Sierra Club v. Envtl. Prot. Agency

• Decision Date: 07 April 2020
• Docket Number: No. 18-1167,18-1167
• Citation: 955 F.3d 56
• Parties: SIERRA CLUB, Petitioner 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

955 F.3d 56

SIERRA CLUB, Petitioner

v. ENVIRONMENTAL PROTECTION AGENCY and Andrew Wheeler, Administrator, U.S. Environmental Protection Agency, RespondentsAir Permitting Forum, et al., Intervenors

No. 18-1167

United States Court of Appeals, District of Columbia Circuit.

Argued October 7, 2019

Decided April 7, 2020

Gordon Sommers argued the cause for petitioner. With him on the briefs was Seth L. Johnson. David S. Baron, Washington, DC, entered an appearance.

Brian H. Lynk, Attorney, U.S. Department of Justice, argued the cause for respondents. With him on the brief were Jeffrey Bossert Clark, Assistant Attorney General, Jonathan D. Brightbill, Deputy Assistant Attorney General, Brian L. Doster, Assistant General Counsel, U.S. Environmental Protection Agency, and Mark M. Kataoka, Attorney.

Makram B. Jaber, Lucinda Minton Langworthy, Andrew D. Knudsen, Washington, DC, Shannon S. Broome, San Francisco, CA, Charles H. Knauss, Steven P. Lehotsky, Washington, DC, Michael B. Schon, Leslie A. Hulse, and Richard S. Moskowitz, Washington, DC, were on the brief for intervenors-respondents.

Megan H. Berge, Scott A. Keller, and Jared R. Wigginton, Washington, DC, were on the brief for amicus curiae American Petroleum Institute in support of respondents U.S. Environmental Protection Agency, et al., and denial of petition for review.

Before: Garland and Wilkins, Circuit Judges, and Randolph, Senior Circuit Judge.

Concurring opinion by Circuit Judge Wilkins.

Concurring opinion by Senior Circuit Judge Randolph.

Wilkins, Circuit Judge:

This case again presents the seemingly labyrinthine question of whether an agency action is final for the purposes of judicial review. The agency action before us is a document titled "Guidance on Significant Impact Levels for Ozone and Fine Particles in the Prevention of Significant Deterioration Permitting Program" (the "SILs Guidance") published on April 17, 2018 by the U.S. Environmental Protection Agency ("EPA"), authored by Peter Tsirigotis, Director of EPA's Office of Air Quality Planning and Standards.

Petitioner Sierra Club contends that we can and should review the SILs Guidance because it is final agency action and prudentially ripe. Respondent EPA counters that this Court lacks jurisdiction over the SILs Guidance because it is not final agency action, and alternatively, that we should not review it because it is not prudentially ripe. Although both parties advance arguments on the merits of EPA's interpretation of 42 U.S.C. § 7475(a)(3) in the SILs Guidance, for the reasons detailed herein, we do not reach those issues. We hold that the SILs Guidance is not final agency action subject to review by this Court under the Clean Air Act ("CAA") as it does not determine rights or obligations and does not effectuate direct or appreciable legal consequences as understood by the finality inquiry. See 42 U.S.C. § 7607(b)(1). As such, we dismiss the petition for lack of subject-matter jurisdiction under the CAA. We express no opinion as to ripeness or the merits.

I.

We turn first to the CAA provisions and EPA regulations that govern the SILs Guidance.

Congress enacted the Clean Air Amendments of the CAA in 1970 as "a comprehensive national program that made the States and the Federal Government partners in the struggle against air pollution." Gen. Motors Corp. v. United States , 496 U.S. 530, 532, 110 S.Ct. 2528, 110 L.Ed.2d 480 (1990). The amendments require EPA to promulgate national ambient air quality standards ("NAAQS") that limit the concentration of certain pollutants allowable in the ambient air people breathe. See 42 U.S.C. § 7409(a)(1). For each pollutant, primary and secondary standards must be set at levels "requisite to protect the public health" and "the public welfare," respectively. Id. § 7409(b). Each state develops its own state implementation plan ("SIP") containing emission limits and other control measures to enforce the NAAQS within the state. Id. §§ 7407(a), 7410(a)(1)-(2).

In 1977, Congress amended the CAA to create the Prevention of Significant Deterioration ("PSD") program. See 42 U.S.C. § 7470 - 79. The PSD program requires major emitting facilities¹ to obtain a permit "setting forth emission limitations" for a facility prior to construction. 42 U.S.C. § 7475(a)(1) ; see Ala. Power Co. v. Costle , 636 F.2d 323, 378 (D.C. Cir. 1979). The program requires any applicant for a PSD permit to demonstrate that new emissions from the proposed project "will not cause, or contribute to, air pollution in excess of any (A) maximum allowable increase or maximum allowable concentration for any pollutant in any area to which this part applies more than one time per year, [or] (B) national ambient air quality standard in any air quality control region[.]" 42 U.S.C. § 7475(a)(3). The "maximum allowable increase" of an air pollutant is a marginal level of increase above the defined baseline concentration and is known as the "increment." 75 Fed. Reg. 64,864, 64,868 (Oct. 20, 2010).

Although the permitting process is primarily implemented at the state level, with states issuing preconstruction permits in accordance with their SIPs and federal minimum standards, see 42 U.S.C. § 7410(a)(1)-(2), (l), section 7475(e)(3) authorizes EPA to promulgate regulations regarding the ambient air quality analysis required under the permit application review. Id. § 7475(e)(3)(D). Pursuant to this power, in 1987 EPA promulgated a regulation outlining a set of values for states to use in determining what level of emissions does "cause or contribute to" a violation under section 7475(a)(3). See 40 C.F.R. § 51.165(b)(2) ; 52 Fed. Reg. 24,672, 24,713 (July 1, 1987). The air quality concentration values specified in the regulation have become known as "significant impact levels," or SILs, when used as part of an air quality demonstration in a permit application. See SILs Guidance at 9.

In 2010, EPA attempted to codify these uses of SILs for certain harmful air pollutants, including fine particulate matter ("PM2.5"), by amending paragraph (k)(2) of its regulations at 40 C.F.R. §§ 51.166 and 52.21 and by incorporating PM2.5 values into its preexisting table of significance values at 40 C.F.R. § 51.165(b)(2). See 75 Fed. Reg. at 64,864, 64,886, 64,902. However, after a petition for review was filed, EPA asked this Court to vacate and remand the (k)(2) paragraphs of both regulations so EPA could address flaws it had recognized during the course of litigation. See Sierra Club v. EPA , 705 F.3d 458, 463-64 (D.C. Cir. 2013). In 2013 the Court vacated the (k)(2) paragraphs, stating that, on remand, "the EPA [might] promulgate regulations that do not include SILs or do include SILs that do not allow the construction or modification of a source to evade the requirement of the Act as do the SILs in the current rule." Id. at 464.

Following the remand, EPA began developing a new rule to address the flaws identified in the 2010 rulemaking, and on August 1, 2016, posted online and sought informal public comment on a new draft of guidance on the use of SILs. On April 17, 2018, EPA issued the SILs Guidance at issue in this case with revisions made in response to the public comments. The SILs Guidance expressed EPA's view that permitting authorities have the discretion to find sources applying for permits and that have individually small impacts exempt from the demonstration required by section 7475(a)(3). SILs Guidance at 17. Based on statistical analyses and technical approaches, the Guidance outlined what the agency believes are individually small impacts by identifying recommended, non-binding SIL values for the PM2.5 and ozone NAAQS, and for the PM2.5 increments. Id. at 15-17. The SILs Guidance then explained that if a proposed source's projected maximum impact is below the corresponding SIL value, that "generally may be considered to be a sufficient demonstration that the proposed source will not cause or contribute to a violation of the NAAQS." Id. at 17. Permitting authorities may use the nationally applicable SILs established in the SILs Guidance, but also "have discretion to develop their own SIL values" using EPA's methodology as a model and provided the values are properly supported in the record for each permitting action or decision in which they are used. Id. at 3.

Essentially, rather than requiring every PSD applicant to conduct a full cumulative impact analysis, if a preliminary analysis shows "a proposed source's maximum impact will be below the corresponding SIL value," EPA is open to a finding by the state permitting authority that such an impact "will not cause or contribute to a violation of the applicable NAAQS or PSD increment." Id. at 17. Furthermore, in what EPA refers to as a "culpability analysis," if a cumulative impact analysis is done anyway and "predicts a NAAQS violation," a source whose contribution to the violation is less than the SIL for a given pollutant may be considered "not culpable for" the violation under the Guidance. Id. at 18. Permitting authorities retain the ability to require additional information, and have discretion to find that even if a proposed source's impact is below the relevant SIL value, there has not been a sufficient demonstration that the "proposed source will not cause or contribute to a violation." Id. The SILs Guidance also requires that "[t]he case-by-case use of SIL values should be justified in the record for each permit," and that the record for any permitting decision using a SIL recommended in the Guidance should fully incorporate the information contained in the Guidance, including the technical and legal documents used in the permitting process. Id. at 19.

In the SILs Guidance, EPA described the document as the first of a two-step approach, explaining it hoped to "first obtain experience with the application of these values in the permitting program before establishing a generally applicable rule." Id. at 2. EPA explained that after seeing how "permitting authorities...