US v. South Coast Air Quality Management Dist.

• Decision Date: 16 October 1990
• Docket Number: No. CV 89-0548 WJR(Sx).,CV 89-0548 WJR(Sx).
• Citation: 748 F. Supp. 732
• Court: U.S. District Court — Central District of California
• Parties: UNITED STATES of America, Plaintiff, v. SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT; James M. Lents, in his official capacity as Executive Officer, South Coast Air Quality Management District, Defendants. PEOPLE OF THE STATE OF CALIFORNIA EX REL. SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT, Counterclaimant, v. UNITED STATES of America, et al., Counterdefendants. State of California, Defendant and Counterclaimant in Intervention.

748 F. Supp. 732

UNITED STATES of America, Plaintiff, v. SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT; James M. Lents, in his official capacity as Executive Officer, South Coast Air Quality Management District, Defendants.

PEOPLE OF THE STATE OF CALIFORNIA EX REL. SOUTH COAST AIR QUALITY MANAGEMENT DISTRICT, Counterclaimant, v. UNITED STATES of America, et al., Counterdefendants.

State of California, Defendant and Counterclaimant in Intervention.

No. CV 89-0548 WJR(Sx).

United States District Court, C.D. California.

October 16, 1990.

Ian Fan, Asst. U.S. Atty., Civ. Div., Los Angeles, Cal., Richard B. Stewart, Asst. Atty. Gen., Environment and Natural Resources Div., Thomas R. Lotterman, Richard A. Correa, Trial Attys., U.S. Dept. of Justice, Washington, D.C., for plaintiff/counterdefendants.

Mark I. Weinberger, Alletta d'A. Belin, Shute, Mihaly & Weinberger, San Francisco, Cal., Peter Greenwald, Dist. Counsel, Barbara Baird, Sr. Deputy Dist. Counsel, Robert N. Kwong, Deputy Dist. Counsel, South Coast Air Quality Management Dist., El Monte, Cal., Daniel P. Selmi, Los Angeles, Cal., for defendants and counterclaimant.

John K. Van de Kamp, Atty. Gen., State of Cal., R.H. Connett, Asst. Atty. Gen., Susan Fiering, Michael W. Neville, Deputy Attys. Gen., San Francisco, Cal., for defendant and counterclaimant in intervention.

MEMORANDUM DECISION AND ORDER RE CROSS MOTIONS FOR SUMMARY JUDGMENT

REA, District Judge.

The Court has reviewed and considered the moving and opposing papers, the record of the case, the arguments of counsel, the applicable authorities and good cause appearing therefor:

IT IS HEREBY ORDERED that the defendants' and counterclaimant's motion for summary judgment is GRANTED. The United States' motion for partial summary judgment is DENIED.

The issue before the Court is whether section 118 of the Clean Air Act ("the CAA" or "the Act") contains a clear and unambiguous waiver of sovereign immunity with respect to federal facilities' obligation to pay certain fees imposed pursuant to the South Coast Air Quality Management District's rules and regulations.

Consistent with the rationale expressed in Hancock v. Train, 426 U.S. 167, 96 S.Ct. 2006, 48 L.Ed.2d 555 (1976), the Court concludes that the language of section 118 clearly and unambiguously waives sovereign immunity, thereby obligating federal facilities to pay the contested fees.

Procedural Background

Federal military installations filed this action in January, 1989, alleging that certain fees required by the South Coast Air Quality Management District ("the District") constituted illegal taxes in violation of the Supremacy Clause, article VI, clause 2, of the United States Constitution.¹ The United States is seeking declaratory and injunctive relief, as well as a refund of all of the protested environmental fees paid by all federal facilities in the District for six years prior to the date the complaint was filed.

In its answer to the complaint, the District denies that the fees were unconstitutional and has filed a counterclaim seeking payment of all unpaid fees, late payments owed by federal facilities, and civil penalties.

The State Air Resources Control Board has intervened as a defendant and counterclaimant supporting the position taken by the District.

Discovery is complete. The parties have entered into a stipulation to bifurcate the issues of liability and damages. Pursuant to that stipulation, the present motions for summary judgment bear only upon the issue of liability. The parties agreed at the October 1, 1990 hearing that the issue of the availability of civil penalties should be decided at a later time pursuant to a briefing schedule stipulated to by the parties.

The United States has moved for partial summary judgment on the ground that the District's imposition of fees on the United States, while exempting state and local governmental agencies from the same fees, discriminates against the United States in violation of the Constitution. The United States is seeking a refund of the discriminatory fees² that it has paid from 1983 to 1989.³

The District has moved for summary judgment on all of the United States' claims. Additionally, the District is moving for summary judgment on its counterclaims for declaratory and injunctive relief. The District's position is that section 118 of the CAA provides a clear and unambiguous waiver of sovereign immunity. Hence, the federal facilities are obligated to pay the assessed fees.

The Clean Air Act/District Regulations in Dispute

The Clean Air Act provides the basic framework for federal air pollution control. 42 U.S.C. §§ 7401-7642. The Act calls for a joint federal-state effort to combat air pollution. 42 U.S.C. §§ 7401, 7407.

The states have primary responsibility for implementation of air pollution standards for ambient air quality and emission standards subject to Environmental Protection Agency ("EPA") oversight and approval. See 42 U.S.C. §§ 7401(a), 7407, 7410, 7413. The CAA requires states to develop plans (State Implementation Plans or "SIPS") and to adopt and enforce regulatory programs to attain and maintain federal air quality standards. 42 U.S.C. §§ 7410, 7411, 7412. The EPA has authority to act for the states and to impose sanctions if a state is not fulfilling the mandates of the Act. 42 U.S.C. §§ 7413(a), 7410(c). Additionally, the CAA allows states to adopt and enforce their own air pollution control programs, provided that they are no less stringent than those required by the Act. 42 U.S.C. § 7416.

In California, primary control of stationary source emissions is vested in the forty-one air pollution control districts in the state. Cal.Health & Safety Code §§ 39002, 40000. The State Air Resources Board has promulgated ambient air quality standards for each of the air basins throughout the state. The air pollution control districts develop and adopt the required elements of the State Implementation Plan within their jurisdiction. These districts adopt and enforce permitting and emissions limitations and rules to achieve and maintain both state and federal ambient air quality standards. Cal.Health & Safety Code § 42300.

The South Coast Air Quality Management District is the agency responsible for management of air quality in the South Coast Air Basin. Cal.Health & Safety Code § 40410. The District includes all of Orange County and the non-desert portions of Los Angeles, Riverside, and San Bernadino counties. Cal.Health & Safety Code § 40410. The South Coast Air Basin has the worst air quality problem in the nation. Cal.Health & Safety Code § 40402(b); SCAQMD Exhibit 1, p.i. While the District has a plan in place, approved by the EPA, the Basin still fails to meet the federal air quality standards for four of the six federally regulated pollutants. SCAQMD Exhibit 1, p.i.

State law authorizes districts to establish fee schedules for the issuance, evaluation, and renewal of permits to cover the cost of the district programs related to the permitted sources to the extent that those costs are not otherwise funded. Cal.Health & Safety Code § 42311(a). Fee revenues may not exceed actual district program costs, and fees in excess of those costs collected by the districts must be carried over to the next fiscal year and the fee schedule adjusted accordingly. Cal.Health & Safety Code § 42311(a).

The District's rules and regulations, adopted pursuant to California Health & Safety Code sections 40440 and 40510, establishing the fee schedules challenged in this case are found in rules 301, 301.1, and 301.2. The United States' motion for summary judgment challenges three fees that, prior to amendments adopted by the District on May 24, 1990, were called filing fees, application evaluation fees, and annual operating permit fees.⁴ The fees at issue were assessed in the following manner: (1) the filing fees were imposed at the time of filing applications for permits to operate equipment that may cause air pollution; (2) the application evaluation fees were imposed for evaluating those applications; (3) one part of the annual operating permit fee was imposed for issuing or renewing annual operating permits; and (4) the other part of the annual permit fee, called the annual emissions fee, was imposed for issuing annual permits based on total emissions.

DISCUSSION

I. The Defendants' and Counterclaimant's Motion for Summary Judgment

A. Whether Section 118 of the CAA is a Clear and Unambiguous Waiver of Sovereign Immunity

The District's motion for summary judgment is based on the argument that section 118 of the Clean Air Act waives sovereign immunity with respect to all aspects of the District's air pollution control program, including the air pollution regulatory fees challenged by the United States. The United States urges the Court to adopt a limited construction of the waiver of sovereign immunity found in section 118. The Court begins its analysis with a review of section 118.

1. Section 118 of the Clean Air Act

Section 118 of the Clean Air Act requires federal entities to comply with the Act in the following manner:

Each department, agency, and instrumentality of the executive, legislative, and judicial branches of the Federal Government ... shall be subject to, and comply with, all Federal, State, interstate, and local requirements, administrative authority, and process and sanctions respecting the control and abatement of air pollution in the same manner, and to the same extent as any nongovernmental entity. The preceding sentence shall apply (A) to any requirement whether substantive or procedural (including any recordkeeping or reporting requirement, any requirement respecting permits and any other requirement whatsoever), (B) to the exercise of any Federal, State, or local administrative authority, and (C) to any process and sanction, whether enforced in Federal, State, or local courts or in any other manner. This subsection shall apply notwithstanding

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