United States v. Bd. of Cnty. Commissioners of Hamilton Cnty.

• Citation: 937 F.3d 679
• Decision Date: 06 September 2019
• Docket Number: No. 18-4036,18-4036
• Parties: UNITED STATES of America, et al., Plaintiffs, v. BOARD OF COUNTY COMMISSIONERS OF HAMILTON COUNTY, OHIO, Defendant-Appellee, City of Cincinnati, Defendant-Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (6th Circuit)

937 F.3d 679

UNITED STATES of America, et al., Plaintiffs,

v.BOARD OF COUNTY COMMISSIONERS OF HAMILTON COUNTY, OHIO, Defendant-Appellee,City of Cincinnati, Defendant-Appellant.

No. 18-4036

United States Court of Appeals, Sixth Circuit.

Argued: August 6, 2019

Decided and Filed: September 6, 2019

ARGUED: Aaron M. Herzig, TAFT, STETTINIUS & HOLLISTER LLP, Cincinnati, Ohio, for Appellant. Anthony L. Osterlund, VORYS, SATER, SEYMOUR AND PEASE LLP, Cincinnati, Ohio, for Appellee. ON BRIEF: Aaron M. Herzig, Donnell J. Bell, TAFT, STETTINIUS & HOLLISTER LLP, Cincinnati, Ohio, for Appellant. Anthony L. Osterlund, Mark A. Norman, Nathan L. Colvin, VORYS, SATER, SEYMOUR AND PEASE LLP, Cincinnati, Ohio, James W. Harper, Charles W. Anness, Michael Friedmann, HAMILTON COUNTY PROSECUTOR’S OFFICE, Cincinnati, Ohio, for Appellee.

Before: ROGERS, BUSH, and LARSEN, Circuit Judges.

ROGERS, Circuit Judge.

In 1968, the Board of County Commissioners of Hamilton County, Ohio and the City of Cincinnati consolidated their sewer districts into a single sewer system and entered an agreement providing that the City would manage the sewer system’s operations, subject to County oversight, for a period of fifty years. After the City indicated that it planned to unilaterally withdraw from the agreement in 2018, the Board sought intervention from the district court. The court found that the City’s withdrawal would interfere with environmental remediation projects that the City and Board had committed to implement under a 2004 consent decree. To prevent this from happening, the court temporarily extended the term of the 1968 agreement, enjoining the City’s withdrawal pursuant to the court’s inherent power to enforce consent decrees. The district court did not abuse its discretion in granting the temporary injunction because doing so was necessary to enforce the terms and objectives of the 2004 consent decree.

I.

A.

The Board of County Commissioners of Hamilton County established and operated sewer districts in accordance with Ohio law beginning in 1924, and a few decades later it consolidated the sewer districts into a single county sewer district called "Hamilton County Sewer District No. 1." By 1968 the Board’s management of the consolidated sewer district had attracted criticism due to mounting problems with pollution in Hamilton County. To resolve these problems, the Board turned to the City of Cincinnati, which had managed its own sewer system for over 150 years.

The City assisted the Board in two ways. First, the City passed an ordinance authorizing the consolidation of its sewer system with Hamilton County Sewer District No. 1. The ordinance provided that "in becoming a part of Hamilton County Sewer District No. 1, [the City] Council conveys to the Board of County Commissioners, for use only, all of the sanitary sewage facilities" that were "owned and operated by the City of Cincinnati for the sole and exclusive use of the sewer district." The reason for the ordinance was "the necessity of providing for the creation of one combined sewer district for the City and County under the direction and control of the County Commissioners," and the City "authorize[d] and consent[ed] to the construction, maintenance, repair and operation of any sewer improvement for local service" within the City by the Board. The Board approved the consolidation of the City’s sewer system with Hamilton County Sewer District No. 1 through a resolution, with the new consolidated sewer district being named "The Metropolitan Sewer District of Greater Cincinnati" ("MSD"). Neither the City’s ordinance nor the Board’s resolution contained provisions about when, if ever, the sewer district was to be de-consolidated.

Second, the Board and the City entered into a written agreement (the "1968 Agreement") that established what the district court would later characterize as a principal-agent relationship between the two respective parties. The City, assuming the role of an agent, was to "provide a total and complete management service for the operation of the county sewer system." To fulfill its responsibility of doing "all things necessary to manage and operate the [MSD] in an efficient and businesslike manner," the City agreed, among other things, to "[m]aintain and operate all sanitary and combined sewers, sewage pumping stations and sewer treatment facilities," and to "draft all necessary legislation" for the sewage system and submit such legislation to the Board "for consideration and approval." The City also agreed to employ MSD staff, including those who transferred to the City from the County. Such transferees were "completely subject to the City’s personnel Rules and Regulations" after the transfer was completed, though they had the option of participating in the retirement system of either the City or the State.

The Board, assuming the role of a principal, was granted the authority to oversee the City’s management of the sewer system, with the 1968 Agreement providing that the City’s management was "subject to the exclusive control and direction of the [Board of] Commissioners." Similarly, a different provision of the 1968 Agreement stipulated that "authority and control of the sewer system of the sewer district shall remain vested in the [Board of] Commissioners including, but not limited to, the major responsibilities of fixing sewerage service charges, adopting Rules and Regulations and approving capital improvement programs, and undertaking the necessary legislation therefor." The arrangement was to "be in full force and effect for a fifty (50) year period beginning May 1, 1968, and thereafter extended for additional periods of time as are mutually agreed upon by the County and the City." During that time period, the 1968 Agreement provided that "the City will be the sole management and operating agency for the sewer system of the district."

B.

In 2002, the United States Environmental Protection Agency ("EPA"), the State of Ohio, and the Ohio River Valley Water Sanitation Commission ("Sanitation Commission") sued the Board and the City, alleging that the codefendants’ management of MSD had violated the Clean Water Act, along with similar Ohio laws and regulations. According to the Amended Complaint, the codefendants had allowed MSD’s discharge of certain pollutants to exceed authorized limits, had discharged other pollutants from MSD’s sewage system without obtaining permits to do so, and had failed to prevent the release of sewage overflows into buildings. The plaintiffs sought, among other things, injunctive relief and civil penalties for the various alleged infractions.

The parties resolved the dispute in 2004 by entering into two consent decrees—one interim decree and one final decree (collectively, the "Consent Decree"). The parties’ "express purpose" in entering into the Consent Decree was "to further the objectives set forth in Section 101 of the [Clean Water] Act, 33 U.S.C. § 1251, and to resolve the claims of the Plaintiffs for injunctive relief and civil penalties for the violations alleged in [the Amended Complaint] in the manner set forth in" a later section of the Consent Decree. To effectuate these objectives, the Board and the City agreed:

to use sound engineering practices, consistent with industry standards, to perform investigations, evaluations and analyses and to design and construct any remedial measures required by this Decree; to use sound management, operational, and maintenance practices, consistent with industry standards, to implement all the requirements of this Consent Decree; and to achieve expeditious implementation of the provisions of this Decree with the goals of eliminating all Sanitary Sewer Overflows and Unpermitted Overflows and coming into and remaining in full compliance with the requirements of the Clean Water Act, U.S. EPA’s 1994 Combined Sewer Overflow (CSO) Policy, Chapter 6111 of the Ohio Revised Code and the rules promulgated thereunder, the Compact and the pollution control standards promulgated thereunder, and Defendants’ Current Permits.

The Consent Decree required the Board and the City to take measures to remedy the pollution and sewage overflow problems in MSD by particular dates and to pay civil penalties if they missed the deadlines. The codefendants’ environmental reform efforts were to be conducted in two phases. The first phase was to be completed by December 31, 2018 at an estimated cost of $1.145 billion, while the second phase was scheduled to begin on January 1, 2019 at an estimated cost of $2.145 billion. In the Consent Decree, the district court retained jurisdiction to "enforce the terms and conditions and achieve the objectives of this Consent Decree and to resolve disputes arising hereunder as may be necessary or appropriate for the construction, modification, implementation, or execution of this Decree." The Consent Decree also granted the district court jurisdiction to resolve disputes related to the implementation of the Consent Decree:

This Court shall retain jurisdiction of this matter for the purposes of implementing and enforcing the terms and conditions of this Consent Decree and for the purpose of adjudicating all disputes among the Parties (including [the Sanitation Commission] ) that may arise under the provisions of this Consent Decree.... [including] any dispute that arises with respect to the meaning, application, implementation, interpretation, amendment or modification of this Consent Decree, or with respect to Defendants’ compliance herewith ... or any delay hereunder, the resolution of which is not expressly provided for in this Consent Decree.

The Consent Decree stipulated that its provisions were "binding upon the Defendants," and a sale or transfer of either defendant’s interest in the sewer system would not alter that fact:

Effective from the Date of Lodging of this Consent Decree until its termination, any sale or transfer of either Defendant[’s] interests in or operating role with

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