Marilyn Wall and Mike Fremont, Sierra Club, Intervenor v. United States Environmental Protection Agency and Christine Whitman, Administrator, United States Environmental Protection Agency

Citations: 265 F.3d 426; 32 Envtl. L. Rep. (Envtl. Law Inst.) 20127; 52 ERC (BNA) 1017; 2001 U.S. App. LEXIS 20138Docket: 00-4010

Court: Court of Appeals for the Sixth Circuit; September 11, 2001; Federal Appellate Court

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The case involves Marilyn Wall and Mike Fremont, who challenged a decision by the United States Environmental Protection Agency (EPA) to redesignate the Cincinnati metropolitan area from "nonattainment" to "attainment" for ground-level ozone, and to approve a clean air maintenance plan. The Sierra Club intervened in support of the petitioners. The Sixth Circuit Court of Appeals vacated the EPA's redesignation and remanded the matter for further proceedings.

Ground-level ozone, a significant component of urban smog, poses serious health risks, including respiratory issues and irritation, and can damage materials. It is not emitted directly but forms from precursors like nitrogen oxides (NOx) and volatile organic compounds (VOCs) in the presence of sunlight. The Clean Air Act (CAA) mandates the establishment of national ambient air quality standards (NAAQS) for pollutants, including ozone, to protect public health. Areas are classified based on their compliance with these standards, with more stringent regulations for nonattainment areas.

Responsibility for achieving the National Ambient Air Quality Standards (NAAQS) lies with individual states under the Clean Air Act (CAA). Each state must create a State Implementation Plan (SIP) that outlines specific pollution control measures tailored for each pollutant, with established deadlines for various classifications of ozone nonattainment areas. Areas classified as marginal to extreme are assigned different timelines and more stringent measures based on severity. 

The Environmental Protection Agency (EPA) is tasked with reviewing each SIP and must approve or disapprove it within one year after submission. Approved SIP provisions become federally enforceable, whereas disapproved plans lead to state sanctions and federally mandated clean air measures. 

The EPA's 1979 regulations delineate the NAAQS for pollutants and the criteria for assessing compliance. The primary ozone standard is set at 0.12 parts per million, with attainment defined as having no more than one day per year exceeding this level, based on a three-year average from monitoring sites. 

For nonattainment areas, the CAA mandates specific pollution control measures to facilitate timely compliance with the ozone standard, including enforcement provisions and necessary resources. For moderate nonattainment areas, the SIP must incorporate reasonable control technology limits for existing volatile organic compound (VOC) emissions and ensure conformity of transportation plans with clean air objectives.

A state can request the EPA to change an area's designation from nonattainment to attainment if air quality has improved. Following redesignation, the area is exempt from stricter pollution controls applicable to nonattainment areas, shifting the state's responsibility to enforce its maintenance plan. For redesignation, five criteria must be satisfied: (i) attainment of national air quality standards; (ii) full approval of the area's implementation plan; (iii) demonstrated air quality improvement due to permanent and enforceable emission reductions; (iv) approval of a maintenance plan meeting specific requirements; and (v) compliance with applicable requirements under the CAA. The Cincinnati metropolitan area is currently under review for compliance with the second, fourth, and fifth criteria. To fulfill these criteria, the EPA must fully approve the State Implementation Plan (SIP) within one year of receiving a complete submission, ensuring it meets all necessary regulatory requirements. The SIP must contain enforceable emission limitations, data collection provisions, and enforcement programs.

A maintenance plan is mandated by CAA §107(d)(3)(E)(iv) for a state's redesignation request, ensuring NAAQS maintenance for at least 10 years post-redesignation. This plan must demonstrate that future emissions will not exceed the attainment emissions inventory level of 0.12 parts per million for ozone, as stipulated in 40 C.F.R. pt. 50.9(a). The EPA, through a memorandum by John Calcagni, emphasizes that the adequacy of the maintenance plan is determined by the specific circumstances of the area and relevant available information. Additionally, the maintenance plan must include enforcement provisions deemed necessary by the Administrator to promptly address any standard violations after redesignation, requiring the state to implement all pre-existing ozone control measures from the SIP.

Part D of Subchapter I of the CAA outlines specific requirements for nonattainment areas to meet the fifth criterion for redesignation, comprising two subparts: Subpart 1, which includes basic requirements for all nonattainment areas, and Subpart 2, which addresses additional requirements for areas classified as marginal to extreme nonattainment. Subpart 2’s pollutants-specific requirements can override the general provisions in Subpart 1. 

Subpart 1 establishes transportation-conformity requirements to mitigate air pollution from transportation sources, prohibiting federal agencies from supporting any activity that does not conform to an approved SIP. Conformity is assessed based on the latest emission estimates, ensuring that anticipated emissions do not undermine the SIP's goals of reducing violations of NAAQS and achieving timely attainment of those standards.

Subpart 2 of Part D mandates that a State Implementation Plan (SIP) for a nonattainment area include reasonably available control technology (RACT) rules, which vary based on the severity of nonattainment. For marginal nonattainment areas, the SIP must adopt general RACT rules for existing volatile organic compound (VOC) sources. Moderate nonattainment areas must implement these general rules and additional RACT regulations for specific VOC emission categories. The Clean Air Act (CAA) requires states to revise their implementation plans to incorporate RACT provisions based on Control Technique Guidelines issued by the EPA from November 15, 1990, until the area attains compliance. The EPA has provided guidance on these requirements in the general preamble and related memoranda. 

The Cincinnati metropolitan area was designated as an ozone nonattainment area in 1978 and reaffirmed as a moderate nonattainment area after the 1990 CAA Amendments, with a deadline for attainment set for November 15, 1996. Consequently, Kentucky and Ohio were obligated to revise their SIPs by November 15, 1993, to meet moderate ozone area requirements. Although both states submitted timely revisions, the EPA could not fully approve them due to deficiencies identified in the submitted plans.

The EPA did not issue a notice of disapproval under CAA § 110(k)(2) after Kentucky and Ohio requested in November 1994 to redesignate the Cincinnati metropolitan area to ozone attainment status, citing no violations of ozone NAAQS over the preceding three years. However, the requests were denied following a violation in the summer of 1995. Kentucky's subsequent petition for review was upheld by the court in Kentucky v. EPA, with the agency instead granting two one-year extensions, which are not contested in the current case.

In 1999, both states submitted new redesignation requests supported by data indicating compliance with the ozone NAAQS from 1996 to 1998, alongside monitoring data from 1999. The EPA published a notice proposing to approve these requests on January 24, 2000, while acknowledging that Kentucky lacked fully approved transportation-conformity requirements in its SIP for the area. The EPA determined that these requirements were not relevant for the redesignation evaluation since areas must comply with federal conformity rules regardless of state approval status.

Moreover, the EPA noted that Ohio had not fully adopted RACT rules for specific VOC source categories as outlined in the CTG document. Despite its policy requiring complete adoption of these rules before redesignation approval, the EPA proposed to waive this requirement in favor of approving the redesignation requests from Kentucky and Ohio.

The EPA has determined that it can accept a commitment to implement certain RACT rules as contingency measures in Ohio's maintenance plan for ozone standards, rather than requiring full adoption prior to redesignation. This decision is based on several factors: the RACT rules were not necessary for achieving the ozone standard in Cincinnati; Ohio has maintained the standard without these measures through 2010; and Ohio has proposed more effective contingency measures that would yield greater emission reductions.

Opposition to this decision was voiced by Wall, Fremont, and the Sierra Club, who argued the maintenance plans from Kentucky and Ohio were inadequate under CAA §175A. They contended that the EPA failed to use air quality models to assess maintenance capabilities and criticized the reliability of the EPA's future emission level assumptions. They also pointed out contradictions in the EPA’s findings regarding the need for additional emissions reductions in the Cincinnati area, as indicated in a separate rulemaking concerning national emission limits for new vehicles. 

Additionally, the petitioners claimed that the maintenance plans did not comply with CAA §110(c)(2)(E)(i) due to the absence of explicit commitments and resources for implementation, particularly regarding enforcement programs and necessary personnel and funding. They also argued that the EPA lacked the authority to exempt the transportation-conformity requirements from applying to the redesignation requests.

Petitioners argued that the EPA lacked authority to redesignate the Cincinnati metropolitan area before states fully adopted the required Reasonably Available Control Technology (RACT) rules under CAA §182(b)(2). They contended that the CAA prohibits states from deferring RACT adoption by treating them as optional, and asserted that the EPA had not fully approved the State Implementation Plans (SIPs) under CAA §110(k) due to this RACT adoption issue. Following a five-month comment period after proposing approval, the EPA determined that the Cincinnati area had met the one-hour National Ambient Air Quality Standards (NAAQS) for ground-level ozone and other conditions necessary for redesignation. Consequently, the EPA issued a final ruling on June 19, 2000, effective July 5, 2000, granting the redesignation requests from Kentucky and Ohio.

For judicial review, the standard dictates that EPA actions can only be overturned if found to be arbitrary, capricious, or not legally compliant. The review follows a two-step Chevron process: first, determining if Congress has clearly addressed the issue; if not, evaluating if the EPA's interpretation is a permissible construction of the statute. Courts must find the EPA's understanding rational and consistent with statutory mandates while conducting a thorough review of its air quality projections.

Three challenges were raised regarding the clean air maintenance plans for the Cincinnati area: (1) the EPA's maintenance demonstration methods did not comply with CAA requirements; (2) models indicating potential non-compliance with ozone NAAQS over the next decade; and (3) insufficient resource and authority commitments for enforcement in the maintenance plans. The first two arguments were grouped for analysis due to their similarities, with the third addressed separately.

The EPA evaluated the maintenance plans of Kentucky and Ohio using an attainment-emissions inventory approach, which assesses compliance and projects future emissions to ensure they remain below current levels for at least ten years, as mandated by the Clean Air Act (CAA) § 175A. The agency determined that the Cincinnati metropolitan area complied with NAAQS during the 1996-1998 and 1997-1999 periods, predicting future emissions would decrease from 1996 levels. Consequently, the EPA concluded that these findings indicated sufficient emissions levels to maintain compliance for the next decade.

Petitioners contested the EPA's approach, arguing it did not satisfy CAA requirements because it relied on emissions inventory rather than air quality modeling as stipulated in 40 C.F.R. § 51.112(a)(1). They asserted that this regulation necessitates modeling to demonstrate maintenance of NAAQS. The EPA countered that this regulation pertains to attainment demonstrations rather than standalone maintenance plans under CAA § 175A. They cited their interpretive memorandum, stating that states may demonstrate maintenance by showing future emissions will not exceed attainment inventory levels or through modeling.

While the petitioners’ interpretation of the regulations is plausible, the EPA's interpretation is valid and does not conflict with statutory mandates. The phrase "timely attainment and maintenance" may be read to apply solely to situations where both attainment and maintenance are to be demonstrated, allowing for the possibility of demonstrating only maintenance in certain contexts. The EPA's approach aligns with its own guidelines permitting evidence of future emissions not exceeding prior attainment levels as sufficient for demonstrating maintenance of NAAQS.

The petitioners argue that the EPA's findings in the current case conflict with earlier findings made in the Tier 2 Motor Vehicle Emissions Standards and Gasoline Sulfur Control Requirements, which identified the Cincinnati metropolitan area as needing additional emission reductions. However, the EPA clarifies that the Tier 2 findings are not relevant to the current matter, as the Tier 2 proceeding aimed at a broader program to reduce emissions from new vehicles rather than specifically assessing the Cincinnati area's attainment status. The EPA also notes that it utilized more recent air quality data in the current proceeding, specifically from 1999, which was not considered in the Tier 2 findings. The court upheld the EPA's decision to disregard the Tier 2 findings based on these differences in data, affirming that the EPA's rationale was sufficient to prevent judicial intervention.

Additionally, the petitioners contend that the Cincinnati maintenance plans lack necessary commitments for enforcement, as required by the Clean Air Act (CAA) §110(a)(2)(C). They argue that the plans should include explicit enforcement measures and criticize the EPA's reliance on outdated resource commitments from the original State Implementation Plans (SIPs) of Kentucky and Ohio. They reference a federal regulation mandating that each plan describe the current and additional resources needed for effective implementation, arguing for a requirement of up-to-date commitments rather than relying on historical assumptions.

A contemporary allocation of resources and authority would enable states to customize commitments to EPA-approved plans, but the Clean Air Act (CAA) and EPA regulations do not mandate a separate commitment within maintenance plans. The EPA concluded that Kentucky and Ohio met the requirement for enforcement of maintenance measures by relying on previously approved State Implementation Plans (SIPs). This is consistent with the Calcagni Memorandum, which indicates that redesignation requests do not reopen prior SIP issues, a view confirmed by the court in Southwestern Pennsylvania Growth Alliance v. Browner. Consequently, the EPA's approval of the clean air maintenance plans for the Cincinnati area is upheld.

Regarding transportation-conformity requirements, Kentucky has not submitted a revised SIP that meets all necessary standards. Petitioners argue that this failure precludes the EPA from redesignating the Cincinnati area to attainment status. The EPA counters that transportation-conformity requirements do not apply to redesignation requests. The CAA specifies five criteria for redesignation, but does not clarify which Part D requirements are applicable. The EPA interprets the transportation-conformity rules as unnecessary for redesignation, asserting that other existing requirements ensure compliance. The agency differentiates these rules from other Part D requirements that are tied to nonattainment status, which do not apply once an area is redesignated. Kentucky remains obligated to adopt transportation-conformity rules post-redesignation and would face sanctions for non-compliance, while federal rules continue to necessitate conformity analyses until state revisions are approved. The EPA's interpretation is deemed reasonable given the lack of additional guidance.

The term "applicable" can be interpreted in two ways: as limiting the geographical scope of statutory requirements or as restricting the number of requirements from CAA §110 and Part D relevant to a specific area. Petitioners argue that the EPA's current interpretation contradicts its own General Preamble for the Implementation of Title I of the CAA Amendments of 1990, which mandates that states demonstrate compliance with section 176 conformity requirements as a condition for designation. They reference the EPA's Calcagni Memorandum indicating that states must adopt applicable conformity requirements prior to redesignation requests if those requirements became applicable before submission. However, in subsequent rulemaking, the EPA reversed its earlier stance, declaring transportation-conformity requirements would no longer be applicable to redesignation requests, a decision supported by consistent application of this interpretation in later evaluations. The Supreme Court's ruling in Rust v. Sullivan emphasizes that revised agency interpretations merit deference, as agencies must continuously reassess their policies. The 1995 Florida rulemaking interpretation does not conflict with statutory provisions and is deemed sufficiently rational, preventing judicial substitution of judgment. Consequently, the EPA's conclusion that Kentucky's failure to submit a compliant SIP revision does not justify denying the Cincinnati metropolitan area's attainment designation stands.

The petitioner challenges the EPA's authority to approve Kentucky's and Ohio's redesignation requests, arguing that Ohio has not adopted all required reasonably available control technology (RACT) rules for volatile organic compound (VOC) source categories as mandated by the Clean Air Act (CAA) §182(b). They assert that merely including these rules as optional in a contingency plan does not fulfill the requirement for actual adoption in the state implementation plan (SIP). The EPA previously acknowledged that full adoption and approval of necessary RACT rules are prerequisites for redesignation requests, confirming that these rules constitute applicable requirements predating the requests.

The CAA explicitly states that states must submit SIP revisions to implement RACT measures, indicating congressional intent for these measures to be adopted as part of redesignation requests. The EPA argues that the statute does not define what constitutes an acceptable provision, suggesting that RACT rules can be included in contingency provisions rather than requiring full adoption. However, contingency measures are not immediately effective, and Ohio's plan treats RACT measures as one option among many, without a requirement for adoption. Consequently, the inclusion of RACT rules in Ohio's contingency plan does not meet the CAA's requirements. Additional statutory and agency guidelines reinforce this position, mandating that states implement RACT rules within specific timelines outlined in Control Techniques Guidelines documents.

States that have not enacted an approvable Reasonably Available Control Technology (RACT) rule for sources outlined by the Control Techniques Guidelines (CTG) are required to submit such a rule by March 23, 1995. A 1993 EPA guidance memo indicates that full implementation of all mandated programs, along with a commitment to enforce a schedule, is necessary for redesignation from nonattainment to attainment for ozone or carbon monoxide, particularly if the redesignation request is submitted after the program's due date. However, the EPA contends that it modified its guidance when approving the redesignation request for Grand Rapids, Michigan, citing that emissions reductions from RACT measures are not currently necessary for Cincinnati's attainment and that Ohio could potentially cease implementing these measures post-redesignation.

Despite the EPA's justification for departing from standard policy, the text argues that such a departure conflicts with Congress's clear intent, which mandates actual provisions instead of optional contingency measures. The Clean Air Act (CAA) Section 175A(d) allows the EPA to include RACT measures as contingency provisions but does not permit a state to avoid adopting these measures entirely. The statutory language implies that RACT measures should have been part of the State Implementation Plan (SIP) prior to redesignation.

The conclusion reached is that the EPA abused its discretion by redesignating the Cincinnati metropolitan area as attaining status without Ohio having fully adopted the required RACT rules. The decision is therefore vacated, and the matter is remanded for further proceedings in accordance with the opinion expressed.