TX Independent v. EPA

In the

United States Court of Appeals

For the Seventh Circuit

____________

Nos. 03-3277, 03-3278, 03-3279,

03-3280, 03-3281 & 03-3865

TEXAS INDEPENDENT PRODUCERS AND

ROYALTY OWNERS ASSOCIATION, et al.,

Petitioners,

v.

ENVIRONMENTAL PROTECTION AGENCY,

Respondent.

____________

Petitions for Review of an Order of the

Environmental Protection Agency

No. 02-OW-55

____________

ARGUED DECEMBER 7, 2004—DECIDED JUNE 13, 2005

____________

Before BAUER, MANION, and WILLIAMS, Circuit Judges.

MANION, Circuit Judge. On July 1, 2003, the

Environmental Protection Agency issued its “Final National

Pollutant Discharge Elimination System General Permit for

Storm Water Discharges From Construction Activities”

(“General Permit”). 68 Fed. Reg. 39,087 (July 1, 2003).

2 Nos. 03-3277, et al.

Several organizations filed petitions for review of this final

agency action, and those petitions were consolidated before

this court. For the reasons that follow, we hold that the

General Permit does not violate the Clean Water Act’s

requirements for public notice and public hearing. We also

hold that in issuing the General Permit, the Environmental

Protection Agency complied with the requirements of the

Endangered Species Act. However, petitioner Natural

Resources Defense Council, Inc., lacks standing to challenge

other aspects of the General Permit, and accordingly we

dismiss the remainder of its petition. As to the remaining

petitioners who represent the interests of the oil and gas

industries, we stay consideration of their challenges to the

General Permit pending resolution by the Fifth Circuit as to

whether those petitioners are required to obtain a permit in

the first instance.

I.

1

Congress enacted the Clean Water Act (“CWA” or “Act”)

“to restore and maintain the chemical, physical, and biolog-

ical integrity of the Nation’s waters.” 33 U.S.C. § 1251(a).

The CWA prohibits the “discharge of any pollutant” except

in compliance with the Act’s provisions. 33 U.S.C. § 1311(a).

Under the Act’s provisions, the discharge of pollutants into

navigable waters is illegal unless authorized by a permit

issued pursuant to § 402 of the Act. 33 U.S.C. § 1342. Section

402 established the National Pollutant Discharge Elimina-

tion System (“NPDES”), and requires dischargers to obtain

1

An appendix to this opinion provides a comprehensive list of

the numerous abbreviations used throughout the opinion.

Nos. 03-3277, et al. 3

a permit from the Environmental Protection Agency

2

(“EPA”) or an authorized state. 33 U.S.C. § 1342(a)(1), (b).

The NPDES permitting system originally used individual

permits, which was feasible for regulating discharges from

wastewater facilities or industrial plants. However, by the

1980’s it became clear that the individual permitting process

was unworkable to regulate storm water discharges which

can occur virtually anywhere. 56 Fed. Reg. 40948, 40949-50

(Aug. 16, 1991). Congress responded in 1987 by adding

§ 402(p) to the CWA. 33 U.S.C. § 1342(p). This section

established a two-step phased approach to regulating storm

water discharges. See 33 U.S.C. § 1342(p).

In Phase I, Congress required NPDES permits for storm

water discharges from “industrial activities,” 33 U.S.C.

§ 1342(p)(3)(A), defined as construction activities involving

five or more acres, as well as discharges from certain large

municipal storm sewer systems. 55 Fed. Reg. 47990, 48066

(Nov. 16, 1990). To implement the permit requirement for

Phase I, the EPA decided to use a general permit system, as

opposed to a system requiring individual permits for each

construction activity. 55 Fed. Reg. 47,990, 48005-48006 (Nov.

16, 1990). With a general permit, the EPA issues a permit for

specific types of activities and establishes specific rules for

complying with the permit. Then, rather than apply for an

individual permit, operators must file a Notice of Intent

(“NOI”) stating that they plan to operate under the general

permit, and absent a negative ruling by the EPA, discharges

that comply with the terms of the general permit are

automatically authorized. The EPA uses a general permit

2

“The EPA administers the NPDES program in each state unless

the EPA previously authorized a state program to issue NPDES

permits.” Am. Paper Inst., Inc. v. EPA, 890 F.2d 869, 871 (7th Cir.

1989) (citing 33 U.S.C. § 1342(b)).

4 Nos. 03-3277, et al.

system to assure “adequate environmental safeguards . . .

without the administrative and resource burdens involved

in an individual permit issuance.” 56 Fed. Reg. at 40961. The

EPA issued its first general permit for construction-related

storm water discharges in 1992, 57 Fed. Reg. 41176 (Sept. 9,

1992), and proposed a revised general permit in 1997. 62 Fed

Reg. 29786 (June 2, 1997). Neither of these general permits

is at issue in this case.

In preparation for Phase II, the EPA, as directed by

Congress, studied all remaining storm water discharges and

established “procedures and methods to control storm

water discharges to the extent necessary to mitigate impacts

on water quality.” 33 U.S.C. § 1342(p)(5). Then, in 1999, the

EPA issued its Phase II storm water rules, designating as

Phase II sources small construction sites (one to five acres),

smaller municipalities, and additional sources that might be

designated on a case-by-case basis. 64 Fed. Reg. 68722 (Dec.

8, 1999); 40 C.F.R. § 122.26(b)(15).

On December 20, 2002, the EPA proposed a third General

Permit for storm water discharges from both large and small

3

construction sites. 67 Fed. Reg. 78116 (Dec. 20, 2002). The

General Permit applies only in those jurisdictions where the

EPA has not authorized the State or Indian Tribe to admin-

ister its own NPDES permitting program. These jurisdic-

3

Although the EPA imposed the NPDES permitting require-

ments on small construction sites (one to five acres) it was not

required to do so by statute. Rather, Congress merely directed the

EPA in Phase II to issue comprehensive regulations addressing

additional discharges as necessary, by “performance standards,

guidelines, guidance, and management practices and treatment

requirements, as appropriate.” 33 U.S.C. § 1342(p)(6). Accord-

ingly, the EPA was not required to subject the smaller construc-

tion sites to the terms of the General Permit at issue here.

Nos. 03-3277, et al. 5

tions include Massachusetts, New Hampshire, Idaho, New

4

Mexico, Alaska, and certain tribal lands. 33 U.S.C. § 1342(c).

After holding a series of public meetings and considering

public comments, the EPA published notice of the final

General Permit on July 1, 2003. 68 Fed. Reg. 39087.

The final General Permit issued by the EPA requires

operators to submit an NOI to be covered by the General

Permit, and mandates that a responsible corporate official

certify the basis for eligibility for such coverage. General

Permit, Appendix G at 11A.1. The General Permit also

requires that the operator create, maintain, and implement

a site-specific Storm Water Pollution Prevention Plan

(“SWPPP”), which must also be certified by a corporate offi-

cial. General Permit 3.13; General Permit, Appendix G at

11A.1. The discharger must further implement best manage-

ment practices (“BMP”) necessary to comply with water

quality standards, assure weekly site inspections, and docu-

ment those inspections, including detailing weather condi-

tions. See General Permit 4.5A (construction operators must

“select, install, and maintain BMPs at your construction

site” that minimize pollutants in the discharges as necessary

to meet applicable water quality standards); General Permit

3.10.A (detailing requirements for inspections).

Shortly before it published the final regulation for

the General Permit, the EPA issued 68 Fed. Reg. 11325

(March 10, 2003). That final rule provided that “[d]ischarges

associated with small construction activity at such oil and

gas sites will require permit authorization by March 10,

4

The EPA also maintains that the General Permit applies to cer-

tain construction activities associated with oil and gas exploration

in the States of Oklahoma and Texas.

6 Nos. 03-3277, et al.

5

2005.” 68 Fed. Reg. at 11330. On June 9, 2003, several

organizations representing business interests in the oil and

gas industry (“Oil and Gas Petitioners”) filed a petition

challenging that regulation in the Fifth Circuit. In their

petition, the Oil and Gas Petitioners claimed that the EPA

lacks authority to require storm water discharge permits for

oil and gas construction activities based on § 402(l)(2) of the

CWA. In § 402(l)(2), Congress expressly prohibited the EPA

from requiring a § 402 permit for storm water discharges for

oil and gas activities unless the discharges were contami-

nated by contact with materials located on the site of such

6

operations. 33 U.S.C. § 1342(l)(2). That petition is still

pending before the Fifth Circuit. See Indep. Petro v. EPA, No.

03-60506 (5th Cir. oral argument Jan. 31, 2005).

In addition to challenging the EPA’s proposed final rule,

arguing that they are exempt from the permit requirements,

the Oil and Gas Petitioners filed a petition for review of the

5

The EPA has since postponed the effective date to June 12,

2006. 70 Fed. Reg. 11560 (March 9, 2005).

6

Section 402(l)(2) provides:

The Administrator shall not require a permit under

this section, nor shall the Administrator directly or

indirectly require any State to require a permit, for

discharges of storm water runoff from mining opera-

tions or oil and gas exploration, production, processing,

or treatment operations or transmission facilities,

composed entirely of flows which are from conveyances

or systems of conveyances (including but not limited to

pipes, conduits, ditches, and channels) used for collect-

ing and conveying precipitation runoff and which are

not contaminated by contact with, or do not come into

contact with any overburden, raw material, intermediate

products, finished product, byproduct, or waste prod-

ucts located on the site of such operations.

Nos. 03-3277, et al. 7

terms of the General Permit in the Fifth Circuit. The Natural

Resources Defense Council (“NRDC”), an environmental

advocacy organization, also filed a petition for review of the

General Permit. That petition was filed before this court.

The Oil and Gas Petitioners’ petition was consolidated with

the NRDC petition pending in this court, and leave was

granted the National Association of Home Builders, the

Wisconsin Builders Association, and the Associated General

Contractors of America (collectively “Builder Groups”), to

intervene in support of the General Permit regulation.

II.

On appeal, petitioner NRDC raises three main arguments.

First, the NRDC argues that the General Permit violates the

mandates of the CWA by “authorizing the discharge of

pollutants without ensuring that the discharge will meet the

water quality and technology requirements of the CWA.”

Second, the NRDC challenges the “General Permit’s failure

to mandate public availability of the NOI and the SWPPP,

as well as its failure to provide the public with the opportu-

nity for a public hearing on the NOI and the SWPPP. . . .”

Third, the NRDC claims that the General Permit violates the

Endangered Species Act (“ESA”). 16 U.S.C. §§ 1531, et seq.

For their part, the Oil and Gas Petitioners first reiterate

their position that the storm water permit requirements do

not apply to construction activities in the oil and gas in-

dustry. The Oil and Gas Petitioners maintain, however, that

in this appeal, they are not challenging the EPA’s decision

that they must obtain storm water discharge permits, as that

question is currently pending before the Fifth Circuit.

Rather, the Oil and Gas Petitioners assume, for purposes of

this appeal, that they must obtain a permit, and instead they

challenge the requirements of the General Permit estab-

8 Nos. 03-3277, et al.

lished by the EPA in 68 Fed. Reg. 39,087. Specifically, the Oil

and Gas Petitioners argue that the EPA’s definition of

“common plan” contained in the General Permit is so broad,

ambiguous, and vague that it violates their rights to due

process because they do not know if they need to apply for

a General Permit. The Oil and Gas Petitioners also argue

that the EPA’s definition of “final stabilization” is too

vague. Alternatively, the Oil and Gas Petitioners argue that

the EPA’s definitions of “common plan” and “final stabili-

zation” are arbitrary and capricious because the definitions

do not take into account the differences in construction

activities related to oil and gas exploration and conventional

residential and commercial activities.

The State of Louisiana’s Department of Natural Resources,

the Railroad Commission of the State of Texas, and the State

of Oklahoma’s Corporation Commission filed amici curiae

briefs in support of the Oil and Gas Petitioners. The amici

support the Oil and Gas Petitioners’ claims that the EPA

acted arbitrarily and capriciously in failing to tailor the

permit criteria to construction activities in the oil and gas

industries. The amici also highlight the importance of the oil

and gas industries to their States’ economies, and stress that

their States currently address environmental concerns

related to the oil and gas industry.

In the cross-fire is the EPA, which maintains the middle

ground, asserting that it acted reasonably in adopting the

General Permit and that the regulations are neither too

harsh nor too lax. The Builders Group supports the EPA’s

position, submitting a brief as Intervening Respondents to

oppose the claims asserted by the NRDC. We begin by ad-

dressing the arguments presented by the NRDC, and then

consider the Oil and Gas Petitioners’ claims.

Nos. 03-3277, et al. 9

A. The NRDC’s Petition

1. Standing.

Before we can address the merits of the NRDC’s argu-

ments, however, we must first determine whether the

parties have standing to sue, an issue raised by the Builders

Group, but one this court must in any event, determine in

7

the first instance. See Heartwood, Inc. v. United States Forest

Serv., 230 F.3d 947, 951 (7th Cir. 2000) (“As always, before

the court may consider the merits of a case, we must

determine whether Plaintiffs have presented a justiciable

claim.”).

Section 509(b)(1)(F) of the CWA authorizes any “inter-

ested person” to obtain review of an EPA action in a Circuit

Court of Appeals. 33 U.S.C. § 1369(b)(1)(F). To qualify as

an “interested person” under § 509(b)(1)(F), a party, at a

minimum, must have Article III standing. Lujan v. Defenders

of Wildlife, 504 U.S. 555, 560-61 (1992) (hereinafter Lujan II).

When a plaintiff is an association, the association has Article

III standing to represent the interests of its members if the

individuals have standing in their own right; the interests

represented are germane to the association’s purpose; and

the relief sought does not require the participation of the

individual members. Hunt v. Wash. State Apple Adv. Comm’n,

432 U.S. 333, 343 (1977). See, e.g., Sierra Club v. Marita, 46

F.3d 606, 611-12 (7th Cir. 1995) (holding that “Sierra Club

7

The NRDC claims that it need not establish standing unless or

until it is challenged. However, this court admonished litigants

in Rhodes v. Johnson, 153 F.3d 785, 787 (7th Cir. 1998), to “be

mindful of our obligation to satisfy ourselves of our jurisdiction

and when, in cases like this, standing is an obvious issue, . . . they

[should] cite to the relevant parts of the record to avoid wasting

judicial time and resources.”

10 Nos. 03-3277, et al.

may maintain standing on behalf of its members”). Plain-

tiffs, as the parties invoking federal jurisdiction, have the

burden of proof and persuasion as to the existence of

standing. Lujan II, 504 U.S. at 561.

At oral argument, we directed the NRDC to file a supple-

mental brief addressing whether it satisfied these require-

ments. In its supplemental brief, the NRDC asserts that it has

standing to sue on behalf of its members as the interests

involved are germane to the association’s purpose, and the

relief sought does not require the participation of individual

members. No one takes issue with those propositions. The

only real question is whether the individual members would

have standing to sue in their own right. The NRDC claims

that it has identified three members who have standing in

their own right by virtue of living near and making use of

“water bodies that receive storm water discharges autho-

rized” by the General Permit. To determine whether this is

sufficient, we turn then to the requirements for individual

standing in general and, specifically, standing in an environ-

mental case.

Generally, to establish standing a petitioner must dem-

onstrate an injury in fact; a causal link between the injury

and the challenged action; and redressability through a

favorable court decision. Id. at 560-61; see also Area Transp.,

Inc. v. Ettinger, 219 F.3d 671, 672 (7th Cir. 2000). However,

when, as here, “a plaintiff’s asserted injury arises from the

government’s allegedly unlawful regulation (or lack of reg-

ulation) of someone else, much more is needed.” Lujan II, 504

U.S. at 562 (emphasis in original). As the Supreme Court

in Lujan II explained, that is because in such a situation,

“causation and redressability ordinarily hinge on the re-

sponse of the regulated (or regulable) third party to the gov-

ernment action or inaction—and perhaps on the response of

others as well.” Id. Thus, the plaintiff must “adduce facts

Nos. 03-3277, et al. 11

showing that those choices have been, or will be, made in

such manner as to produce causation and permit

redressability of injury.” Id. Accordingly, as Lujan II ex-

plained, “when the plaintiff is not himself the object of the

government action or inaction he challenges, standing is not

precluded, but it is ordinarily substantially more difficult to

establish.” Id. (internal quotations omitted).

Notwithstanding this difficult standard, the NRDC main-

tains that it has standing to challenge the General Permit

because three of its members use various bodies of water

which are polluted and that the pollution lessens their

enjoyment and use of the water bodies. The NRDC asserts

that that is enough to establish environmental standing,

citing numerous environmental cases holding that such an

interest is sufficient.

The NRDC is correct that injury to recreational or aes-

thetic interests constitutes a cognizable injury for purposes

of standing. See Friends of the Earth, Inc. v. Laidlaw, 528 U.S.

167, 183 (2000) (stating that injury to aesthetic and recre-

ational values constitutes sufficient injury for standing);

Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 886 (1990) (herein-

after Lujan I) (“We have no doubt that ‘recreational use and

aesthetic enjoyment’ are among the sorts of interests those

statutes were specifically designed to protect.”). However,

to establish standing, the NRDC must establish not just

“ ‘injury in fact’—an invasion of a legally protected interest

which is (a) concrete and particularized,’ ” but also that

there is “a causal connection between the injury and the

conduct complained of . . . .” Lujan II, 504 U.S. at 560. In

other words, “the injury has to be ‘fairly . . . trace[able] to

the challenged action of the defendant, and not . . . th[e]

result [of] the independent action of some third party not

before the court.” Id.

12 Nos. 03-3277, et al.

Simply put, the NRDC must tie the asserted injury,

namely its members’ reduced aesthetic and recreational

enjoyment, to the challenged conduct, namely the EPA’s

issuance of the General Permit. The NRDC asserts its mem-

bers “will be directly affected by the General Permit,” as it

“has members in each of the states in which construction

activities will be regulated by the General Permit,” and that

its “members swim and engage in other recreational activ-

ities in water bodies directly affected by pollution from

construction activities subject to the General Permit.” These

contentions, however, fail to establish the requisite casual

connections for standing for numerous reasons.

Initially, we note that the NRDC fails to adduce specific

facts in its proffered affidavits to support its claim that the

water bodies are “directly affected by pollution from con-

struction activities subject to the General Permit.” Rather, in

the three affidavits presented in the NRDC’s reply brief to

establish standing, the members merely repeat the conclu-

sory allegations of the NRDC’s opening brief. For instance,

one affiant stated: “In recent years, there has been much

construction activity near the waters that I use in Idaho. . . . I

believe that that [sic] these construction projects contribute

to sediment, turbidity and water quality problems in the

Boise River, Snake River, and Clearwater River.” However,

the affidavit fails to identify any specific construction

project authorized under the General Permit to discharge

into these bodies of water, and more significantly it fails

to present evidence that discharges of sediment from the

sites are actually occurring. Similarly, a second affidavit

merely states: “The construction that has been occurring

in and around Taos has negatively affected water quality

and harmed me and my family in the process.” Again, this

conclusory statement does not identify any specific con-

struction sites authorized under the General Permit and fails

to present evidence of any discharges into the water bodies

Nos. 03-3277, et al. 13

at issue. Finally, although the third affidavit identifies a

construction project approved under the EPA’s General

Permit, that affidavit does not specify any discharge from

8

that project into the water body at issue. As petitioning

party, the NRDC bears the burden of proof, Lujan II, 504

U.S. at 561, and because it has sought a ruling as a matter of

law, it must present record evidence establishing standing.

Sierra Club v. EPA, 292 F.3d 895, 899 (D.C. Cir. 2002).

Repeating the conclusory allegations of a complaint is not

enough. Lujan I, 497 U.S. at 888. Yet that is what the NRDC

has done, opining that the construction activities result in

pollution, without citing any supporting evidence.

The NRDC seeks to overcome the deficiencies in the

affidavits by citing in its Supplemental Brief to several NOIs

filed with the EPA, including some from construction

companies providing a notice of an intent to discharge

under the General Permit in the bodies of water used by

the three affiants. There are several problems with this

approach. First, the water bodies at issue span, in some

cases, hundreds of miles. For instance, the Rio Grande runs

the entire length of New Mexico, and pointing to an NOI

seeking coverage under the General Permit for discharges

into the Rio Grande does not establish an injury to the por-

tion of the river used by the affiant. This is fatal, as “aver-

ments which state only that one of respondent’s members

uses unspecified portions of an immense tract of territory,

on some portions of which [regulated] . . . activity has

occurred or probably will occur by virtue of the governmen-

8

Ironically, while the affiants conclusorily declare that dis-

charges from the construction sites pollute the water bodies at

issue, the NRDC’s acknowledgment in its brief that it cannot

“determine which point-sources might be responsible for harmful

discharges” calls into question the veracity of these declarations.

14 Nos. 03-3277, et al.

tal action, are insufficient to show that the member’s rights

have been adversely affected or aggrieved by Government

action.” Lujan I, 497 U.S. at 889. Moreover, to satisfy the

“fairly traceable” causation requirement, there must be a

distinction between “the plaintiffs who lie within the

discharge zone of a polluter and those who are so far

downstream that their injuries cannot fairly be traced to that

defendant.” Friends of the Earth, Inc. v. Gaston Copper Recy.,

Corp., 204 F.3d 149, 162 (4th Cir. 2000). See also Lujan II, 504

U.S. at 565-66 (“[P]laintiffs claiming injury from environ-

mental damage must use the area affected by the challenged

activity and not an area roughly ‘in the vicinity’ of it.”).

Thus, for instance, the Fifth Circuit held in Friends of the

Earth, Inc. v. Crown Cent. Petroleum Corp., 95 F.3d 358, 360-61

(5th Cir. 1996), that an eighteen-mile distance is “too large

to infer causation.” Likewise here, where the specific water

bodies used by NRDC members run a great distance,

pointing to NOIs that authorize discharges in those water

bodies is insufficient to establish the discharges are within

the zone to infer causation. See Lujan I, 497 U.S. at 887-89.

Second, the NOIs relied upon by the NRDC do not

establish that any discharge has actually occurred into the

water bodies. See, e.g., 69 Fed. Reg. 76743, 76746 (Dec. 22,

2004) (In discussing the General Permit, the EPA char-

acterizes the CWA and its implementing regulations as

requiring “certain potential dischargers to seek permit cover-

age.”). Nor do any of the affidavits filed present evidence of

the discharge of pollutants. “[I]t will not do to ‘presume’ the

missing facts because without them the affidavits would not

establish the injury that they generally allege.” Lujan I, 497

U.S. at 889. Additionally, even if discharges were occurring

into the water bodies, the NRDC must still trace the alleged

polluted conditions of the water bodies to the discharges.

Although a plaintiff need not establish such a nexus with

Nos. 03-3277, et al. 15

“scientific certainty,” Gaston Copper, 204 F.3d at 161, a

plaintiff must show “that a defendant discharges a pollutant

[which] causes or contributes to the kinds of injuries alleged

in the specific geographic area of concern.” Id. (internal

citations omitted). In Gaston Copper, the Fourth Circuit noted

that “[w]here a plaintiff has pointed to a polluting source as

the seed of his injury, and the owner of the polluting source

has supplied no alternative culprit, the ‘fairly traceable’

requirement can be said to be fairly met.” Id. at 162. Here,

however, the NRDC failed to establish “any seed of [its]

injury.” The NRDC also ignores the existing polluted

condition of at least three of the water bodies, the Anacostia

and Potomac Rivers, and Rock Creek, in Washington D.C.

This condition is in large part caused by the “estimated 3.2

billion gallons of untreated raw sewage that flows into the

rivers each year from the area’s sewer systems.” Depart-

ment of Justice Press Release, U.S. - WASA Sewage Settle-

ment to Clean up D.C.’s Anacostia River, December 16,

2004.

Finally, and most significantly, pointing to NOIs filed

with the EPA is insufficient because for the NRDC to have

standing to sue, it is not enough to assert that water bodies

used by its members receive storm water discharges au-

thorized by the General Permit. Rather, the NRDC must

show that the discharge caused the complained-of legally

cognizable aesthetic or recreational injury. Establishing a

discharge does not also establish an injury. That is because

the EPA “may issue permits authorizing the discharge

of pollutants in accordance with specified conditions,”

and such authorized discharges are not illegal. Gwaltney

of Smithfield, Ltd. v. Chesapeake Bay Found., Inc., 484 U.S.

49, 52 (1987) (citing 33 U.S.C. § 1342). Therefore, to establish

causation and, in turn, standing, the NRDC must establish

16 Nos. 03-3277, et al.

that the discharge violated the General Permit or the terms

of the CWA. The NRDC has established neither.

This distinguishes our case from those relied upon by the

NRDC wherein the courts found environmental standing, as

those cases alleged aesthetic and recreational injuries caused

by violations of a permit. For instance, in Laidlaw the

plaintiffs sued for injunctive relief for alleged violations of

an NPDES permit by a hazardous waste incinerator. The

Supreme Court found standing in Laidlaw, reasoning: “[I]t

is undisputed that Laidlaw’s unlawful conduct—discharg-

ing pollutants in excess of permit limits—was occurring at

the time the complaint was filed.” Laidlaw, 528 U.S. at 184.

Similarly, in Ecological Rights Found. v. Pac. Lumber Co., 230

F.3d 1141, 1146 (9th Cir. 2000), the Ninth Circuit held the

plaintiffs had standing because they alleged that their indi-

vidual members used the water bodies at issue and that

their aesthetic and recreational interests were impaired by

the alleged violations of the 1992 General Permit. Likewise

in Gaston Copper, 204 F.3d at 156, the Fourth Circuit held

that the plaintiff had standing to sue because the plaintiff

was “a property owner whose lake lies in the path of Gaston

Copper’s toxic chemical discharge. He and his family swim

and fish in this lake. [Plaintiff] testified that he and his

family swim less in and eat less fish from the lake because

of his fears of pollution from Gaston Copper’s permit

exceedances.” (emphasis added). The court in Gaston contin-

ued: “Plaintiff here established the required nexus for the

alleged injury by presenting evidence consisting of reports

show[ing] over 500 violations of the company’s discharge

limits, including unlawful releases of cadmium, copper,

iron, lead and zinc, as well as pH violations.” Id. at 157

(internal quotation omitted).

Conversely, in this case, the NRDC does not assert any

violation of the General Permit. The NRDC responds that it

Nos. 03-3277, et al. 17

need not establish a violation of the General Permit because

it is attacking the General Permit scheme and not a specific

discharge. However, to attack the General Permit scheme,

the NRDC must still establish standing, which means the

petitioner must demonstrate its members suffered an injury

from the General Permit scheme. Yet the only potential

injury to its members is one that could occur in the future

should a contractor violate the terms of the General Permit.

Moreover, it would be illogical to hold that a petitioner

has standing to challenge a General Permit scheme because

a discharger may in the future violate the terms of the per-

mit, where the Supreme Court has held that a citizen lacks

standing to sue for actual violations of a permit where the

discharger corrects the violation within the sixty-day notice

9

period. See Atlantic States Legal Found., Inc. v. Stroh Die

Casting Co., 116 F.3d 814, 825 (7th Cir. 1997) (“In Gwaltney,

the Supreme Court set forth a test for standing under the

Act: a plaintiff must make a ‘good-faith allegation of con-

tinuous or intermittent violation.’ 484 U.S. at 64, 108 S.Ct. at

385. This means that a citizen plaintiff does not have

standing to maintain a suit for civil penalties for wholly past

violations of the act.”) (citing Gwaltney, 484 U.S. at 54).

Allowing an attack on the General Permit scheme where

no actual violation has occurred also defeats the goal of the

regulatory provisions requiring that the notice of a permit

violation provide the alleged discharger with specific details

so the discharger knows what it is doing wrong and what

9

Section 1365(b)(1)(A) authorizes private suits for violations of

the terms of an existing NPDES permit, but “[c]itizens may not

bring suit, however, unless and until they have given 60 days’

notice of their intent to sue to the alleged violator (as well as the

Administrator and the state)”. Atlantic States, 116 F.3d at 818

(citing 33 U.S.C. § 1365(b)(1)(A)).

18 Nos. 03-3277, et al.

corrective actions will avert a lawsuit. Id. Where there is no

alleged violation, the dischargers have no opportunity to

take corrective action, as Congress and the EPA desired.

Gwaltney, 484 U.S. at 60 (stating that the sixty-day notice

requirement provides the alleged violator “an opportunity

to bring itself into compliance with the Act and thus like-

wise render unnecessary a citizen suit”). Moreover, allow-

ing such suits would conflict with Congress’ intent that “the

great volume of enforcement actions be brought by the

State,” and with Congress’ design that citizen suits be

brought only “if the Federal, State, and local agencies fail to

exercise their enforcement responsibility.” Ailor v. City of

Maynardville, Tenn., 368 F.3d 587, 598 (6th Cir. 2004) (quot-

ing S. Rep. No. 92-414, p.64 (1971)).

Of course, that does not mean that the NRDC would be

without standing to challenge a discharge that complies

with the terms of the General Permit but violates the terms

of the CWA. Such a discharge would be illegal, whether or

not the EPA authorized it. Some language from the NRDC’s

briefs could be read as presenting such an argument. For

instance, in its reply brief, the NRDC frames the issue as

whether the EPA has “authority to issue a General Permit

that authorizes discharges that do not comply with the

law.” However, the NRDC has presented no evidence of a

discharge authorized by the General Permit that violates the

terms of the CWA. The NRDC’s other briefs also demon-

strate that that is not the NRDC’s real contention. Rather,

the NRDC’s complaint is that the General Permit scheme

allows for the possibility that a contractor may violate the

terms of the General Permit. But to have standing to present

such a claim premised on a third party’s action or inaction,

the NRDC must adduce facts showing that “those choices

have been, or will be, made in such manner as to produce

causation and permit redressability of injury.” Lujan II, 504

Nos. 03-3277, et al. 19

U.S. at 562. This it has failed to do. Therefore, it lacks

standing to challenge the substantive provisions of the

General Permit.

Because the NRDC has failed to establish standing to

present its substantive challenges to the General Permit, this

court lacks jurisdiction to consider the NRDC’s objections to

the General Permit scheme. Thus, its reliance on decisions

from the Ninth and Second Circuits addressing the validity

of other General Permit schemes is misplaced. Specifically,

the NRDC cites the Ninth Circuit’s decision in Environmental

10

Defense Center, Inc. v. EPA, 344 F.3d 832 (9th Cir. 2003), and

the Second Circuit’s decision in Waterkeeper Alliance, Inc. v.

11

EPA, 399 F.3d 486 (2d Cir. 2005), in support of its challenge

to the General Permit scheme. However, neither the Ninth

nor the Second Circuit addressed the initial question of

standing, at least as to whether environmental plaintiffs not

subject to the regulation have standing to challenge the

12

general permit. Without standing, this court cannot reach

10

In Envirnomental Defense Center, the Ninth Circuit considered a

general permit authorizing municipal storm water discharges.

344 F.3d 832.

11

In Waterkeeper, the Second Circuit considered the validity of a

general permit authorizing discharges by Concentrated Animal

Feeding Operations. 399 F.3d 486.

12

The Second Circuit did not address the issue of standing at all.

Waterkeeper Alliance, 399 F.3d 486. The Ninth Circuit addressed

standing in considering challenges to the general permit pre-

sented by the industries subject to the permit requirements, and

it concluded those petitioners lacked standing. Environmental

Defense, 344 F.3d at 863, 867-68. The Ninth Circuit, however,

did not mention the question of whether the environmental

petitioners had standing. The Ninth Circuit did hold that the en-

(continued...)

20 Nos. 03-3277, et al.

the merits of the petitioner’s substantive challenges to the

General Permit. In the Matter of Memorial Estates, Inc., 950

F.2d 1364, 1369 (7th Cir. 1991).

Whether the NRDC has standing to present procedural

challenges to the General Permit, namely by attacking the

General Permit’s failure to mandate public availability of

the NOI and SWPPP, and its failure to provide the public

with the opportunity for a public hearing on the NOI and

the SWPPP, however, is a separate question. Here the

NRDC seeks to vindicate procedural rights established by

statute to participate in the process. “The person who has

been accorded a procedural right to protect his concrete in-

terests can assert that right without meeting all the normal

standards for redressability and immediacy.” Lujan II, 504

U.S. at 572 n.7. Lujan II illustrated this point, noting that

individuals living adjacent to a site for proposed construc-

tion have standing to challenge the licensing agency’s

failure to prepare an environmental impact statement, even

though they “cannot establish with any certainty that the

12

(...continued)

vironmental petitioners’ claim was ripe, noting that “we are

addressing whether the EPA, in promulgating the Phase II Rule,

has accomplished the substantive controls for municipal storm-

water that Congress mandated in § 402(p) of the Clean Water

Act, . . . [and that] question is ripe for review.” Id. at 852 n.30.

Although ripeness and standing overlap in some respects, in

passing on ripeness, as the above excerpt demonstrates, the Ninth

Circuit failed to consider whether the Phase II Rule at issue in

that case caused an actual injury to the environmental petitioners.

Id. at 852 n.30. That is significant because, as the above analysis

demonstrates, the NRDC lacks standing to challenge the General

Permit at issue in this case because it failed to present sufficient

evidence that the General Permit caused a legally cognizable

injury to any of its members.

Nos. 03-3277, et al. 21

statement will cause the license to be withheld or altered

and even though the dam will not be completed for many

years.” Id. This court also recognized standing to vindicate

a procedural right in Sierra Club v. Marita, 46 F.3d 606 (7th

Cir. 1995), holding that the plaintiffs had standing to chal-

lenge a forest management plan because “[o]nce the plan

has passed administrative review, the procedural injury has

been inflicted, [and] [u]nless a plaintiff’s purported interest

in the matter is wholly speculative, waiting any longer to

address that injury makes little sense.” Id. at 612.

So too here: Even though the NRDC members cannot

establish the immediacy of an injury from construction

activities operating under the General Permit, the NRDC

nonetheless has standing to challenge the EPA’s failure to

mandate public availability of the NOI and the SWPPP, and

its failure to provide the opportunity for a public hearing

related to the NOI and the SWPPP. This is because the

NRDC has presented evidence that its members use water

bodies that may receive discharges authorized by the

General Permit and the three affiants stated that they would

participate in the decision making process if allowed.

This contrasts with the Lujan II case in which, after re-

affirming the principle of procedural standing, the Supreme

Court nonetheless held that the plaintiffs lacked standing to

present such a challenge because they failed to satisfactorily

establish their future use of the property affected by the

alleged procedural violation. Lujan II, 504 U.S. at 564, 572-

73. Conversely, here, the NRDC members stated that they

regularly use the water bodies. Accordingly, the NRDC has

procedural standing. See Rhodes, 153 F.3d at 787 (holding

that the plaintiffs have standing because they alleged they

used the forest at issue and that the Forest Service’s decision

would diminish this use and enjoyment, and “that the

defendant’s failure to permit them to participate in the

22 Nos. 03-3277, et al.

public review of the decision is causally connected to their

harm”); Heartwood, 230 F.3d at 952 (holding that under

Rhodes, plaintiffs had standing to challenge the Forest

Service’s exclusion of certain classes of actions from proce-

dural safeguards designed to determine the environmental

impact of those actions, and that plaintiffs had an informa-

tional injury justifying standing as well, where the alleged

violation prevented them from commenting on or challeng-

ing the agency’s decision).

2. Public notice and hearing.

Having concluded that the NRDC has standing to pursue

its procedural injury claims, we turn to the merits of those

claims. As noted above, the NRDC presents two procedural

challenges: the NRDC challenges the General Permit’s fail-

ure to mandate public availability of the NOIs and the

SWPPP, and its failure to provide the public with the op-

portunity for a public hearing on the NOI and the SWPPP.

In support of its position, the NRDC cites 33 U.S.C.

§§ 1342(j) and 1342(1)(a).

Section 1342(j) of the CWA provides that “[a] copy of each

permit application and each permit issued under

this section shall be available to the public. Such permit

application or permit, or portion thereof, shall further be

available on request for the purpose of reproduction.”

Section 1342(a)(1) authorizes the EPA “after opportunity for

public hearing, [to] issue a permit for the discharge of any

pollutant, or combination of pollutants. . . .” The NRDC

claims this statutory language requires the EPA to make the

NOIs and SWPPPs publicly available and to provide for the

opportunity for a public hearing. The EPA responds that

Sections 1342(j) and 1342(a)(1) do not apply to the NOIs and

Nos. 03-3277, et al. 23

SWPPPs because NOIs and SWPPPs are neither permits nor

permit applications.

This presents an issue of statutory interpretation, which is

governed by the two-step test set forth in Chevron U.S.A.,

Inc. v. National Resource Defense Council, Inc., 467 U.S. 837,

842-43 (1984). Under the first step, a reviewing court must

determine “whether Congress has directly spoken to the

precise question at issue.” Id. at 842. If Congress’ intent is

clear from the statutory language, a court must “give effect

to the unambiguously expressed intent of Congress.” Id. at

842-43. However, if the statute is “silent or ambiguous with

respect to the specific issue,” the court must decide whether

the Agency’s interpretation is based on a permissible con-

struction of the statute. Id. at 843. To uphold an agency’s

interpretation of a statute, this court need only find the

interpretation permissible. Id.

The statutory language quoted above speaks only to “per-

mits” and “permit applications,” and not NOIs or SWPPPs.

Thus, Congress has not spoken directly to the precise

question at issue, or at best, it is ambiguous as to whether

Congress intended to treat NOIs and SWPPPs as permits or

permit applications for purposes of Sections 1342(j) and

1342(a)(1). Accordingly, under Chevron, we must decide

whether the EPA gave a permissible construction to the

term “permit applications” and “permits.”

Maintaining that NOIs and SWPPPs do not constitute

“permit applications” or “permits” for purposes of Sections

1342(j) and 1342(a)(1), the EPA stresses that the General

Permit scheme does not make use of a permit application.

Rather, general permits are proposed through a notice in the

Federal Register, and the EPA solicits and receives public

comments on the proposed general permits. It is at that time

that the public has the opportunity to request a public

24 Nos. 03-3277, et al.

hearing. Once a general permit issues, a discharger wishing

to operate under the general permit must comply with the

previously established permit terms. Therefore, according

to the EPA, there is no need for additional public comment

or a notice period. Moreover, the EPA maintains that

requiring “an additional public hearing on each individual

NOI and SWPPP would eviscerate the administrative

efficiency inherent in the general permitting concept,” in

effect making the general permit scheme no different from

the process for obtaining individual permits. This would be

inconsistent with Congress’ intent to allow for the use of

general permits. See Pub. L. 102-240 (Dec. 18, 1991) (“The

Administrator shall issue final regulations with respect to

general permits for storm water discharges associated with

industrial activity on or before Feb. 1, 1992.”). These ratio-

nales are eminently reasonable. Therefore, we conclude that

the EPA’s interpretation of the terms “permit application”

and “permit” as not including NOIs and SWPPPs is a

permissible construction. Under the EPA’s interpretation,

then, NOIs and SWPPPs are not subject to the requirements

of Sections 1342(j) and 1342(a)(1), and, accordingly, the EPA

did not violate those sections of the CWA in issuing the

13

General Permit at issue.

13

The Ninth Circuit’s majority opinion in Environmental Defense

Center found under step one of Chevron that Congress clearly

intended NOIs to be subject to the public availability and public

hearing requirements because NOIs are the functional equivalent

of a permit application. 344 F.3d at 856. However, as discussed

above, the statutory language at issue addresses only “permit

applications” and fails to include any mention of NOIs, SWPPPs,

or other so-called “functional equivalents.” Thus, as the dissent

in Environmental Defense Center concludes, the majority erred in

concluding that Congress clearly spoke to the issue. Id. at 880-81

(Tallman, J., dissenting). Because this opinion creates a split

(continued...)

Nos. 03-3277, et al. 25

3. Endangered Species Act.

Finally, the NRDC claims that the General Permit violates

Section 7 of the Endangered Species Act (“ESA”). 16 U.S.C.

§§ 1531, et seq. Section 7 requires each federal agency to

ensure that any action authorized, funded, or carried out by

that agency “is not likely to jeopardize the continued

existence of any endangered species or threatened species or

result in the destruction or adverse modification” of des-

ignated critical habitat. 16 U.S.C. § 1536(a)(2). The relevant

regulations further require any agency proposing an action

to pursue either informal or formal consultation with the

Fish and Wildlife Service and/or the National Marine

Fisheries Service (together “Service”) if the proposed federal

action “may affect” a threatened or endangered species. 50

C.F.R. § 402.14(a).

The NRDC claims that the General Permit violates Section

7 because the EPA does not consult with the Service upon

receipt of an NOI and the completion of a SWPPP. Again,

we begin by considering the NRDC’s standing. As above,

the NRDC’s claimed injury here is a procedural injury—the

lack of statutorily required consultation. Therefore, the

standing requirements are more relaxed. In this case, the

NRDC alleged that some of its members use bodies of water

which endangered species inhabit, and that pollution

threatens the proliferation of these species. For at least one

of the members, a claimed harm exists: Affiant Justin Hayes

claims his use and enjoyment of the water bodies is dimin-

13

(...continued)

between the circuits, we circulated it in advance of publication to

the full court pursuant to Seventh Circuit Rule 40(e). No judge in

active service voted to hear the case en banc. (Chief Judge Flaum

and Judge Ripple did not participate in consideration of whether

to hear the case en banc.)

26 Nos. 03-3277, et al.

ished because the polluted conditions prevent endangered

fish species from flourishing, which means that he cannot

keep the fish he catches, but must instead release them back

into the water. Given that the claimed harm is a procedural

injury stemming from the EPA’s failure to consult with the

Service, we conclude the NRDC has standing to challenge

the lack of consultation. See supra at 20-22.

However, on the merits the NRDC loses because Section 7

only requires consultation with the Service whenever a

federal action “may affect” a threatened or endangered

species. 16 U.S.C. § 1536(a)(2). A private actor, however,

files an NOI and creates a SWPPP, and neither the filing of

an NOI nor the creation of a SWPPP by a private contractor

requires any federal action. Without a federal action, the

consultation requirements of Section 7 are not triggered.

Therefore, the EPA need not engage in consultation with the

Service every time an NOI is filed or a SWPPP is prepared.

Consultation was required earlier, when the EPA issued the

General Permit, but at that time the EPA undertook and

concluded informal consultation with the Service on the

issuance of the General Permit. Specifically, the EPA and the

Service developed a detailed procedure designed to accom-

modate listed species and critical habitats and the Service

agreed that the issuance of the General Permit was not

likely to adversely affect those species and habitats. Accord-

ingly, the EPA complied with the ESA in issuing the

General Permit. See 50 C.F.R. § 402.13 (explaining that the

consultation requirement is satisfied if during the informal

consultation the Service concurs in writing that the action

“is not likely to adversely affect” a listed species).

B. Oil and Gas Petitioners

Nos. 03-3277, et al. 27

The Oil and Gas Petitioners also challenge the terms of the

General Permit, taking issue with various definitions and

provisions, arguing in essence that the EPA acted arbitrarily

and capriciously by failing to take into account the differ-

ences in construction activities related to oil and gas explo-

ration and conventional residential and commercial ac-

tivities. However, as noted above, the Oil and Gas Petition-

ers also maintain that the EPA lacks the authority to require

a permit for construction activities related to oil and gas

exploration. That question is currently pending before the

Fifth Circuit. The Oil and Gas Petitioners acknowledge that

should the Fifth Circuit rule in their favor, their claims

would be moot. We agree. Accordingly, we stay consider-

ation of the Oil and Gas Petition until the Fifth Circuit

determines the initial question of whether the Oil and Gas

Petitioners are subject to the permitting requirements of the

CWA. See Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)

(stating that “the power to stay proceedings is incidental to

the power inherent in every court to control the disposition

of the causes on its docket with economy of time and effort

for itself, for counsel, and for litigants); Aetna State Bank v.

Altheimer, 430 F.2d 750, 755 (7th Cir. 1970) (“A stay pending

the outcome of litigation in another court between the same

parties, involving the same or controlling issues is an

acceptable means of avoiding unnecessary duplication of

judicial machinery.”).

III.

In sum, we conclude that the NRDC lacks standing to

challenge the terms of the General Permit because it has

failed to show any of its members have standing to sue

in their own right; the NRDC failed to present evidence

establishing the General Permit caused an actual injury to

the aesthetic or recreational interests of its members. How-

28 Nos. 03-3277, et al.

ever, the NRDC has standing to present its procedural

challenges to the General Permit, but those challenges fail

because NOIs and SWPPPS are not permits or permit appli-

cations and therefore the CWA’s public notice and hearing

requirements do not apply. Likewise, while the NRDC has

standing to present a procedural ESA claim, that claim fails

on the merits because the filing of an NOI and the creation

of a SWPPP by a private actor does not constitute “federal

action,” and, therefore, the consultation requirements of the

ESA are not implicated. Accordingly, we DENY the NRDC’s

PETITION FOR REVIEW, IN PART, and DISMISS IT IN PART FOR

LACK OF STANDING. We further STAY consideration of the Oil

and Gas Petitioners’ petition pending a decision from the

Fifth Circuit as to whether the permit requirements of the

CWA apply to the Oil and Gas Petitioners.

Nos. 03-3277, et al. 29

Appendix:

The Act: The Clean Water Act

BMP: Best Management Practices

Builder Groups: National Association of Home Builders,

the Wisconsin Builders Association, and

the Associated General Contractors of

America

CWA: The Clean Water Act

EPA: The Environmental Protection Agency

ESA: Endangered Species Act

General Permit: Final National Pollutant Discharge

Elimination System General Permit for

Storm Water Discharges From

Construction Activities

NRDC: Natural Resources Defense Council

NOI: Notice of Intent

NPDES: The National Pollutant Discharge

Elimination System

Oil and G a s Texas Independent Producers and Roy-

Petitioners: alty Owners Assocation; Independent

Petroleum Association of America, U.S.

Oil and Gas Association, Texas Alliance

of Energy Producers, Louisiana Oil and

Gas Associations, Independent Gas and

Gas Association of Pennsylvania, Ohio

Oil and Gas Association, and Oklahoma

Independent Petroleum Association

SWPPP:

30 Nos. 03-3277, et al.

Storm Water Pol-

lution Prevention

Plan

A true Copy:

Teste:

_____________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit

Nos. 03-3277, et al. 31

USCA-02-C-0072—6-13-05