S. Cal. Alliance of Publicly Owned Treatment Works v. U.S. Envtl. Prot. Agency

• Decision Date: 12 April 2017
• Docket Number: No. 14-74047,14-74047
• Citation: 853 F.3d 1076
• Parties: SOUTHERN CALIFORNIA ALLIANCE OF PUBLICLY OWNED TREATMENT WORKS, Petitioner, v. U.S. ENVIRONMENTAL PROTECTION AGENCY; Jared Blumenfeld, Regional Administrator, USEPA, Region IX, Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

853 F.3d 1076

SOUTHERN CALIFORNIA ALLIANCE OF PUBLICLY OWNED TREATMENT WORKS, Petitioner,

v.U.S. ENVIRONMENTAL PROTECTION AGENCY; Jared Blumenfeld, Regional Administrator, USEPA, Region IX, Respondents.

No. 14-74047

United States Court of Appeals, Ninth Circuit.

Argued and Submitted November 7, 2016, Pasadena, California

Filed April 12, 2017

Melissa Thorme (argued), Downey Brand LLP, Sacramento, California, for Petitioner.

Eileen T. McDonough (argued), Attorney; John C. Cruden, Assistant Attorney General; Environment Defense Section, Environment and Natural Resources Division, United States Department of Justice, Washington, D.C.; Marcela von Vacano, Assistant Regional Counsel, Region 9, United States Environmental Protection Agency, San Francisco, California; Pooja S. Parikh, Attorney-Advisor, Office of the General Counsel, United States Environmental Protection Agency, Washington, D.C.; for Respondents.

Before: Kim McLane Wardlaw and Jay S. Bybee, Circuit Judges, and Robert Holmes Bell,^* District Judge.

OPINION

BYBEE, Circuit Judge:

The Southern California Alliance of Publicly Owned Treatment Works (SCAP) petitions for review of an objection letter sent by the United States Environmental Protection Agency (EPA) regarding draft permits for water reclamation plants in El Monte and Pomona, California. SCAP argues that we have original jurisdiction to review the objection letter under 33 U.S.C. § 1369(b)(1)(E), which applies to EPA action "approving or promulgating any effluent limitation," and 33 U.S.C. § 1369(b)(1)(F), which applies to EPA action "issuing or denying any permit." We agree with EPA that we lack subject matter jurisdiction to hear SCAP's claims, and we dismiss the petition.

I. BACKGROUND

A. The Clean Water Act

In 1972, Congress enacted sweeping amendments to the Federal Water Pollution Control Act (FWPCA) of 1948 "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." 33 U.S.C. § 1251(a). After another round of substantial amendments in 1977, the statute became known as the Clean Water Act (CWA or the Act). The CWA prohibits the discharge of any pollutant into navigable waters from any point source without a permit. Id. § 1311(a). Permits are issued in accordance with the National Pollutant Discharge Elimination System (NPDES). Id. § 1342(a). These permits authorize certain point source discharges and are typically conditioned on compliance with water quality standards and effluent limitations issued under the Act. Id. § 1342(a).

The CWA establishes two pathways for the issuance of NPDES permits. First, EPA may issue the permits under 33 U.S.C. § 1342(a). Second, the states, with EPA approval, may assume responsibility for issuing permits. Id. § 1342(b). The state program must meet specific requirements, including incorporating certain provisions of the NPDES regulations, and be approved by EPA. Id. ; 40 C.F.R. §§ 123.25(a)(15), 122.44. "If [NPDES permitting] authority is transferred, then state officials—not the federal EPA—have the primary responsibility for reviewing and approving NPDES discharge permits, albeit with continuing EPA oversight." Nat'l Ass'n of Home Builders v. Defs. of Wildlife , 551 U.S. 644, 650, 127 S.Ct. 2518, 168 L.Ed.2d 467 (2007). Forty-six states, including California, currently have authority to issue their own NPDES permits. EPA, NPDES State Program Information, https://www.epa.gov/npdes/npdes-state-program-information (follow: "Authority" hyperlink).

Even when a state assumes primary responsibility for issuing NPDES permits, EPA retains supervisory authority over state permitting programs under 33 U.S.C. § 1342(d). The state must transmit to EPA a copy of each permit application received, as well as proposed permits, and EPA has ninety days to notify the state of any objections it has to the draft permit. Id. § 1342(d)(1)–(2). The objection must be in writing and state "the reasons for such objection and the effluent limitations and conditions which such permit would include if it were issued by" EPA. Id. § 1342(d)(2). If the disagreement proves intractable, the state or any interested person can request that EPA hold a public hearing on the objection. Id. § 1342(d)(4) ; 40 C.F.R. § 123.44(e). Following a public hearing, EPA may reaffirm, withdraw, or modify the original objection. 40 C.F.R. § 123.44(g). If the state does not request a hearing or EPA maintains its objection, the state then has a choice: It can either revise the permit to address EPA's objection or allow permitting authority to pass back to EPA. 33 U.S.C. § 1342(d)(4) ; see also 40 C.F.R. § 123.44(h).

The state's decision either to make the changes and retain jurisdiction over the permit or to relinquish permitting authority to EPA has practical consequences for further review. If the state chooses to revise and issue a permit, an aggrieved party can seek further administrative review and then judicial review in accordance with state law. See Am. Paper Inst., Inc. v. EPA , 890 F.2d 869, 875 (7th Cir. 1989). By contrast, if jurisdiction returns to EPA and EPA issues a federal NPDES permit, EPA's decision may be appealed within EPA to the Environmental Appeals Board (EAB). 40 C.F.R. § 124.19(a)(1). A final EPA permit approved by the EAB is subject to review in an appropriate circuit court of appeals. 33 U.S.C. § 1369(b)(1)(F).

B. California's NPDES Permitting Program

In 1973, EPA granted California authority to administer the NPDES permits program. Approval of California's Revisions to the State National Pollution Discharge Elimination System Program, 54 Fed. Reg. 40,664 (Oct. 3, 1989) ; Discharges of Pollutants to Navigable Waters: Approval of State Programs, 39 Fed. Reg. 26,061 (July 16, 1974). Regional Boards make the initial permitting decisions. The California State Water Resources Control Board (State Board), the final NPDES permitting authority in California, reviews the permits issued by Regional Boards. "[A]ny aggrieved party" may then file a petition for review in California Superior Court. Cal. Water Code § 13330(a).

Additionally, California and EPA have entered into a Memorandum of Agreement that explains in greater detail the rights the State has under the Act and the regulations. Under that agreement, for example, if the State disagrees with EPA's objection, it has the option to pursue informal means of resolving the dispute. See , e.g. , NPDES Memorandum of Agreement Between U.S. Environmental Protection Agency and California State Water Resources Control Board 16 (1989) (MOA) ("If EPA and a Regional Board are unable to resolve a disagreement over provisions of a prenotice draft permit to which EPA has filed a formal objection, the State Board may mediate the disagreement to a resolution that is satisfactory to EPA and to the Regional Board."). Once EPA has filed an objection letter, the State may request that EPA conduct a public hearing pursuant to 40 C.F.R. § 123.44 or opt to conduct its own public hearing. Id. at 16–17. The MOA, like the regulations, contemplates that, following this process, EPA may modify or even withdraw its objections. Id. at 19.

C. The Permits at Issue

The Whittier Narrows Water Reclamation Plant, located in El Monte, California, and the Pomona Water Reclamation Plant, located in Pomona, California (collectively, the Plants), are tertiary-level treatment water reclamation facilities that receive industrial, commercial, and residential wastewater from the surrounding cities.¹ They each produce approximately 9000 acre-feet of recycled water per year, which is used for groundwater recharge and landscape irrigation in Southern California.

The Los Angeles Regional Office (L.A. Board) of the State Board prepared the draft NPDES permits (Draft Permits) for the Plants at issue. The L.A. Board also prepared a "Fact Sheet," which included its determination that effluent limitations were required for "whole effluent toxicity"² because the discharge potentially could cause or contribute to chronic toxicity. The Draft Permits addressed chronic toxicity by setting "Chronic Toxicity Trigger and Requirements" (Toxicity Triggers).

The L.A. Board submitted the Draft Permits to EPA for review consistent with 33 U.S.C. § 1342(d)(1). Jane Diamond, the Region 9 Director of EPA's Water Division, issued a letter with EPA's formal objections to the Draft Permits on September 4, 2014 ("Objection Letter"). EPA's principal concern "relate[d] to numeric effluent limitations for whole effluent toxicity." EPA criticized the permits because they "express a chronic toxicity requirement as a series of steps which include a narrative trigger for further investigation of effluent toxicity, not as an effluent limitation for WET.... Taken together, these toxicity triggers simply require further investigation, and thus do not met meet the definition of ‘effluent limitation’ under the CWA...." EPA offered other criticism as well and attached to its letter what it characterized as "Required Changes" and "Recommended Changes" in the permits. EPA stated that if the L.A. Board did not submit revised permits addressing EPA's concerns, EPA would "acquire exclusive NPDES authority over the discharges pursuant to 40 C.F.R. § 123.44(h)(3)."

The L.A. Board revised the Draft Permits to meet the terms of EPA's Objection Letter. After reviewing the revised permits, EPA notified the L.A. Board, the State Board, and the permit applicants that EPA's objections had been satisfied and that the NPDES permits for the Plants remained within the L.A. Board's jurisdiction. After complying with procedures required by state law, the L.A. Board issued the permits for both Plants in November 2014.

D. State Administrative Proceedings

On December 8, 2014, SCAP, along with the permittees and other parties, filed an administrative appeal of the L.A. Board's action with the State Board. The petition requested a hearing and a stay of the NPDES Permits. Three weeks later, on December 31, 2014, SCAP also filed a ...