Memorandum — Mont. Power Co. v. U.S.E.P.A.

} Supreme Court, U, de”

FILED

FEB 17 1977

19, 76-620

DAK, JR., CLERK

In the Supreme Court of the United States

OcTOBER TERM, 1976

Nos. 76-529, 76-585, 76-594, 76-603, 76-617, 7

MONTANA POWER COMPANY, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

AMERICAN PETROLEUM INSTITUTE, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.*

ON PETITIONS FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

MEMORANDUM FOR THE FEDERAL RESPONDENTS

DANIEL M. FRIEDMAN,

Acting Solicitor General,

PETER R. TAFT,

Assistant Attorney General,

EDMUND B. CLARK,

EARL SALO,

Attorneys,

Department of Justice,

Washington, D.C. 20530.

G. WILLIAM FRICK,

General Counsel,

Environmental Protection Agency,

Washington, D.C. 20460.

* Additional captions are shown on reverse side.

INDIANA-KENTUCKY ELECTRIC CORPORATION, ET AL.,

PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

ALABAMA POWER COMPANY, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

SIERRA CLUB, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL,

UTAH POWER AND LIGHT COMPANY, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

WESTERN ENERGY SUPPLY AND TRANSMISSION ASSOCIATES,

ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

INDEX

Page

i siaheenineiocmnmnndons 2

Et nL sds andeneippnnbasnumneciaanenneads 2

RS NT OL 2

Constitutional provision, statute and regulations

EERIE 298 Ree nC a ee 3

SESE oe Ne SE ae ae ee eo 3

i ies willie Mine daisies tadsinbdinenes 8

I idaciad inis sindi ttt nadie achianiemigliihiedibeindeeesess 10

CITATIONS

Cases:

Dayton Power and Light Co. v. Environmental

Protection Agency, 520 F. 2d 703 ...............000000 7

me a Ee Bk RR eee 5

Organization for a Better Austin v. Keefe,

I SUED Usaha dhhhlsssaidpehdcbaasiesopsbidedesbiccessonses 4

Sierra Club v. Ruckelshaus, 344 F. Supp. 253 ... 4, 7

Constitution, statutes and regulations:

United States Constitution:

I cn uiaoheneadesonen 3

Te is ccntaallisdiceienendinedeondvetioesen 3

Clean Air Act Amendments of 1970, 84

Stat. 1676, et seqg., 42 U.S.C. 1857a, et seq. ........ 3

Section 110(a)(1), 42 U.S.C. 1857c-S(a){1) ...... 3

Section 110(c), 42 U.S.C. 1857¢-Se .................. 3

Section 111, 42 U.S:C. 1857c-6 .................... 6-7

Page

Constitution, statutes and regulations (continued):

SP is SED socnccittibeiasisnciteanadniititiiiatinicnbicds 3,5

FP Grr es. HIE Sees bcidtieidahntinuniicsiniblia inti i &

FF Ge: SNARE Seitabibeiidetecinrissninsilintsiardicmeiinistinlimmaiialatcas 3, 5

Gai as SEED ceerknsisticccnnitenitinateinabanitatbaninteins 5

SO EF ks FE erinitinittdicnsntenitlaaibbainininieis 5

SP SF Bae Se stttenincesvitnpesibiiiliaeliptintiband 5

SP CF i SED ctitscvctntiicienseneanabdcbinildeii 5, 6

SD Fe PED snsicitintitiintnsitestintilauibaitiias 6

cai PE Slit sitininnctcctccdindicatcditncieaistincnas 6

PF tke SIN wlchncicecicescstecminbianitidibinnes 6

PE Bs SD wit diictdiiiscintinlevsdeibintiieunsanisasta 6

Se GF a, SIE scictiischicesnainccisensiiacens padiekiceiiae 6

TD CF ke EI cscsinss<ccoupaniininaiesoesionnbios 6

Ge as SED insists cesnthithdaticnesithihintenecingee 6

GF Ak SED cciteiicepiiiccassibnesniiiianiininclons 6

TF CF is PH pitbisnniintitpeininieccetintimeniiinlonisited 6

FP CF ae PD ssbicdincedithtickinctiictianpiituidieknas 6

40 C.F.R. 52.21(d)(2ii) ........ isconbehgleidbicnisiiheibeeinhdéea 7

40 C.F.R. 52.21(f) vecccessccseeeen ipesblta adit acco 7

Miscellaneous:

122 Cong. Rec. $13543-S13544 (daily ed.,

RE Fg TI witdehttattibabiniihinitensbitliatitibicimiiitieos 8

122 Cong. Rec. H10198-H10201 (daily ed.,

ES TU I dCi a 8

Fe eee

Page

Miscellaneous (continued:

122 Cong. Rec. H11959, H11970-H11973,

H11987-H11988 (daily ed. September 30,

1976)

123 Cong. Rec. $646-S647 (daily ed., January

Siac SEMUIT UIE - ccpinschsitiah tsihnsiansedinalabsnatesiasiinasaiinemmnacnianicnnipiaiceaiiiee

123 Cong. Rec. S647 (daily ed., January 14,

1977)

H.R. 10498, 94th Cong., 2d Sess. (1976) .............24.

H.R. Rep. No. 94-1742, 94th Cong., 2d Sess.

(1976)

SOOO EEE HEHEHE EEE

S. 252, 95th Comg,, lat Sess. (IGT 7) .cccsccceccccccsssesses

S. 253, 95th Cong., Ist Sess. (1977) ............:eeeeeeeeees

S. 3219,

94th Cong., 2d Sess. (1976) ...........cceeeeeees

In the Supreme Court of the United States

OcTOBER TERM, 1976

No. 76-529

MONTANA POWER COMPANY, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

No. 76-585

AMERICAN PETROLEUM INSTITUTE, ET AL., PETITIONERS

V.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

No. 76-594

INDIANA-KENTUCKY ELECTRIC CORPORATION, ET AL.,

PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

No. 76-603

ALABAMA POWER COMPANY, ET AL., PETITIONERS,

V.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

No. 76-617

SIERRA CLUB, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

(1)

No. 76-619

UTAH POWER AND LIGHT COMPANY, ET AL., PETITIONERS

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

No. 76-620

WESTERN ENERGY SUPPLY AND TRANSMISSION ASSOCIATES,

ET AL., PETITIONERS,

Vv.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY,

ET AL.

ON PETITIONS FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE DISTRICT OF COLUMBIA CIRCUIT

MEMORANDUM FOR THE FEDERAL RESPONDENTS

OPINION BELOW

The opinion of the court of appeals (Pet. No. 76-529,

App. A, pp. la-5la) is reported at 540 F. 2d 1114.

JURISDICTION

The judgment of the court of appeals (Pet. No. 76-529,

App. C, pp. 9la-94a) was entered on August 2, 1976. The

petitions for a writ of certiorari were filed on October 15,

1976 (No. 76-529), October 27, 1976 (No. 76-585), October

29, 1976 (No. 76-594 and No. 76-603), and November |,

1976 (No. 76-617, No. 76-619, and No. 76-620). The juris-

diction of this Court is invoked under 28 U.S.C. 1254(1).

QUESTIONS PRESENTED

1. Whether regulations promulgated by the En-

vironmental Protection Agency to prevent the significant

3

deterioration of air quality are authorized by the Clean Air

Act.

2. Whether the Environmental Protection Agency

properly exercised its discretion and complied with the

Clean Air Act in promulgating the regulations.

3. Whether a congressional grant of authority to the

Environmental Protection Agency to promulgate the

regulations is a constitutional delegation of authority and is

consistent with the Fifth and Tenth Amendments.

CONSTITUTIONAL PROVISION, STATUTE

AND REGULATIONS INVOLVED

The Fifth and Tenth Amendments to the Constitution of

the United States are set forth in Pet. App. D,' pp. 95a-96a.

The Clean Air Act Amendments of 1970, 84 Stat. 1676, e7

seq., 42 U.S.C. 1857a, et seq., are set forth in pertinent part

in Pet. App. E, pp. 97a-112a.

The relevant regulations, 40 C.F.R. 52.01(d) and (f), and

52.21, are set forth in Pet. App. B, pp. 75a-90a.

STATEMENT

Pursuant to the Clean Air Act Amendments of 1970, 84

Stat. 1676, the Administrator of the Environmental

Protection Agency established national primary and

secondary standards for ambient air quality and the States

submitted plans to EPA designed to implement and

maintain these standards within their respective bound-

aries, as required by Section | 10(a)(1) of the Act, 42 U.S.C.

1857c-5(a)(1). If the state implementation plans failed to

meet the standards of the Act, or if the State did not submit a

plan, the EPA Administrator was required to issue a

substitute plan for the State. Section 110(c), 42 U.S.C.

1857c-S(c).

‘Unless otherwise noted, “Pet. App.” refers to the Appendix to the

Petition in No. 76-529.

4

On May 30, 1972, one day before the EPA Administra-

tor was to approve or disapprove the various state plans

submitted to him, the district court in Sierra Club v.

Ruckelshaus, 344 F. Supp. 253 (D. D.C.),? issued a prelimi-

nary injunction. This prohibited the Administrator from

approving any state plan without making it subject to later

review by him “to insure that it does not permit significant

deterioration of existing air quality in any portion of any

state where the existing air quality is better than one or more

of the secondary standards promulgated by the

Administrator” (Pet. App. A, p. 8a). The court further

ordered the Administrator to complete this review within

four months.

Upon the Administrator’s appeal,’ the court of appeals

affirmed on November |, 1972, relying on the opinion of the

district court (Pet. App. A, p. 9a). The court of appeals,

which issued no opinion, later denied a stay pending the

EPA Administrator’s filing of a petition for a writ of

certiorari.

In compliance with the district court’s order the EPA

Administrator, on November 9, 1972, disapproved all state

plans “insofar as they failed to provide for the prevention of

significant deterioration of existing air quality” (Pet. App.

B, p. 53a).

After granting the EPA Administrator’s petition for a

writ of certiorari and hearing oral argument, this Court

affirmed the judgment below on June 11, 1973,4 by an

>The district court’s opinion was filed on June 2, 1972.

‘The parties had stipulated that the district court's preliminary

injunction should be regarded as a final order since nothing further

remained for trial and since the district court had, in effect, decided the

controlling legal question. See Organization for a Better Austin v.

Keefe, 402 U.S. 415, 418 n.*.

‘Twenty States, appearing as amici curiae, urged affirmance, two

States as amici urged reversal.

5

equally divided Court.> Friv. Sierra Club, 412 U.S. 541. The

EPA Administrator therefore became bound to comply

with the district court’s preliminary injunction, which

appeared to have the effect of a final order in the case.®

Accordingly, on July 16, 1973, the Administrator pub-

lished a notice of proposed rulemaking, setting forth pos-

sible programs for preventing significant deterioration that

could be included in the state implementation plans (Pet.

App. B, p. 54a). “A series of public hearings were held and

over 300 written comments were submitted in response to

this proposal” (ibid.).

This is the background against which the regulations at

issue here’ were promulgated. The regulations limit the

deterioration of ambient air quality with respect to two

pollutants: particulate matter and sulfur dioxide (SO,).

Under the regulations, areas where air quality is better than

the levels set by the national ambient air quality standards

are designated class I, class II, or class III areas. The

designation determines how much deterioration is

“significant,” that is, how much deterioration will be

allowed in that area. Class I is the most restrictive

designation: it allows only slight increases in ambient levels

of particulates and SO). 40 C.F.R. 52.21 (c)(2)(i). Class II

allows more deterioration. /bid. Class III allows

deterioration to the level of the national ambient air quality

standards. 40 C.F.R. 52.21(c)(2)(ii). All areas are initially

designated class II. 40 C.F.R. 52.21(c)(3)(i).

Generally, authority to redesignate areas as either class |

or class III is left with the States. 40 C.F.R. 52.21 (c)(3)(ii).

As to federal lands, however, the authority is concurrent:

5Mr. Justice Powell took no part in the decision of the case.

*See note 3, supra.

“40 C.F.R. 52.01(d) and (f) and 52.21.

6

the State may redesignate federal lands, but the federal land

manager may also redesignate the land to a more restrictive

class than would otherwise apply. 40 C.F.R. 52.21(c)(3)(iii),

(iv). The regulations do not attempt to change the existing

division of authority between the States and Indian tribes.

Therefore, when a State has not assumed jurisdiction over

an Indian reservation, the Indian governing body has the

authority to redesignate the reservation. 40 C.F.R.

52.21(c)(3)(v). Every redesignation must be based on a

public hearing and a record demonstrating that anticipated

growth in the area has been considered and that social,

environmental and economic effects of the proposed

redesignation, and regional and national considerations

have been taken into account. 40 C.F.R. 52.21(c)(3)ii),

(iv)(a), (v)(a). EPA will not approve a redesignation that

arbitrarily and capriciously disregards those considerations.

40 C.F.R. 52.21(c)(3){vi). Neither will EPA approve a state

redesignation unless the State has accepted the

responsibility to review new sources of pollution in order to

determine whether they will exceed the amount of

deterioration allowed under the regulations. 40 C.F.R.

52.21(c)(3)(vi)(a). (This requirement may be waived if the

State lacks legal authority to accept responsibility for such

new source review. 40 C.F.R. 52.21(c)(3\vi)(/).)

A procedure for “review of new sources,” 40 C.F.R. 52.21

(d’, insures that the deterioration limits are not violated.

Under this procedure construction or modification of

nineteen enumerated stationary sources of particulates or

SO, may not be commenced unless EPA determines that the

new or modified source will not, in conjunction with

emissions from other sources in the area, violate the air

quality increments. 40 C.F.R. 52.21(d)(2)(i). In addition, the

source must use the best available pollution control

technology for particulates and sulfur dioxide, which in

most cases is the same as the technology already required by

EPA’s new source standards under Section 111 of the Act,

,

42 U.S.C. 1857c-6. 40 C.F.R. 52.01(f), 52.21(d) (2)(ii). The

authority to review new sources may be delegated to the

States under 40 C.F.R. 52.21(f).

Petitions to review the significant deterioration regu-

lations that had been filed in several courts of appeals were

transferred to the Court of Appeals for the District of

Columbia Circuit. See Dayton Power and Light Co. v.

Environmental Protection Agency, 520 F. 2d 703 (C.A. 6).

The court of appeals, after reconsidering its decision in

Sierra Club v. Ruckelhaus, supra, held that the Clean Air

Act authorized significant deterioration regulations. In the

court’s view, “{i]t would fly in the face of overwhelming

evidence of legislative intent to hold that the Clean Air Act

does not contain a requirement of prevention of significant

deterioration” (Pet. App. A, p. 23a).

As to the validity of the particular regulations, the in-

dustry petitioners argued that EPA had exceeded its statu-

tory authority and abused its discretion because the regula-

tions allegedly were unrelated to the effects of adverse air

quality, were unworkable and interfered with authority

granted to the States under the Act. The court rejected these

arguments and rejected as well petitioners’ further

contentions that the regulations were unconstitutional

because they had no rational relationship to the protection

of public health, took private property without just

compensation and represented an unconstitutionally vague

delegation of authority to EPA (Pet. App. A, pp. 34a-44a,

48a-50a). The court further held that the question regarding

the authority of federal land managers and Indian govern-

ing bodies to propose redesignation of their lands (see p. 6-

7, supra) was not ripe for review (Pet. App. A, pp. 45a-

48a). As to the contentions of the petitioners representing

environmental groups and individuals, the court held that

the regi'‘ations were not invalid on the basis that air quality

in regions designated class II] would deteriorate or on the

basis that only two of the six primary air pollutants are

covered (Pet. App. A, pp. 29a-34a).

8

After the decision of the court of appeals in this case, the

House and the Senate passed different versions of proposed

Clean Air Act Amendments of 1976." Both the House and

the Senate bills included provisions designed to implementa

policy to prevent significant deterioration of air quality, as

did the bill that emerged from the Conference Committee.’

However, Congress adjourned without voting on the

conference proposal.

On January 14, 1977, Senator Muskie introduced two

bills to amend the Clean Air Act, one of which is the same

as the bill passed by the Senate in 1976; each contains

requirements specifying how significant deterioration of

air quality is to be prevented.'° Hearings on these bills be-

fore the Subcommittee on Environmental Pollution of the

Senate Committee on Public Works are now underway.!!

DISCUSSION

As noted above (p. 4, supra), four years ago this Court

granted the EPA Administrator’s certiorari petition

presenting the question whether, under the Clean Air

Act, state implementation plans must contain provisions

to prevent significant deterioration of air quality. Five

*S. 3219, 94th Cong., 2d Sess. (1976), 122 Cong. Rec. $13543-S 13544

(daily ed., August 5, 1976); H.R. 10498, 94th Cong., 2d Sess. (1976), 122

Cong. Rec. H10198-H10201 (daily ed., September 16, 1976).

“H.R. Rep. No. 94-1742, 94th Cong., 2d Sess. (1976); see 122 Cong.

Rec. H11959, H11970-H11973, H11987-H11988 (daily ed.. September

30, 1976).

™S. 252 and S. 253, 95th Cong.. Ist Sess. (1977). 123 Cong. Rec.

$646-S647 (daily ed.. January 14, 1977).

''Senator Muskie stated that the Senate Committee on Public

Works could be expected to report a bill before March 15, 1977 (123

Cong. Rec. $647 (daily ed.. January 14, 1977)).

9

of the petitions in this case raise the same issue.'? The

issue was important in 1972 and it is no less important

today. Accordingly, we do not oppose the petitions inso-

far as they present this issue.

The other issues raised in the seven petitions in this case

relate generally to the questions whether the regulations

are arbitrary and capricious, whether the regulations were

promulgated in accordance with the procedures required

by the Act, and whether the regulations violate the Con-

stitution (see p. 7, supra). We likewise do not oppose

the petitions raising these issues. It is difficult to divorce

the question whether the Act authorizes the particular

regulations involved here from the broader question

whether the Act authorizes any significant deterioration

regulations. Indeed, the first question presented in five

of the petitions'? may fairly comprehend the subsidiary

issues concerning whether the current EPA regulations

conform to the standards of the Act. Many of the argu-

ments of the industry petitioners that the regulations

are arbitrary or procedurally defective or violate the Con-

stitution overlap with their arguments that Congress did

not intend to authorize any significant deterieration

regulations.'4

In order for the Court to receive « full and complete

presentation of the competing conteations in this case,

we therefore do not oppose the petitions insofar.as they

raise issues collateral to the primary question of the EPA

'2Pet. No. 76-529, at p. 2 (Question |); Pet. No. 76-585, at p. 2 (Ques-

tion 1); Pet. No. 76-594, at p. 2 (Question 1); Pet. No. 76-603, at p. 2

(Question 1); Pet. No. 76-619, at p. 2 (Question 1). See also Pet. No.

76-620, at p. 3 n. 3, concurring in the questions presented in Pet. No.

76-529.

''See note 12, supra.

“Compare Pet. No. 76-620, at pp. 6-18. with Pet. No. 76-529. at pp.

W-37, and Pet. No. 76-585, at pp. 12-26.

10

Administrator’s responsibility with respect to state im-

plementation plans that do not contain significant de-

terioration provisions.

CONCLUSION

The federz! respondents do not oppose the granting

of the petitions for a writ of certiorari.

Respectfully submitted.

DANIEL M. FRIEDMAN,

Acting Solicitor General.

PETER R. TAFT,

Assistant Attorney General.

EDMUND B. CLARK,

EARL SALO,

Attorneys.

G. WILLIAM FRICK,

General Counsel,

Environmental Protection Agency.

FEBRUARY 1977.

DOJ-1977-02

— + oe ee eee oe