605 F.2d 283 (7th Cir. 1979), 78-1563, United States Steel Corp. v. United States E.P.A.

Docket Nº:78-1563, 78-1564.
Citation:605 F.2d 283
Party Name:Envtl. CA 79-2913 UNITED STATES STEEL CORPORATION, and Youngstown Sheet and Tube Company, Petitioners, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent.
Case Date:August 01, 1979
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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Page 283

605 F.2d 283 (7th Cir. 1979)

Envtl.

CA 79-2913 UNITED STATES STEEL CORPORATION, and Youngstown

Sheet and Tube Company, Petitioners,

v.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent.

Nos. 78-1563, 78-1564.

United States Court of Appeals, Seventh Circuit

August 1, 1979

Argued April 18, 1979.

Page 284

Laurence A. McHugh, James T. Harrington, Chicago, Ill., for petitioner.

Ronald C. Hausmann, U. S. Environmental Protection Agency, Washington, D. C., for respondent.

Before CASTLE, Senior Circuit Judge, CUMMINGS and SPRECHER, Circuit Judges.

SPRECHER, Circuit Judge.

This case arises from the Environmental Protection Agency's promulgation of a list designating those areas which do not meet national primary or secondary ambient air quality standards. The petitioners attack these designations on both substantive and procedural grounds. We find both claims to be without merit, and we uphold the agency's designations.

I

Under the Clean Air Act, 42 U.S.C. §§ 7401-7626, the Administrator of the EPA was required to promulgate national primary and secondary ambient air quality standards. 42 U.S.C. § 7409(a). The Administrator has promulgated these standards and they are codified at 40 C.F.R. §§ 50.1-50.11 (1978). After these standards were established, the states had a statutory responsibility to develop implementation plans to achieve these standards. See 42 U.S.C. § 7410. The Act required the state plans to provide for the attainment of these standards no later than 1975. However, in 1977 it became clear that these standards had not yet been achieved. Accordingly, Congress amended the Act to restructure the scheme for attaining these standards. Clean Air Act Amendments of 1977, P.L. 95-95, 91 Stat. 685 (August 7, 1977). These amendments pushed the primary standard compliance deadline forward to 1982. 42 U.S.C. § 7502(a) (1). Further, to insure that this deadline would be met, Congress established a new implementation process. This implementation process was to begin with a combined state and federal effort for the designation of those areas not in compliance with air quality standards. 42 U.S.C.

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§ 7407(d)(1). 1 The designation of an area as "nonattainment" imposes upon the state the obligation to include certain more stringent provisions in its implementation plan. 42 U.S.C. § 7502.

Under the scheme established by § 7407(d)(1), the states were required to submit to the EPA, within one hundred and twenty days after the passage of the Act, a list identifying the attainment status of all air quality control regions within the state. Pursuant to this requirement, Harry D. Williams, director of the Air Pollution Control Division of the Indiana State Board of Health submitted a draft copy of the state of Indiana's designations, indicating that a final copy would be sent on December 5, 1977, the statutory deadline. The final report designated portions of Northern Indiana in which petitioners operate steel works as nonattainment areas.

The EPA published its list of attainment designations, based on the state's submissions, on March 3, 1978. 43 Fed.Reg. 8962. 2 This list accepted the state of Indiana's designation of certain portions of Northern Indiana as "nonattainment." Furthermore, the EPA indicated that although these designations were to be immediately effective, it was soliciting comments on these designations for 60 days. Comments were submitted by the petitioners in this case and by other interested parties, and on October 5, 1978, the EPA reaffirmed its designation of certain portions of Northern Indiana as nonattainment, although it did make alterations in designations with respect to other areas. 43 Fed.Reg. 46007.

II

Petitioners contend that the EPA's promulgation of these attainment designations violated the procedural requirements of 5 U.S.C. § 553 by not providing for notice and comment prior to the effective dates of the designations. 3 We reject this contention on

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two grounds. First, we hold that the agency had "good cause" to postpone the proceeding within the meaning of section 553's specific exemption. Second, we find that even if the agency lacked "good cause" within the terms of section 553, we are precluded from reversing by the Clean Air Act. The Act limits the circumstances in which rules promulgated by the EPA may be reversed for procedural errors.

A

Section 553(d) of the Administrative Procedure Act contains two "good cause" exceptions. The first, section 553(b)(B) provides that notice of, and public comment on, agency rules may be dispensed with "when the agency for good cause finds . . . that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest." The second, section 553(d) (3), provides that "(t)he required publication or service of a substantive rule shall be made not less than 30 days before its effective date except . . . (3) as otherwise provided by the agency for good cause found and published with the rule." Accordingly, in a case such as the one before us where a regulation is made effective before notice and comment, the agency could rely on either "good cause" provision. Thus, the EPA made its attainment designations immediately effective, stating:

The States are now preparing revisions to their State implementation plans (SIPs) as required by sections 110(a)(2)(1) and 172 of the Act. This enterprise, which must be completed by January 1, 1979, requires that the States have immediate guidance as to the attainment status of the areas designated under section 107(d). Congress has acknowledged this by imposing a tight schedule on the designation process and requiring EPA to promulgate the list within 180 days of the enactment of the amendments. Under these circumstances it would be impracticable and contrary to the public interest to ignore the statutory schedule and postpone publishing these regulations until notice and comment can be effectuated. For this good cause, the Administrator has made these designations immediately effective.

The agency's statement of "good cause" does not reveal on which of the two provisions the agency was relying. Although at least two commentators have suggested that the two provisions provide the same standard of good cause, 4 we believe that the standards are distinct and that the agency action, while justifiable under the (b)(B) standard, is unquestionably, justifiable under the broader standard set out by (d)(3).

Turning first to whether the agency action here was justified under the narrower

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(b)(B) standard, we find that such justification existed under the impracticability standard embodied in the statutory language of the first good cause exception. The legislative history of this impracticability standard reveals that Congress intended this exemption to operate when the regular course of rulemaking procedure would interfere with the agency's ability to perform its functions within the time constraints imposed by Congress. Early versions of this provision allowed public participation to be dropped where it was "impracticable because of unavoidable lack of time or other emergency." S.Doc.No.248, 79th Cong., 2d Sess. 140, 148, 157 (1946). The exception was broadened by the elimination of this qualifying language. The Senate and House Reports interpreted "impracticable" in this broader formulation as a situation "in which the due and required execution of the agency functions would be prevented by its undertaking public rule-making proceedings." Id. at 200, 258.

Two other courts have agreed that the "good cause" exception may be utilized to comply with the rigors of a tight statutory schedule. In Clay Broadcasting Corp. v. United States, 464 F.2d 1313 (5th Cir. 1972), Rev'd on other grounds sub nom. National Cable Television Ass'n, Inc. v. United States, 415 U.S. 336, 94 S.Ct. 1146, 39 L.Ed.2d 370 (1974), the court held that the FCC had good cause to dispense with rulemaking before altering a license fee schedule since

(1) wide-spread notice in fact would be provided affected parties; (2) a first of the month effective date was required for administrative pro-ration of yearly fees; and (3) that in accordance with Congressional directives the Commission wanted the fee schedule to cover as much of fiscal 1971 as reasonably possible.

Id. at 1320. Likewise, in Energy Reserves Group v. FEA, 447 F.Supp. 1135 (D.Kan.1978), the Court found that promulgation without rulemaking proceedings of regulations defining a congressional exemption to its oil price control scheme was justified under the "good cause" exemption. Congress required these regulations to be promulgated in 15 days, leading the court to find "good cause" to rely on "the legislative requirement of expeditious promulgation." Id. at 1150.

The legislative scheme involved in this case also confronted the EPA with a series of tight statutory deadlines. The EPA was given 60 days after the date on which states were required to provide lists of nonattainment areas to promulgate final designations of nonattainment areas. 42 U.S.C. § 7407(d)(2). More importantly, the states were required to have promulgated implementation plans for designated nonattainment areas by January 1, 1979. 42 U.S.C. § 7502 (annotation) (Pub.L. 95-95, § 129(c)). These plans are to provide for attainment in these areas "as expeditiously as practicable . . . (but) not later than December 31, 1982." 42 U.S.C. § 7502(a)(1). Furthermore, the development of these plans is a time-consuming process, requiring formal involvement by the public, local governments and state legislative bodies as well as the redevelopment of current emissions inventories. Id. at § 7502(b). These deadlines were a response to the failure of the states to meet prior attainment deadlines and represent Congressional concern over the seriously adverse health consequences of continued...

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