526 F.2d 1027 (3rd Cir. 1975), 74-1640, American Iron and Steel Institute v. E.P.A.

Docket Nº:74-1640, 74-1642, 74-1962, 74-2006 and 74-2256.
Citation:526 F.2d 1027
Party Name:AMERICAN IRON AND STEEL INSTITUTE et al., Petitioners, v. ENVIRONMENTAL PROTECTION AGENCY, Respondent. BETHLEHEM STEEL CORPORATION et al., Petitioners, v. ENVIRONMENTAL PROTECTION AGENCY, Respondent. SHARON STEEL CORPORATION et al., Petitioners, v. ENVIRONMENTAL PROTECTION AGENCY, Respondent. YOUNGSTOWN SHEET AND TUBE COMPANY, Petitioner, v. ENVIRO
Case Date:November 07, 1975
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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Page 1027

526 F.2d 1027 (3rd Cir. 1975)

AMERICAN IRON AND STEEL INSTITUTE et al., Petitioners,

v.

ENVIRONMENTAL PROTECTION AGENCY, Respondent.

BETHLEHEM STEEL CORPORATION et al., Petitioners,

v.

ENVIRONMENTAL PROTECTION AGENCY, Respondent.

SHARON STEEL CORPORATION et al., Petitioners,

v.

ENVIRONMENTAL PROTECTION AGENCY, Respondent.

YOUNGSTOWN SHEET AND TUBE COMPANY, Petitioner,

v.

ENVIRONMENTAL PROTECTION AGENCY and Administrator,

Environmental Protection Agency, Respondents.

CF&I STEEL CORPORATION, Petitioner,

v.

ENVIRONMENTAL PROTECTION AGENCY, Respondent.

Nos. 74-1640, 74-1642, 74-1962, 74-2006 and 74-2256.

United States Court of Appeals, Third Circuit.

Nov. 7, 1975

Argued June 9, 1975.

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David McNeil Olds, Blair S. McMillin, Thomas C. Wettach, Robert M. Walter, Thomas J. Duman, Reed, Smith, Shaw & McClay, David S. Watson, Peter G. Veeder, Frank J. Clements, Thorp, Reed & Armstrong, Pittsburgh, Pa., Max N. Edwards, Richard E. Schwartz, Collier, Shannon, Rill & Edwards, Washington, D.C., Richard E. Nolan, Henry H. Korn, Davis, Polk & Wardwell, New York City, H. Stephen Madsen, Baker, Hostetler & Patterson, Cleveland, Ohio, K. Robert

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Conrad, Charles J. Bloom, Pepper, Hamilton & Scheetz, Philadelphia, Pa., David W. Furgason, William C. Robb, Welborn, Dufford, Cook & Brown, Denver, Colo., for petitioners.

Wallace H. Johnson, Martin Green, Edmund B. Clark, Bradford F. Whitman, Robert V. Zener, Nancy Speck, Washington, D.C., for respondent, Environmental Protection Agency.

Before ADAMS, HUNTER and GARTH, Circuit Judges.

OPINION

JAMES HUNTER, III, Circuit Judge:

This is a petition brought by the American Iron and Steel Institute and several individual steel companies to review regulations promulgated by the Administrator of the Environmental Protection Agency on June 28, 1974. 1 In these regulations, entitled 'Effluent Guidelines and Standards, Iron and Steel Manufacturing Point Source Category,' the Administrator established nationwide single number effluent limitations for point sources 2 in the iron and steel industry engaged in 'primary' (or basic manufacturing) operations. 3 Contending that the Administrator's regulations do not conform to the requirements of the Federal Water Pollution Control Act Amendments of 1972 (hereinafter, the 'Act'), 4 the petitioners seek judicial review of the Administrator's actions under section 509(b)(1) of the Act. 5 Two other steel companies--Youngstown Sheet and Tube Company, and CF&I Steel Corporation--filed similar petitions in the Sixth and Tenth Circuits, respectively. By order of each Circuit, the cases were transferred to this Court, and they have been consolidated with the petitions filed here. In addition, the Natural Resources Defense Council, Inc., has filed a brief as Amicus Curiae.

I

Petitioners' first, and most basic, challenge is to the Administrator's very power to promulgate nationwide single number effluent limitations for existing point sources. 6 Petitioners contend that the limitations which are to be binding on them can only be established by the permit-granting authorities (principally, the States), which are to follow guidelines promulgated by the Administrator. The Administrator contends that he is not merely empowered to promulgate guidelines, but may establish limitations which are binding throughout the country and which must be incorporated into any permit issued to any individual point source. The answer to this dispute, which goes to the very heart of the administration of the Act, depends upon our resolution of the interrelationship of three key sections of the Act--301, 7 304 8 and 402. 9

Petitioners rely heavily on the fact that there is no section in the Act which explicitly authorizes the Administrator to establish single number effluent limitations

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for existing point sources. They contend that the lack of such explicit authorization cannot have been an oversight, since the Act expressly authorizes the Administrator to promulgate other types of regulations. For example, the Administrator has the explicit authority to set standards for new point sources under section 306(b)(1)(B) 10 and for toxic discharges under section 307(a)(2), 11 and to establish pretreatment standards under section 307(b) 12 and water quality standards under section 303(b). 13 Many of these sections not only explicitly authorize the Administrator to promulgate regulations establishing such standards, but also specify in some detail the times and procedures to be followed.

In contrast to these sections, the only section explicitly authorizing the Administrator to establish any regulations pertaining to effluent standards for existing point sources--section 304(b)--merely authorizes the promulgation of 'guidelines' rather than precise standards or single number limitations. While section 301(b) refers to 'effluent limitations' for existing point sources, that section does not explicitly authorize the Administrator (or anyone else) to promulgate regulations establishing such limitations. Rather, using the passive voice, that section merely states that effluent limitations for such point sources 'shall be achieved' by July 1, 1977 through the application of the 'best practicable control technology currently available' (hereinafter, 'BPCTCA'), and by July 1, 1983 through the application of the 'best available technology economically achievable' (hereinafter, 'BATEA'). Under petitioners' construction of the Act, these effluent limitations are to be 'achieved' through the permit process. They contend that the permit issuing authorities, under section 402, are to determine the effluent limitations to be achieved by applying, to individual point sources, the factors enumerated in the guidelines previously promulgated by the Administrator under section 304(b).

The two consolidated cases present graphic examples of the differing consequences of the two interpretations. Both Youngstown and CF&I contend that they have local problems which can be fully appreciated only by a local permit-issuing authority. Youngstown claims that its plants in the Mahoning Valley provide one third of the direct employment in that area and that they are indirectly responsible for a significant percentage of the remaining jobs. It also claims that its plants are very old (several were built before World War I), that many will be forced to close if the limitations promulgated by the Administrator are enforced, and that because of the heavy concentration of steel plants along the shores, the river is unavailable for recreational uses anyway. Youngstown claims that a local authority, in appreciation of these factors, might have required somewhat less stringent controls. CF&I points to a different problem. It contends that the installation of anti-pollution devices in its Colorado plants would cause a significant net loss of water through evaporation, which would have serious consequences in a state where water is a scarce and valuable resource. Contending that only a local authority would fully appreciate the impact of the anti-pollution devices on scarce water resources, 14 CF&I argues that its case is another illustration of the necessary for flexibility at the local level.

We acknowledge that these arguments are not without force, but we believe that the Administrator does have the authority to promulgate effluent limitations under section 301. While we admit that Congress did not express its intent

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on this point with particular clarity, we conclude, after examining the entire statutory scheme and the legislative history, that the Administrator's power to promulgate effluent limitations under section 301 can be inferred. [14A] We thus respectfully disagree with the contrary conclusion reached by the Eighth Circuit in CPC International, Inc. v. Train, 515 F.2d 1032 (8th Cir. 1975). With respect to the peculiarly local problems of some point sources, as illustrated by Youngstown and CF&I, we believe that our holding that the Administrator does have power under section 301 does not preclude some flexibility at the local level. This point will be addressed in detail in part II of this opinion.

Perhaps the strongest indication in the Act that the Administrator has the power under section 301 to promulgate effluent limitations can be found in section 509(b)(1). This section provides for judicial review 'of the Administrator's action . . . (E) in approving or promulgating any effluent limitation or other limitation under section 301 . . . and (F) in issuing or denying any permit under section 402.' Not only does this section explicitly refer to the Administrator's action in promulgating a section 301 effluent limitation, but its separate references, in subsections (E) and (F), to section 301 effluent limitations and section 402 permits indicates that the limitations and permits have independent significance.

The Eighth Circuit in CPC International discounted the importance of section 509(b)(1)(E) by contending that the section 301 limitation referred to must be one promulgated under section 301(c), which empowers the Administrator to 'modify the requirements of subsection (b)(2)(A) of this section' with respect to an individual plant upon a stringent showing of hardship and good faith efforts at compliance. We cannot accept the Eighth Circuit's reasoning on this point. In the first place, section 301(c) does not authorize the Administrator to promulgate any effluent limitations...

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