plan of operations that AGC submitted to the Forest Service at that time, this was to be achieved by November of 2008. (Simmons Aff. at ¶ 20, Dkt. 20-5). However, in 2008, AGC withdrew the pending plan to conduct a heap leach mining operation. (Id. at ¶¶ 20 & 22). It is not clear when AGC does plan to begin mining, since it has submitted no plan for mining operations on the overall Project Site since that time. Id.
Turning to more recent events, the Plaintiffs issued their notice of Intent to Sue on December 24, 2010 (Hawley Decl. Exh. 23, Dkt. 22-5), and filed this lawsuit on April 18 2011. (Complaint, Dkt. 1). Several days later, on April 28, 2011, AGC declined to exercise its option to purchase the mining claims upon which the 900 Adit is located. (Points Affidavit at ¶¶ 2-4, Dkt. 20-3). AGC then attempted to terminate its NPDES permit on May 2, 2011, claiming that it no longer had any interest in the site. (Points Aff. at ¶ 6 & Exh. B). In a letter dated June 9, 2011, the EPA rejected this effort, informing AGC that coverage under the Permit "does not automatically terminate upon notification." (Hawley Decl., Exh. 25, Dkt. 22-5). On June 19, 2012, AGC sent a letter to the EPA in which it expressed its intent to continue operation under the Permit and "request[ed] extension of coverage of that permit for an unspecified period of time." (Dkt. 86). The EPA granted this request on June 28, 2012. (Dkt. 85).
Since it has now abandoned its interest in the 900 Adit, AGC's current plan is to close the Adit off and reclaim the site. On May 1, 2012, AGC submitted a Supplemental Plan of Operations to the Forest Service ("the 2012 Supplemental Plan") that addresses its proposals for closure and reclamation of the Adit. The Supplemental Plan also contains a new proposal for treating the Adit waters until these objectives can be achieved. (Id. at ¶¶ 4 & 8, & Third Simmons Decl., Exh. A, Dkt. 77). The 2012 Supplemental Plan states that AGC can bring the discharges from the 900 Adit into compliance with the terms of the NPDES Permit by October 2012. (Third Simmons Decl., Exh. A, p. 2, Dkt. 77-3). AGC asserts that compliance can be achieved on this time frame by means of the following measures: 1) diverting Montezuma Creek above the 900 Adit to reduce the flow of water through the Adit; 2) constructing another settling pond to increase holding capacity and settling times at the PWTF so that more arsenic and iron can precipitate out; and 3) adding a layer of sand to the floor at mouth of the Adit to assist in the removal of toxins. (Id. at pp. 1-2.) Therafter, the Plan proposes installing a bulkhead to seal off the Adit by 2013, and completing reclamation of the site by 2014. (Id., Dkts. 77-15 & 77-16). The 2012 Supplemental Plan also stated that "[i]f the proposed settling pond and sand filtration system are unable to meet required water quality parameters, a future filtration system will be constructed downstream of the ponds." (Id., Dkt. 77-13 at p. 4). AGC has referred to this potential future filtration system as a "contingency filter."
At the time of the hearing on Plaintiffs' Motion for Remedies, the Forest Service had neither approved nor rejected AGC's 2012 Supplemental Plan, and has not done so as of the date of this opinion. Accordingly, after the hearing, the Court instructed the parties and their counsel to meet informally with the Forest Service to discuss that agency's opinion of the 2012 Supplemental Plan as a potential viable solution for contamination at the 900 Adit. The Court also instructed the parties to discuss with the Forest Service what steps it believes AGC could take, in the near term, to achieve compliance with the terms of the NPDES Permit or to bring it as close as possible to that goal. The parties reported back to the Court with the results of this meeting on June 27, 2012. (Dkt. 86). During this meeting, the Forest Service requested that AGC provide it with design and engineering specifications for the "contingency filter," so that the need to obtain approval of such a filter would not cause further delays if the additional pond and sand filtration system did not achieve compliance. (Id.). The Court will make these reports part of the record and take them into account in fashioning the remedy best suited to ensure compliance.
The Clean Water Act authorizes the district court "to order that relief it considers necessary to secure prompt compliance with the Act. That relief can include, but is not limited to, an order of immediate cessation." Weinberger v. Romero-Barcelo, 456 U.S. 305, 320, 102 S.Ct. 1798, 1087 (1982). Discretion is vested in the district court to either grant or deny a request for injunctive relief, depending upon its view of the range of public interests at issue. Id. If a district court chooses to grant an injunction, however, it must meet the requirements of Federal Rule of Civil Procedure 65(d), which states that every injunction must "a) state the reasons why it was issued, b) state its terms specifically, and c) describe in reasonable detail--and not by referring to the complaint or other document--the act or acts restrained or required." F.R.C.P. 65(d). See also, Reno Air Racing Ass'n. Inc. v. McCord, 452 F.3d 1126, 1132 (9th Cir. 2008).
In addition, the Act mandates civil penalties if violations of the CWA are found. 33 U.S.C. § 1319(d) is couched in mandatory language, and states that any person who violates the Act "shall be subject to a civil penalty not to exceed $25,000 per day." (emphasis added). See also, Natural Resources Defense Council v. Sw. Marine, Inc., 236 F.3d 985, 1001 (9th Cir. 2000) (holding that penalties are mandatory if a violation of the Act is found). The maximum daily penalty has increased periodically since the statute was enacted and is currently set at $37,500.00. 40 C.F.R. § 19.4. Unlike damages in a civil case, these penalties do not inure to the citizen plaintiffs, but are payable to the United States Treasury. See, Friends of the Earth v. Laidlaw Environmental Svcs., Inc. 528 U.S. 167, 173, 120 S.Ct. 693, 700 (2000).Section 1365(a) of the Act also authorizes the imposition of penalties in citizen suits.
I. Atlanta Gold's Motion to Strike.
AGC has filed a Motion to Strike the Third Declaration of Justin Hayes, (Dkt. 72), which the Court will address before turning to Plaintiff's Motion for Remedies.
Mr. Hayes is an employee of the Idaho Conservation League and holds undergraduate degrees in Human Biology and Earth Systems, and a masters degree in Earth Science from Stanford University. (Hayes Affidavit, at ¶ 2, Dkt. 62). His affidavit discusses, generally, the following topics: 1) the reasons why the EPA set the water quality limits for arsenic and iron their current levels, and 2) the various water quality standards and beneficial use categories generated by the Idaho Department of Environmental Quality (DEQ) to protect Montezuma Creek and the Middle Fork of the Boise River. Mr. Hayes's affidavit also offers opinions about the conditions of the affected streams, (Id. at ¶ 27), and explains how ...