Chemicals, Regulatory Developments

Colorado Whistleblower Complaint Launches Air Permitting Investigation

On July 1, 2021, Colorado Attorney General Phil Weiser announced that attorneys at Troutman Pepper Hamilton Sanders LLP have been appointed as special assistant attorneys general to conduct an independent investigation into “allegations regarding alleged improper non-enforcement of air quality standards as alleged by certain Air Pollution Control Division staff at the Colorado Department of Public Health and Environment.”

colorado air polution control division

How It All Started

The announcement is a result of a whistleblower complaint filed by Public Employees for Environmental Responsibility (PEER) with the EPA’s Office of Inspector General (OIG) on behalf of three employees of the Colorado Department of Public Health and Environment’s (CDPHE) Air Pollution Modeling Department (APM). The complaint alleges “permits were unlawfully issued and that a CDPHE modeler was ordered to falsify data in a modeling report to ensure that no modeled violation would be reported,” according to the request for information the Colorado AG’s office made in seeking applicants for the special investigation.

The complaint states that the directive to stop looking for surges of specific pollutants came directly from Air Pollution Control Division Director Garry Kaufman.

“Kevin Bell, an attorney with [PEER] and lead counsel on the complaint, said the incident showed the state’s top regulators had become impatient with air modelers, who he said have a legal obligation to assess the potential risk of new pollution sources,” according to CPR News. “Faced with evidence of potential violations, Bell said the team felt like they were being told to, ‘sit down, shut up and stop issuing these reports.’”

The Fallout

Environmental groups are demanding that Colorado Governor Jared Polis remove Kaufman from his position, as well as calling for a “review of all other supervisors within the Colorado Air Pollution Control Division and a stop to all new or modified air pollution permits,” according to CPR News.

“The fallout comes as the Front Range struggles to meet federal air quality standards,” according to CPR News.  “State-regulated companies release compounds that form ozone pollution, which scientists have linked to heart and respiratory conditions. The pollutant is also a main ingredient in Denver’s smoggy ‘brown cloud,’ which has started to reappear after its heyday in the 1970s and 1980s. The U.S. Environmental Protection Agency has already named the region a ‘serious’ violator of federal ozone limits.”

The whistleblower complaints are focused on permitting activities for oil and gas facilities north of Denver. For now, EPA officials are deferring to state officials for initial investigations, according to the Denver Post.

What’s Next

As a result of the compliant, PEER formally requested that EPA Administrator Michael Regan have the agency intervene on an environmental justice initiative to protect the health of people in Commerce City, a disadvantaged neighborhood just north of the Denver metro area.

“The focus of PEER’s complaint is illegal permitting of the Xcel Cherokee power station without required air modeling for its emissions. … Currently, CDPHE is in the process of issuing an operating permit for an oil refinery, the Suncor Refinery, also in Commerce City, without required air pollution modeling. … Colorado’s entire Front Range remains in violation of National Ambient Air Quality Standards set by EPA and has been in noncompliance since 2012, when Cherokee’s permit was issued,” according to Peer.

CDPHE operates with EPA funding. “Deviation from EPA requirements can result in federal sanctions against the state, ranging from loss of funding to Colorado being stripped of its air permitting authority altogether,” according to PEER.

These allegations have placed the oil and gas industry under a permitting microscope. The results of this complaint are expected to have broad nationwide impact on industry, including enforced compliance on ozone precursor emissions by state and local regulatory authorities, and a slowdown on air quality permitting processes, particularly for industrial facilities.