Clean Air Council v. Pruitt

• Decision Date: 03 July 2017
• Docket Number: No. 17-1145,17-1145
• Citation: Clean Air Council v. Pruitt, 862 F.3d 1 (D.C. Cir. 2017)
• Parties: CLEAN AIR COUNCIL, et al., Petitioners v. E. Scott PRUITT, Administrator, Environmental Protection Agency and Environmental Protection Agency, Respondents American Petroleum Institute, et al., Intervenors
• Court: U.S. Court of Appeals — District of Columbia Circuit

862 F.3d 1

CLEAN AIR COUNCIL, et al., Petitioners

v.E. Scott PRUITT, Administrator, Environmental Protection Agency and Environmental Protection Agency, Respondents

American Petroleum Institute, et al., Intervenors

No. 17-1145

United States Court of Appeals, District of Columbia Circuit.

Decided July 3, 2017

Susannah L. Weaver, Sean H. Donahue, David Doniger, Meleah Geertsma, Tim Ballo, Joel Minor, Adam Kron, Peter Zalzal, Alice Henderson, Vickie Patton, Tomás Carbonell, Andres Restrepo, Joanne Marie Spalding, Ann Brewster Weeks, and Darin Schroeder were on the emergency motion for a stay or, in the alternative, summary vacatur and reply to responses in opposition to emergency motion for a stay or, in the alternative, summary vacatur.

Jeffrey H. Wood, Acting Assistant Attorney General, U.S. Department of Justice, and Benjamin Carlisle, Attorney, were on EPA's opposition to petitioners' emergency motion for a stay or, in the alternative, summary vacatur.

William L. Wehrum, Felicia H. Barnes, Stacy R. Linden, John Wagner, Samuel B. Boxerman, Joel F. Visser, Sandra Y. Snyder, James D. Elliott, Shannon S. Broome, Charles H. Knauss, and John R. Jacus were on the industry intervenor-respondents' response in opposition to petitioners' emergency motion for a stay or, in the alternative, summary vacatur.

Before: Tatel, Brown, and Wilkins, Circuit Judges.

Dissenting Opinion filed by Circuit Judge Brown.

Per Curiam:

Petitioners, a group of environmental organizations, challenge the Environmental Protection Agency's decision to stay implementation of portions of a final rule concerning methane and other greenhouse gas emissions. For the reasons set forth in this opinion, we conclude that EPA lacked authority under the Clean Air Act to stay the rule, and we therefore grant petitioners' motion to vacate the stay.

I.

In June 2016, EPA Administrator Gina McCarthy issued a final rule establishing "new source performance standards" for fugitive emissions of methane and other pollutants by the oil and natural gas industries. 81 Fed. Reg. 35,824 (June 3, 2016). The methane rule took effect on August 2, 2016, id. , and required regulated entities to conduct an "initial monitoring survey" to identify leaks by June 3, 2017, 40 C.F.R. § 60.5397a(f).

After EPA published the rule, several industry groups—including the American Petroleum Institute (API), the Texas Oil and Gas Association (TXOGA), and the Independent Petroleum Association of America (IPAA)—filed administrative petitions seeking reconsideration under section 307(d)(7)(B) of the Clean Air Act (CAA). 42 U.S.C. § 7607(d)(7)(B) ; see also 82 Fed. Reg. 25,731 (June 5, 2017). That provision sets forth the circumstances under which EPA must reconsider a rule. It provides that "[i]f the person raising an objection can demonstrate to the Administrator that [1] it was impracticable to raise such objection within [the notice and comment period] ... and [2] if such objection is of central relevance to the outcome of the rule, the Administrator shall convene a proceeding for reconsideration of the rule ...." 42 U.S.C. § 7607(d)(7)(B) (emphasis added). The statute also provides that the "effectiveness of the rule may be stayed during such reconsideration, however, by the Administrator or the court for a period not to exceed three months." Id. The industry associations argued that CAA section 307(d)(7)(B) required EPA to reconsider the final rule because several of its provisions "were not included in the proposed rule and ... [they were therefore unable] to raise an objection during the public comment period." See, e.g. , API, Request for Administrative Reconsideration of EPA's Final Rule "Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources," at 1 (Aug. 2, 2016) ("API Reconsideration Request"). They also sought a stay "pending reconsideration." Id.

By letter dated April 18, 2017, the Administrator, now Scott Pruitt, stated that EPA "[found] that the petitions have raised at least one objection to the fugitive emissions monitoring requirements" that warrants reconsideration "under 307(d)(7)(B) of the CAA." Letter from E. Scott Pruitt to Howard J. Feldman, Shannon S. Broome, James D. Elliott, & Matt Hite, Convening a Proceeding for Reconsideration, at 2 (Apr. 18, 2017). Accordingly, the Administrator announced, "EPA is convening a proceeding for reconsideration" of two specific provisions of the methane rule. Id. The letter also stated that "EPA intend[ed] to exercise its authority under CAA section 307 to issue a 90-day stay of the compliance date" for the fugitive emissions requirements. Id.

On June 5—just two days after the deadline for regulated parties to conduct their first emissions surveys and begin repairing leaks, see 40 C.F.R. § 60.5397a(f) —EPA published a "[n]otice of reconsideration and partial stay" in the Federal Register, 82 Fed. Reg. at 25,730. Relying on CAA section 307(d)(7)(B), EPA granted reconsideration on four aspects of the methane rule: (1) the decision to regulate low-production wells, (2) the process for proving compliance by "alternative means," (3) the requirement that a professional engineer certify proper design of vent systems, and (4) the decision to exempt pneumatic pumps from regulation only if a professional engineer certified that it was "technically infeasible" to route such pumps "to a control device or a process." 82 Fed. Reg. at 25,731 –32. In addition, the notice "stay[ed] the effectiveness of the fugitive emissions requirements, the standards for pneumatic pumps at well sites, and the certification by a professional engineer requirements" for 90 days "pending reconsideration." 82 Fed. Reg. at 25,732. The notice explained that the stay had gone into effect on June 2, 2017—that is, three days before the notice was published in the Federal Register. 82 Fed. Reg. at 25,731.

On June 16, EPA published a notice of proposed rulemaking (NPRM) announcing its intention to extend the stay "for two years" and to "look broadly at the entire 2016 Rule" during "the reconsideration proceeding." 82 Fed. Reg. 27,645 (June 16, 2017). Comments on that NPRM are due July 17, or if any party requests a hearing, by August 9. Id.

After EPA suspended implementation of the methane rule, six environmental groups—Environmental Defense Fund, Natural Resources Defense Council, Environmental Integrity Project, Earthworks, Clean Air Council, and Sierra Club—filed in this court an "emergency motion for a stay or, in the alternative, summary vacatur." According to Environmental Petitioners, EPA's stay violates CAA section 307(d)(7)(B) because "all of the issues Administrator Pruitt identified could have been, and actually were , raised (and extensively deliberated) during the comment period." Environmental Petitioners' Mot. 5 (emphasis in original). EPA opposes the motion, as do intervenors, a group of oil and gas associations including API, IPAA, and TXOGA. Together, they argue that we lack jurisdiction to review the stay, and that even if it were justiciable, the stay is lawful. We consider these arguments in turn.

II.

We begin with jurisdiction. Both EPA and Industry Intervenors argue that an agency's decision to grant reconsideration of a rule is unreviewable because it does not constitute "final action" under 42 U.S.C. § 7607(b)(1). EPA Opp. 8; Intervenors' Opp. 6. Industry Intervenors argue that for the same reason we lack jurisdiction to review the stay. Intervenors' Opp. 8.

It is true that an agency's decision to grant a petition to reconsider a regulation is not reviewable final agency action. See Portland Cement Association v. EPA , 665 F.3d 177, 185 (D.C. Cir. 2011) (noting that review is available "if reconsideration is denied " (emphasis added)). To be "final," agency action must "mark the consummation of the agency's decisionmaking process" and "be one by which rights or obligations have been determined, or from which legal consequences will flow." Bennett v. Spear , 520 U.S. 154, 177–78, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997) (citations and internal quotation marks omitted). By itself, EPA's decision to grant reconsideration, which merely begins a process that could culminate in no change to the rule, fails this test.

The imposition of the stay, however, is an entirely different matter. By staying the methane rule, EPA has not only concluded that section 307(d)(7)(B) requires reconsideration, but it has also suspended the rule's compliance deadlines. EPA's stay, in other words, is essentially an order delaying the rule's effective date, and this court has held that such orders are tantamount to amending or revoking a rule. As we explained in a very similar situation, where an agency granted an application for interim relief from a safety standard while it reconsidered that standard: "In effect, the Administrator has granted a modification of the mandatory safety standard for the entire period of time that the petition is pending. There is no indication that the Secretary intends to reconsider this decision or to vacate the grant of interim relief. Thus, the Secretary's decision represents the final agency position on this issue, has the status of law, and has an immediate and direct effect on the parties. Therefore, we have no difficulty concluding that the Secretary has issued a final decision ...." International Union, United Mine Workers of America v. Mine Safety & Health Administration , 823 F.2d 608, 614–15 & n.5 (D.C. Cir. 1987) (citation omitted); see also Environmental Defense Fund, Inc. v. Gorsuch , 713 F.2d 802, 813 (D.C. Cir. 1983) ("[S]uspension of the permit process ... amounts to a suspension of the effective date of regulation ... and may be reviewed in the court of appeals as the promulgation of a regulation."); Council of Southern Mountains, Inc. v. Donovan , 653 F.2d 573, 579 nn.26 & 28 (D.C. Cir. 1981) (rejecting the argument that the court lacked jurisdiction to review an order "defer[ring] the implementation of...