Green Homes and the Changing Demands for Sustainable Real Estate

 Photo: Jeremy Levine

Photo: Jeremy Levine

With Hurricanes Harvey and Irma dominating our thoughts these last few weeks, national news headlines are paying more attention (see here or here for examples) to the resilience of our built infrastructure.  That's a step in the right direction, of course, though a priority on environmental sustainability and resilience needs to be maintained (especially suring times of relative environmental calm) in order to foster meaningful long-term policy changes. 

It's a welcome sign, then, that the real estate market itself is showing signs of increasing interest in green homes.  Greg Geilman, a realtor who blogs about shifting trends in the real estate market, provides the guest post below.  His points hit close to home.  When I was in the market for a home last year, I found myself attracted to homes that included green features such as solar panels, high-efficiency lighting, or a pellet stove.  Now that I'm settled in, I have been debating the costs and benefits of installing solar panels. According to Greg, I'm not alone in having these thoughts, and the collective interest in green homes is having a measurable impact on the real estate market.  Without further ado:

 

The New Generation of Home Buyers Wants to go Green

Guest Post by Greg Geilman

There have always been trends in home buying, and the latest trend is buyers that are
demanding green homes. These buyers are focused on ways to have a smaller carbon
footprint and a lower impact on the planet. Because of their desire to have green homes,
the construction and real estate market are also being required to change. These are
markets that are often slow to change and do things differently, but they are finding that
they really do not have a choice moving forward. If sellers and builders want to attract
buyers, they have to go green as much as possible.

How Do Green Home Buyers Affect the Construction Market?

The construction market is affected by green home buyers in two different ways. The first
is simple. Builders need to create houses that will sell, and if more buyers want green
homes
more builders will create them. These homes can include features such as energy
efficient windows and appliances, along with certifications for the type of lumber used
and other factors. With so many options, builders will have to pick and choose what
works for them and for their buyers.

The second way is more subtle. Builders and the overall construction market can be
affected financially, because building green homes has a different pricing structure than
building more standard homes. But whether buyers will pay more for these homes or not
affects the markup that builders receive. This can change the construction market, for
both good and bad. It forces builders to make a choice about what level of green homes
they are willing to build, as well.

What Does the Green Home Buying Movement Mean for Current Homeowners?

New construction homes that are being created by builders are not the only aspect of the
market to consider when it comes to buyers wanting green homes. It also affects the real
estate market, because sellers must consider the issue when they put their homes on the
market. Their biggest question is whether they want to make changes to their home to
make it more green before they try to sell. In most instances, whether they do this or not
will be affected by the cost of the changes that would need to be made.

Overall, anything that is energy efficient can be a good choice for a seller to consider.
Appliances, windows and doors, water heaters, and other items that reduce the amount of
power the home uses are popular with sellers who want to make changes. Buyers may
also like LED light bulbs, an automated thermostat, and apps that let them control
lighting, temperature, and other aspects of their home from other locations. Sellers will
have to decide which, if any, of these options are worth the expense in an effort to get
their home sold. The earlier these changes are made can make the difference, too. If a
homeowner makes an efficiency upgrade years in advance of selling, they reap the
rewards of saving energy over time, and making extra money on the price tag of the
home down the line.

Is This Trend Only for the Younger Generation?

The younger generation of home buyers helped kickstart this trend, but now other
generations are starting to come on board. Nearly all buyers use technology, and they are
interested in some of the ways their home can be automated, or ways they can have more
control over things like their power bill based on how much energy they consume. While
not as interested overall as younger buyers, older buyers are not shying away from green
homes, either.

One of the reasons these older buyers like green homes is because these kinds of homes
can be less expensive to operate and maintain. Once proper green systems are installed
there is little that needs to be done to maintain them over and above more standard
systems, so they can save a homeowner a lot of money over the long term. Older or
younger, buyers are starting to see the advantage to saving money and the planet at the
same time, and that is what green homes can provide them, both now and in the future –
and builders are taking notice.

What can the Dakota Pipeline protests tell us about existing tribal consultation requirements?

 Sacred Stone Camp, North Dakota.  Photo: Joe Brusky

Sacred Stone Camp, North Dakota.  Photo: Joe Brusky

When the federal government announced in September that it would be withdrawing permits issued for the Dakota Access Pipeline, it was a huge win for Indian tribes and environmentalists who were protesting the construction of the pipeline across sacred sites and sensitive ecosystems.  But the government's announcement also called for a revision to federal policy as it concerns tribal consultation.  Specifically, the government requested feedback and dialogue on two questions:

(1) Within the existing statutory framework, what should the federal government do to better ensure meaningful tribal input into infrastructure-related reviews and decisions and the protection of tribal lands, resources, and treaty rights?  
(2) Should new legislation be proposed to Congress to alter that statutory framework and promote those goals?

These are fairly open-ended questions, and its fair to wonder if the administration will have enough time to consider responses, formulate a policy response, and implement it in time for this process to have a meaningful impact before the administration change-over in January.  Nonetheless, both questions merit some thought.  I'll tackle the first question in this post.  

Before thinking about how consultation can be improved within the existing framework, we need to know what the existing framework is. There are several statutes that require consultation before proceeding with certain government actions. Here are the most prominent:

The National Historic Preservation Act (which was the consultation statute at issue when the Standing Rock Sioux sued to block the Dakota pipeline from moving forward) requires consultation with tribes that attach religious and cultural significance with certain lands and properties.

The Archaeological Resources Protection Act requires consultation before the government can permit archaeological excavation on tribal lands.

The American Indian Religious Freedom Act provides tribes with access to sacred sites and objects, and allows them to conduct traditional rites.  

The Native American Graves Protection and Repatriation Act requires consultation with tribes regarding the treatment and disposition of human remains and sacred objects.

In addition to these statutes, federal agencies are bound by Executive Order 13175, "Consultation and Coordination with Indian Tribal Governments."  The Executive Order was established in 2000 "in order to establish regular and meaningful consultation and collaboration with tribal officials in the development of Federal policies that have tribal implications."  In 2009, President Obama directed federal agencies to develop a plan of action to implement the directives of EO 13175.  The Department of the Interior's plan can be seen here, for example.  

Many of these consultation statutes, regulations, and policies are fairly open-minded and receptive to consultation best practices.  The Department of the Interior's policy, for example, calls for consultation reporting and training, regular meetings with tribes, the appointment of tribal officers within the agency and sub-agencies, and opportunities for tribal consultations and dialogue throughout the administrative rule-making process.  Other agencies have similar policies and procedures (see the Department of Transportation's policy here).  

So it seems there are numerous avenues for tribal consultation on federal agency actions.  There are a number of statutory directives, as well as tailored tribal consultation plans for each agency.  Why then, is tribal consultation still challenging?  

One reason is that there is ambiguity with respect to which actions "trigger" consultation.  It is obvious that the US Army Corps of Engineers will consult with a tribe if a dam the Corps is operating will be modified in a way that will flood tribal land.  But what if water levels in a reservoir operated by the Corps are modified in a way that may negatively impact salmon, a species fished by a local tribe?  Would that type of activity trigger consultation?  It's not always clear.  And because agency rule-making or government operations often require multiple layers of bureaucracy and approvals, agencies may be tempted to err on the side of expediency rather than consultation. 

An additional challenge is that there are no uniform standards for what constitutes satisfactory consultation.  Often consultation may consist of an invitation to submit comments on a proposed agency action.  Hardly the round-table dialogue many envision when they think of consultation.  The agencies have to balance their duty to consult with the demands on their time and resources; they seek to satisfy their obligations while moving the ball forward.  

Finally, the requirement to consult typically does not carry with it any obligations to undertake any particular final decision or agency action.  For example, while the National Historic Preservation Act requires extensive consultation, ultimately it does not mandate that the permitting agency in question take any particular measures to protect historic resources.  

When the Standing Rock Sioux Tribe sued to block construction of the Dakota Access Pipeline, it claimed that the Army Corps of Engineers had not fulfilled its National Historic Preservation Act obligations because the Corps had not executed a "programmatic agreement" with tribal representatives.  A programmatic agreement is an agreement negotiated with the tribes that governs an agency's actions over a particular activity, so as to reduce impacts on sensitive resources.  The District Court's opinion noted that the Corps had executed such agreements in the past, but its failure to execute one for the Dakota Access Pipeline was not a problem because programmatic agreements are not mandatory.

These issues are not easily remedied, but lessons learned from the Dakota Access Pipeline and other cases, as well as similar provisions and procedural requirements of other statutes, can shed light on some potential fixes to federal-tribal consultation requirements.  My thoughts on those fixes are forthcoming.  

 

Federal Pipeline Policy pivots toward tribal and environmental interests

 Sacred Stone Camp in North Dakota and the Standing Rock Sioux Reservation have become the staging area for protests along the proposed Dakota Access Pipeline route.  Photo: Joe Brusky.

Sacred Stone Camp in North Dakota and the Standing Rock Sioux Reservation have become the staging area for protests along the proposed Dakota Access Pipeline route.  Photo: Joe Brusky.

Last November, the Obama Administration denied federal approval of the Keystone XL pipeline, finding that approval of the pipeline was not in the US' interests.  It largely did so because Keystone XL had become THE symbol of environmental resistance.  Previously, energy infrastructure projects had not been particularly controversial.  Even Keystone XL's impacts (both environmental and economic) were overblown by vehement opponents and supporters of the project.  I wrote then that the federal government's rejection signaled a pivot toward environmental protection, especially as the timing of the rejection came just before world leaders met in Paris to negotiate a major climate agreement.  It also represented a major victory for environmentalists, and the power of environmental protests.

The history of Keystone XL has become more salient in recent weeks, as protests over the proposed Dakota Access Pipeline (DAPL) intensified.  DAPL would carry oil from western North Dakota oil fields to an existing pipeline network in Illinois.  Along the way, however, the proposed route crosses federally controlled waterways, as well as sacred tribal lands and burial sites.  The Standing Rock Sioux Tribe, in particular, is also concerned that an oil spill might contaminate their water supplies.  But protests over the pipeline have evolved into a larger battle regarding tribal and environmental interests, on the one hand, and energy security on the other hand.  Other tribes are standing in support of the Standing Rock Sioux, as are scores of celebrities, politicians, environmentalists, and other activists.  Protests have taken place all over the country.  It is possible that these protests and shows of support for blocking the pipeline would have taken place regardless, but it seems more likely that the anti-Keystone XL movement has provided a model for citizens to use political pressure to block pipeline construction.

The legal process took an interesting turn this week, as the D.C. District Court rejected the Standing Rock Sioux Tribe's request for an injunction.  The tribe claimed that, because it was not consulted about the DAPL (as is required by the National Historic Preservation Act), construction of the pipeline would lead the tribe to suffer irreparable harm worthy of a preliminary injunction.  The court appeared sympathetic to the tribe's concerns, opening its decision thusly: "Since the founding of this nation, the United States’ relationship with the Indian tribes has been contentious and tragic."  But ultimately the standard one must meet to be granted a preliminary injunction is a very high one.  As the court noted, "'[I]njunctive relief' is 'an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief'" [citing Winter v. Nat. Res. Def. Advisory Council].  The tribe didn't meet that standard, according to the court, and the injunction was denied.

The legal defeat notwithstanding, pipeline protesters received a significant victory immediately after the court's decision was released.  The US Department of the Interior, Department of Justice, and Army Corps of Engineers issued a joint statement that federal approval of the DAPL would be suspended pending further review.  In addition, the federal government invited tribes and the general public to participate in consultations regarding tribal lands and resources, and the potential need for new legislation.  The joint statement calls into question the viability of the DAPL moving forward - without federal approval, the pipeline will not be able to cross major waterways blocking its path.  The statement represents a remarkable victory for tribes, environmentalists, and pipeline protestors.

This is, therefore, the second major pipeline protest breakthrough in less than one year.  One of three developments is likely true: either the federal administration is pivoting toward tribal and environmental interests, or the political pressure mounted by pipeline protestors is increasingly influential, or both.  The administration's support for tribal and environmental interests can be measured in other ways over the past few years, and that support is likely a factor in this case as well.  But the influence of protest movements in shaping energy politics is undoubtedly a major factor as well.  As mentioned, these types of infrastructure projects rarely took center stage in the past.  Now, they are doing so with regularity.  It will be interesting to see how the DAPL legal and political processes play out.  It will also be interesting to see if more pipeline protests emerge in the near future.  If the Keystone XL and Dakota Access Pipelines are any indication, high-profile pipeline protests may become the new normal.  

Big Cypress: Oil and Gas Rights and Multiple Use in the National Park System

 Big Cypress.  Photo: Franco Tobias.

Big Cypress.  Photo: Franco Tobias.

Last semester I taught Natural Resources Law for the first time.  Some of the themes we encountered throughout the course included: the federal government's constitutional authority over public lands, the National Park Service's dual mandate to promote conservation and enjoyment of NPS lands, "multiple use" principles, tribal natural resources, wilderness designation, federal energy policy, oil and gas exploration and development, environmental review requirements, and designation of critical habitat for endangered species.  As if tailor made as a law school exam hypothetical, controversial management of the Big Cypress national preserve in South Florida invokes each of these themes.

National Parks Traveler has an excellent rundown of the preserve's troubled past.  A recent decision from the NPS to forego an Environmental Impact Statement in favor of an Environmental Assessment (or more simply, to forego more rigorous environmental impacts review) will allow Collier Resources (owner of oil and gas rights in the preserve) to study the preserve area to determine if oil and gas development is feasible.  The decision is reigniting concerns over many dormant ambiguities in the preserve's enabling legislation and management history.   Consider just a few of these ambiguities:

  • the Big Cypress National Preserve is part of the National Park System and thus its ecological integrity must be maintained, but its enabling legislation provides for some oil and gas development;
  • NPS management of the preserve has, at times, appeared to promote the principle of "multiple use" of public lands (allowing for extensive Off-Road Vehicle use for example), even though the principle does not apply to NPS lands;
  • when the federal government acquired the lands that now make up the preserve, subsurface mineral values may have been taken into account when Collier Resources was paid for surface lands; 
  • Assuming Collier's mineral rights are secure, it is unclear if meaningful energy deposits are located in the preserve, making it difficult to valuate Collier's property interests in advance of a potential buy-out;
  • there are several endangered species living in the preserve - such as the Florida panther - but critical habitat has never been designated
  • federally recognized tribes retain certain use rights in the natural resources of the preserve
  • as a vast wilderness expanse, the preserve is an obvious candidate for designation as a federally protected wilderness area, but park officials disagree on which lands should be designated as wilderness and which lands should not;

If the seismic testing and exploration moves forward as anticipated, at least one of these issues will be cleared up, as Collier and the NPS will have a better sense of how much oil and gas is located in the preserve.  Historically Florida has not been an oil-rich state, so there's a good chance the exploration phase comes up empty.  If that's the case, a buy-out of the mineral rights would be more feasible.  If, on the other hand, Collier finds extraction worthwhile, the company will still face a difficult road.  Collier will have to submit an oil and gas development plan to the NPS for approval.  At that point, a full-blown Environmental Impact Statement is likely, and the fragility of the preserve's ecological resources might limit the extent of development.  The low cost of oil might make such a complex extraction scheme financially impracticable even if the plan is approved and survives third-party litigation.  In any case, potential oil and gas development in a national preserve (and potential wilderness area) is something to keep an eye on.  If nothing else, it makes for a great case study for students of natural resources law.

Introducing 'Marijuana Agriculture Law'

 Photo: Brittney

Photo: Brittney

If you've been following this blog for the past few weeks, you've noticed that I've been teasing out my forthcoming article entitled "Marijuana Agriculture Law: Regulation at the Root of an Industry."  I wrote about marijuana appellations, as well as the potential for counties across the country to start adopting a marijuana ordinance.  I've been working on the article for the past few months, and I'm pleased to finally post a full draft online.  See here for access to the article.  The article will be published in the Florida Law Review sometime next year, but this draft is available immediately.  Major themes covered include the potential commoditization/consolidation of the marijuana industry, the environmental regulation of marijuana agriculture, and the administrative challenges of regulating this new industry.  Below is the introduction to the article:  

Across the United States, voters are weighing the costs and benefits of marijuana legalization.  As many as sixty marijuana legalization initiatives may appear on election ballots in 2016, legalizing the recreational or medicinal use of marijuana in as many as 17 states and adding to the growing number of states that have already legalized marijuana.  As states move toward legalization, governments will need to address a broad range of regulatory issues, including the distribution, sale, and consumption phases of the supply chain.  But legal marijuana’s track record so far suggests that the agricultural component of the marijuana industry is being ignored.  Whether states are failing to appreciate marijuana’s agricultural roots or choosing to disregard them, the industry’s direction will be out of state control until regulatory frameworks are in place.  

Nowhere has this been more apparent than in California.  In 1996, California voters passed Proposition 215, the Compassionate Use Act (CUA).  With the CUA California became the first state to legalize the medicinal use of marijuana, exempting patients and prescribing physicians from criminal prosecution.  The text of the act was short, and did not address how the state or local governments were intended to regulate the marijuana industry.  It did not, for example, assign regulatory authority to an administrative agency, articulate limits on possession or cultivation, or propose a broad regulatory framework from which the state or local governments could operate. 

In the wake of the CUA a legal medical marijuana industry was created in California, and the industry experienced tremendous growth, notwithstanding the absence of any meaningful state regulations.  But the CUA’s omissions prompted the state legislature to enact the Medical Marijuana Program Act (MMPA) in 2003, which, among other measures, restricted the number of plants medical marijuana patients or designated caregivers could cultivate, and assigned further regulatory authority to the Attorney General.  Even these limits, however, became legally ambiguous guidelines after the California Supreme Court ruled that the rights established by constitutional amendment Proposition 215 could not be limited by legislative act.  The upshot of these early experiments with marijuana legalization is that California’s burgeoning marijuana industry has been more or less unregulated for twenty years.

In the absence of regulation, marijuana cultivation in California has exploded, with approximately 50,000 marijuana farms accounting for 60% of all marijuana grown in the United States.  There are as many marijuana farms in Humboldt County, California, as there are wineries statewide.  And this un-checked growth in marijuana agriculture has consequences for the sustainability and potential growth of the industry.  Marijuana farming has been blamed for sucking rivers dry, poisoning soil and water resources with pesticides and rodenticides, and clearing mature forests.  Much of these criticisms are flawed, as research on the environmental impacts of marijuana farming is nascent and rarely acknowledges that farmers can grow responsibly and sustainably on private lands. 

Many farmers would welcome the security of being in compliance with state and local laws, while being distinguished from cartel operations or destructive “trespass grows” on public lands.  As it stands, farms on private property remain vulnerable to police raids and asset forfeiture laws, and are unable to take advantage of typical agricultural government services, such as crop insurance programs or pesticide-free certifications.  Because marijuana agriculture’s regulatory contours have remained ambiguous for so long, the marijuana agriculture industry has been poorly understood by states and the public.  This disconnect presents a threat to responsible management of legal marijuana markets. 

Fortunately, change is on the horizon in California.  In January 2016, the Medical Marijuana Regulation and Safety Act (MMRSA) came into effect, with ambitious proposals to create comprehensive regulations for marijuana agriculture.  The MMRSA assigns authority for various regulatory responsibilities to a variety of state agencies, including the Department of Food and Agriculture, Department of Fish and Wildlife, Department of Public Health, and the State Water Resources Control Board.  Said the author of the bill, “cultivators are going to have to comply with the same kinds of regulations that typical farmers do…it's going to be treated like an agriculture product.”  It took twenty years to get there, but marijuana cultivation has finally been recognized as an agricultural activity in California, and may now be regulated as such.

The same cannot be said for every state that has legalized, or is considering legalizing, medicinal or recreational marijuana.  In many states the immediate regulatory priority is the distribution, sale, and consumption of marijuana.  Colorado legalized recreational marijuana by passing Amendment 64: The Regulate Marijuana Like Alcohol Act of 2012.  For political and public health reasons the analogy makes sense, but it also reveals a regulatory blind spot.  States may be using alcohol as a model for regulating the distribution, retail, and consumption of marijuana, but marijuana is much more than a retail product.  It is also an agricultural product, and by some measures, the largest cash crop in the United States.  Since marijuana prohibition laws were passed long before any regulations for cultivation were developed, states are facing an unprecedented challenge: regulate, for the first time ever, one of the country’s largest agricultural industries.  

Early indications suggest that states are making little effort to regulate marijuana cultivation, or fail to appreciate the disruptive potential of marijuana agriculture.  21 states may have marijuana legalization initiatives on their ballots for the 2016 elections.  Colorado, Washington, Oregon, Alaska, and Washington DC have already legalized the medicinal and recreational use of marijuana.  But few of these states are anticipating the unique regulatory challenges that marijuana agriculture presents.  Even fewer are prepared to tackle them.

This Article argues that marijuana is a burgeoning agricultural industry, and calls for regulations that recognize it as such.  As the field of marijuana agriculture law is incipient, this article provides a roadmap for the major regulatory issues states and the industry are likely to encounter.  Many agricultural policies and programs are created or supported by the federal government, and would not apply to marijuana agricultural activities that run afoul of federal marijuana prohibition laws.  Therefore, states and the marijuana industry will need to be creative in providing analogous regulatory functions.

The most immediate choice regulators will be forced to make is between an approach that incorporates the marijuana industry into the existing regulatory framework for agriculture (essentially treating marijuana like any other agricultural product), or an approach that creates a separate regulatory framework for marijuana cultivation.  While the former has its benefits, and may be achievable long-term, marijuana’s transition from the black market may call for a targeted regulatory scheme in the interim. 

Another fundamental issue facing the marijuana agriculture industry has not yet been conclusively resolved: is marijuana an agricultural commodity?  Commodities are fungible goods with no qualitative differentiation, such as wheat or soybeans.  Many existing farmers fear that marijuana markets will be flooded with cheap, indistinct marijuana grown by “Big Ag” conglomerates.  To counteract these concerns, some industry groups are advocating for states to adopt an appellation model of marijuana cultivation that would preserve markets for regional marijuana products and maintain quality standards.  States and counties can play a large role in this existential question by adopting or rejecting the appellation model, or by enacting other regulations that facilitate or preclude the consolidation of marijuana agriculture.

There is an environmental component to marijuana agriculture that will also require regulatory attention.  Pesticides and fertilizers facilitate plant growth, but may reduce soil and water quality.  There is a market for organic or pesticide-free marijuana that states and the marijuana industry may wish to cultivate.  Marijuana agriculture also requires appropriate quantities of water for irrigation and, when grown indoors, energy resources.  Regulators must balance an interest in providing resources to a growing industry with the need to manage those resources sustainably.  

When the environment does not cooperate, the federal government has been instrumental in providing stability to the agricultural industry by regulating crop insurance and providing disaster relief.  As marijuana farmers would not be eligible for these programs, states may want to provide their own support structures.  However, it may be difficult to avoid the federal government’s institutional and legal reach, presenting federal preemption concerns.

Another question concerns power sharing: where can/should regulatory authority be placed?  Local governments may play a large role in the direction of marijuana agriculture, as states with marijuana regulations have so far been broadly permissive of counties and municipalities creating their own (often more restrictive) marijuana agriculture regulations.  Local governments can utilize their lawmaking powers to shape agricultural policy for the marijuana industry, but this decentralized nature of policy-making may come at the expense of regulatory clarity for the state as a whole.

Keeping the regulatory framework centralized on the state level provides more consistency, but may be difficult to apply in states where political support for marijuana cultivation changes drastically by jurisdiction.  In addition, states will need to decide whether to consolidate regulatory authority for marijuana into one state agency, or to assign different roles and responsibilities to several agencies and regulate cooperatively.  Colorado has adopted the former model, while California the latter.  

In February 2016, Humboldt County passed a comprehensive commercial marijuana cultivation ordinance, one of the first of its kind.  As the heart and soul of California’s marijuana agriculture sector, Humboldt County has consistently played a leadership role in the development of the marijuana industry, and this ordinance may prove instrumental in shaping marijuana agriculture policies around the country.  The ordinance addresses many of the issues identified in this article, placing limits on farm size, water, and energy use, while developing an artisanal labelling program.  The Humboldt County ordinance is an ideal case study for the nascent field of marijuana agriculture law, and underscores the need for state and local governments across the nation to start developing their own regulatory framework.   

Never before has a major agricultural product entered legal markets with the pace and scale that marijuana is entering them today.  States face an unprecedented regulatory challenge, and ignoring the agricultural dimension of the marijuana industry is not a sound long-term approach.  This article will present and analyze the most significant legal and regulatory challenges states will face when legalizing marijuana.  Responsible and sustainable marijuana agriculture can be fostered at the state level, but only if regulations are responsive to the unique and unprecedented challenges that marijuana agriculture presents.

 

The Marijuana Ordinance

 Arcata Plaza, Humboldt County, California.  Photo: Terrence McNally.

Arcata Plaza, Humboldt County, California.  Photo: Terrence McNally.

One of the early trends in marijuana regulation is to include a heavy dose of local governance.  States that have legalized marijuana cultivation, sale, and consumption are being broadly permissive of local governments that want to enact their own marijuana regulations.  Local regulations can be more or less permissive of marijuana activities (often they outright prohibit the cultivation or sale of marijuana), and for states the advantages of local governance are numerous.  Because marijuana regulation is so new, states often have little experience or expertise on the subject, so getting local governments involved helps develop institutional capacities.  It also encourages experimentation with diverse regulatory approaches that might lead to innovative or create policies that can be replicated in other localities or on the state level.  And, since many legalization statutes are created by ballot initiative, allowing local governments to create their own rules makes marijuana regulation a less divisive issue on the state level, where politicians might retain some discomfort with the industry.

Local governments can use their power to enact ordinances to regulate marijuana agriculture, and that power has been utilized in states like California, Colorado, and Washington.  In most cases, though, ordinances make small changes or adopt broad positions.  There are few ordinances that comprehensively address marijuana agriculture.  Humboldt County, however, is an exception, having recently passed the Commercial Medical Marijuana Land Use Ordinance. Humboldt County officials had been working on the Marijuana Ordinance for several years, in collaboration with marijuana industry groups and farming representatives.  The close collaboration between local officials and industry representatives enabled the ordinance drafting process to move forward quickly and with political support, a dynamic that may prove to be equally helpful in other jurisdictions.  

My forthcoming article on marijuana agriculture goes into detail on the Humboldt County Marijuana Ordinance.  Part of that analysis is reproduced below:

The Marijuana Ordinance itself is relatively comprehensive in scope, addressing farming styles (indoor, outdoor, and mixed), historical use protections and benefits for existing farms, tiered permitting requirements based on zoning classifications, total farm acreage and marijuana cultivation area, water quantity and quality protections, energy use, and farm labor standards.  The ordinance addresses many of the issues explored in this article, and the choices those issues present to local governments.  The ordinance represents a clear attempt to regulate marijuana agriculture in a tailored fashion; marijuana cultivation limits (no more than one acre) indicate a preference for small scale farming and a rejection of large-scale consolidation models, demonstration of sufficient water rights and water quality compliance permits are required, and energy used in indoor farms must come from renewable sources or be offset with carbon credits.  The ordinance even attempts to create a ‘Humboldt Artisanal Branding’ certification program for small-scale, organic marijuana farms.  The Marijuana Ordinance does not address crop insurance or disaster relief, but local governments are not well-suited to provide financial services of this nature.

The central tension local governments face when regulating marijuana agriculture, particularly in jurisdictions where marijuana is already a primary crop, is between the need to bring farmers out of the shadows and into the regulatory system, on the one hand, and the need to create and enforce regulations that have a meaningful impact on cultivation and the direction and impact of the industry, on the other hand.  The Marijuana Ordinance addresses this tension by incentivizing existing farmers to register and participate with the county by providing benefits to those farmers who step forward within 180 days following passage of the Ordinance.  Those benefits include a larger maximum cultivation area (43,560 square feet, as opposed to a maximum 10,000 square feet for new farms), as well as a certificate of good standing for purposes of priority processing of state permits.  In addition, the ordinance incentivizes the retirement and relocation of existing farms located in environmentally sensitive areas by allowing farmers to cultivate an area four times larger in environmentally resilient areas.

It remains to be seen if the certificate of good standing will have meaningful value, but the cultivation area restrictions on new farms (which would include existing farms that chose not to register by the deadline) are significant, and may ultimately provide a pronounced advantage to existing farmers, who can cultivate an area over four times larger than new farmers.  In my conversations with farmers in the county, “to legalize or not to legalize” has been a frequent topic of debate.  Considering the isolationist nature of the marijuana farming industry in northern California, that debate is a promising sign for the county.

In other aspects, the Marijuana Ordinance is less well thought out.  It is logical to require that marijuana farmers have water rights (either riparian or by appropriation) sufficient to meet their agricultural needs, as well as water use plans and other documents certifying water use, but the ordinance may require water rights holders to agree to forego any water diversions from May 15th to October 31st.  Instead, marijuana farmers would be required to collect and store water during the rainy season in quantities sufficient for the dry season.  While there is some evidence that water used for purposes of marijuana cultivation may have adverse effects on water resources during periods of low flow, the ordinance’s prohibition on dry season water use as a general rule is unprecedented.  

The environmental impacts of this rule are unclear, as well.  While wet season flows are high and waterways can likely support an increase in diversions, ecological processes may depend on these traditionally high flows, and widespread wet season diversions and water storage may disrupt the wet season environment.  In addition, since irrigation demands are substantial during the dry season, the environmental impact of building large storage tanks on every marijuana farm, necessitating building materials, construction waste, and a storage footprint, may outweigh the benefits intended by the rule.  Moreover, if this rule is perceived to be unreasonable and infeasible by marijuana farmers, they may reject the ordinance and regulatory process as a whole.

Cognizant of its shortcomings and the hurried nature of its drafting, the Marijuana Ordinance contains a flexibility provision that may reassure skeptical farmers that compliance is attainable.  If, upon inspection, a marijuana farm does not comply with the requirements of the ordinance, a farmer may nonetheless be granted a provisional license, as well as a two-year window within which to cure the violation.  The provision is not only generous with respect to the compliance grace period, it also may provide enough time for county officials and marijuana farming representatives to address problematic aspects of the ordinance and make amendments prior to enforcement of violations.  It will take time for farmers to adjust to the dry season water use ban, if they adjust at all, but two years may be sufficient to devise wet season storage infrastructure or develop an alternative water use plan with the county and state officials. 

It is clear that marijuana ordinances are in their infancy.  So far most local governments have only superficially addressed marijuana agriculture.  Humboldt County, however, has capitalized on its economic and political ties with the marijuana farming community to develop a first-of-its-kind marijuana agriculture ordinance.  It remains to be seen if the county’s marijuana farmers buy into the regulatory framework, but initial signs are promising.  As marijuana legalization and regulation moves forward, the Humboldt County Marijuana Ordinance may prove to be a model for local governments.

 

Supreme Shocker: Environmental Law in the Scalia Era

 Photo: Ryan Stoa.

Photo: Ryan Stoa.

Last Thursday in my Ocean and Coastal Law class, we discussed the Supreme Court's majority opinion in Lucas v. South Carolina Coastal Council.  The opinion, written, by Justice Scalia, required the state of South Carolina to find "background principles" that would have prevented the plaintiff in the case from building on his property before the state enacted regulations that prevented construction on coastal lands for the purpose of environmental protection.  Unable to do so, South Carolina was eventually required to pay compensation for the regulation.  Although a controversial case, most of my students found Scalia's reasoning persuasive, a testament to his skills of argumentation.

After his passing, many have questioned what his death will mean for the Clean Power Plan.  I wrote last week about the stunning implications of the Supreme Court's stay of the plan (putting it on hold until the DC Circuit Court hears the case).  Since Scalia was part of the 5 justices voting for the stay (with 4 against), his passing makes it less likely the CPP will be struck down.  As many others have speculated (see examples here, here, and here), a justice appointed by President Obama, or a hypothetical President Clinton or Sanders, would very likely be more friendly to the CPP than Justice Scalia.  If the Supreme Court doesn't have a ninth justice by the time the DC Circuit issues its ruling, then a 4-4 decision from the Supreme Court would simply maintain the DC Circuit ruling.  And as has been noted, the government got a bit lucky there: the 3-judge panel selected from the DC Circuit court (which has a reputation for being conservative) consists of two judges appointed by Democratic presidents.   

Here's another wrinkle: one of the judges on the DC Circuit panel hearing the case is Sri Srinivasan, an early front-runner for the Supreme Court vacancy in the eyes of many observers.  If he recused himself from the Circuit or was confirmed by the Senate fairly quickly, another judge would be appointed to the Circuit court, which could alter the outcome of the decision.  Alternatively, if Srinivasan participates in the Circuit decision and then gets confirmed, he might recuse himself from the Supreme Court hearing of the case, leaving the door open for a 4-4 decision.

It will be interesting to see how this all plays out.  In the meantime, Dan Farber provides a summary of Scalia's environmental legacy that bears reflection:

Administrative law.  The Chevron test says that an agency’s interpretation of a statute is entitled to deference.  It can be set aside only if it is contrary to an unambiguous statute or if it is an unreasonable interpretation of an ambiguous statute.  There are only three cases in which the Supreme Court has ever held that a statute’s interpretation of an ambiguous statute was unreasonable, all three written by Scalia: Whitman v. American Trucking, UARG v. EPA, and Michigan v. EPA.  In all three cases, the “unreasonable” agency was EPA.  To be fair, in American Trucking, he did admit that another portion of the statute unambiguously required air quality standards to be based solely on health effects, not cost.

Property rights.  Justice Scalia wrote two major opinions elevating property rights over land use controls.  In the Lucas case, he held that a government regulation is a taking if it completely blocks development or other economic use of the land.  In the Nolan case, he held that even when the government would be justified in denying a permit completely, it can’t impose “logically unrelated” conditions on the permit, even if those conditions are in the public interest. In Stop the Beach Renourishment, he tried to freeze property law in place for all time by holding that a decision by a state supreme court reinterpreting state property law can be a taking.

Standing.  Justice Scalia wrote major opinions limiting standing for environmental groups in National Wildlife FederationDefenders of Wildlife, and Summers v. Earth Island Institute, Scalia narrowed standing law, making it more difficult for environmental groups to sue.

Federal jurisdiction. In Rapanos,  a plurality opinion by Scalia attempted to cut back drastically on federal authority over wetlands and streams.  Justice Kennedy, the swing voter, wrote a more nuanced opinion that gave the federal government more maneuvering room.

Indoor agriculture's future: bright or blight?

 Photo: Phil Hendley

Photo: Phil Hendley

Indoor agriculture - growing food in greenhouses instead of in an outdoor field - is nothing new.  Roman gardeners used a greenhouse-type system to provide cucumbers to the Emperor Tiberius every day of the year.   Today greenhouses cover 0.25% of the Netherlands' total area.  But two recent developments are making agronomists and the private sector look at indoor agriculture on a larger systemic scale. The first is that climate change is wreaking havoc on traditional agricultural areas.  California, for example, grows most of the United States supply of produce, but now faces a recurring lack of water to irrigate those crops.  Indoor agriculture can grow produce any time of the year, virtually anywhere:

In an indoor farm, water doesn’t inconveniently evaporate. LED lights can lengthen the hours of sunlight so plants can grow faster. CO2 levels can be tweaked. Even as the weather outside goes haywire, plants farmed indoors can live out an optimized version of the weather that they coevolved with — the weather of the past. The best weather of the past. 

The second development is an advancement in greenhouse technology and software that monitors plants and growing conditions and adjusts those conditions to reach that optimized environment.  Importantly, these technological advances can mitigate the two major downsides of indoor agriculture: cost and energy.  Outdoor crops use sunlight and rain, so replicating that process makes indoor agricultural products more expensive.  And the massive amounts of electricity required to mimic the sun and pump water into the system dramatically increases the energy footprint of an already carbon-intensive industry.  

Agricultural start-ups are working on these inefficiencies and looking at ways to make indoor agriculture more sustainable (e.g. incorporating solar powered electricity sources).  But, as promising as indoor agriculture might seem, it will be some time until the energy demands are reduced to the point of sustainability.  Indoor agriculture can contribute to food security by ensuring stability in the supply chain, but the most resilient and sustainable food system grows crops at the time, place, and location where they are best suited.  If California isn't a suitable place to grow arugula anymore, it's likely there is a region somewhere else that is.  

Perpetuating agriculture in unsuitable locations, or deciding to replicate natural processes indoors, is partly a by-product of negative externalities and the difficulty in pricing resources like water and electricity to reflect their true cost.   Agricultural policies can make this more difficult as well, providing subsidies to traditional agricultural regions or placing zoning restrictions on lands with potential to support agriculture.  In the face of these barriers to agricultural mobility it's not surprising that market disrupters are enthusiastic about indoor agriculture, but let's not forget that policy changes in the agricultural sector can make a big difference in the resilience and efficiency of the food system.  The sun and the rain still have a role to play.

 Greenhouses in the Netherlands.  Photo: Pieter Edelman

Greenhouses in the Netherlands.  Photo: Pieter Edelman

 Photo: Sint -Katelijne-Wave

Photo: Sint -Katelijne-Wave


Will frackers be held liable for inducing earthquakes in Oklahoma?

 A flare releases pressure from a natural gas fracking well in Oklahoma.  Photo: Joshua Pribanic.

A flare releases pressure from a natural gas fracking well in Oklahoma.  Photo: Joshua Pribanic.

Five years ago, before hydraulic fracturing became a common method to extract natural gas, Oklahoma recorded only three magnitude three earthquakes.  In 2015, Oklahoma recorded 907.  2016 is off to another record-breaking start: last week two earthquakes (magnitude 4.7 and 4.8) struck northern Oklahoma, where fracking dominates.  It's hard to predict if a larger earthquake will rock the state, but these recent quakes suggest that may be likely:

“I do think there’s a really strong chance that Oklahoma will receive some strong shaking,” said Daniel McNamara, a research geophysicist at the National Earthquake Information Center in Colorado, who has followed the state’s quakes.  Referring to the shocks that occurred Wednesday night, he added, “I’m surprised it didn’t rupture into a larger event.”

Most experts believe the drastic increase in earthquake incidence is the result of forcing fracking wastewater into the ground.  While that process is effective in disposing of fracking waste, it also disturbs fault lines.  In some cases, especially in Oklahoma, these disturbances become earthquakes.  

But while the science is clear to some in a broad "A is causing B" sense (fracking is causing earthquakes), the more specific causal connection between a particular fracking operator's activities causing damage to people or property is less clear.  It would be hard for a homeowner whose property has been damaged from an earthquake to present a strong scientific case that the earthquake was caused by a discrete defendant in order to assign liability and claim damages.   Some cases are already popping up, and in most of these property owners are suing a bundle of oil and gas companies in the hopes that they will be collectively responsible.  In regions where more than one company is injecting wastewater underground, that may be the strongest approach, but it dilutes the causal connection.

An added difficulty in these cases is the reality that, in most states, injecting water into the ground is illegal or negligent behavior.  In Oklahoma, neither the state legislature or the governor have taken any meaningful action to curb fracking activities.  Only the Oklahoma Corporation Commission has been assigned to propose restraints, and it has limited regulatory powers:

With no explicit authority to regulate seismic issues, the commission has persuaded producers to voluntarily follow a series of ever-stricter directives on waste disposal in earthquake zones. But while those orders appear to have curtailed earthquakes in some areas, the overall number has continued to soar.  Last month, a financially troubled producer in the northern oil and gas fields struck by Wednesday’s quakes, SandRidge Energy Incorporated, broke industry ranks and refused the commission’s request to scale back its underground waste disposal.

Professor Blake Watson (Dayton) believes courts should impose strict liability on fracking producers on the grounds that groundwater injection is inherently dangerous - a finding that would eliminate the need to show that producers were negligent in their activities.  The downside is that courts aren't the ideal branch of government to sift through scientific studies emerging in real-time and impose liability after-the-fact.  Ideally a strong administrative agency would do so.  In many cases they have proved effective:

In recent years, other states with oil and gas exploration have also seen an unusual number of earthquakes. State authorities quickly suspected that the earthquakes were linked to disposal wells. In Youngstown, Ohio, in 2011, after dozens of smaller quakes culminated in a 4.0, a nearby disposal well was shut down, and the earthquakes stopped. Around the same time, in Arkansas, a series of earthquakes associated with four disposal wells in the Fayetteville Shale led to a ban on disposal wells near related faults. Earthquakes were also noted in Colorado, Kansas, and Texas. There, too, relevant disposal wells were shut down or the volume of fluid injected was reduced and the earthquakes abated.

Absent a strong regulatory agency, though, property owners may have no other recourse than to pursue compensation through litigation, however challenging causation arguments may prove to be.  If Oklahoma's agencies continue to meekly regulate fracking activities and wastewater injection, we'll soon find out how the courts address induced-earthquake liability.

Malheur and Misfortune on Federal Public Lands

 The Malheur National Widlife Refuge. Photo: John Bromley

The Malheur National Widlife Refuge. Photo: John Bromley

Over the weekend armed protesters stormed and occupied a federal building at the Malheur National Wildlife Refuge in northeastern Oregon.  Their complaint?  In this instance, the group is protesting against criminal charges brought against ranchers starting fires on federal lands in the region.  In general, the group is part of a small but vocal movement to return federal lands to states or private landowners.  Here is Jed Purdy on why their argument stands on shaky ground:

The Bundys’ side of these fights is rooted in the radical idea that the federal government was never supposed to hold Western lands permanently, but instead should have ceded them to the states or granted them directly to private owners. It is possible to piece together this argument from the text of the Constitution, but courts have never accepted it. It is not really a legal theory but a political wish that history ended in 1891, when the federal government began to create national forests, or even back in 1872, when Congress made Yellowstone the country’s first national park.

So it seems the best bet, if the law isn't on your side, is to make a spectacle of federal lands management.  In the Malheur Refuge, the group is exploiting recent disagreements between ranchers and wildlife refuge officials, who are required to prioritized the well-being of (you guessed it) wildlife.  Except that those disagreements may be overblown.  The ranchers in question have not backed the largely out-of-state protest group, and locals who participated in the most recent management planning process saw the Malheur as a model for collaboration, not conflict:

In 2013, Malheur completed its Comprehensive Conservation Plan. This is a long-range vision and management plan that all refuges are required to complete. Malheur stood alone in the refuge system for deciding to have a very inclusive, transparent stakeholder process which included local ranchers, county commissioners, tribes, conservation groups, local, state and federal agencies, etc.
We met many times over the course of three years and much to everybody’s surprise emerged with a consensus, collaborative approach that includes major initiatives on both the refuge and surrounding ranch lands. It is a plan that tries to respect both the ecology and the economics of the region. The groups involved have remained actively engaged in implementing the plan. It includes one of the largest wetland restoration efforts ever undertaken.

Having witnessed and participated in the stakeholder engagement process for Biscayne National Park's General Management Plan, which sparked a similar conflict between marine conservationists and fishermen, I can attest to the challenge it can be to satisfy every stakeholder's demands.  That's especially true when ideals like exploitation and conservation appear mutually exclusive.  There is some irony in the calls for federal relinquishment of public lands, as well.  First, because it was federal control that may have saved the Malheur in the first place:

Before the federal agencies came to eastern Oregon, large ranching operations from California had monopolized hundreds of thousands of acres of rangeland. Irrigation developers controlled water, cattle barons controlled the grass, and settlers were essentially locked out. Tensions were high.
During the 1890s, a populist, anti-monopolist rhetoric emerged among settlers and news editors. The local newspaper deplored the fact that the great Western ranges were passing into “the hands of a few big cattle or sheep companies,” and predicted that soon “an aristocracy of range lords and cattle kings would rule our mountains and plains.” In 1897, Peter French, the cattle baron who controlled the largest ranching empire in America, along the Blitzen River, was murdered by an angry homesteader. Arson, violence and grinding poverty flourished.

And second, because these lands were already occupied when the federal government laid claim to them on behalf of western settlers.  Purdy again:

Harney County was largely Paiute land until the Civil War, and later settler pressure and violence eroded the tribe’s claim to lands that were nominally reserved to it. The age of settlement lasted a few generations in eastern Oregon, beginning with the bloody dispossession of indigenous peoples and ending with the rather gentle conclusion of federal privatization.
American vigilantism is never racially innocent. Its two parents are self-mobilization on the frontier, usually against Native Americans at a time when homesteading was reserved to whites, and the racial terror of the Ku Klux Klan in the South during and after Reconstruction. It is too much to call the occupiers “domestic terrorists,” as the Oklahoma City Bomber Timothy McVeigh or the Klan were, but it is also obtuse to ignore the special comfort that certain white men have using guns as props in their acts of not-quite-civil disobedience. After all, guns were how they acquired their special sense of entitlement to public lands in the first place.

Follow the Money: Florida's Land Acquisition Trust Fund

  WACISSA RIVER, FLORIDA.  PHOTO: FWC

WACISSA RIVER, FLORIDA.  PHOTO: FWC

Constitutional Amendment 1 wasn't controversial when it was on Florida's ballot last November.  Dubbed the Florida Land and Water Conservation Initiative, the amendment passed easily.  Controversy has flared up since then, as interpretations of the amendment vary.  Some say the money raised by the amendment - put into the Land Acquisition Trust Fund - can only be used to acquire conservation land.  Others (including legislative budget proposals) claim the funds can be used to cover existing expenses related to land and water management.  I wrote about this back in May, arguing that the language of the amendment probably leaves room for the Fund to cover existing operations, despite the name of the Fund itself.  I also wrote that acquiring land might not be the only mechanism to achieve sound conservation: 

Amendment supporters might consider focusing the debate on outcomes, not inputs.  Land acquisition might not by itself promote conservation, just as operational spending is not per se  unproductive.  An effective conservation framework in Florida requires lands that are thoughtfully managed to advance conservation goals.  So instead of bemoaning operational expenditures, it might behoove amendment supporters to ask for more detail instead:  Will staff salary allocations make new hires in areas where expertise is lacking or merely cover the existing bureaucracy?  What kind of "technology and information services" will be provided to the Department of Environmental Protection?  Will firefighting equipment purchased by the fund prioritize the protection of conservation areas?  Given that sea level rise presents a monumental challenge to coastal communities, will the fund be used to finance climate change adaptation measures Florida's cities are begging for from the state?

The Vero Communique picked up on my piece, and it looks like they've been doing just that by trying to track down the whereabouts and details of two major state-funded projects.  One of them was an allocation from the Land Acquisition Trust Fund to the St. John's River Water Management District:

Another project we researched is one of the [] projects where $ 2,750,000 was allocated to the St. John’s River Water Management District (SJRWMD).  SJRWMD was kind enough to respond to our inquiry about this project, as follows: “The $2,750,000 referenced in Rep. Mayfield’s column is a state appropriation from the Land Acquisitions Trust Fund. The District has not yet determined how this money will be used, but will be making that decision in the near future.”

This is the first instance I've encountered where a water management district has been given an allotment from the Fund with discretion on how to spend it.  It might imply that legislators are willing to place the burden of interpretation on implementing agencies by giving them both funds and the discretion to spend those funds in compliance with the amendment's terms.  It will be interesting to see how the SJRWMD decides to spend the appropriation in light of that power.

Ghani's Dilemma: Land Reform in Afghanistan

Ghani's Dilemma: Land Reform in Afghanistan

When Ashraf Ghani was elected President of Afghanistan in September 2014, he inherited a country in turmoil.  The election results sparked a political crisis challenging Ghani's right to power, the Taliban was ramping up operations just as NATO troops were preparing to withdraw, relations with key neighbors (e.g., Pakistan) were shaky, and the economy was still reliant on the illegal opium trade.  Afghanistan ranked 169th on the UN's Human Development Index.  Here's a less publicized but just as important problem facing Afghanistan today: it has a weak legal framework for land administration and management.  

Effective ownership of land provides economic and political opportunities to landowners, stability to the economy and government, and reinforces state functions like tax collection and security.  The absence of an effective legal framework for land does the opposite, weakening the economy, corrupting politics, and threatening security.  A 3-part series on land theft in Afghanistan - produced by the UN Assistance Mission in Afghanistan (UNAMA)'s Rule of Law Unit - claims that weak land administration is not just a critical issue in Afghanistan; it may be the most critical issue in Afghanistan:

Whether related to the opium trade, extractive industries, or land transactions, land conflict drivers likely affect a far greater proportion of the Afghan people on a daily basis than the ongoing military conflict...Land ownership disputes are estimated to be the cause of over 70% of all serious crimes (murder and crimes of violence) in Afghanistan.

So far Part I and Part II have been released, and the research effort is impressive.  Some key findings:

  • Most land in Afghanistan is not titled or registered in any formal legal sense.  The Land Management Law of 2008 provides a path towards ownership for individuals with customary or traditional land tenure, but the bureaucratic requirements and administrative costs needed to establish ownership are unrealistic.
  • Assuming customary tenure can be shown, formal title is no guarantee of effective ownership since many institutions provide some claim to title.
  • Property laws are skewed toward protection of the state, not individuals.  Lands are often claimed by the government (and often corruptly) without compensation provided to landowners.
  • The various land dispute resolution mechanisms that exist - be they formal, informal, or a hybrid - encourage forum shopping and create ambiguity.
  • Land grabbing is not criminalized.  In theory a penalty of 2 years can be imposed, but criminal land grabbing cases must wait until the associated civil case concludes.  To date no criminal prosecution of land grabbing has been recorded, an open invitation to steal land.  

Reforming this system means accepting some rather uncomfortable possibilities. 

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