4/29/2019 8:02 AM

Velva L. Price
District Clerk
Travis County
D-1-GN-19-002002
Cause No. D-1-GN-19-002002 Jonathan Sanders

STATE OF TEXAS, § IN THE DISTRICT COURT

§
Plaintiff, §
§
v. §
§ TRAVIS COUNTY, TEXAS
DAVID POLSTON and INLAND §
ENVIRONMENTAL AND §
REMEDIATION, INC., and INLAND §
RECYCLING, L.L.C., §
§
Defendants. § 53rd JUDICIAL DISTRICT

STATE’S MEMORANDUM OF LAW REGARDING

WASTE AND DISCHARGE AUTHORIZATIONS

The State of Texas (“State”), by and through its Attorney General, on behalf of the

people of Texas and the Texas Commission on Environmental Quality (“TCEQ”) files this

memorandum of law in support of its application for temporary injunctive relief.

I. Summary of Applicable Law

• Storage, processing, or disposal of waste without a permit is prohibited.

• When discarded or abandoned, materials that could be recycled are waste.

• Inland must demonstrate that material is not a solid waste.

• Discharge of waste—including wastewater and stormwater—into any

water in the State is prohibited without a permit.

• TCEQ rules and Multi-Sector General Permits do not allow process

wastewater discharge.

• TCEQ rules and General Permits do not authorize Defendants’ discharge

of petroleum contaminated waters.
 II. A permit is required to store, process, or dispose of any industrial solid waste
or municipal hazardous waste.

TCEQ rules governing the handling and management of waste 1 prohibit causing,

suffering, allowing, or permitting any activity of storage, 2 processing, 3 or disposal 4 of any

industrial solid waste or municipal hazardous waste unless such activity is authorized

by a permit, amended permit, or other authorization. 30 Tex. Admin. Code

§ 335.2(a). Even when storage, processing, or disposal is authorized, it may not cause a

nuisance, endanger public health and welfare, or discharge or threaten to discharge

industrial solid waste or municipal hazardous waste into or adjacent to the waters in the

state without obtaining a specific discharge authorization. 30 Tex. Admin. Code § 335.4.

1
Solid waste means any “garbage, refuse, sludge from a waste treatment plant, water supply treatment
plant or air pollution control facility, and other discarded material, including solid, liquid, semisolid, or
contained gaseous material resulting from industrial, municipal, commercial, mining, and agricultural
operations, and from community and institutional activities.” 30 Tex. Admin. Code § 335.1(146)(A)

2Storage means “the holding of solid waste for a temporary period, at the end of which the waste is
processed, disposed of, recycled, or stored elsewhere.” 30 Tex. Admin. Code § 335.1(152).

3Processing means the “extraction of materials, transfer, volume reduction, conversion to energy, or other
separation and preparation of solid waste for reuse or disposal, including the treatment or neutralization
of solid waste or hazardous waste, designed to change the physical, chemical, or biological character or
composition of any solid waste or hazardous waste so as to neutralize such waste, or so as to recover energy
or material from the waste or so as to render such waste nonhazardous, or less hazardous; safer to transport,
store or dispose of; or amenable for recovery, amenable for storage, or reduced in volume.” 30 Tex. Admin.
Code § 335.1 (129)

4Disposal means the “discharge, deposit, injection, dumping, spilling, leaking, or placing of any solid waste
or hazardous waste (whether containerized or uncontainerized) into or on any land or water so that such
solid waste or hazardous waste or any constituent thereof may enter the environment or be emitted into
the air or discharged into any waters, including groundwaters.” 30 Tex. Admin. Code § 335.1 (47)

Memorandum of Law Regarding Waste and Discharge Authorizations 2

State of Texas v. David Polston, et al.
 III. Materials that could be recycled but are instead abandoned or discarded,
they are a solid waste.

One narrow exception to the permit requirement waste processing is for recycling.

30 Tex. Admin. Code § 335.2(a). But to avail themselves of this exception, Inland must

first adhere to specific notification requirements. 30 Tex. Admin. Code §§ 335.6, 335.24.

Inland notified TCEQ that it intended to engage in four recycling activities to

recycle materials into road base and to use wastewater as washwater for on-site vehicles.

See Attachment A.

Importantly, the notification is not an authorization to store, process, or dispose of

any waste. In fact, the notification form specifically alerts would-be recyclers that storage

of material prior to recycling may require a permit and that recyclable materials may not

threaten the waters of the state, cause a nuisance, or endanger human health or welfare.

See e.g. Attachment A at 2.

Moreover, the recycling exception does not apply to sham recycling. To

demonstrate “legitimate recycling,” an operator must comply with specific TCEQ

requirements. 30 Tex. Admin. Code § 335.24 (requirements for recyclable materials and

nonhazardous recyclable materials), 335.27 (legitimate recycling of hazardous materials).

The recycling exception also does not apply to materials used in a manner

constituting disposal, used to produce products applied to the land, burned for energy

recovery, used to produce a fuel, or materials accumulated speculatively. 30 Tex. Admin.

Code § 335.1(146)(A). “A hazardous secondary material found to be sham recycled is

Memorandum of Law Regarding Waste and Discharge Authorizations 3
State of Texas v. David Polston, et al.
considered discarded and a solid waste. Sham recycling is recycling that is not legitimate

recycling.” 30 Tex. Admin. Code § 335.1(146)(J). “Discarded” materials are those that are

abandoned, disposed of, burned, recycled or stored before recycling in a manner

constituting disposal, accumulated, stored, or processed (but not recycled) before or in

lieu of being abandoned by being disposed of, burned, or incinerated, or sham recycled.

30 Tex. Admin. Code §§ 335.1(146)(B), (C), (D).

“Disposal” encompasses a broad range of activities including discharging,

depositing, spilling, leaking, or placing of waste such that the waste, or any constituent

thereof, may enter the environment or be emitted into the air or discharged into any

waters. 30 Tex. Admin. Code § 335.1 (47). Harris Cty. v. Int'l Paper Co., No. 01-15-00354-

CV, 2016 WL 5851895, at *10 (Tex. App.—Houston [1st Dist.] Oct. 6, 2016, no pet.) (“more

simply, one disposes of waste by placing the waste so that it ‘may’ enter any waters”).

IV. Inland must demonstrate that the material at the Site is not a solid waste.

The burden to demonstrate that a material is not a solid waste and that “the

recycling activity is legitimate and beneficial” falls on those claiming the material is not

solid waste. 30 Tex. Admin Code § 335.1(146)(I). 5 To do so, purported recyclers must

5 “Respondents in actions to enforce the industrial solid waste regulations who raise a claim that a certain

material is not a solid waste, or is conditionally exempt from regulation, must demonstrate that there is a
known market or disposition for the material, and that they meet the terms of the exclusion or exemption.
In doing so, they must provide appropriate documentation (such as contracts showing that a second person
uses the material as an ingredient in a production process) to demonstrate that the material is not a waste,
or is exempt from regulation. In addition, owners or operators of facilities claiming that they actually are
recycling materials must show that they have the necessary equipment to do so and that the recycling
activity is legitimate and beneficial.” 30 Tex. Admin Code § 335.1(146)(I).

Memorandum of Law Regarding Waste and Discharge Authorizations 4

State of Texas v. David Polston, et al.
show, among other things, the existence of a legitimate market for the recycling material

and its products; the material is managed and protected from loss; the material is not

burned for energy recovery, used to produce a fuel, or contained in a fuel; and the

material must not present an increased risk to human health, the environment, or waters

in the state when applied to the land or used in products which are applied to the land

and the material, as generated. 30 Tex. Admin Code § 335.1(146)(H).

What’s more, when materials are abandoned or discarded, they become waste.

Osage Envtl., Inc. v. R.R. Comm'n of Texas, No. 03-08-00005-CV, 2008 WL 2852295, at *6

(Tex.App.—Austin 2008, no pet.)(mem. op.) (upholding Railroad Commission of Texas

determination that cuttings received by a recycling facility claiming to create finished

road base were waste because they lay on the ground and were not immediately used).

Although generators of waste may make claim that material is not waste, their

determination is not dispositive as to whether a material is waste. Slay v. Texas Comm'n

on Envtl. Quality, 351 S.W.3d 532 (Tex.App.—Austin 2011, pet. denied) (upholding TCEQ

decision that, despite landowner’s contention to the contrary, materials were “waste”

when materials in containers at the site contained significant levels of benzene, a

hazardous waste, and soil samples showed detectable amounts of industrial and

hazardous waste).

Memorandum of Law Regarding Waste and Discharge Authorizations 5

State of Texas v. David Polston, et al.
 V. Authorization is required to discharge waste into any water in the State.

The Texas Water Code prohibits the discharge 6 of sewage, municipal waste,

recreational waste, agricultural waste, or industrial waste 7 into or adjacent to any water

in the state, 8 except as authorized by the TCEQ. Tex. Water Code. § 26.121(a)(1). This

prohibition is absolute--even discharges of nominal wastes are prohibited unless

specifically authorized by the TCEQ. Discharge of other waste 9 into or adjacent to water

in the state that causes, continues to cause, or will cause pollution 10 of the water in the

state is similarly prohibited. Id. § 26.121(a)(2). So too is any other unauthorized act or

activity which causes, continues to cause, or will cause pollution of any of the water in

the state. Id. § 26.121(a)(3).

6“To discharge” includes to deposit, conduct, drain, emit, throw, run, allow to seep, or otherwise release
or dispose of, or to allow, permit, or suffer any of these acts or omissions. Tex. Water Code § 26.001(20).

7“Industrial waste” means waterborne liquid, gaseous, or solid substances that result from any process of
industry, manufacturing, trade, or business. Id. § 26.001(11).

8 “Water in the state” means “groundwater, percolating or otherwise, lakes, bays, ponds, impounding
reservoirs, springs, rivers, streams, creeks, estuaries, wetlands, marshes, inlets, canals, the Gulf of Mexico,
inside the territorial limits of the State, and all other bodies of surface water, natural or artificial, inland or
coastal, fresh or salt, navigable or nonnavigable, and including the beds and banks of all watercourses and
bodies of surface water, that are wholly or partially inside or bordering the State or inside the jurisdiction
of the State.” Id. § 26.001(5).

9 “Other waste” means garbage, refuse, decayed wood, sawdust, shavings, bark, sand, lime, cinders, ashes,
offal, oil, tar, dyestuffs, acids, chemicals, salt water, or any other substance, other than sewage, industrial
waste, municipal waste, recreational waste, or agricultural waste. Id. § 26.001(12).

10“Pollution” means the alteration of the physical, thermal, chemical, or biological quality of, or the
contamination of, any water in the state that renders the water harmful, detrimental, or injurious to
humans, animal life, vegetation, or property or to public health, safety, or welfare, or impairs the usefulness
or the public enjoyment of the water for any lawful or reasonable purpose. Id. § 26.001(14). “Pollutant”
includes industrial waste discharged into any water in the state. Id. § 26.001(13).

Memorandum of Law Regarding Waste and Discharge Authorizations 6

State of Texas v. David Polston, et al.
 Wastewater—or water that is the byproduct of an industrial process—is a waste

that requires authorization to discharge. See e.g. McGee v. State, 923 S.W.2d 627, 631

(Tex.App.-Houston [1st Dist.] 1995, writ ref'd). In fact, TCEQ requires specific individual

permits be obtained before any wastewater is authorized for discharge .

VI. The Multi-Sector General Permit does not authorize wastewater discharge.

TCEQ offers general permits—permits that apply general statewide standards to

minimally-concerning environmental activity without individual technical review—to

facilities that notify the TCEQ of their intent to use the authorization. 11 Unlike an

individual permit, a general permit carries no public notice requirement. Nor does it

provide the opportunity for a contested case hearing or public meeting.

One such general permit is the Multi-Sector General Permit (“MSGP”) which

authorizes the discharge of stormwater associated with categories of industrial activity

identified in the permit. 12 See Attachment B. Stormwater includes rainfall runoff,

snowmelt runoff, and surface runoff and drainage. See Attachment B at 15. Inland

currently holds authorization to discharge stormwater pursuant to the terms and limits

of the MSGP.

11In fact, TCEQ’s authority to issue general permits is contingent on TCEQ finding that activities authorized
by the general permit “discharges covered by the general permit will not include a discharge of pollutants
that will cause significant adverse effects to water quality.” Tex. Water Code 26.040.

The discharge from any conveyance that is used for collecting and conveying stormwater and that is
12 “

directly related to manufacturing, processing or raw materials storage areas at an industrial facility.”
Attachment A at 15. For the complete regulatory definition, including the categories of industrial activity,
see 40 CFR §122.26(b)(14).

Memorandum of Law Regarding Waste and Discharge Authorizations 7

State of Texas v. David Polston, et al.
 Importantly, the MSGP only authorizes the discharge of stormwater—not

wastewater or stormwater mixed with wastewater. Attachment B at 15 (“Stormwater

discharges associated with industrial activity that combine with sources of

nonstormwater are not eligible for coverage by this general permit. . . .”). And the MSGP

does not authorize any discharge “that would cause or contribute to a violation of water

quality standards, or that would fail to protect and maintain existing designated uses of

receiving waters.” Id. The MSGP also requires all those claiming its authorization to have

a stormwater pollution prevention plan and implement “all pollution prevention

practices” necessary to protect the water quality in receiving waters. Id. at 62.

VII. The General Permit to discharge waters contaminated by petroleum

substances does not permit commercial petroleum tank washing.

The General Permit to discharge waters contaminated by petroleum substances—

another general permit receiving no individual technical review or public notice—

authorizes the discharge of such waters, but only if the contaminating petroleum

substances result from a limited list of cleanup-type activities. 13 See Attachment C. Insofar

as the General Permit authorizes discharges resulting from the “removal of water from

underground and aboveground storage tank systems previously containing petroleum

13Specifically, the General Permit authorizes the discharge of water contaminated by petroleum substances
resulting from groundwater pump tests, groundwater, surface water, and soil remediation activities,
cleanup activities following spills that occur during transportation of petroleum substances; required
testing of spill buckets and sumps, removal of water from underground and aboveground storage tank
systems previously containing petroleum substances, removal of accumulated groundwater from
excavation sites, removal of accumulated water from utility and pipeline vaults. Attachment C at 7.

Memorandum of Law Regarding Waste and Discharge Authorizations 8

State of Texas v. David Polston, et al.
substances,” it bears note that the authorization was created to remove water from tanks

previously used for petroleum, and is dependent on the discharge being the result of

removal of the water, not ongoing commercial washing operations. And even then,

discharge is only permitted from storage tank systems previously containing petroleum

substances, not every vessel that could hold petroleum substances. Further, leaking

petroleum storage tanks are not authorized.

The General Permit also limits its authorization to discharges with minimal levels

of petroleum substances, which must be reported monthly. 14 The General Permit does

not authorize discharge of floating solids or visible oil, discharges that create nuisance

conditions, interfere with the production of potable water, impart unpalatable flavor to

food fish, result in offensive odors arising from the receiving waters, or otherwise

interfere with reasonable uses of water in the state. Attachment C at 16-17.

ACCORDINGLY, the foregoing legal authorities applied to the evidence admitted

at the temporary injunction hearing compel the conclusion that the Court should grant

the temporary injunction requested by the State.

Respectfully submitted,

KEN PAXTON
Attorney General of Texas

For total hydrocarbons the limit is 15 mg/L, for lead it is .10 mg/L; for benzene it is .005mg/L and for
14

MTBE is it 0.15 mg/L. Attachment C at 14.

Memorandum of Law Regarding Waste and Discharge Authorizations 9

State of Texas v. David Polston, et al.
 JEFFREY C. MATEER
First Assistant Attorney General

DARREN L. MCCARTY
Deputy Attorney General for Civil Litigation

PRISCILLA M. HUBENAK
Chief, Environmental Protection Division

PHILLIP LEDBETTER
State Bar No. 24041316
Assistant Attorney General
Phillip.Ledbetter@oag.texas.gov

/s/ J. Amber Ahmed

J. AMBER AHMED
Assistant Attorney General
State Bar No. 24080756
Amber.Ahmed@oag.texas.gov

AMY RODRIGUEZ
Assistant Attorney General
State Bar No. 24103107
Amy.Rodriguez@oag.texas.gov

OFFICE OF THE ATTORNEY GENERAL OF TEXAS

ENVIRONMENTAL PROTECTION DIVISION
P.O. Box 12548, MC-066
Austin, Texas 78711-2548
Telephone: (512) 463-2012
Facsimile: (512) 320-0911

ATTORNEYS FOR THE STATE OF TEXAS

Memorandum of Law Regarding Waste and Discharge Authorizations 10

State of Texas v. David Polston, et al.
 CERTIFICATE OF SERVICE

On April 29, 2019, a true and correct copy of the State’s Memorandum of Law
Regarding Waste and Discharge Authorizations was served on the following counsel by
eservice and email:

Darrel L. Barger
dbarger@hartlinebarger.com

Victor L. Cardenas Jr.

vcardenas@hartlinebarger.com

Pryce G. Tucker
ptucker@hartlinebarger.com

HARTLINE BARGER LLP

1980 Post Oak Blvd., Suite 1800
Houston, Texas 77056
8750 North Central Expressway, Suite 1600
Dallas, Texas 75231

James D. Smith
Jim@smithtexaslaw.com

Smith Law Firm

550 Westcott Street, Suite 250
Houston, Texas 77007
Phone: (713) 652-3200
Fax: (713) 652-3201

ATTORNEY FOR DAVID POLSTON, INLAND ENVIRONMENTAL AND

REMEDIATION, INC., AND INLAND RECYCLING, L.L.C.

/s/ J. Amber Ahmed

J. AMBER AHMED
Assistant Attorney General

Memorandum of Law Regarding Waste and Discharge Authorizations 11

State of Texas v. David Polston, et al.
Attachment A
Attachment B
Attachment C