Cal. Cmty. Against Toxics v. Envtl. Prot. Agency

• Decision Date: 20 August 2019
• Docket Number: No. 18-1085,C/w 18-1095, 18-1096,18-1085
• Citation: 934 F.3d 627
• Parties: CALIFORNIA COMMUNITIES AGAINST TOXICS, et al., Petitioners v. ENVIRONMENTAL PROTECTION AGENCY and Andrew Wheeler, Administrator, U.S. Environmental Protection Agency, Respondents Air Permitting Forum, et al., Intervenors
• Court: U.S. Court of Appeals — District of Columbia Circuit

934 F.3d 627

CALIFORNIA COMMUNITIES AGAINST TOXICS, et al., Petitioners

v.ENVIRONMENTAL PROTECTION AGENCY and Andrew Wheeler, Administrator, U.S. Environmental Protection Agency, Respondents

Air Permitting Forum, et al., Intervenors

No. 18-1085

C/w 18-1095, 18-1096

United States Court of Appeals, District of Columbia Circuit.

Argued April 1, 2019

Decided August 20, 2019

Sanjay Narayan argued the cause for Environmental Petitioners. With him on the briefs were James S. Pew, Tomás E. Carbonell, Vickie Patton, Washington, DC, Surbhi Sarang, John Walke, Emily Davis, Thomas Zimpleman, and Keri N. Powell, New York, NY.

Kavita P. Lesser, Deputy Attorney General, Office of the Attorney General for the State of California, argued the cause for petitioner State of California. With her on the briefs were Xavier Becerra, Attorney General, David A. Zonana, Deputy Attorney General, and Jonathan Wiener, Deputy Attorney General.

Eric Grant, Attorney, U.S. Department of Justice, argued the cause for respondents. On the brief were Jeffrey Bossert Clark, Assistant Attorney General, Jonathan D. Brightbill, Deputy Assistant Attorney General, and Scott Jordan, Attorney, U.S. Environmental Protection Agency.

Shannon S. Broome, San Francisco, CA, argued the cause for intervenors-respondents Air Permitting Forum, et al. With her on the briefs were Charles H. Knauss, Washington, DC, Leslie Sue Ritts, Alexandria, VA, Makram B. Jaber, and Andrew D. Knudsen, Washington, DC.

David M. Friedland, Leslie A. Hulse, Washington, DC, Felicia H. Barnes, Seattle, WA, Steven P. Lehotsky, Washington, DC, Michael B. Schon, and amici curiae American Chemistry Council, et al. in support of respondents.

Before: Rogers and Wilkins, Circuit Judges, and Silberman, Senior Judge.

Dissenting Opinion filed by Circuit Judge Rogers.

Wilkins, Circuit Judge.

This case asks us to determine the nature of an agency action, an inquiry that – paradoxically – is quotidian but abstruse. When we are confronted with agency action, the litany of questions is by now very well-rehearsed: Is it final? Is it ripe? Is it a policy statement? Is it an interpretive rule? Is it a legislative rule? Despite the clarity of these questions, however, predictable answers have eluded courts and commentators. See, e.g., Perez v. Mortg. Bankers Ass’n. , ––– U.S. ––––, 135 S. Ct. 1199, 1204, 191 L.Ed.2d 186 (2015) (describing the question of how to distinguish between legislative and interpretive rules as "the source of much scholarly and judicial debate"); Ticor Title Ins. Co. v. FTC , 814 F.2d 731, 745 (D.C. Cir. 1987) (opinion of Williams, J.) (characterizing the law governing finality and ripeness as "chaotic"); Ronald M. Levin, Rulemaking and the Guidance Exemption , 70 ADMIN L. REV. 264, 348 (2018) ("The standard view among commentators is that [distinguishing between legislative and nonlegislative rules] is exceptionally perplexing and incoherent."). Indeed, the nature of agency action, it seems, is too often in the eye of the beholder. We resolve the instant matter, therefore, with our eye toward the "continuing project" of clarifying this "byzantine" area of the law. Nat’l Min . Ass’n v. McCarthy , 758 F.3d 243, 246 (D.C. Cir. 2014).

The agency action before us is a 2018 memorandum ("Wehrum Memo") that William L. Wehrum, Assistant Administrator for the Environmental Protection Agency’s ("EPA") Office of Air and Radiation, issued to all Regional Air Division Directors. The Wehrum Memo declares that the plain language of § 112 of the Clean Air Act ("Act" or "CAA"), 42 U.S.C. § 7412, compels the conclusion that a source of toxic emissions classified as "major" can reclassify to an "area source," and thereby ease its regulatory burden, at any time after it limits its potential to emit to below the major source threshold. J.A. 1. The Wehrum Memo states that it supersedes a prior 1995 EPA memorandum ("Seitz Memo") issued by John Seitz, then Director of EPA’s Office of Air Quality Planning and Standards, which interpreted § 112 to mean that once EPA classifies a source as major, that source can never reclassify to area source status, even if it limits its potential to emit to below the major source threshold. Id.

Petitioners are the State of California and a group of environmental organizations whose citizens and members, respectively, breathe the air in the vicinity of regulated sources. EPA is the Respondent, and a group of industry organizations have joined as Intervenor. Petitioners contend that we can and should review the Wehrum Memo because it is final agency action and prudentially ripe. Moreover, Petitioners argue, the Wehrum Memo is a legislative rule, and it is therefore procedurally defective under the Administrative Procedure Act ("APA"), 5 U.S.C. § 551 et seq. , because EPA failed to provide notice and comment before issuing it, see id. § 553. But even if we hold that the Wehrum Memo is an interpretive rule (for which notice and comment is not required, see id. ), Petitioners contend that we still must vacate it because EPA’s interpretation of § 112 is incorrect. Respondent and Intervenor retort that this Court lacks jurisdiction over the Wehrum Memo because it is not final agency action. Alternatively, they argue, we should not review it because it is not prudentially ripe. If, however, we find the Wehrum Memo final and ripe, Respondent and Intervenor assert, we must deny the petitions because it is an interpretive rule and is thus procedurally sound, and its interpretation of § 112 is correct.

For the reasons explained herein, we hold that the Wehrum Memo is not final agency action, and we dismiss the petitions for lack of subject matter jurisdiction under the Act. We express no opinion as to whether the Wehrum Memo is prudentially ripe, an interpretive rule or a legislative rule, or on the merits of its interpretation of § 112. In holding that the Wehrum Memo is not final, we emphasize two points. First, when assessing the nature of an agency action (including whether it is final), courts should resist the temptation to define the action by comparing it to superficially similar actions in the caselaw. Rather, courts should take as their NorthStar the unique constellation of statutes and regulations that govern the action at issue. Second, although all legislative rules are final, not all final rules are legislative, and the finality analysis is therefore distinct from the test for whether an agency action is a legislative rule.

I.

Because they share a progenitor, a reliable approach to understanding a James Baldwin novel is to compare it, according to a set of criteria, to another work in his oeuvre. Indeed, a thematic reading of Giovanni’s Room is sure to inform such a reading of The Fire Next Time , and vice versa. Not so, however, with respect to the broad set of phenomena we categorize as agency action. Because few, if any, of them are governed by the exact same combination of statutes and regulations, it is a mistake to assume – even if they appear facially similar – that they can lend each other definition through comparison, or that they are decipherable under a common rubric. Rather, to ascertain the nature of an agency action, courts should ground the analysis in the idiosyncratic regime of statutes and regulations that govern it. We have great sympathy for the desire to develop a one-size-fits-all heuristic. See, e.g., Nat’l Min ., 758 F.3d at 251 ("... all relevant parties should instantly be able to tell whether an agency action is a legislative rule, an interpretive rule, or a general statement of policy ...."). But this desire is perhaps misplaced, since, as we once said of interpretation itself, agency action is "a chameleon that takes its color from its context." American Min. Congress v. Mine Safety & Health Admin. , 995 F.2d 1106, 1111 (D.C. Cir. 1993).

Accordingly, we turn first to the CAA provisions and EPA regulations that govern the Wehrum Memo.

Congress enacted the CAA, 42 U.S.C. § 7401 et seq. , to "protect and enhance the quality of the Nation’s air resources ...." Id. § 7401(b)(1). Toward this end, § 112 requires EPA to regulate "Hazardous Air Pollutants," i.e. toxic emissions such as chloroform. Id. § 7412. Congress established an initial list of hazardous air pollutants, id. § 7412(b)(1), but the Act requires EPA to curate it, deleting or adding hazardous air pollutants over time according to certain criteria, id. § 7412(b)(2)-(3). Based on this list, the Act mandates EPA to create a second list of categories of sources of hazardous air pollutants, id. § 7412(c), like asphalt processing plants and industrial dry-cleaning facilities, see Revision of Source Category List under Section 112 of the Clean Air Act , 70 Fed. Reg. 37819-01 (June 30, 2005). Importantly, the Act distinguishes between "major" and "area" sources. Id. § 7412(a)(1)-(2). According to the Act’s definitional provisions, a major source means any source within a listed category that "emits or has the potential to emit considering controls, in the aggregate, 10 tons per year or more of any [listed hazardous air pollutant] or 25 tons per year or more of any combination of [listed hazardous air pollutants]." Id. § 7412(a)(1). Area source means "any stationary source of [hazardous air pollutants] that is not a major source." Id. § 7412(a)(2).

Whether EPA classifies a source as major or area has major consequences for both sources of hazardous air pollutants, which must comply with emissions standards, and regulatory beneficiaries, who live, work, recreate – and thus regularly breathe the air – near sources of hazardous air pollutants. For major sources, the Act requires EPA to establish stringent emissions caps that result in "the maximum degree of reduction in emissions ... (including a prohibition on such emissions, where achievable)." Id. § 7412(d). EPA refers to these emissions limitations as "Maximum Achievable Control Technology" ("MACT") standards. J.A. 1. The Act mandates that MACT...