Even as municipal water agencies lobby Congress to reverse the Justice Department's (DOJ) almost certain bar on supplemental environmental projects (SEPs), a lawyer who represents some municipal agencies says there is a "silver lining" in DOJ's policy. The lawyer, Paul Calamita of AquaLaw, said in a recent note to clients that SEPs have been "dying on the vine and we likely won't miss them." He adds that some projects have made sense over the years, but SEPs have largely been phasing out and the ones that remained were less palatable because they were worth fewer dollars subtracted from penalties and came with increasing transaction costs, such as reporting. Many communities preferred to try to negotiate a smaller penalty, he says. At issue are plans by DOJ environment chief Jeffrey Clark, who has signaled in a recent memo that he plans to scale back the use of SEPs in enforcement settlements, including in wet weather settlements involving municipal agencies. Calamita says the Clark memo "effectively ends the use of SEPs in municipal environmental consent decrees." Clark's plans have drawn concern from many municipal entities, which frequently rely on SEPs in settlements to offset penalties. The National Association of Clean Water Agencies (NACWA), a group that represents many municipal water agencies, recently failed to convince Clark to ease the policy.
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