RGEINSQN BRADSHAW September 8, 2017 Direct Phone ?04.3??3.3980 Direct Fax VIA EMAIL William F. Lane, Esq. General Counsel NC Department of Environmental Quality 21 7 West Jones Street Raleigh, NC 27603 Re: Chemours Dear Mr. Lane: We write on behalf of The Chemours Company FC, LLC (?Chemours?) in response to that part of September 5, 2017? letter which directs Chemours? to . I cease discharges in any amount of two PFESA compounds (CASRN 86796-1306 and CASRN 749836-20-2) from its Fayetteville Works facility by September 8, 2017 (hereinafter the Cease and Desist Order? or Order?) as a pro-condition for not suspending the Fayetteville Works? NPDES Permit NCGOO3573 (the ?Permit"). For the reasons set forth below, the PFESA Order violates applicable law, contravenes the terms of Chemours' NPDES permit and long-standing NPDES permitting practice, is-unsupported factually, technically or scienti?cally, and is arbitrary and capricious on these and other grounds. Furthermore, there is no evidence whatsOever that these two trace level discharges represent an acute health risk or other public health emergency that would justify precipitous action. in continuing fidelity to the Company?s commitment to fully cooperate with its regulators, and as we informed you and three other DEQ officials in our conference call on Wednesday (the ?September 6 Call"), Chemours has already taken expeditious measures to identify and eliminate sources of these hyo PFESA compounds in its permitted discharge. The bases on which we have concluded that the PFESA Order is unlawful include, but are not limited to, the following: No Authority. Chemours has requested, multiple times, that provide the legal authority for its PF ESA Order, but to date DEQ has provided no such legal authority. When we spoke on the afternoon of September 6th?r?.e., after DEQ issued its Order?you suggested that both of us research the statutes and regulations concerning the alleged authority for the PFESA Order. I have not heard back. from you on the subject. escort-aw HHNSON. RA. robinsonbradshweom - Charioite Of?ce I01 N. Tryon St. Ste. 1900. Charlotte, NC 25246 704.3??2538 September 8, 2017 Page 2 - Legally lmgroger Notice. Indeed, there is no legal authority for the PFESA Order and the directives in the Order represent an unlawful effort to modify Chemours' NPDES permit without proper notice. Under 15A NCAC DEQ may ?modify or revoke any permit upon giving 60 days? notice to the person affected pursuant to Rule .0114(a) of the Section.? (emphasis added). Setting aside that Rule .0114(a) does not permit modi?cation or revocation of Chemours? NPDES permit under these circumstances, PFESA Order is an attempt to end-run this unambiguous requirement by effectively modifying the terms of Chemours? NPDES permit with just three-days? notice. By stating in advance that the Agency will suspend the permit in 60 days if these two trace level discharges are not entirely eliminated, effectiver is imposing an entirely new permit requirement a zero discharge limitation on two of the multiple constituents in the wastewater for which DEQ heretofore has not established guy permit limitations. Procedurally Defective. The PFESA Order also violates applicable law by modifying Chemours? NPDES permit without adhering in any respect to procedural regulations established under North Carolina law, designed to prevent preciser this type of ill-conceived, closed-door decision-making. 15A NCAC 2H.0114(b) (?Modi?cations and reissuance of permits shall be subject to the same public notice and other procedural requirements as the issuance of permits except as follows . . . id. 2H.O109 (setting forth public notice and meeting requirements); id. 2H.0111 (setting forth public meeting and hearing requirements). Moreover. DEQ has disregarded even the most basic rudiments of fair play and proper process. In one of many such examples, DEQ has refused to provide Chemours with any technical or scienti?c basis for its concluding that elimination of every last detectable molecule of the two PF ESAs within three days is required to protect public health. When we asked the Agency?s team on the September Call for such basis, you refused to provide any response to us. Constitutional Due Process. In fact, the process followed by DEQ has been so fundamentally ?awed as to violate the due process guarantees of the US Constitution (Amendment 14) and the guarantee of the North Carolina Constitution (Art. 1, Sec. 19). In that regard, the repeated public statements by the leaders of DEQ about permit actions that would be taken against Chemours in the future, in advance of the legally required process, dispels any notion that this has been, or is, a fair administrative process. September 8, 2017 Page 3 Inexgiicable Secrecy. . Chemours made a proper and reasonable. written request for public records request on August 15, 201?. The Company did not receive access to a single document in response until today. when DEQ offered to produce Chemours? permit ?le (which DEQ could have easily produced immediately after receiving our request on August 15) . Any process in which the result is preordained and the information relied on for that result is kept secret is precisely what due process protections prohibit and own regulations are meant to prevent. it Chemours? Discharges Comply with Its Still Effective Permit. Chemours' discharges of the PFESAs comply with Chemours' NPDES Permit. (Indeed, DEQ does not allege that Chemours has violated the permit, but rather that DEQ did not receive all material facts in relation to the permit application.) The NPDES permit speci?cally describes the portion of the Fayetteville Works' complex that generates the PFESAs and in accordance with well?and long-established NPDES permitting practice as construed and rati?ed by the courts, this is sufficient for the discharges to be covered by the permit. See in re Ketchikan Puip (30., 7' E.A.D. 605 (1998) (?When the permittee has made adequate disclosures during the application process regarding the nature of its discharges, unlisted pollutants may be considered to be within the scope of_ an NPDES permit. even though the permit does not expressly mention those . pollutants?); see also Attentic States Leger Found, Inc. v. Eastman Kodak, 12 F.3d 353, 357 (2d Cir.1994) (?it is impossible to identify and rationally limit every chemical or compound present in a discharge of pollutants"). Indeed, DEQ itself has publicly stated in connection with this very Permit that chemical substances did not have to be enumerated by name in Chemours' NPDES permit in order to be covered under the permit, so long as the process from which they were generated was described in the permit. Prophetically, one court put it this way: otherwise, ?anybody seeking to harass a permittee need only analyze that pennittee's discharge until determining the presence of a substance not identi?ed in the permit.? Eastman Kodak 00., 12 F.3d at 357. - DEQ Has Long Known of the Presence of Unquanti?ed PFESA Compounds in the Discharge. The PFESA Order, and its implicit. assumption that any continued discharge of the PFESA compounds at any level presents an emergency necessitating the immediate cessation of any discharge. simply ignores the fact that DEQ has been aware of discharges of fluorinated compounds from the Fayetteville Works for years. In 2002, Vaughn Hagerty, Did Chemours Tell NC It Was Discharging GenX. STAR News (June 29. 2017) (quoting DEQ spokesman Jamie Kn?tzer). . September 8, 2017 Page 4 the former operator of the Fayetteville Works E.l. du Pont de Nemours and Company ("DuPont") noti?ed DEQ that the "Fayetteville Works facility manufactures many fluorocarbon compounds? that ?create dozens or hundreds of byproducts in very low concentrations" and asked DEQ how to handle these compounds under its NPDES permit.2 Faced with this unambiguous information (which characterizes the circumstances that also prevail at countless permitted facilities throughout North Carolina and the rest of the United States, where numerous untested and unregulated trace-level compounds are present in permitted dischargesthe best of Chemours? knowledge take any action or make any request that the Fayetteville Works test for or quantify these byproducts (3.9., PFESAs), much less cease their discharges, during the succeeding 15 years. DEQ and EPA Have Had the gate on These Two PFESAs Since 2015. More than two years ago, in August 2015, Dr. Mark and others published an article titled ?Identi?cation of Novel Perfluoroalkyl Ether Carboxlic Acids (PFECAs) and Sulfonic Acids (PFESAs) in Natural Waters Using Accurate Mass Time-of?Flight Mass Spectrometry (TOFMS), which identi?ed - the presence of the two PF ESAs in the Cape Fear River. A Chemours employee circulated a copy of that paper to DEQ in 2015. DEQ took or directed no follow-up action in the two years following that meeting.3 For these and other reasons, there is no basis for assertions that it was never informed and was misled by Chemours or DuPont. There is No Evidence of Any Public Health or other Emergency. DEQ has provided no information in either the PFESA Order,during the September 6th Call, or in any of its other communications that indicates, much less substantiates. that the trace level discharges of the PFESAs pose a public health risk. In other words, there is no evidence that either of these compounds are present at levels more potentiaiiy harmful than the levels of Dimer Acid already deemed safe by the State's health of?cials.4 As you know, North Carolina law allows various known human carcinogens in drinking water at levels far greater?in some instances thousands of times greater-- than the two substances about which DEQ has expressed concern in Chemours? ef?uent. 2 Letter from Michael Johnson, Environmental Manager, Fayetteville Works, to David Goodrich, - NCDENR-Division of Water Quality at 1 (Apr. 23. 2002). 3 Furthermore, from 2002 to today, Chemours has submitted three wastewater discharge pannit applications, and DEQ had not requested further identification or permit requirements to address PFESAs or other fluorinated compounds. 4 For many reasons Chemours believes that the 140 PPT level is flawed. September 8, 2017 Page 5 a State Health Of?cials Statement. The three-day deadline established by the PFESA Order is at odds with the public statements from the State?s own Department of Health and Human Services that the water being taken now from the Cape Fear River remains safe to drink. Speci?cally, as your agency announced last week, reiterated its health guidance that the public can continue to drink the water. . . . This guidance has not changed following the preliminary results shared by the EPA this week.?5 An Absolute ?Zero? Discharge Limitation is Without Precedent. The PFESA Order, without explanation or justi?cation, singles out Chemours and these 2 PFESAs out by imposing a zero discharge limit on them. However, as DEQ permitting of?cials acknowledged during prior discussions this summer with Chemours, NPDES permits are not written with ?zero? discharge limits. By way of just one example. North Carolina law allows formaldehyde (which, unlike the two PFESAs, is of?cially classi?ed by EPA as a probable human carcinogen) to be present in drinking water at 600,000 pot?approximately 10 times the highest concentration of PFESAs that EPA's ?semi-qualitative assessment" estimated in Chemours? wastewater discharges. Yet DEQ demands that these wastewater trace levels be summarily and instantly eliminated. We are unaware of any other permit holder being ordered to cease discharges of an unregulated, unclassi?ed substance within a matter of 3 days merely because it has been detected in an effluent. singling out of Chemours for grossly disparate treatment is the quintessence of arbitrary and capricious agency action. it it ?t This recent turn of events is regrettable and was avoidable. Chemours has demonstrated the utmost good faith and willingness to cooperate with DEQ, but has been stymied. by DEQ at every turn. The good faith was demonstrated when Chemours took aetian beginning on June 21St to capture and dispose off?site the process wastewater at its facility that was contributing to the trace levels of HFPO Dimer Acid (GenX) found in the Cape Fear River. Chemours did this as a good and responsible corporate citizen of North Carolina. and at very substantial expense: - a without the need for any directive or formal action by DEQ 5 See "State Seeks to Step Additional Chemical Discharges into the Cape Fear River," August 31, 2017, available at: discharges-cape-fear=river. September 8, 2017 Page 6 even though DEQ had known about the HFPQ Dimer Acid discharge for years even though the levels of HF PO Dimer Acid found in the River were well below 71,000 PPT preliminary screening level then in effect, and has continued to do this even though it believes that the quickly revised 140 PPT screening level is ?awed in multiple respects - o- even though any risk presented by the HF P0 Dimer Acid was far below those presented by numerous other compounds found in the River and not contributed to by Chemours. . Most recently, as we discussed with you on Wednesday, Chemours has been taking steps to identify potential sources of PFESAs even in the absence of an established test method, but that edict that Chemours must cease all discharges of PF ESAs within three days would be technically impossible to comply with for a whole host of reasons. Therefore, Chemours requested that deadline be extended by a mere 'r days to allow Chemours enough time to gather and analyze information regarding the potential sources of PFESAs, take whatever actions were reasonable and feasible, and then meet with DEQ to discuss this matter further. DEQ refused even this - modest request, and provided no rational basis for that refusal. Che?mour?s remains willing to work with DEQ cooperatively to address responsibly and expeditiously any legitimate questions or concerns about the safety of its discharges and appropriate terms for its NPDES permit. We have made the same commitment to DHHS. We urge DEQ to reconsider its hasty actions and unilaterai positions; we urge the State to put aside litigation and engage in open-transparent dialogue. And even in the absence of such reconsideration, as yet another gesture of its good faith, Chemours wiil pursue appropriate measures to reduce its discharges of the two PFESA compounds. To that end, based on the best analytical resources available to it, Chemours has already identi?ed the single source of signi?cance in terms of discernible levels of the 2 PFESA compounds, to the best of the Company?s present knowledge. Starting today, Chemours will cease releasing and will instead (before resuming the pertinent process operation) hold for off-site shipment and disposal, that identi?ed waste stream. This action should result in a reduction in the already minute concentrations of these PFESAs in the facility?s discharge. if, after implementing these changes, Chemours detects concentrations of concern still present in its NPDES~permitted discharge, the Company is prepared to address such remaining concentrations further, as appropriate and feasible. That is the best we can do today. in sum, PFESA Order violates applicabie law, contravenes the terms of Chemours? NPDES permit and long?standing NPDES permitting practice, is unsupported by any facts or science made known by DEQ, and otherwise is arbitrary and capricious. September 8, 2017 Page 7 Enclosure cc: Francisco J. Benzoni, Assistant Attorney General Linda Culpepper, DEQ Evelyn Brantley The Chemours Company, FC LLC John Savarese Wachtell, Lipton, Rosen Katz Ralph Levene Wachtell, Lipton, Rosen Ketz Lester Sotsky Arnold Porter Kaye Scholer Joel Gross Arnold Porter Kaye Scholer