Great Basin Mine Watch v. U.S. E.P.A.

• Decision Date: 23 March 2005
• Docket Number: No. 03-70231.,03-70231.
• Citation: 401 F.3d 1094
• Parties: GREAT BASIN MINE WATCH, Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent, Newmont USA, Limited; State of Nevada, Respondents-Intervenors.
• Court: U.S. Court of Appeals — Ninth Circuit

401 F.3d 1094

GREAT BASIN MINE WATCH, Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Respondent Newmont USA, Limited; State of Nevada, Respondents-Intervenors.

No. 03-70231.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted November 1, 2004.

Filed March 23, 2005.

Roger Flynn, Bradley A. Bartlett, Western Mining Action Project, Boulder, CO, for the petitioner.

Andrew J. Doyle, Environmental Defense Section, United States Department of Justice, Washington, D.C., for the respondent.

William J. Frey, Deputy Attorney General, Carson City, NV, for intervenor State of Nevada.

On Petition for Review of an Order of the Environmental Protection Agency.

Before: CANBY, RYMER, and HAWKINS, Circuit Judges.

CANBY, Circuit Judge.

Great Basin Mine Watch petitions for review of a final rule of the Environmental Protection Agency ("EPA") allowing Nevada to split one of its clean air areas ("area 61") into two ("lower 61" and "upper 61"). Great Basin contends that the EPA, by approving the split, violated its statutory and regulatory duties under the Clean Air Act because it failed to consider the effect of a major pollution emitter, Barrick Goldstrike Mine, in area 61. We deny Great Basin's petition for review because we conclude that the EPA did not act arbitrarily, capriciously, or contrary to law when it granted Nevada's request to divide area 61, and that the existence and operation of the Mine did not preclude the division.

Background

The Clean Air Act includes a program for the prevention of significant deterioration of air quality ("PSD" program), which applies to areas that are actually or potentially low in air pollution. Several of the program's restrictions on emissions are triggered when a major stationary source (i.e., a major pollution emitter) submits an application for a permit for new construction or major modification within the area under the appropriate regulations. 40 C.F.R. § 52.21(b)(14)(ii). A central issue in the present appeal is whether the PSD restrictions were triggered, or must be deemed triggered, in area 61 by the actions of the Barrick Mine. Great Basin contends that the PSD restrictions were triggered, and that as a consequence EPA's decision to allow division of area 61 was impermissible. We agree with the EPA, however, that the restrictions were not triggered, and that division of area 61 was not arbitrary, capricious, or contrary to law. Before we explain our reasons, we think it best to describe briefly the relevant framework of the Act.

1. The Clean Air Act's PSD Program

The Clean Air Act regulates air pollutants such as particulate matter, sulfur dioxide, and nitrogen oxide. See 42 U.S.C. §§ 7408-7409. The Act requires the division of states into air quality planning areas ("baseline areas"). These baseline areas are assigned one of three labels — attainment, unclassifiable, or nonattainment — depending on the quality of their air. If an area fails to meet national air quality standards, it is classified as a nonattainment area. If an area meets national standards, it is classified as an attainment area. If it is unclear whether the area meets the standards, the area is denominated unclassifiable. The PSD program applies to the latter two categories, and it is undisputed that area 61 falls within them.¹

In attainment and unclassifiable areas, the PSD program attempts to maintain the relatively clean air by limiting the total pollution "increment" per year. The PSD restrictions are not automatic, however; they come into effect when an application is filed under the appropriate regulations for new construction of a major stationary source or for major modification of an existing major source within the area. 40 C.F.R. § 52.21(b)(14)(ii). It is important for our purposes to note that application for a permit is the trigger, not simply the existence of substantial pollution emissions. The filing of such an application establishes a "minor source baseline date" for which the EPA determines the ambient "baseline concentration" for the area. 40 C.F.R. § 52.21(b)(13), (14)(ii). Thereafter, the PSD program places strict limits on aggregate increases in pollution within the baseline area whether the increases come from minor or major sources.

If no major source within a baseline area has applied for a permit, however, the PSD restrictions are not triggered. In that event, pollution emitters are free to operate under the less restrictive national air quality standards, rather than the stricter standards of the PSD program. See, e.g., Reno-Sparks Indian Colony v. EPA, 336 F.3d 899, 902-03 (9th Cir.2003).

2. Discretion to Redesignate Baseline Areas

Because the PSD program is administered by baseline areas, the number and size of these areas has a very considerable effect on potential polluters. The greater the number and the smaller the size of the baseline areas, "the less likely it is that a major source has applied for a permit within any one area, thereby establishing a baseline date." Id. at 903. Thus a minor source is more likely to "find an area in which to operate where it is not subject to the requirements of the PSD program." Id. On a smaller scale, the division of one baseline area into two might have a similar effect; if a major source were to seek a permit in only one of the two newly-divided areas, the other might escape PSD regulation that would have applied had the original area not been split.

Despite this consideration, the EPA has broad discretion to grant a state's request to divide an area for which no baseline date or baseline concentration has been established. The EPA may grant redesignation requests "on the basis of air quality data, planning and control considerations, or any other air quality-related considerations the Administrator deems appropriate." 42 U.S.C. § 7407(d)(3)(A). This decision also must rely on "sufficient data." 40 C.F.R. § 81.300(a).

The situation is different when PSD restrictions have already been triggered in an area. Division of such an area into two new areas raises additional problems. One is the question whether one of the new areas may or should be "untriggered" because the major source that triggered the PSD restrictions lies in the other new area. Perhaps in recognition of this and other problems, the discretion of the EPA is more limited when dealing with redesignation of an area for which PSD restrictions have been triggered. The EPA cannot redesignate, for example, if the new area would "intersect or be smaller than the area of impact of any major stationary source or major modification which ... [e]stablishes a minor source baseline date." 40 C.F.R. §§ 51.166(b)(15)(ii), 52.21(b)(15)(ii). Moreover, the EPA has indicated that it is more likely to deny a request to split an area in which the PSD caps apply because the redesignation may allow greater deterioration of the air quality.

The Present Controversy

This dispute arose when the State of Nevada submitted its request to the EPA to divide baseline area 61(550 square miles) into two, lower 61 and upper 61. Nevada claimed that the split would aid its air quality management because the two new areas more accurately reflect the "local air transport processes," industrial development, and the region's topography, among other reasons. Much of the present dispute arises from the fact that, in Nevada's view, the Barrick Mine, although a major source, has never applied or been required to apply for a permit for new construction or a major modification. This situation presumably results from the fact either that the Mine was a major source before the Clean Air Act's requirements took effect, or that it became a major source by small increments not subject to permits. Nevada reflected its view in its redesignation request, in which it asserted that "Area 61 does not contain any PSD sources, and it has not been significantly impacted by any major source or modification," although it acknowledged that Barrick Goldstrike Mine was "a major source for PM10, NOx [nitrogen oxide], and SO2."

In response to Nevada's request, the EPA issued a proposed rule granting the request to split area 61 into lower 61 and upper 61. See 67 Fed.Reg. 21194, 21197 (Apr. 30, 2002). The EPA proposed to approve the request because of its policy to "provide States a fair degree of autonomy to balance air quality management with economic planning" and because the redesignation would not interfere with Nevada's management of air quality in the area. Id. In concluding that the change met the statutory and regulatory requirements of the Act, the EPA relied on its conclusion that "no PSD source has located in [area 61], ... and the newly created baseline areas ... do not intersect the area of impact of any major PSD source nor do they have boundaries that are smaller than such impact area." Id.

In a footnote, the proposed rule acknowledged that the Barrick Mine was a major source, but disregarded it because "the source has not been subject to PSD review." Id. at 21196 n. 3. The proposed rule also stated that the redesignation did not result in "an untriggering of the baseline area," and thus there was "no elimination of already consumed [pollution] increment and no consumed increment would be added to the baseline for the area." Id. at 21197. Moreover, the division did not "carve out small `postage stamp' areas encompassing only the significant impact area around a major PSD source." Id. at n. 4. The EPA also solicited public comment on its proposed rule.

Relying on the reasons listed in the proposed rule, the EPA's final rule granted Nevada's request despite criticism from several commentators, including Great Basin. See 67 Fed.Reg. 68769, 68771, 68776 (Nov. 13, 2002). Great Basin petitioned for review under 42 U.S.C. § 7607(b)(1).

Standard of Review

"In reviewing a final action by the EPA, we reverse only if it is arbitrary, capricious, or contrary to law or if it exceeds...