Petition — American Iron & Steel Institute v. Environmental Protection Agency
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IN THE pec 1 1977
Supreme Court, U. S.
FILED
|
Supreme Court of the United! Stattesoos.n. an
OCTOBER TERM 1977
Nog 7 = 782
AMERICAN IRON AND STEEL INSTITUTE, UNITED
STATES STEEL CORPORATION, NATIONAL STEEL
CORPORATION, REPUBLIC STEEL CORPORATION,
WHEELING-PITTSBURGH STEEL CORPORATION,
INLAND STEEL COMPANY, ARMCO STEEL CORPO-
RATION, JONES & LAUG STEEL CORPORA-
TION, BETHLEHEM STEEL CORPORATION, INTER-
LAKE, INC., ALLEGHENY LUDLUM INDUSTRIES,
INC., SHARON STEEL CORPORATION, THE BAB-
COCK & WILCOX COMPANY, CRUCIBLE, INC.,
CYCLOPS CORPORATION, DETROIT STEEL CORPO-
RATION, ATLANTIC STEEL COMPANY, LONE STAR
STEEL COMPANY, CONTINENTAL COPPER &
STEEL INDUSTRIES, INC., THE TIMKEN COM-
PANY, SHENANGO INCORPORATED, YOUNGS-
TOWN SHEET AND TUBE COMPANY,
Petitioners,
v.
ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
AND APPENDICES
Davm MCNEIL OLDs
BLAIR S. MCMILLIN
THOMAS C. WETTACH
ROBERT W. THOMSON
THOMAS J. PUMAN
GEORGE H. VALENTINE
REED SMITH SHAW & MeCLAx
747 Union Trust Building
P. O. Box 2009
Pittsburgh, Pennsylvania 15230
Attorneys for Petitioners
SMITH BROS., LAW PRINTERS, 620 SECOND AVENUE, PITTSBURGH, PA. 15219
SUBJECT INDEX
— PAGE
r ̃ Fone AAO Lee” Oh t= a OF OO 2
Ze ——A 2
. eo ccescsscescocsconecscesssesoses 8 3
Statutes and Rules Involvens 4
⁊ꝰ WEI II oc rnccnccsthenviccnesesscnssstisiilabecscosspsitinas 4
Reasons for Granting the Writ 7
F AbisaleinsddsheidiisnadaainiIondiaipieal 9 18
// 1a
ii
Index.
TABLE OF CITATIONS
CASES PAGE
Aerojet General Corp. v. American Arbitration As-
sociation, 478 F. 2d. 248 (9th Cir. 1973) 8
American Paper Institute v. Train, 543 F.2d 328
r a aN ace Oe 16
American Petroleum Institute v. Train, 540 F.2d
„„ REE Or FELT oe 16
Appalachian Power v. Train, 545 F.2d 1351 (4th
SA a eet aN ED 16
Civil Aeronautics Bd. v. Delta Air Lines, 367 U.S.
, T 14
Collins v. City of Witchita, 254 F.2d 837 (10th Cir.
nne . 9
duPont v. Train, —— U.S. ——, 97 S. Ct. 965 (1977)
c 3, 6, 9, 10, 15, 16, 18
duPont v. Train, 541 F.2d 1018, aff’d in part, rev'd
in part, U.S. ——, 97 S. Ct. 965 (1977).... 16
Grain Processing Corp., et al. v. Train, Doc. No.
76-1233, decided December 3, 197666
ß᷑.:᷑ LXU—PI ͤ 83 16 and Appendix G
Greater Boston Television Corp. v. F.C. C., 463 F. 2d
268. (D.C. Cir. 1971), cert. denied, 405 U.S. 950
D RES RE RCN I 7,8
Hooker Chemical v. Train, 537 F.2d 620 (2d. Cir.
ccc 16
Iverson v. United States, 257 F.2d 408 (Sth Cir.
c 9
Legate v. Maloney, 348 F. 2d 164 (Ist Cir. 1965) 11, 12
Luminous Unit Co. v. Freeman-Sweet Co., 3 F.2d 577
r e 9
Meredith v. Fair, 306 F.2d 374 (5th Cir. 1962) 8
Reserve Mining Co. v. Lord, 529 F.2d 181 (8th Cir.
/ SER Ne aE AS ST OO 7
Republic Steel Corp. v. Train, 557 F.2d 91 (6th Cir.
%% he Ry Lt shee 13,17
So — I OE —
iii
Index.
CASES PAGE
In re Union Nacional de Trabajadores, 527 F.2d 602
(Amt Clr. 1975) . . . ... ..... ...... 9
United States v. Kismetoglu, 476 F.2d 269 (9th Cir.
11 ̃ —— 1
United States Steel v. Train, 556 F.2d 822 (7th Cir.
. 1M 13, 17
STATUTE
Federal Water Pollution Control Act, as amended in
1972, 33 U.S.C. § 1251 ef . . . . passim
REGULATIONS
Effluent Guidelines and Standards, Iron and Steel
Manufacturing Point Source Category, 40
C.F.R. § 420.10 et seq. (1974)))7ꝓ́7ncn passim
—— — —— — ly pe
IN THE
Supreme Court of the United States
OCTOBER TERM 1977
n
AMERICAN IRON AND STEEL INSTITUTE, UNITED
STATES STEEL CORPORATION, NATIONAL STEEL
CORPORATION, REPUBLIC STEEL CORPORATION,
WHEELING-PITTSBURGH STEEL CORPORATION,
INLAND STEEL COMPANY, ARMCO STEEL CORPO-
RATION, JONES & LAUGHLIN STEEL CORPORA-
TION, BETHLEHEM STEEL CORPORATION, INTER-
LAKE, INC., ALLEGHENY LUDLUM INDUSTRIES,
INC., SHARON STEEL CORPORATION, THE BAB-
COCK & WILCOX COMPANY, CRUCIBLE, INC.,
CYCLOPS CORPORATION, DETROIT STEEL CORPO-
RATION, ATLANTIC STEEL COMPANY, LONE STAR
STEEL COMPANY, CONTINENTAL COPPER &
STEEL INDUSTRIES, INC., THE TIMKEN COM-
PANY, SHENANGO INCORPORATED, YOUNGS-
TOWN SHEFT AND TUBE COMPANY,
Petitioners,
v.
ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
To the Honorable Warren Burger, Chief Justice of
the Supreme Court of the United States, and the Associ-
ate Justices of the Supreme Court of the United States:
Petitioners pray that a writ of certiorari issue to
review the order of the United States Court of Appeals
for the Third Circuit, entered in this case on August 10,
1977, recalling its mandate and amending its judgment
decided on November 7, 1975.
Jurisdiction.
OPINION BELOW
The opinion of the Court of Appeals (Appendix A
infra) is reported at 560 F.2d 589. The original decision
of the Court of Appeals is reported at 526 F.2d 1027
(Appendix D infra).
JURISDICTION
The judgment of the court below (Appendix B
infra) was entered on August 10, 1977. A timely peti-
tion for rehearing was denied on September 2, 1977.
(Appendix C infra.) The jurisdiction of this Court is
invoked under 28 U.S.C. § 1254(1).
— —
Questions Presented.
QUESTIONS PRESENTED
1. Whether it was proper for the Court of Ap-
peals to recall its mandate eighteen months after the
time for certiorari expired, based upon any one or all of
the following reasons:
a) purported incongruencies between the mandate
and a later decision of this Court;
b) inconsistencies between the mandate and later
decisions in some other courts of appeals;
c) unsubstantiated, non-record allegations of dam-
age to the public interest unless the mandate
were recalled.
2. Whether the issues left open in duPont v. Train,
— U.S. ——, 97 S. Ct. 965 (1977), as to the effect of
§ 304 of the Federal Water Pollution Control Act
(“FWPCA”’) on the exercise of the powers of the per-
mit grantors to implement the limitations promulgated
under § 301 of the FWPCA were properly decided by
the Court of Appeals.
Statement of the Case.
STATUTES AND RULES INVOLVED
This case involves Sections 101, 301, 304, 401, 402,
501 and 509 of the FWPCA, 33 U.S.C._§§ 1251, 1311,
1314, 1341, 1342, 1361 and 1369. They are reprinted in
Appendix E infra. It also involves the Effluent Guide-
lines and Standards for Iron and Steel Manufacturing
Point Source Category, 39 Fed. Reg. 24114, 40 C. F. R.
§ 420.10 et seq., promulgated June 24, 1974. They are
reprinted in Appendix F infra.
STATEMENT OF THE CASE
On June 9, 1975, the Court of Appeals heard argu-
ment of the challenge by the Steel Industry to the Fed-
eral Water Pollution Control Act regulations applicable
to that industry’s “Phase I” operations—steelmaking
as distinguished from steel finishing. The challenged
regulations were promulgated in response to require-
ments of the FWPCA, 33 U.S.C. § 1251 et seq., which
created a complicated new regulatory program for in-
dustrial (and municipal) effluent discharges.
The law in substance established a permit program
for each “point source”, the permits to be issued by the
states (or the EPA, if a state chose not to “qualify”’ it-
self to act as a permit grantor) and to contain effluent
limitations. Discharges without permits were made il-
legal, and it was recited in § 301 of the FWPCA that
effluent limitations were to be achieved requiring appli-
cation of something styled “best practicable control
technology currently available” (usually referred to as
“BPT”’) by July 1, 1977, and “best available technology
economically achievable” (“BAT“) by July 1, 1983.
—— atl
Statement of the Case.
Section 301 further recited that the identification
of BPT (1977) and BAT (1983) was to be made in ac-
cordance with guidelines issued under § 304 of the
FWPC A. Although; 301 referred to “effluent limita-
tions”, did not specify who was to establish them.
Section 304 was clear, however, in its provision that
EPA was to issue the “guidelines”, and reasonably clear
in indicating “factors” to be considered in establishing
and applying limitations for individual plants.
Initially, the lower court in its first decision, referred
to throughout as AJS/ I, concluded that the EPA Ad-
ministrator was empowered by § 301 to promulgate na-
tionwide, single-number effluent limitations for cate-
gories of operations within an industry. Beyond that,
however, the court was faced with the § 304 question of
the proper delineation of powers and duties of the Ad-
ministrator vis-a-vis the local permit-issuing authority.
In the course of construing the command of
§ 304(b) that the EPA publish regulations which estab-
lished guidelines for determining 1977 and 1983 effluent
limitations—and that such regulations take into account
certain statutorily enumerated factors—the court con-
sidered both the FWPCA’s textual language and legis-
lative history and ascertained that the issue was neces-
sarily one of properly accommodating two competing
interests, i. e., preserving nationally uniform effluent
limitations while, on the other hand, maintaining a de-
gree of local flexibility in the hands of the § 402 permit
grantor. Such accommodation, the court determined,
was inconsistent with the EPA argument that § 304
guidelines were intended solely to assist the Adminis-
trator himself in setting number limitations for cate-
gories of point sources. The court found no merit to the
Statement of the Case.
claim that the congressionally intended accommodation
would be achieved by an EPA “variance” regulation
sanctioning departures from the rigid, nationally set
limitations only upon a permit applicant’s successful
showing that factors relevant to the point source were
“fundamentally different” from those the EPA consid-
ered in establishing limitation regulations.
The Third Circuit held in 4181 I that this basic
dilemma of the FWPCA was resolved thusly: Review of
§304(b) factors relative to achieving nationwide ef-
fluent limitations for categories of point sources lies
with the Administrator; by the same token, the Admin-
istrator must promulgate guidelines specifying by ref-
erence to the same 304(b) statutory factors a carefully
circumscribed discretion (a range) for the use of the
local permit issuer who is authorized to make more
stringent the § 301 single-number limitations—which
perforce are but “base” figures. Accordingly, AISI J
remanded the regulations for EPA’s reconsideration of
the § 301 base limitations, as well as promulgation of
proper § 304 guidelines.
On February 23, 1977, in this Court’s decision in
duPont v. Train, supra, the EPA’s power to issue efflu-
ent limitation regulations under § 301 of the FWPCA
was upheld. Subsequent to the announcement of the
Court’s decision the EPA moved the lower court panel
which decided AJS/ J to recall its mandate and amend
its judgment. After oral argument, the lower court by
a 2 to 1 decision sustained the motion on August 10,
1977. The majority stated that it perceived incongru-
encies in its original mandate with this Court’s decision
in duPont and amended the judgment to remove there-
from any requirement that the EPA by regulations (1)
establish ranges of effluent limitations and (2) specify
—ͤ—ü—— —————
Reasons for Granting the Writ.
factors to be considered by permit grantors or (3) re-
consider the §301 effluent limitations in light of the
“base level” and ceiling“ concepts.
By its amendment of the judgment in 4181 J, the
Third Circuit in all material respects affirmed the EPA’s
construction of the Act and denied Petitioners a sub-
stantial part of the relief originally sought and obtained
in their petition for review.
REASONS FOR GRANTING THE WRIT
I. A. This case will permit the Court to delineate for
the first time the appropriate limitations on the
exercise of the power to recall a mandate.
Although the Court of Appeals stated it recognized
the “weighty policy” that there should be an end to
litigation, it clearly disregarded that policy when it
granted a motion to recall its mandate eighteen months
after the time for rehearing and petition for writ of
certiorari had expired and long after all parties were
to have acted in reliance upon the judgment. As pointed
out by Judge Hunter in his dissenting opinion, at issue
here is nothing less than our “orderly system of justice.”
(Appendix A at 25a.) The appropriate limits upon the
exercise of this extraordinary power have not been here-
tofore established by this Court—review of the lower
court’s action will be a case of first impression.
All courts which have been confronted with the
prospect of recalling a mandate have recognized it as
an extraordinary remedy to be exercised only in ex-
treme circumstances.! In the majority of instances, re-
1. See for example the discussion in Greater Bos-
ton Television Corp. v. F. O. O., 463 F.2d 268, 275-280 (D.C.
Cir. 1971), cert. denied, 405 U.S. 950 (1972).
Reasons for Granting the Writ.
call of a mandate case has involved a clarification by the
court, often done sua sponte. E.g., Reserve Mining Co.
v. Lord, 529 F.2d 181 (8th Cir. 1976); Aerojet General
Corp. v. American Arbitration Association, 478 F.2d
248 (9th Cir. 1973) ; Meredith v. Fair, 306 F.2d 374 (5th
Cir. 1962). Since this case did not involve clarification
of a mandate, the recall of the mandate was unusual
even in the context of that unusual remedy.
Although the court below found that Greater Bos-
ton, supra note 1, provided helpful guidelines, it recalled
its mandate though none of the Greater Boston “special
reasons” were present. With deference to the lower
court, its expansive reading of its own power makes
even less clear what limits, if any, there are upon the
right to disturb final judgments. Action by this Court
is urgently needed to set forth those principles estab-
lishing when parties may not rely on the finality of
judgments entered and not appealed, and when they
may.
——— —
— —— —ü——— — — ——
Reasons for Granting the Writ.
B. This Court should grant certiorari to resolve
the conflict among the circuits as to the effect
of a subsequent decision of this Court on judg-
ments of lower courts.
One reason cited by the Court of Appeals below for
recalling its mandate was its perception of purported
„incongruencies“ between the mandate and this Court's
decision in duPont. Even assuming arguendo that the
court was correct in its perceptions, the question be-
comes whether it was appropriate to change a final
order twenty-one months later to make it “consistent”
with this Court’s decision.
The circuits are divided over the answer to this
question. The Eighth Circuit has denied a petition for
recall of its mandate because of conflict with a subse-
quent Supreme Court decision on the basis that such
was not an adequate ground for exercise of such a
sparingly used remedy. Iverson v. United States, 257
F.2d 408 (8th Cir. 1958). In like circumstances, the
Tenth Circuit refused to recall its mandate, stating
that even a change in the law by the Supreme Court
was not such an extraordinary circumstance as to jus-
tify relief from final judgment. Collins v. City of Wichita,
254 F.2d 837 (10th Cir. 1958). On the other hand, the
First, Seventh and Ninth Circuits have felt themselves
bound to amend their judgments to conform to a sub-
sequent decision of this Court where the lower court
decision was clearly erroneous. In re Union Nacional de
Trabajadores, 527 F.2d 602 (1st Cir. 1975); United
States v. Kismetoglu, 476 F.2d 269 (9th Cir. 1973) ;
Luminous Unit Co. v. Freeman-Sweet Co., 3 F.2d 577
(7th Cir. 1924).
10
Reasons for Granting the Writ.
A reading of the cases in which recall has been
granted because of conflict with a subsequent decision
Court shows that the later decision of this Court
was in each case or “all-fours” with the lower court
mandate, and unequivocally to the contrary. Such was
not the case here. The lower court specifically pointed
out that duPont did not show AISI I to be “demonstra-
bly wrong”. (Appendix A infra at 14a.) In fact, the
court made special note that this Court cited A/S] I five
times in duPont, never once indicating that this Court
disapproved of A/JS/ I. (Appendix A infra at 12a.)
The action taken by the Third Circuit was, there-
fore, unprecedented. No other court has been willing to
erode the integrity of its own judgments and the prin-
eiple of finality of judgments because of “incongruen-
cies” between its mandate and a subsequent Supreme
Court decision. Before other eourts fall into like error,
we urge the Court to uphold the principle of finality of
judgments by restricting the power to recall.
eo
3225
11
Reasons for Granting the Writ.
C. Certiorari should be granted to resolve the con-
flict between the First and Third Circuits on
the issue whether a mandate should be recalled
to achieve conformity with other courts of ap-
peal.
The court below felt (albeit erroneously) that its
interpretation of the FWPCA in AISI I was uniformly
rejected by all the other circuits.2 (Appendix A infra
at 16a-17a.) The court was moved by its sense of rejec-
tion to recall its mandate to conform to the other cir-
cuits, without considering the correctness of those other
holdings. Interestingly, at no point did the lower court
intimate that its decision in AISI I had been incorrect.
There is no known principle of law requiring uniformity
among the circuits. Even if all the other circuits uniform-
ly differed with the Third Circuit, that circumstance
alone would neither require, nor even make desirable, a
change by the Third Circuit in its mandate.
The lower court was the first to act on the issues
involved here. If there were a principle of uniformity
among the circuits, all the other circuits should have
conformed to the decision in A/S/ J. That some did not
is apparent—-probably because such a principle would
reward the first litigant to the courthouse. It does not
follow that it is wise to permit the erosion of a judicial
bedrock—the need for reasonable finality of judgments
—because of the supposed desirability of inter-circuit
uniformity.
The First Circuit resolved the circuit uniformity
question differently in Legate v. Maloney, 348 F.2d 164
2. The court was incorrect in its characterization
of ry opinions of other circuits. See discussion infra at
15-17.
12
Reasons for Granting the Writ.
(Ist Cir. 1965). Considering a motion for recall based
upon supposed inconsistencies of the court’s decision
with decisions in other circuits, Judge Aldrich said:
“If we were in error in this appraisal [of the mer-
its], of which we are not presently persuaded, we
believe it would be far greater error to permit re-
consideration now after denial of petitions for re-
hearing and certiorari. There must be an end to
dispute.” 348 F. ad at 166.
In our case, the lower court in effect treated the
position of the other circuits as controlling. Legate ob-
viously did not. Where a power exists with the extra-
ordinary reach of recall, conflict as to a principle con-
trolling its utilization requires prompt resolution by
this Court.
te es On ee ee
wey. ee ee
13
Reasons for Granting the Writ.
D. Grave danger to the appellate review system
will result unless this Court overturns a deci-
sion by the court below to rely on unsubstan-
tiated statements of counsel and to make find-
ings of fact without a hearing.
As an additional basis for recall, the lower court
cited the public interest.” Under that rubric, the court
lumped together such “facts” as the possibility that the
Iron and Steel Industry might be treated differently
from other industries, that EPA would be unduly bur-
dened by complying with the mandate, and that delays
would result in the issuance of permits to the Iron and
Steel Industry unless the mandate were recalled. All
such statements as to burden on the EPA, and delays
in the permit program, were in effect lifted intact from
unsubstantiated allegations made by counsel for EPA
either in its Brief or in its oral argument. 3
Giving weight to these allegations was most im-
proper. Only facts found in the record should be used
by the appellate court in making its determination. The
Court of Appeals had before it no record facts devel-
oped in any type of hearing or proceeding to establish
that the permit program was being delayed or that the
Agency would be unable to carry out the remand man-
date. While in some cases representations of fact not
susceptible to serious challenge may be incorporated
into the factual fabric of an adjudication, such was not
3. The EPA had previously asserted in oral argu-
ment in the companion case — 2 Phase II Iron
and Steel Regulations that the pe 1 rogram was — *
impeded by the absence of —— also R
Steel Corp. v. Train, 557 F.2d 91 (6th Cir. 197772 ), —
United States Steel v. Train, 556 F. 2d 822 (7th Cir. 1977).
14
Reasons for Granting the Writ.
the situation here. Petitioners do not agree that any of
the “factual” statements referred to by the court were
trv1e,
Acceptance by the lower court of EPA’s contentions
relative to the Agency’s burden in complying with the
remand seems particularly unsound. All the pertinent
aspects of the remand were obvious when the mandate
was originally handed down. No facts came into exist-
ence after the original judgment changing the burden
one whit. Since the EPA waived its right to appeal the
mandate, it should not have been given credence in its
complaint that the mandate required it to undertake
activity it considered burdensome. More to the point, by
its unseemly procrastination in discharging its duties
under the remand, the Agency performed the miracle
of transforming its “burden” into a blessing—since the
lower court found support for the exercise of the recall
power in the circumstances that the remand had not been
completed.
Apparently itself somewhat troubled whether there
was sufficient cause to recall the mandate, the court com-
forted itself with the observation that the effect of the
amendments to the mandate was “relatively modest”
and affected only a “minor segment of .. . [a] lengthy
opinion.” (Appendix A at 22a.) The obvious fact is,
however, that this surgery removed almost everything
in the mandate favorable to Petitioners. After eighteen
months of reliance upon the mandate in the conduct of
their business activities and permit negotiaticns with
the EPA, Petitioners have been summarily denied favor-
able results obtained by a lengthy proceeding in a Court
of Appeals. After the time for rehearing and certiorari
had expired, Petitioners were justified in relying upon
the judgment. See Civil Aeronautics Bd. v. Delta Air
Lines, 367 U.S. 316 (1961).
—— — — — —
22 „%
2 — G „
15
Reasons for Granting the Writ.
II. The decision in duPont left unresolved and in con-
flict issues as to the basic administration of the Act,
and this case presents an appropriate opportunity to
resolve those issues. |
This Court in dwPont answered in the affirmative
the question of whether the Administrator has the
power to promulgate, as regulations, effluent limitations
for classes and categories of point sources—a conclu-
sion which was in complete accord with AJSI J. Left un-
resolved, however, were questions as to the power and
authority of the permit grantors to take into account the
factors identified in § 304 of the Act in applying in a
given permit situation the effluent limitations estab-
lished pursuant to § 301.
Although the issue was not before this Court in
duPont, there was a tacit recognition that § 304 requires
from the Agency guidelines to govern the discretion of
the permit grantors in setting limits for individual
plants. As stated by this Court:
“The legislative history . . . makes it clear that
§ 304 guidelines are not merely aimed at guiding the
discretion of permit issuers in setting effluent limi-
tations for individual plants.” 97 S. Ct. 976.
Understandably this Court did not consider the form of
the guidelines and their relation to § 301 limitations in
the permit-granting process.
Eight courts of appeals have addressed in various
ways the issue of the relation of §§ 301 and 304 to the
exercise of the permit-granting power. For example, the
Third Circuit in AISI I harmonized the potential incon-
sistencies between the § 301 requirement of uniformity
in effluent limitations and the § 304 recognition of in-
16
Reasons for Granting the Writ.
dividual plant differences by holding that the § 301
numbers represented base level limitations and that the
Administrator was required to indicate ranges of dis-
charge levels more stringent than the base levels and to
publish guidelines specifying § 304 factors to be consid-
ered by permit grantors in setting limits more stringent
than the base level for individual point sources.
This approach was subsequently adopted by the
Eighth Circuit Court of Appeals in an unpublished Opin-
ion in Grain Processing Corp. et al. v. Train, Doc. No.
76-1233, decided on December 3, 1976.4 The Third Circuit
view was rejected by the Second Circuit5 and the Dis-
trict of Columbia Circuit® which found that permit is-
suers had no discretion to vary from § 301 effluent limi-
tations.
The approach taken by the Fourth? and Tenth Cir-
cuitss to the question was consistent with the spirit if
not the letter of that adopted by the Third Circuit in
AISI I. They held that the § 301 effluent limitations were
only “presumptively applicable” to an individual plant
and that if the applicant for a permit showed the in-
appropriateness of the limitations as applied to him, the
permit issuer had the power to go outside of the § 301
4. See Appendix G infra.
5. Hooker Chemical v. Train, 537 F.2d 620 (2d
Cir. 1976).
6. American Paper Institute v. Train, 543 F.2d 328
(D.C. Cir. 1976).
7. duPont v. Train, 541 F.2d 1018, aff’d in part,
rev'd in part 191 eee , 97 S. Ct. 965 (1977) and
— Power v. Train, 545 F.2d 1351 (4th Cir.
1976).
8. American Petroleum Institute v. Train, 540 F.2d
1023 (10th Cir. 1976).
„„
E r
17
Reasons for Granting the Writ.
limitations. Inappropriateness in the Fourth Circuit's
view could be established by considering the generic
factors of § 304.9 Although the Tenth Circuit was not so
specific, it clearly affirmed the concept of flexibility at
the permit level.
The Fourth and Tenth Circuits differed from AISI 1
in not requiring the Administrator to publish guidelines
under § 304 to aid the permit grantors in the exercise of
their discretion at the permit level. Although they did
not require publication of definitive guidelines, the
Fourth and Tenth Circuits recognized discretionary
power at the permit-granting level to consider individual
point source factors specified in § 304 or otherwise. Thus,
although different accommodations of §§ 301 to 304 ( and
vice versa) were identified, the circuits sought to achieve
a similar goal—to find flexibility in the Act with refer-
ence to the exercise by the permit grantor of his power.
It is accordingly apparent that, contrary to the
conclusion of the court below, only two of the seven cir-
ceuit courts faced with construction of the Act substan-
tially departed from the 4181 J approach to the § 304
issue in the perspective of discretion at the permit level.
The remaining courts have either followed that approach
or have adopted a cognate one. 10
9. 545 F.2d at 1358.
i i F.2d
10. In ic Steel Corporation v. Train, 557
91 (6th Cir. 1977), the court quoted approvingly the 14
vant part of the AJSI I hol , even though the § g
issue was not I a on „* es
Steel v. Train, 556 F.2d ’ N ease
cited by the lower court as an illustration that sister =
cuits were united in their o tion, the Seventh ——_
specifically noted that its decision was compatible
AISI I. Id. at 843-844.
Conclusion.
CONCLUSION
In summary, this case presents the Court with an
opportunity to delineate for the first time the basic con-
tours of a circuit court’s power to recall a mandate. At
least two of the grounds relied upon by the court be-
low—eliminating “incongruencies” with a subsequent
Supreme Court decision, and achieving inter-circuit uni-
formity—have never before been advanced by any
court. Parenthetically, neither ground has factual sup-
port in this case. Furthermore, as a separate reason
for granting certiorari, this case will enable the Court
to answer an important question involving the funda-
mental administration of the FWPCA, a question left
open in duPont v. Train, supra.
Respectfully submitted,
Davip McNEIL OLps
BLAIR S. MCMILLIN
THOMAS C. WETTACH
ROBERT W. THOMSON
THOMAS J. DUMAN
GEORGE H. VALENTINE
REED SMITH SHAW & McCLAY
747 Union Trust Building
P. O. Box 2009
Pittsburgh, Pennsylvania 15230
Attorneys for Petitioners
ee
2
„% es
APPENDICES
Appendix A
AMERICAN IRON AND STEEL INSTITUTE, et al.,
Petitioners,
Vv
ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
Nos. 74-1640, 74-1642, 74-1962, 74-2006 and 74-2256.
United States Court of Appeals, Third Circuit.
Argued June 9, 1977.
Decided Aug. 10, 1977.
Before ADAMS, HUNTER and GARTH, Circuit
Judges.
OPINION OF THE COURT
ADAMS, Circuit Judge.
The EPA has moved this Court to recall the man-
date and to amend the judgment in American Iron and
Steel Institute v. EPA (AISI I),1 decided by us on No-
1. 526 F.2d 1027 (3d Cir. — 1
The present opinion should ad in conjun
with the — awed in AISI I. With respect to the
technical details of the water pollution regulations at
issue here, we shall assume familiarity with our earlier
opinion which discusses such matters — — .
Subsequent to 41781 I, this Court deci merican
Iron and Steel Institute v. EPA, 543 F.2d 521 (3d Cir.
1976) (4787 IT). That later case concerned the —-
tional question whether regulations that Ss, —
justments in effluent limitations for certain individu
point sources were reviewable by a court of appeals. But
the panel ruled that such regulations were not review-
able.
Currentl nding before this Court are several pe-
titions for 22 of effluent limitation regulations a
plicable to “secondary” or finishing operations wi ;
the iron and steel ind . American Iron and Steel In-
stitute v. EPA, Docket Nos. 76-1386, 76-1749, 76-1751,
76-1757, 76-2176 and 76-2232 (4787 III).
2a
Appendix A.
vember 7, 1975. Two primary issues must be considered
in connection with such a request: first, whether—and,
if so when—this Court has the power to reconsider and
modify a judgment after the time for rehearing has
expired; and second, whether the EPA’s motion to re-
call the mandate should be granted under the circum-
stances present here.
I,
This controversy originally arose when the Ameri-
can Iron and Steel Institute and several steel companies
petitioned this Court to review water pollution regu-
lations designed by the EPA. Promulgated for com-
panies engaged in basic iron and steel manufacturing
operations, such regulations established single-number
effluent limitation standards for point sources in the
industry.? In seeking judicial review, the Institute and
the other petitioners challenged the authority of the
EPA to issue effluent limitation regulations and con-
tended that, in any event, such regulations failed to
conform to the requirements of the Federal Water Pol-
lution Control Act Amendments of 1972 (Act).3 Al-
though this Court held that the EPA has the power to
issue the regulations in question,“ the regulations were
deemed to diverge, in certain respects, from the statu-
tory strictures.
Specifically, the AJS/ J panel ruled that the regula-
tions were not consistent with § 3015 and § 3046 of the
See 39 Fed. Reg. 24114, 40 C.F.R. §§ 420.10 et
seq.
33 U.S.C. §§ 1251 et seg. (Supp. 1977).
526 F.2d at 1035-42.
33 U.S.C. § 1311.
Id., at § 1314.
ANP wo ww
CAD aD BA Bg re 6 A
POO ee
,
3a
Appendiz A.
Act. We construed those provisions to require that the
§ 301 limitations represent “both the base level or mini-
mum degree of effluent control permissible and the ceil-
ing (or maximum amount of effiuent discharge) per-
missible nationwide within a given category“, 7 and that
the § 304 guidelines “provide precise guidance to the
permit-issuing authorities in establishing a permissible
level of discharge that is more stringent than the ceil-
ing.“ 8
Consonant with such an interpretation, the EPA was
instructed to promulgate, on remand, § 304 guidelines
which would specify “permissible ‘ranges’ of limita-
tions” and “factors to be taken into account” by permit-
issuing authorities in setting effluent limitations for
particular point sources.“ Also, the Administrator was
ordered to “reconsider the [§ 301] limitations with the
base level and ceiling concepts in mind.“ 10 The matters
to be dealt with on remand, and the underlying ration-
ales, are delineated in considerable detail in the AJSI J
opinion. 11
7. 526 F.2d at 1045.
8. Id.
9. Id.
10. Id. at 1047.
The “base level” and “ceiling” concepts are closely
tied to the “range” issue. For purposes of this opinion,
all subsequent references to ranges“ should be deemed
to encompass the “base level” and “ceiling principles
as well.
11. Following the issuance of the opinion in A/S/ J.
the EPA did not submit a petition for rehearing before
this Court. Nor did it file a petition for certiorari with
the Supreme Court. The EPA thus did not avail itself
of the normal mechanisms for review of a panel decision.
4a
Appendix A.
Immediately after our decision in A/JS/ J, four other
courts of appeals considered the “range” and “guidance”
questions. 12 Each of these tribunals, however, reached
a conclusion contrary to that of this Court: they sus-
tained single number effluent limitation regulations, as
designed for various industrial categories, and declined
to order the EPA to reconsider or amend its § 301 and
304 standards. As a result, the position of this Court
with respect to the range“, guidance“ and related mat-
ters deviates from that of all other courts of appeals
which have spoken on the issue.
Despite such a schism, the EPA has initiated efforts
to develop regulations and guidelines for the iron and
steel industry in conformity with the mandate of this
Court. Nonetheless, we were advised at oral argument
that only limited progress has been made in developing
“ranges” and “guidance” factors. Perhaps such lack of
advancement reflects the magnitude of the EPA’s duties
on remand as well as its anticipation that the Supreme
Court would settle the uncertainty whether the tasks
prescribed by this Court are required by the Act.
12. See Hooker Chemicals & Plastics Corp. v.
Train, 537 F.2d 620 (2d Cir. 1976); American Frozen
Food Institute v. Train, 176 U.S.App.D.C. 105, 539 F.2d
107 (1976) ; FMC Corporation v. Train, 539 F.2d 973 (4th
Cir. 1976); American Petroleum Institute v. EPA, 540
F.2d 1023 (10th Cir. 1976); duPont v. Train, 541 F.2d
1018 (4th Cir. 1976) ; and American Paper Institute v.
Train, 177 U.S.App.D.C. 181, 543 F.2d 328 (1976).
More recently, the Second Circuit reaffirmed its posi-
tion regarding the range“, guidance“ and associated
problems. See California d Hawaiian Sugar Co. v. EPA,
553 F. 2d 280 (2d Cir. 1977). The Seventh Circuit has also
joined the ranks of the above four courts of appeals. U. 8.
Steel v. Train, 556 F.2d 822 (7th Cir. 1977).
ee
MOAT Reds Ot TB IW! he oy « 4 24
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5a
Appendix A.
On February 23, 1977, the Supreme Court decided
Z. I. duPont de Nemours and Company v. Train1!3—its
first foray into the interpretative morass surrounding
§ 301 and § 304 of the Act. That case concerned the re-
view of a set of regulations crafted by the EPA for the
inorganic chemical industry which are essentially identi-
cal in form to those implicated in A/JSI I. And the duPont
Court approved the single-number effluent limitations as
promulgated.
Thereafter, the EPA filed its motion to recall the
mandate and modify the judgment in A/S] I. The agency
asserts, inter alia, that the construction of the Act as
set forth in the opinion of this Court, together with the
instructions to develop “range”, “guidance” and related
factors for regulation of the iron and steel industry, devi-
ates from the Supreme Court’s opinion in duPont.
Given this backdrop, we proceed to determine
whether this Court may reconsider and modify a judg-
ment following the expiration of the rehearing period
and, if so, whether the relief that the EPA seeks is ap-
propriate in the present context.
II.
A.
It is not surprising that there are relatively few
precedents dealing with the question whether a court of
appeals possesses the authority to recall a mandate. Un-
doubtedly, litigants may have been deterred from bring-
ing recall“ petitions by the weighty policy interests
which undergird the salutary principle that there should
be an end to a controversy in litigation: Not only should
parties be entitled to rely on a judgment as the final
13. —— US. —, 97 S.Ct. 965, 51 L.Ed.2d 204
(1977).
6a
Appendiz A.
settlement of their dispute, but courts must be able to
clear their dockets of decided cases in order to permit
them to hear new controversies which have arisen and
require resolution by the judicial process. Put another
way, parties should be afforded ample opportunity to
litigate their claims, but once a final disposition is
reached they should not expect that the good offices of
the court will be available for a chance to press their
claims anew.
Despite these considerations, it would appear that
an appellate court does have the power to recall a man-
date in appropriate instances. Insofar as we have been
able to ascertain, this Court has not spoken on the
issue. 14 But many of our sister circuits have accepted,
14. Within a footnote in Root Refining Co. v. Uni-
versal Oil Products Co., 147 F.2d 259, 260 n.2 (3d Cir.
1945), this Court stated: “if no corruption [in procuring
judgments] had been practiced this court would not have
possessed the power to reopen its judgments or to recall
its mandates after the end of the term.” However, the
Root decision subsequently was reversed by the Supreme
Court, 328 U.S. 575, 66 S.Ct. 1176, 90 L.Ed. 1447 (1946),
and so we are not bound by the sentiments expressed in
the footnote.
More importantly, while it was once recognized that
expiration of a court’s term precluded any modification
of an adjudication decided therein, see, e. g., Bronson v.
Schulten, 104 U.S. 410, 26 L.Ed. 797 (1882), the “term”
concept no longer retains much significance, especially
since the enactment of 28 U.S.C. § 452. See Greater Bos-
ton Television Corp. v. F.C.C., 149 U.S.App.D.C. 322, 463
F. 2d 268, 276 (1971), cert. denied, 406 U.S. 950, 92 S.Ct.
2042, 32 L.Ed.2d 338 (1972).
Finally, it may be that the term restriction wes
somewhat less rigid than the Root Court believed. See,
e. g., Hazel-Atlas Co. v. Hartford Co., 322 U.S. 238, 244-
45, 64 S.Ct. 997, 88 L.Ed. 1250 (1944).
ee
. ——— vad Bo tims Ieee 9
4 —
rr
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***
Ta
Appendiz A.
without question, the proposition that courts of appeals
may vacate their judgments in certain limited circum-
stances.15 Apparently, no court now takes the position
that a federal tribunal lacks authority to recall its own
mandate.
The source of the power to recall a mandate has not
been conclusively identified. One court of appeals has
discovered a “foundation in statute” for judicial au-
thority to recall a mandate. 16 It points to 28 U.S.C.
15. See, e. g., Reserve Mining Co. v. Lord, 529 F.2d
181 (8th Cir. 1976) ; Perkins v. Standard Oil Co. of Cali-
fornia, 487 F.2d 672 (9th Cir. 1973) 7 Powers v. Bethle-
hem Steel Corp., 483 F.2d 963 (1st Cir. 1973) ; Aerojet-
General Corp. v. American Arbitration Ass'n, 478 F.2d
248 (9th Cir. 1973) ; Greater Boston Television > v.
F. O. C., 149 U.S. App. D. C. 322, 463 F.2d 268 (1971) ; Grad-
sky v. United States, 376 F.2d 993 (5th Cir. 1967), cert.
denied, Grene v. United States, 389 U.S. 908, 88 S.Ct. 224,
19 L.Ed.2d 224 (1967) ; Legate v. Maloney, 348 F.2d 164
(1st Cir. 1965) ; Meredith v. Fair, 306 F.2d 374 ( 5th Cir.
1962) ; Yanow v. Weyerhaeuser Steamship Co., 274 F.2d
274 (9th Cir. 1958); Hines v. Royal Indemnity Co., 253
F.2d 111 (6th Cir. 1958).
The Supreme Court also has recognized the power
of federal courts, both trial — r to alter = —
aside judgments after their entry. See, e. g., Haze
Atlas 00. v. Hartford Co., 322 U.S. 238, 244, 64 S. Ct. 997,
1000, 88 L.Ed. 1250 (1944), in which the Court stated:
[I]n most instances society is best served by putting
an end to litigation after a case has been tried and
judgment entered. This has not meant, however,
that a judgment finally entered has ever been re-
garded as completely immune from impeachment...
[U]nder certain circumstances . . relief will be
granted against judgments regardless of the term
of their entry.
16. Greater Boston Television Corporation v. FCC,
463 F 5d 268 (DC. Cir 1971). cert. denied, 406 U.S. 950,
92 S.Ct. 2042, 32 L.Ed.2d 338 (1972)
Appendiæ A.
8a
§ 2106, which expressly authorizes an appellate court to
affirm, modify or vacate any judgment as that court may
deem to be “just under the circumstances.” While, on its
face, § 2106 seems to apply primarily to review by an
appellate tribunal of a judgment or order of an inferior
court, arguably the statute sanctions reassessment by a
court of appeals of its own decisions as well.17
Most courts of appeals have rooted the authority
to recall a mandate in the “inherent power” of a court.
The Eighth Circuit, sitting en banc, has posited, for
example, that a mandate may be recalled “[i]n the
exercise of this court’s supervisory power over [a] liti-
gation and in order to protect the integrity of this
court’s [earlier] mandate. .”18 Likewise, a panel of
17. Another court of appeals has suggested that
Fed.R.Civ.P. 60(b) may constitute a basis for granting a
recall motion, since that procedural provision permits a
court “on motion and upon such terms as are just....
[to] relieve a party or his legal representative from a
final judgment .. . [for] any... reason justifying relief
from the operation of the judgment.” Yanow v. Weyer-
haeuser Steamship Company, 274 F.2d 274 (9th Cir.
1958). Nonetheless, there may be some question whether
Rule 60(b) provides authority for recall of a mandate
in the Third Circuit. This is so because, unlike the Ninth
Circuit (see id. at 278), this Court has not generally con-
strued the Federal Rules of Civil Procedure to apply to
appellate proceedings. Nor does Rule 81 appear to make
Rule 60(b) pertinent here. See also Hines v. Royal In-
demnity Company, 253 F.2d 111, 113 (6th Cir. 1958), in
which the Court declared: “The Rules of Civil Procedure
apply to procedure in the District Courts, not to the
Court of Appeals.“
18. Reserve Mining Co. v. Lord, 529 F. 2d 184, 188
(Sth Cir. 1976). See, e. g., Powers v. Bethlehem Steel
Co tion, 483 F.2d 963 (Ist Cir. 1973); Perkins v.
6 : i Company of California, 487 F.2d 672, 674
r.
rr REEL E ELAS ERE DAE NB Coty
N r
54 — Gh,
9a
Appendiz A.
the Ninth Circuit has declared: “The authority of a
Court of Appeals to recall a mandate is not conferred
by statute, but its existence cannot be questioned. 19
Thus, although there are various possible sources
of judicial power to recall a mandate, it is well recog-
nized that a court of appeals has such authority. In
light of this recognition, and reflective of the fact that
the parties to the present controversy do not contest
such a premise, we conclude that this Court may amend
the judgment in 41817 J, should such action prove ap-
propriate.
B.
While the parties do not dispute the elemental
power of the Court to recall a mandate, they disagree as
to whether such relief is in order in the case at hand.
Before seeking to resolve this question, however, we
first must define the parameters which will frame our
inquiry.
The existing precedents provide some guidance as
to when it is appropriate to amend a judgment after the
time for rehearing has concluded. All of the courts
of appeals have emphasized that recall of a mandate
is an extraordinary remedy, one to be used sparing-
ly. And their opinions teach that recall may be war-
ranted for “good cause, 20 to “prevent injustice,’’*!
19. Aerojet-General Corporation v. American Arbi-
tration Ass’n, 478 F.2d 248, 254 (9th Cir. 1973).
20. See, e. g., Aerojet-General Corporation v. Amer-
ican Arbitration Ass’n, 478 F.2d 248, 254 (9th Cir. 1973) ;
Greater Boston Television Corporation v. F. C. O., 463
F.2d 268, 277 (D.C. Cir. 1971).
21. See, e. g., Aerojet-General C ation v. Amer-
ican Arbitration Ass’n, 478 F. 2d 248, 254 (9th Cir. 1973);
ow v. United States, 376 F.2d 993, 995 (5th Cir.
).
10a.
Appendiz A.
or in “special circumstances.“ 22 Such phrases indicate
that exercise of the authority to alter a judgment falls
within the discretion of the court, but that such dis-
cretion should be employed to recall a mandate only in
unusual instances.
A few courts have attempted to enunciate specific
standards for determining whether sufficient “good
cause” exists to justify the recall of a mandate. The
most pertinent opinion in this regard is Greater Boston
Television Corporation v. F.C.C.23 There, Judge Levin-
thal presented a series of hypothetical situations in
which recall of a mandate might be proper, including
(1) where clarification of a mandate and opinion is crit-
ical; (2) where misconduct has affected the integrity of
the judicial process; (3) where there is a danger of in-
congruent results in cases pending at the same time;
and (4) where it is necessary to revise an “unintended”
instruction to a trial court that has produced an unjust
result.24
Greater Boston also implicitly recognized a fifth
criterion by reference to an earlier First Circuit opinion,
Legate v. Maloney,?5 in which it was suggested that re-
call of a mandate might be justified if a subsequent Su-
preme Court decision “showed that [the] original judg-
ment was demonstrably wrong.“ 26 In sum, then, the
22. See, e. g., Powers v. Bethlehem Steel Corpora-
tion, 483 F.2d 963, 964 (Ist Cir. 1973); Greater Boston
Television Corporation v. F. C. C., 463 F.2d 268, 280 (D.C.
Cir. 1971).
23. 463 F.2d 268 (D.C. Cir. 1971).
24. Id. at 278-279.
25. 348 F.2d 164 (1st Cir. 1965).
26. 463 F.2d at 278 and note 12, quoting Legate v.
Maloney, 348 F.2d 164, 166 (Ist Cir. 1965).
eee
bee
.
ö
a
N
f
lla
Appendix A.
opinion in Greater Boston attempts to set forth guide-
lines as to when a court of appeals may properly amend
one of its decisions—guidelines that may prove to be
helpful in the present case.
Above all, though, recall of a mandate is a mode
of relief that falls within the ambit of a court’s discre-
tion. Ordinarily, such discretion should not be exercised
to modify or vacate a prior judgment, absent good cause
or unusual circumstances. And decisions concerning the
propriety of such relief must be rendered on a case-by-
case basis.
With these precepts in mind, we turn to a consid-
eration whether recall of the mandate is warranted in
the instant setting.
III.
A.
In support of its motion to recall the mandate, the
EPA primarily relies on the opinion of the Supreme
Court in duPont27 filed subsequent to the decision in
AISI I. The agency maintains that the interpretation of
the Act set forth in 4781 I is “clearly inconsistent” with
the statutory constructic™ expressed in duPont. Accord-
ing to the EPA, the Supreme Court’s approval of sin-
gle-number effluent limitation regulations, roughly iden-
tical to those considered by this Court, obviates the
need for development of “ranges” and “guidance” fac-
tors during the course of a remand in this litigation.
The EPA, in so arguing, seemingly endeavors to
come within the reach of the fifth criterion adverted
to in Greater Boston—that recall of a mandate might
27. —— US. ——, 97 S.Ct. 965, 51 L.Ed.2d 204
(1977).
12a
Appendiz A.
be appropriate when a later Supreme Court decision re-
veals that the original judgment was “demonstrably
wrong.“ 28 But it is important to emphasize that we do
not believe that the du Pont case has, to any great ex-
tent, called into question the validity of the analysis in
AISI I.
As we read duPont, that decision in no way sounds
the death knell for AJS/ J that the EPA would have us
perceive. To the contrary, the duPont opinion affirms
much of the statutory interpretation espoused by this
Court in AJS/ IJ. In both duPont and AISI I, a central
issue was whether, under the Act, the EPA possesses
the power to set industry-wide effluent limitation regu-
lations. Like this panel, the Supreme Court concluded
that the EPA does, indeed, have authority under § 301
to promulgate industry-wide regulations limiting ef-
fluent discharges.29 Moreover, the duPont Court seem-
ingly did not view AJS/ I with disapproval, citing our
opinion no less than five times.39 Had 4181 I been
wrongly decided, the Supreme Court surely would have
been reluctant to refer to it in such fashion.
Even though AJSI I appears to retain its funda-
mental vitality under duPont, we recognize that the
Supreme Court specifically did not remand the regula-
tions to the EPA for further refinement. Not only did
the duPont Court decline to order the development of
“range” or “guidance” factors for the § 304 guidelines,
but it did not direct any alteration of the § 301 regula-
28. See notes 25 and 26 and accompanying text
supra.
29. Compare U.S. at
with 526 F.2d at 1035-42.
30. See —— USS. at ,
, 97 S.Ct. 965,
, 97 S.Ct. 965.
hl nate AO hile Hh Nh ali e Lb ks blir Makes bal Heli Ratan + teil ——
|
13a
Appendix A.
tions themselves. Instead, the Court approved the
single-number regulations as issued, recognizing that
such limitations make some allowance for varia-
tions in individual plants . by including a variance
clause... 31
With respect to the duties imposed upon the EPA
by § 304 of the Act, the du Pont Court declared that the
agency’s use of subcategories satisfies Congressional ex-
pectations regarding a “range” of best practicable and
best available treatment levels.3 2 Also, the Supreme
Court concluded that, under procedures adopted by the
EPA, the purposes of the § 304 guidelines—including
that of providing guidance to permit issuers—had been
“substantially achieved.“ Such procedures entail the
utilization of a development document and other sup-
porting materials as well as the agency’s practice of
obtaining comments on such materials and any proposed
regulations. 33
Because the EPA established, by subcategoriza-
tion, a “range” of limitations within the iron and steel
regulations and also followed the very procedures sanc-
tioned in duPont, such as the employment of a develop-
ment document and public input, it would appear that the
EPA complied with the strictures of the Act. It follows,
therefore, that remand of the regulations for develop-
ment of range“ and “guidance” factors may well be in-
31. Id. —— US. at ——, 97 S.Ct. 965.
The observations in A/S] J respecting the “variance”
procedure, see 526 F.2d at 1046, have at best limited
validity in light of such statements in duPont.
32. —— USS. at —— and note 21, 97 S.Ct. 965.
33. Id. —— USS. at and notes 22, 23, 97
S.Ct. 965.
14a
Appendiæ 4.
compatible with the reading of § 304 articulated in®
duPont.3+ At the very least, the requirements that this
Court imposed on the EPA to be dealt with on remand
cannot be said to be mandatory under the Act.35
The question remains, of course, whether the dis-
parity between our opinion in AJS/ J and that of the Su-
preme Court in duPont is such as to warrant recall of
the mandate. Despite the efforts of the EPA to fit the
present case into the Greater Boston/Legate formula, it
is questionable whether the duPont decision “showed
that our original judgment [in AISI 1] was demonstrably
wrong.”36 Even so, we do not view the Legate test as an
immutable rule with which literal compliance is required
before a motion to recall may be granted. This is so since
Legate itself did not involve a factual matrix in which a
Supreme Court decision undermined the viability of a
prior disposition by the First Circuit. Indeed, the refer-
ence to recall of a mandate based on a subsequent Su-
34. Speaking of the “subcategorization” concept
in AISI I, this Court declared: “we disagree with the
Administrator’s contention that ‘sub-categorization’ pro-
vides a range.“ 526 F.2d at 1046. As to the employment of
a development document, this Court did not consider
such a procedure as satisfying the dictates of § 301 or
§ 304. Id. at 1046-47 and note 44. But such postulates evi-
dently have become outmoded under duPont.
35. It is important to note that the Supreme Court
permitted the American Iron and Steel Institute to sub-
mit a brief, as amicus curiae, in duPont. In such brief,
the Institute urged the Supreme Court to adopt this
Court’s position respecting the “range” and “guidance”
problems. But it would + ge that the Supreme Court
rejected, at least implicitly, the position advanced in the
amicus brief.
* Legate v. Maloney, 348 F.2d 164, 166 (1st Cir.
m oA. bad . . tas tes Ne —
ae
|
:
15a
Appendiz A.
preme Court opnion constitutes dictum, intended only to
demonstrate the natural skepticism with which the court
of appeals would view any motion to amend or vacate a
prior judgment.
Although we are inclined to minimize the rigidity
of the Legate model, the statements in that case remain
pertinent to the matter before us. For Legate does call
attention to the problems generated when the Supreme
Court addresses issues that already have been adjudi-
cated in the courts of appeals. Where, as here, a deci-
sion of the Supreme Court—the preeminent tribunai in
our judicial system—departs in some pivotal aspects
from those of lower federal courts, amendatory action
may be in order to bring the pronouncements of the lat-
ter courts into line with the views of the former. As
noted above, recall of a mandate traditionally has been
warranted when and to the extent necessary to protect
the integrity” of a court’s earlier judgment.37 Certainly,
such integrity may be jeopardized when the solemn dec-
larations of a court are called into question by a later
Supreme Court opinion. Recall of a mandate, in such a
situation, would appear to be an appropriate response
by a court of appeals.
In the present case, duPont places in doubt the
necessity of the remand previously ordered and the con-
comitant requirement that the § 301 and § 304 stand-
ards for the iron and steel industry undergo further de-
velopment. Because the Supreme Court approved the
concept of single-number effluent limitations, without
ordering separate § 304 guidelines specifying ranges“
and “guidance” factors, the decision in AJS/ I, insofar
as it addressed such matters and imposed far more strin-
37. See authorities cited in note 18 supra.
16a
Appendix A.
gent demands upon the EPA, appears to be at odds
with duPont. So as to eliminate such variances, and,
more importantly, to protect the integrity of our earlier
decision, modification of our judgment now seems justi-
fied under the unusual circumstances here.
We do not, however, award such relief merely on
the basis of the incongruencies between duPont and 418“
I. Additional factors, to be discussed below, support our
view that the EPA’s recall“ motion should be granted.
B.
Among the hypothetical situations in which recall
of a mandate might be proper, Greater Boston included
instances portending “differences of result for cases
pending at the same time.” Judge Levinthal declared
that the interest in “uniformity” in application of prin-
ciples and in decision-making might constitute a “special
reason for disturbing [the] repose and finality .. .” of
an earlier adjudication. 38 While the Greater Boston tri-
bunal evidently was concerned with promoting intra-
circuit consistency, we believe that the interest in uni-
formity may transcend the territorial borders of any
one circuit. Where a court of appeals finds itself op-
posed by the asseverations of the majority of its sister
courts, then a reevaluation of its own position may be
in order. This is especially so where the views of other
courts of appeals fall more harmoniously into an align-
ment with the position of the Supreme Court.
In the situation before us, this Court has assumed
a solitary position respecting the “range”, “guidance”
and related issues. At least five other courts of appeals
38. 463 F.2d at 278-79.
————
2
1
;
1
a
a
7
:
3
2
3
i
4
3
‘
4
4
:
17a
Appendix A.
have considered such questions, and each of them has
reached a conclusion opposed to that adopted by this
Court.39 Speaking on the “range” issue, for example,
the Second Circuit declined to rule that the effluent limi-
tation regulations were invalid because the “EPA failed
to establish permissible ‘ranges’ of discharges within
each category or subcategory of existing point sources
Rather, that Court stated: [wle disagree with
this argument and believe that whenever Congress spoke
of ‘ranges’ in the debates over the Act, it meant only
the spectrum comprised of varying discharge levels on
a subcategorial, rather than individual, basis.“ 0 And
the Supreme Court in duPont indicated that such an in-
terpretation is the proper one.
Similarly, the Second Circuit, like the other courts
of appeals that have discussed the “guidance” elenient,
spurned the contention that the regulations violated the
39. See U.S. Steel v. Train, 556 F.2d 822 (7th Cir.
1977); California & Hawaiian Sugar Co. v. EPA, 553
F.2d 280 (2d Cir. 1977); American Paper Institute v.
Train, 177 U.S.App.D.C. 181, 543 F.2d 328 (1976); du-
Pont v. Train, 541 F.2d 1018 (4th Cir. 1976) ; American
Petroleum Institute v. EPA, 540 F.2d 1023 (10th Cir.
1976) ; FMC Corporation v. Train, 539 F.2d 973 (4th Cir.
1976); American Frozen Food Institute v. Train, 539
F.2d 107 (D.C. Cir. 1976) ; Hooker Chemicals & Plastics
Corp. v. Train, 537 F.2d 620 (2d Cir. 1976).
In U.S. Steel v. Train, supra, which was decided after
the duPont case, the Seventh Circuit briefly commented
on the remand for a “range” of effluent limitations or-
dered in AISI I. The Court stated, inter alia, that “the
Supreme Court’s approval of single-number effluent limi-
tations in duPont renders [the AJSI I remand] conclu-
sion questionable... .”
40. Hooker Chemicals & Plastics Corp. v. Train,
537 F.2d 620, 630 (2d Cir. 1976).
18a
Appendix A.
Act by neglecting to specify factors to be taken into
account in determining the control measures and prac-
tices to be applied to point sources. Basically, the pro-
cedures that the EPA employed in setting the single-
number effluent limitations were deemed by the Second
Circuit to comply with the dictates of § 304 and the Act
in general.41 Again, such a proposition substantially was
embraced by the Supreme Court in duPont.
In any event, it is clear that the decision of this
Court on the range“, guidance“ and related matters
departs from the position of the other courts of appeals.
The result is a lack of uniformity between the treatment
accorded the EPA’s effluent limitations in this Circuit
and the reception bestowed on such regulations by other
courts.
Given such a setting, for this Court to eschew an
opportunity to modify the mandate in AJSI I would
prove disruptive to the national program of water pol-
lution control envisioned by the Act. Should we reject
the recall motion, the EPA, as it represented at oral
argument, would have to proceed to refine its regula-
tions and guidelines as directed in AJS/J J. Once that
task was completed, the EPA then would apply the
newly developed regulations to the iron and steel indus-
try. However, the EPA would continue to utilize its
single-number regulations for other industries—cer-
tainly in all other circuits where the courts of appeals
have rejected range“, guidance“ and similar require-
ments. Put another way, the pollution control regula-
tions to be applied to categories of similar industrial
dischargers would become discordant, with a special set
of regulations to govern the iron and steel industry and
41. Id. 537 F.2d at 630.
Ie MA tak se heli Seep
19a
Appendiz A.
perhaps other industrial categories in the Third Circuit
alone.
In the face of such a consequence, and especially in
view of the apparent inconsistencies between facets of
duPont and the opinion in AJS/ I, we are willing to ac-
cede to the motion to amend the mandate to the extent
that it concerns the range“, guidance“ and related
issues. In so doing, we adhere to the precept of uniform-
ity in judicial decisionmaking and in the treatment of
litigants. Because the interest in avoiding differences
in result in cases pending at the same time stands as a
valid basis for the recall of a mandate, alteration of the
judgment here does not constitute a radically new or
unwarranted departure from the strong policy that
there be an end to any particular litigation.
C.
Although Greater Boston did not designate the
public interest” as a specific reason for granting a re-
call” motion, such a concern would seem to be encom-
passed under the broader rubrics of “good cause” or
“special circumstances.” The EPA contends that the
remand requirements directed in AJS/ I, but not ordered
by duPont, impose substantial burdens on the agency
that will obstruct the effectiveness of the national pro-
gram of water pollution control. This position is not
without merit.
We recognize that development of “ranges”, guid-
ance” factors and the like would constitute a fairly
onerous task. As indicated at oral argument, the EPA
would have to restructure its methodology for promul-
gating regulations. In addition, the agency might have
to devote substantial manpower in order to satisfy the
20a
Appendiæ A.
remand instructions. The result of expending consider-
able resources so as to comply with AJS/ I might be
to impede effective administration of a wide variety of
environmental enactments.
Equally significantly, because of the contours of
the mandate in A/JS/ J, there presently are no regula-
tions applicable to iron and steel manufecturing opera-
tions, a major source of effluent discharges into the wa-
ters of the United States. The EPA has advised the
Court that the absence of such regulations has contrib-
uted to delays in the issuance of discharge permits pur-
suant to § 402 of the Act.42 Removal of the stringent
remand requirements of AJS/ J, and reinstatement of
the effluent limitation regulations as originally designed,
would serve to expedite the operation of the permit sys-
tem. And such action may bolster the accomplishment
of the central objective of the legislative draftsmen,
viz., “to restore and maintain the chemical, physical and
biological integrity of the Nation’s waters.“ 43
Because of these weighty considerations, coupled
with the fact that the remand instructions may be un-
necessary in light of the duFont adjudication, recall of
the mandate here would appear to be justified. Easing
the burdens imposed upon the EPA by A/JSI J will serve
the public interest by facilitating the enforcement of
the national pollution laws. This is so because the agen-
cy will be able to direct its limited resources towards a
more effective cleanup of our waterways.
42. 33 U.S.C. § 1342.
43. Section 101 of Act, 33 U.S.C. § 1251.
21a
Appendix A.
D.
Another basis for granting the EPA the remedy
that it requests rests on the character of the original
disposition in this case. AJSI I did not result in the
award of a money judgment or in other relief that was
inherently final. Rather, in directing the agency to for-
mulate water pollution standards in compliance with
the “range” and “guidance” analysis of AJ/S/ I, this
Court rendered an order which necessarily is of a con-
tinuing nature. Since the EPA has not yet devised efflu-
ent limitations to comport with A/S/ I, the remand obli-
gations currently remain in force.
It would follow that modification of the extant judg-
ment here would not appear to be particularly violative
of the elemental precept, discussed above, that there
should be a conclusion to a controversy in litigation.““
Because 41781 I, at least prior to completion by the agen-
cy of the tasks ordered by this panel, cannot be said to
have constituted a final adjudication of the dispute con-
cerning the validity of the challenged regulations, recall
of the mandate in the present setting thus is not espe-
cially disruptive of the interests in finality of judgments.
Had AISI I, for example, awarded a money judg-
ment, we would have been far more reluctant to amend
the original mandate. And litigants generally should
stand as forewarned that the extraordinary remedy
granted here may well be confined to instances where
litigants are under a continuing duty to satisfy an order
of the Court.
44. See Part I A of this opinion supra.
Appendix A.
E.
As a final point, we note that the effect on our origi-
nal judgment of the amendment sought by the EPA will
be a relatively modest one. While the decision in 4187 I
constitutes a rather extensive interpretation and analy-
sis of the Act, the EPA seeks to amend or vacate only a
minor segment of that lengthy opinion.
Yet the desired modification is not moderate simply
in terms of pagination. For, as noted above, we view the
vital center of 48/1 I to be the analysis respecting the
power of the EPA to promulgate the subject regulations
in the first instance. And the motion to recall in no way
undercuts—nor could it in light of duPont—our conclu-
sion that the EPA possesses the power to design effluent
limitation regulations. 5
Of course, those portions of our opinion that remain
intact are largely favorable to the EPA, and so the re-
call“ motion naturally does not challenge those facets
of the AISI I opinion. Nonetheless, in light of duPont
and the decisions of the other courts of appeals respect-
ing the range“, “guidance” and related matters, to-
gether with the fact that the bulk of our opinion ap-
pears to remain viable, we believe that sufficient “good
cause” has been evinced to warrant the amendment of
our judgment.
IV.
For the reasons articulated in the foregoing opin-
ion, we hold, first, that this Court has the power to re-
45. Additionally, the analysis in AJS/ J regardin
the 1977 “BPCTCA” and 1983 “BATEA™ standards in the
iron and steel regulations as well as the discussion of
other contentions raised by the petitioners have not been
undermined by duPont. See 526 F.2d at 1047-66.
23a
Appendix A.
call a mandate in certain limited situations. Second, and
to dispel any possible doubts, such relief may be grant-
ed only in exceptional circumstances and for good cause.
Because this Court ordinarily will view motions to recall
a mandate with disfavor, the opinion in this matter
should not be read as an invitation to litigants to seek
review of already adjudicated claims. |
Finally, we conclude today that recall of the man-
date and modification of the judgment in AJSI/ I is war-
ranted because of the confluence of several unusual fac-
tors: the incongruencies, in certain respects, between
the opinion in AJSI J and the Supreme Court’s decision
in duPont; the solitary position of this Court concern-
ing the range“, guidance“ and related matters, a po-
sition contrary to that adopted by every court of ap-
peals that has dealt with the issue; the heavy burdens,
contrary to the public interest, that adherence to 4181 J
would impose on the national program of water pollu-
tion control; the continuing nature of the obligations
placed on the agency in the original panel decision; and
the relatively moderate effect of the amendment desired
by the EPA on the judgment in 4181 J.
Accordingly, the original mandate will be recalled
and the judgment amended insofar as that judgment
remanded the effluent limitation regulations to the EPA
(1) to establish “ranges” of effluent limitations other
than those established by subcategorization; (2) to
specify factors to guide the permit writers in selecting
limitations other than the guidance provided by the
Development Document and related materials; and (3)
to reconsider the effluent limitations as promulgated in
light of the “base level” and “ceiling” concepts. Such
as amendment of the judgment will not affect any other
24a
Appendiz A.
portion of the original decision—specifically, it does not
concern Sections I and IV through VII of the opinion in
AISI I. Section VIII of that decision will be affected only
to the extent that the Agency’s obligations on remand
are modified as specified above.
JAMES HUNTER, III, Circuit Judge, dissenting:
The motion before the court was filed March 22,
1977. It seeks (1) recall of the mandate in American
Iron and Steel Institute v. Environmental Protection
Agency, and (2) amendment of judgment.
The case to which the motion has been addressed
was decided November 7, 1975. It is reported at 526
F. 2d 1027 (3d Cir. 1975).
The moving party here, the Environmental Protec-
tion Agency, never filed a petition for rehearing. Fur-
thermore, we have no record of its having petitioned
the Supreme Court for certiorari.
On February 23, 1977, the Supreme Court decided
Z. I. duPont de Nemours & Co. v. Train, —— U.S. ——,
97 S.Ct. 965, 51 L.Ed.2d 204 (1977).
The majority permits this court, in the “new” light
of duPont, to open the door to reconsideration of this
case through the recall of the mandate and, addition-
ally, to modify its opinion to “conform” to that recent
decision.
I respectfully dissent. I would not attempt to re-
examine our 1975 decision because of duPont. There
must be an end to each individual piece of litigation.
1. See Baldwin v. lowa State Traveling Men’s
Ass’n., 283 U.S. 522, 525, 51 S.Ct. 517, 75 L.Ed. 1244
(1931) ; Powers v. Bethlehem Steel Corp., 483 F.2d 963,
25a
Appendiæ A.
In the instant case that time has long since past.? I do
to “conform” to subsequent decisions of other courts
in other cases.
964 (ist Cir. 1973); Greater Boston Tel. Corp. v. F. C. C.,
463 1.24 268, 278 (D.C. Cir. 1971), cert. dented 406 U.S.
950 Ct. 2042, 32 L.Ed.2d 338 (1972); Collins u. City
of Wichita, Kansas, 54 F.2d 837, 839 (10th Cir. 1958) .
2. See Riha v. International Tel. & Tel. Corr., 533
F.2d 1053, 1055 (8th Cir. 1976) ; Lee v. Terminal Trans-
port Co., 301 F.2d 234, 236 (7th Cir. 1962).
Appendiz B.
Appendix B
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
ON PETITIONS FOR REVIEW OF AN ORDER OF
THE ENVIRONMENTAL PROTECTION AGENCY
Present: ADAMS, HUNTER and GARTH,
Circuit Judges.
AMENDED JUDGMENT ON MOTION FOR
RECALL OF MANDATE
On consideration whereof, it is now here ordered
and adjudged that the certified judgment issued, Decem-
ber 1, 1975, in lieu of formal mandate be, and the same
is hereby recalled and the j.dgment of this Court, filed
November 7, 1975, be, and the same is hereby amended
insofar as that judgment remanded the effluent limita-
tion regulations to the EPA (1) to establish “ranges”
of effluent limitations other than those established by
subcategorizafion; (2) to specify factors to guide the
permit writers in selecting limitations other than the
guidance provided by the Development Document and
related materials; and (3) to reconsider the effluent
limitations as promulgated in light of the base level“
and ceiling“ concepts. Such an amendment of the judg-
ment will not affect any other portion of the original
decision—specifically, it does not concern Sections I and
IV through VII of the opinion in 4181 J. Section VIII of
that decision will be affected only to the extent that the
27a
Appendiz B.
Agency’s obligations on remand are modified as specified
above, all in accordance with the opinion of this Court.
ATTEST: |
THOMAS P. QUINN
Clerk
August 10, 1977
Certified as a true copy and issued in lieu of a formal
mandate on September 13, 1977.
Test: M. Elizabeth Ferguson
Chief Deputy Clerk, U.S. Court of Appeals for thr:
Third Circuit
Appendiz C.
Appendix C
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Nos. 74-1640, 74-1642, 74-1962, 74-2006, 74-2256
AMERICAN IRON AND STEEL INSTITUTE, et al.
v.
ENVIRONMENTAL PROTECTION AGENCY
SUR PETITION FOR REHEARING
BY ORIGINAL PANEL
Present: ADAMS, HUNTER and GARTH,
Circuit Judges.
The petition for rehearing filed by Petitioners in
the above entitled case having been submitted to the
judges who participated in the decision of this court,
and no judge who concurred in the decision having asked
for rehearing, the petition for rehearing is denied.
By the Court,
Circuit Judge
Dated: September 2, 1977
Appendiz D.
Appendix D
AMERICAN IRON AND STEEL INSTITUTE, et al.,
Petitioners. |
v.
ENVIRONMENTAL PROTECTION AGENCY,
Respondent.
Nos. 74-1640, 74-1642, 74-1962, 74-2006 and 74-2256.
United States Court of Appeals, Third Circuit.
Argued June 9, 1975.
Decided Nov. 7, 1975.
Before ADAMS, HUNTER and GARTH, Circuit
Judges.
OPINION OF THE COURT
JAMES HUNTER, III, Circuit Judge:
This is a petition brought by the American Iron and
Steel Institute and several individual steel companies to
review regulations promulgated by the Administrator
of the Environmental Protection Agency on June 28,
1974.1 In these regulations, entitled “Effluent Guide-
lines and Standards, Iron and Steel Manufacturing Point
Source Category,” the Administrator established na-
tionwide single number effluent limitations for point
sources2 in the iron and steel industry engaged in “pri-
1. 39 Fed.Reg. 24114, 40 C. F. R. § 420.10 et seq.
2. 33 U.S.C. § 1362 (14) defines “point source“ as
“any discernible, confined and discrete conveyance, in-
cluding but not limited to any pipe, ditch, channel, tun-
nel, conduit, well, discrete fissure, container, rolling
stock, concentrated animal feeding operation, or vessel
or other floating craft, from which pollutants are or may
be discharged.”
30a
Appendix D.
mary” (or basic manufacturing) operations.? Contend-
ing that the Administrator’s regulations do not conform
to the requirements of the Federal Water Pollution Con-
trol Act Amendments of 1972 (hereinafter, the Act“),
the petitioners seek judicial review of the Administra-
tor’s actions under section 509(b) (1) of the Act.5 Two
other steel companies—Youngstown Sheet and Tube
Company, and CF&I Steel Corporation—filed similar pe-
titions in the Sixth and Tenth Circuits, respectively. By
order of each Circuit, the cases were transferred to this
Court, and they have been consolidated with the petitions
filed here. In addition, the Natural Resources Defense
Council, Inc., has filed a brief as Amicus Curiae.
I
Petitioners’ first, and most basic, challenge is to
the Administrator’s very power to promulgate nation-
wide single number effluent limitations for existing point
sources.® Petitioners contend that the limitations which
are to be binding on them can only be established by the
permit-granting authorities (principally, the States),
which are to follow guidelines promulgated by the Ad-
ministrator. The Administrator contends that he is not
3. Regulations for “secondary” (or finishing)
operations have not yet been promulgated.
4. 33 U.S.C. § 1251 et seq. (Supp. II 1972). The
relevant sections of the Act are set out in full in the ap-
pendix to this opinion.
5. 33 U.S.C. § 1369(b) (1).
6. The power of the Administrator to establish
such limitations for new point sources under § 306 of the
Act, 33 U.S.C. § 1316, is unquestioned. Thus, petitioners’
challenge to the new source regulations, discussed in
parts VI and VII of this opinion, takes a different ap-
proach.
31a
Appendiæ D.
merely empowered to promulgate guidelines, but may
establish limitations which are binding throughout the
country and which must be incorporated into any per-
mit issued to any individual point source. The answer
to this dispute, which goes to the very heart of the ad-
ministration of the Act, depends upon our resolution of
the interrelationship of three key sections of the Act
301,7 3048 and 402.9
Petitioners rely heavily on the fact that there is no
section in the Act which explicitly authorizes the Ad-
ministrator to establish single number effluent limita-
tions for existing point sources. They contend that the
lack of such explicit authorization cannot have been an
oversight, since the Act expressly authorizes the Ad-
ministrator to promulgate other types of regulations.
For example, the Administrator has the explicit author-
ity to set standards for new point sources under section
306 (b) (1) (B) 10 and for toxie discharges under section
307 (a) (2), 11 and to establish pretreatment standards
under section 307 (b) 12 and water quality standards
under section 303 (b). 13 Many of these sections not only
explicitly authorize the Administrator to promulgate
regulations establishing such standards, but also speci-
fy in some detail the times and procedures to be fol-
lowed.
7. 33 U.S. C. § 1311.
8. Id. § 1314.
9. Id. § 1342.
10. Id. S 1316 (b) (1) (B).
11. Id. § 1317 (a) (2).
12. Id. § 1317 (b).
13. Id. S 1313 (b).
32a
Appendiz D.
In contrast to these sections, the only section ex-
plicity authorizing the Administrator to establish any
regulations pertaining to effluent standards for exist-
ing point sources—section 304(b)—merely authorizes
the promulgation of guidelines“ rather than precise
standards or single number limitations. While section
301 (b) refers to “effluent limitations” for existing point
sources, that section does not explicitly authorize the
Administrator (or anyone else) to promulgate regula-
tions establishing such limitations. Rather, using the
passive voice, that section merely states that effluent
limitations for such point sources “shall be achieved“
by July 1, 1977 through the application of the “best
practicable control technology currently available”
(hereinafter, “BPCTCA”’), and by July 1, 1983 through
the application of the “best available technology eco-
nomically achievable” (hereinafter, “BATEA’’). Under
petitioners’ construction of the Act, these effluent limi-
tations are to be “achieved” through the permit process.
They contend that the permit issuing authorities, unc er
section 402, are to determine the effluent limitations to
be achieved by applying, to individual point sources, the
factors enumerated in the guidelines previously promul-
gated by the Administrator under section 304(b).
The two consolidated cases present graphic exam-
ples of the differing consequences of the two interpreta-
tions. Both Youngstown and CF&I contend that they
have local problems which can be fully appreciated only
by a local permit-issuing authority. Youngstown claims
that its plants in the Mahoning Valley provide one third
of the direct employment in that area and that they are
indirectly responsible for a significant percentage of the
remaining jobs. It also claims that its plants are very
old (several were built before World War I), that many
33a
Appendiz D.
will be forced to close if the limitations promulgated by
the Administrator are enforced, and that because of
the heavy concentration of steel plants along the shores,
the river is unavailable for recreational uses anyway.
Youngstown claims that a local authority, in apprecia-
tion of these factors, might have required somewhat
less stringent controls. CF&I points to a different prob-
lem. It contends that the installation of anti-pollution
devices in its Colorado plants would cause a significant
net loss of water through evaporation, which would
have serious consequences in a state where water is a
scarce and valuable resource. Contending that only a
local authority would fully appreciate the impact of the
anti- pollution devices on scarce water resources, 14
CF&I argues that its case is another illustration of the
necessary for flexibility at the local level.
We acknowledge that these arguments are not
without force, but we believe that the Administrator
does have the authority to promulgate effluent limita-
tions under section 301. While we admit that Congress
did not express its intent on this point with particular
clarity, we conclude, after examining the entire statu-
tory scheme and the legislative history, that the Ad-
ministrator’s power to promulgate effluent limitations
under section 301 can be inferred.14* We thus respect-
14. It is undisputed that the Administrator did not
even consider this evaporation problem. But see Port
IV(c) of this opinion.
14a. See part I of Judge Adams’ opinion in which
Judge Garth and I join. As part I of that opinion aptly
notes, Congress’ failure to express more clearly its intent
on such a crucial matter is indeed disturbing and we hope
that Congress will heed our admonition to draft its legis-
lation with greater clarity. The admitted ambiguities in
34a
Appendiz D.
fully disagree with the contrary conclusion reached by
the Eighth Circuit in CPC International, Inc. v. Train,
515 F.2d 1032 (8th Cir. 1975). With respect to the pe-
culiarly local problems of some point sources, as illus-
trated by Youngstown and CF&I, we believe that our
holding that the Administrator does have power under
Section 301 does not preclude some flexibility at the
local level. This point will be addressed in detail in part
I of this opinion.
Perhaps the strongest indication in the Act that the
Administrator has the power under section 301 to pro-
mulgate effluent limitations can be found in section
509(b) (1). This section provides for judicial review “of
the Administrators action. (E) in approving or
promulgating any effluent limitation or other limitation
under section $01 ...and (F) in issuing or denying any
permit under section 402.” Not only does this section ex-
plicity refer to the Administrator’s action in promulgat-
ing a section 301 effluent limitation, but its separate
references, in subsections (E) and (F), to section 301
effluent limitations and section 402 permits indicates
that the limitations and permits have independent
significance.
The Eighth Circuit in CPC International discounted
the importance of section 509 (b) (1) (E) by contending
that the section 301 limitation referred to must be one
promulgated under section 301(c), which empowers the
Administrator to “modify the requirements of subsec-
tion (b) (2) (A) of this section” with respect to an in-
this Act, however, cannot be an excuse to avoid deciding
the case before us, and we are satisfied that our resolu-
tion of the Act’s ambiguities is the one most consistent
with Congress’ expressed intent.
35a
Appendiz D.
dividual plant upon a stringent showing of hardship
and good faith efforts at compliance. We cannot accept
the Eighth Circuit’s reasoning on this point. In the first
place, section 301(c) does not authorize the Administra-
tor to promulgate any effluent limitations. Rather, it
merely authorizes him to relax the requirements of sec-
tion 301 (b) with respect to 1983 BATEA“ standards, 15
and thus it cannot be read to be within the scope of
section 509 (b) (1) (E). Furthermore, the legislative his-
tory shows quite clearly that section 301 (e), which was
only added during the House-Senate Conference, did not
even exist at the time section 509(b) (1) (E) was orig-
inally drafted.1°
15. In fact, § 301(c) itself seems to support the
Administrator’s position by p posing the existence
of a section 301 effluent limitation which the Administra-
tor can relax. Petitioners, noting that § 301(c) empowers
the Administrator to “modify the requirements” of §
301 (b) (2) (A), contend that this merely means that
the Administrator may relax the requirement that
“BATEA” technology be used. However, it is clear from
Senator Muskie’s statement in support of the Conference
bill that Congress contemplated the relaxation of limita-
tions:
“The Conferees have provided, however, a
mechanism for individual point-source-by-source
consideration in section 301(c). That section pro-
vides that the Administrator may modify any effi-
uent limitation based on ‘best available technology’
to be achieved by July 1, 19838. [Emphasis add-
ed].”’
Environmental Policy Division of the Library of Con-
gress, A Legislative History of the Water Pollution Con-
trol Act Amendments of 1972, 93d Cong., Ist Sess.
(Comm. Print 1973), at 1972 [hereinafter, “Leg.Hist.”’].
16. In the original Senate bill, S. 2770, § 509 (b) (1)
contained essentially the same language it does now [see
Leg.Hist. at 1713], while § 301(c) was what is now §
36a
Appendix D.
Further support for the Administrator’s power can
be found in section 505,17 which permits citizen suits to
enforce compliance with the Act. Section 505 (a) (1)
permits such suits against any person “who is alleged
to be in violation of (A) an effluent standard or limita-
tion under this Act... .” Section 505 (f) defines “effluent
standard or limitation,” for purposes of section 505 (a),
as “. . (2) an effluent limitation or other limitation
under section 301 ...; or (6) a permit or condition there-
301(d), and no subsection in § 301 contained what is now
§ 301(c) [see Leg.Hist. at 1610]. It is clear that what
is now § 301(c) was added during the House-Senate Con-
ference. See Leg.Hist. at 172 and 304.
We also see no merit to petitioners’ contention, ad-
vanced in their Reply Brief, that the initial bill’s distinc-
tion between the Administrator’s actions having a na-
tional impact and those having a local impact, the former
to be reviewable in the District of Columbia Circuit and
the latter in the Circuit of the affected locality, somehow
is support for their position that effluent limitations can
only be established locally. To the extent that Congress
ever intended that, this view would seem hard to recon-
cile with enacted version of section 509, which draws no
distinction between “national” standards and local“
effluent limitations. Furthermore, even if Congress had
considered § 301 limitations to have a local impact, in
contrast to unspecified “federal standards,” the earlier
version of § 509 still provided for judicial review “of the
Administrator’s action in approving or promulgating’
section 301 limitations. The fact that Congress may h
thought that the impact was local does not mean that the
Administrator does not have the power to promulgate
such limitations. Congress may instead have recognized
that some “national” limitations may have a predom-
inantly local impact on those industries which are con-
centrated primarily in one region of the country.
17. 33 U.S. C. S 1365.
37a
Appendiz D.
of issued under section 402 of this Act.. IS If peti-
tioners’ view were correct—that effluent limitations re-
quired under section 301 can only be established through
the permit process under section 402—then subsections
(2) and (6) of section 505(f) would appear redundant.
The fact that Congress felt it necessary to include sep-
arate references to section 301 limitations and to sec-
tion 402 permits indicates that they have independent
significance and that a person could be in violation of
section 301(b) independently of section 402.
Petitioners attempt to explain away this redun-
dancy by arguing that the separate references merely
indicate that “the legislative draftsmen appreciated
that a § 402 permit condition is not always an effluent
limitation—it might be a monitoring or reporting re-
quirement.” This contention fails to eliminate the re-
dundancy, and it fails to explain why Congress did not
consider it sufficient to include only a reference to a vio-
lation of a section 402 permit. While a permit may con-
tain conditions other than section 301 limitations, peti-
tioners’ position is that a section 301 limitation can only
be established through the permit process. Thus, given
the reference to violations of section 402 permits, any
reference to violations of section 301 limitations would
still be superfluous under petitioners’ view.
The Eighth Circuit in CPC International attempted
to explain away the redundancy on a different ground.
It viewed the independent reference to section 301 as
18. The Senate Report states, with reference to
section 505, that “[i]n addition to violations of Section
301(a), citizens are granted authority to bring enforce-
ment action for violations of effluent limitations under
section 301 . . . and any condition of any permit issued
under section 402.” Leg.Hist. at 1500.
38a
Appendiz D.
being necessary to encompass section 301(f), which pro-
hibits the discharge of radiological, chemical, or bio-
logical warfare agents and high-level radioactive wastes
into navigable waters. However, section 301(f) is not
an “effluent limitation,” but rather a flat prohibition on
all such discharges. Section 301(b) is the part of section
301 which requires compliance with effluent limitations,
and section 301(f) would seem to be a type of “other
limitation” referred to in section 505(f) (2).
Section 401 (a) (1) 19 also lends support to the Ad-
ministration's position. This section requires an appli-
cant for a permit to provide the permit- issuing agency
with “a certification from the State. that any such
discharge will comply with the applicable provisions of
sections 301, 302, 306, and 307 of this Act.“ The section
then proceeds to state:
“In the case of any such activity for which there
is not an applicable effluent limitation or other limi-
tation under sections 301(b) and 302, and there is
not an applicable standard under sections 306 and
307, the States shall so certify .. ..”
This section, by requiring the State to certify the ab-
sence of a section 301 effluent limitation when someone
has applied for a permit, seems to presuppose that sec-
tion 301 limitations have an existence independent of
the section 402 permits, and that they are generally ex-
pected to have been promulgated prior to the issuance
of such permits.
There are a number of other sections in the Act
which refer to the establishment of effluent limitations
“under” or “pursuant to” section 301. While it is true
19. 33 U.S.C. S 1341(a) (1).
39a
Appendiæ D.
that none of these sections specify how these limitations
are to be established or who is expected to establish
them, the repeated references to such limitations, when
coupled with the complete absence of any qualification
that such limitations are to be established through the
permit process, is further support for the position that
Congress intended the section 301(b) limitations to
have an independent existence. If they are to have such
an independent existence, it is reasonable for the Admin-
istrator to conclude that the promulgation of regula-
tions establishing such limitations is within his inherent
rule-making power.29 Those sections containing refer-
ences to effluent limitations include section 301 (e) [“Ef-
fluent limitations established pursuant to this section“! :
section 302(c) 21 [The establishment of effluent limita-
tions under this section shall not operate to delay the
application of any effluent limitation established under
section 301 or section 306 of this Act’’]; section
316 (b) 22 [“any standard established pursuant to sec-
tion 301”]; and section 316 (e) 23 [“effluent limitations
established under section 301“.
Finally, we believe that a joint reading of sections
304 and 301 lends support for the Administrator’s posi-
tion and undercuts that of the petitioners. Sections 304
(b) (1) (A) and 304 (b) (2) (A) require that the Ad-
ministrator’s regulations, which are to be applicable by
the years 1977 and 1983, respectively, identify. the
S.C. § 1361(a), which pro-
vides “Tae Pe ly 15 44 — * rescribe
such regulations as are necessary to carry out his func-
tions under the Act.”
21. 33 U.S.C. § 1312(c).
22. Id. § 1326 (b).
23. Id. § 1326 (e).
40a
Appendiz D.
degree of effluent reduction attainable” through appli-
cation of the best technology practicable or available.
This meshes in very neatly with section 301(b), which
requires the “achievement” of effluent limitations by
those dates applying the same respective levels of tech-
nology. Reading the two sections together, it would seem
inconsistent to require, on the one hand, both the
achievement of effluent limitations applying certain
levels of technology [section 301 (b)] and the promulga-
tion of regulations by the Administrator which “iden-
tify...the degree of effluent reduction attainable”
through those levels of technology [section 304 (b)],
while at the same time allowing permit grantors to de-
termine for themselves, bound only by section 304(b)
guidelines, what levels of effluent limitation are to be
achieved.
The Eighth Circuit in CPC International relied in
part on the permit provisions of the Act, especially sec-
tion 402(d) (2), which provides:
“No permit shall issue... if the Administrator
within ninety days of the date of transmittal of the
proposed permit by the State objects in writing to
the issuance of such permits as being outside the
guidelines and requirements of this Act.”
The Eighth Circuit, emphasizing the phrase “as being
outside the guidelines,” concluded that “[i]t is hard to
imagine a clearer indication that the permit-issuing
authority is to follow the guidelines promulgated under
304 (b), and is not to refer to independent regulations
under § 301.“ We respectfully disagree, and believe that
the Eighth Circuit read too much into section 402
(d) (2). Even if the word “guidelines” is a specific refer-
ence to the section 304(b) guidelines, the Eighth Cir-
Appendix D.
41a
cuit’s emphasis on that word ignores the fact that the
permit grantors must also comply with the “require-
ments” of the Act. In section 402(b) (1) (A), the Act re-
quires that any permits issued “apply, and insure com-
pliance with, any applicable requirements of sections
301, 302, 306, 307 and 403.” Section 304, unlike section
301, is never explicitly mentioned in section 402. We thus
read the whole of section 402 as requiring compliance
both with section 301 limitations and with any guide-
lines promulgated by the Administrator.
We aiso believe that a close reading of the legis-
lative history supports the Administrator’s position.
The Senate Report accompanying the bill stated:
“It is the Committee’s intention that pursuant
to subsection 301(b)(1)(A), and Section 304 (b) the
Administrator will interpret the term ‘best prac-
ticabie’ when applied to various categories of indus-
tries as a basis for specifying clear and precise ef-
fluent limitations to be implemented by January 1,
1976.24
Virtually identical language was used by Senator Mus-
kie, the principal author of the bill, in explaining’ the
Report of the House-Senate Conference Committee.?5
Senator Bentsen, a member of the Senate Public
Works Committee which drafted the bill, gave perhaps
the clearest indication that Congress contemplated that
the Administrator would establish section 301 limita-
tions:
24. Leg.Hist. at 1468 (emphasis added). The bill
as enacted, 55 course, had a date of July 1, 1977 instead
of January 1, 1976.
25. Leg.Hist. at 169.
Appendiz D.
“In phase I, for point sources of pollutants,
effluent limits shall be established not later than
January 1, 1977 [now July 1, 1977], which comply
with specifically defined levels of effluent controls
and treatment. As defined in section 301(b) (1) of
the bill, and as elaborated in the regulations which
we anticipate the Administrator shall issue pur-
suant to section 301 and section 304, these 1976
(now 1977] goals shall be at least .. the ‘best prac-
ticable control technology currently available’ for
[industrial] point sources... 26
The petitioners, as did the Eighth Circuit in CPC
International, also rely on portions of the legislative
history as support for their interpretation, but we be-
lieve that a close reading of the parts on which they rely
does not contradict our analysis. Many of the statements
indicating the need for flexibility, precise federal guide-
lines and a meaningful state role do not prove that the
Administrator does not have the power to establish
limitations under section 301. As we shall explain in
greater detail in part II of this opinion, they merely
indicate that the Administrator was empowered to pro-
mulgate guidelines in addition to limitations. Further-
more, some of the legislative history relied on by peti-
tioners is ambiguous. One example is the following ex-
chang: between Senator Mathias and Senator Muskie:
“Mr. Mathias. Does section 301(b) (2) (A) on page
76 contemplate that a State, or the Administrator
if appropriate, might be able to set the 1981 [now
1983] effluent limitations almost on an individual
point source by point source basis?
26. Id. at 1283 (emphasis added).
43a
Appendiz D.
“Mr. Muskie: Section 301(b)(2)(A) as well as
section 301 (b) (1) anticipate individual application
on point sources through the procedures under the
permit program established under section 402.“ 27
Unlike the petitioners, we do not see Senator Muskie’s
answer as support for the view that section 301 effluent
limitations can only be established through the permit
process. Rather, it is fully consistent with the Admin-
istrator’s position that previously promulgated nation-
wide effluent limitations are to be applied to individual
plants through the permit process. Given the question
asked, his answer must be taken primarily as a denial
that the Administrator was to set limitations on a
plant-by-plant basis, not that he lacked the authority
to establish nationwide limitations. He merely indicated
that those limitations were to be applied by local au-
thorities on a local basis.
The strongest statement in support of the view that
effluent limitations were to be established, as well as
applied, through the permit process appears in a letter
from EPA Administrator William Ruckelshaus to Chair-
man Blatnik of the House Public Works Committee:
“Effluent limitations required by Section 301 would
be established and applied to all point sources of
discharges covered by the Act by means of permits
issued under Title IV.” 28
We believe that this statement should not be given great
weight. This Act was predominantly a congressional
product, with the Administration playing a relatively
insignificant rule in its drafting, at least with respect
27. Id. at 1391.
28. Id. at 844.
44a
Anpendiz D.
to those parts of the Act at issue here. Consequently,
we believe that the comments by the EPA Administra-
tor reflecting his interpretation of then pending legisla-
tion should be given less weight in determining the
meaning of the Act than statements by Senators such
as Muskie and Bentsen who had a far greater responsi-
bility for the Act’s drafting.
The Eighth Circuit in CPC International also relied
heavily on the fact that several Representatives, prin-
cipally Abzug and Rangel, were concerned about the
lack of a federal veto power over the permit grantors
in the early House version of the bill.29 The Eighth
Circuit concluded that “the creation of the veto power
would make no sense if the EPA was already empowered
to promulgate regulations under § 301.” We disagree.
We believe that a veto power could have been considered
just as necessary to ensure compliance by the permit
grantors with section 301 limitations as with section 304
guidelines.
As a final point, we note that the Supreme Court
has consistently stated that, where an Act of Congress
is fairly susceptible of differing constructions, the in-
terpretation made of it by the agency charged with its
administration should be given considerable deference.
Udall v. Tallman, 380 U.S. 1, 16-18, 85 S.Ct. 792, 13 L.Ed.
2d 616 (1965) ; Power Reaction Co. v. Electricians, 367
U.S. 396, 408, 81 S.Ct. 1529, 6 L.Ed.2d 924 (1961):
McLaren v. Fleischer, 256 U.S. 477, 480-81, 41 S.Ct. 577,
65 L.Ed. 1052 (1921). This position was most recently
reiterated in Train v. NRDC, 421 U.S. 60, 87, 95 S.Ct.
1470, 43 L.Ed.2d 731 (1975), where the Supreme Court,
29. Such a veto power was eventually provided in
section 402(d) (2), 33 U.S.C. S 1342 (d) (2).
45a
Appendix D.
in upholding the Administrator’s interpretation of sec-
tion 110 of the Clean Air Act, 30 stated:
We therefore conclude that the Agency’s interpre-
tation of §§ 110(a) (3) and 110(f) was ‘correct’ to
the extent that it can be said that any particular
interpretation of a complex statute such as this is
the ‘correct’ one. Given this conclusion, as well as
the facts that the Agency is charged with adminis-
tration of the Act, and that there has undoubtedly
been reliance upon its interpretation by the States
and other parties affected by the Act, we have no
doubt whatever that its construction was sufficiently
reasonable to preclude the Court of Appeals from
substituting its judgment for that of the Agency.”
Similarly, the Supreme Court also stated:
“Without going so far as to hold that the Agency’s
construction of the Act was the only one it permis-
sibly could have adopted, we conclude that it was at
the very least sufficiently reasonable that it should
have been accepted by the reviewing courts.“ 31
For the reasons expressed earlier, we believe that
the Administrator’s interpretation of this very complex
Act—at least with respect to his power to promulgate
effluent limitations under section 301—is the more rea-
sonable one, and should be given appropriate deference.
30. 42 U.S.C. § 1857c-5.
31. 421 U.S. at 75, 95 S.Ct. at 1479.
32. We also reject the argument made by Youngs-
town that differing — in §§ 301 (b) (1) (A) and
301 (b) (2) (A) indicates that the administration of the
Act differs as between 1977 and 1983 limitations. Noting
that § 301 (b) (1) (A) requires the achievement of efflu-
ent limitations for point sources,” whereas § 301(b) (2)
Appendix D.
II
Having concluded that the Administrator does have
the power to promulgate effluent limitations under sec-
tion 301, we are now faced with the question of inter-
preting the nature of the Administrator’s powers and
duties under section 304 and of reconciling our construc-
tion of section 304 with that of section 301. We begin
by observing that the Administrator not only has the
power, but the explicit obligation to promulgate guide-
lines“ under section 304. In these guidelines, the Ad-
ministrator is specifically required (1) to “identify...
the degree of effluent reduction attainable through the
application” of the relevant standard of technology
{sections 301 (b) (1) (A) and 301 (b) (2) (A) ], and (2)
to “specify factors to be taken into account in determin-
ing the control measures and practices to be applicable
to point sources... within such categories or classes”
[section 304 (b) (1) (B) J33 (emphasis added). This sec-
ond requirement clearly contemplates that the guidelines
promulgated by the Administrator on the basis of broad
(A) requires the achievement of “effluent limitations
for categories and classes of point sources,“ Youngstown
appears to argue that the 1 limitations can only be
established on a category or class basis while conceding
that they can be established on an individual basis for
1977. However, we see nothing in the legislative history
indicating that the regulatory scheme was to be so radi-
cally different as between the 1977 and 1983 limitations.
Furthermore, it makes little sense to have the limitations
applied on a point source by point source basis in 1977,
while permitting limitations on a category-wide basis
six years later. We thus conclude that any ambiguity
created by §§ 301(b) (1) (A) and 301(b) (2) (A) on this
point was inadvertent and was a result of imprecise legis-
lative drafting.
33. Substantially similar language is included in
section 304(b) (2) (B), pertaining to guidelines for 1983
standards.
47a
Appendiz D.
categories or classes of industries are to provide guid-
ance to those authorities (presumably, the permit grant-
ors) which determine the precise degree of effluent con-
trol required of any individual point source. The only
other interpretation possible would be that the Admin-
istrator is required to promulgate guidelines for broad
categories or classes which are to guide himself in set-
ting precise limitations for specific point sources—
clearly an illogical interpretation, and, as noted below,
one which is contrary to the clearly expressed congres-
sional intent that the Administrator is not to consider
the particular circumstances of individual point sources.
Sections 304(b)(1)(B) and 304(b)(2)(B) also
specify a number of factors to be taken into account
in determining the control measures required for com-
pliance with the respective 1977 and 1983 technological
standards. These factors include cost, the age of the
equipment and facilities involved, engineering aspects
of application of various types of control techniques,
and non-water quality environmental impact. The first
question to address is who is to consider these factors
—the Administrator in promulgating the guidelines, or
the permit grantors in applying the guidelines to in-
dividual point sources? The statute is somewhat ambig-
uous on this point. By listing the various “factors” in
sections 304 (b) (1) (B) and 304 (b) (2) (B) immediately
after stating that the guidelines are to “specify factors
to be taken into account,” Congress would appear to
have intended that these were factors to be considered
by those authorities applying the guidelines to individual
point sources within the categories outlined by the Ad-
ministrator. On the other hand, the statute states that
these are factors “relating to the assessment” of the
relevant technology, and sections 304(b)(1)(A) and
48a
Appendiz D.
304 (b) (2) (A) state that the Administrator is required
to “identify ... the degree of effluent reduction attain-
able through the application” of the relevant level of
technology. This suggests that the factors are ones to
be considered by the Administrator in “assessing’’ the
proper level of technology.
The legislative history, however, indicates quite
clearly that a full consideration of these factors at the
permit-issuing stage was not intended. In Senator
Muskie’s statement in support of the bill as approved
by the House-Senate Conference Committee, he ex-
plained:
“The Conferees intend that the factors described
in Section 304(b) be considered only within classes
or categories of point sources and that such factors
not be considered at the time of the application of
an effluent limitation to an individual point source
within such category or class.’’34
Similarly, Representative Dingell, in discussing one of
the factors (“cost”) enumerated in section 304 (b),
stated:
“The conference report emphasizes on page 121
a very important point. The report states:
‘The conferees intend that the Administrator
or the State, as the case may be, will make the de-
termination of the economic impact of an effluent
limitation on the basis of classes and categories of
point sources, as distinguished from a plant by plant
determination.’
“Thus, a plant-by-plant determination of the
economic impact of an effluent limitation is neither
34. Leg. Hist. at 172.
49a
Appendiz D.
expected, nor desired, and, in fact, it should be
avoided.”’35
Nevertheless, it does appear that Congress con-
templated that some degree of consideration of the
enumerated factors was to be made by the permit grant-
ors on a plant-by-plant basis. The Senate Report, after
referring to the section 304(b) factors, stated:
“In applying effluent limitations to any individual
plant, the factors cited above should be applied to
that specific plant.”36
At first glance, this statement seems hard to reconcile
with the previously quoted statements indicating that
the factors were not to be considered on a plant-by-plant
basis. We note, however, that the Senate Report just
quoted said that the factors were to be “applied,” not
that they were to be “considered.” We therefore believe
that the statements quoted can be reconciled if we de-
termine that any consideration“ to be given the speci-
fied factors by the permit grantors should be consider-
ably less than de novo. Thus, it seems that the Admin-
istrator is to conduct the primary consideration of the
enumerated factors for classes and categories and is to
specify to the permit grantors how some variation in
the standards should be made in light of those factors.
In other words, the permit grantors are to have a limited
and carefully circumscribed discretion to take into ac-
count factors as specified by the Administrator. To hold
that they have no discretion does not make sense in
light of the clear command in section 304(b) (1) (B) that
the guidelines“ promulgated by the Administrator
35. Id. at 254-55.
36. Id. at 1468.
50a
Appendix D.
“specify factors to be taken into account in determining
the control measures and practices to be applicable to
point sources...within such categories and classes.”
Nor would it make any sense in light of the very fact
that the permit grantors are to be guided by “guide-
lines.” Finally, it would be inconsistent with Congress’
concern that the guidelines provide precise guidance. As
Senator Muskie stated:
“Except as provided in Section 301(c) of the Act,
the intent is that effluent limitations applicable to
individual point sources be as uniform as possible.
The Administrator is expected to be precise in his
guidelines so as to assure that similar character-
istics, regardless of their location or the nature of
the water into which the discharge is made, will
meet similar effluent limitations.”37
This indicates to us that, while uniformity was clearly
a major congressional concern, some amount of local
variation, carefully circumscribed by precise guidelines,
was contemplated. In short, uniformity was to be
achieved by effluent standards within a given category
which were similar, rather than identical or unitary.38
37. Id. at 172.
38. As the Eighth Circuit in CPC International
stated, [this preoccupation with the precision of the
guidelines as a means of achieving uniformity makes no
sense in a regime where the permit-issuing authorities
are to look, not to the guidelines, but to regulations pro-
mugated under § 301.” Where we disagree with the
Eighth Circuit is its conclusion that the permit grantors
were not also constrained by § 301 limitations. As ex-
plained below, we conclude that they are bound to follow
both § 301 limitations and §304 guidelines.
51a
Appendiæ D.
This conclusion is further buttressed by several in-
dications in the legislative history that the guidelines
were intended to provide permissible ranges“ of effluent
limitations. With respect to the 1977 “BPCTCA” stand-
ards the Senate Report, for example, stated:
“The Administrator should establish the range of
best practicable levels based upon the average of
the best existing performance by plants of various
sizes, ages, and unit processes within each industrial
category.“ 39
With respect to the 1983 “BATEA” standards, the same
Report continued:
„. . [T]he Committee intends that effluent limita-
tions be based upon application of best available
technology as defined by the Administrator. In
making the determination of ‘best available’ the
Committee expects the Administrator to apply the
same principles involved in making the determina-
tion of best practicable as outlined above except
that rather than the range of levels established in
reference to the average of the best performers in
an industrial category the range should at a mini-
mum be referenced to the best performer in any
industrial category.“ 40
Similarly, Senator Muskie, in summarizing the bill as
reported out of the House-Senate Conference, stated:
The Administrator should establish the range of
best practicable levels based upon the average of
the best existing perforance by plants of various
39. Leg. Hist. at 1468 (emphasis added).
40. Id. (emphasis added).
52a
Appendiz D.
sizes, ages, and unit processes within each indus-
trial category.“ 41
Having concluded that the local permit-issuing au-
thorities have a carefully circumscribed degree of dis-
cretion, as evidenced by Congress’ concern that the
Administrator’s guidelines “specify factors to be taken
into account” and that they provide “ranges,” we are
then faced with the problem of reconciling this limited
amount of discretion with out previous conclusion that
the Administrator has the power to promulgate effluent
limitations under section 301. The answer, in our view,
lies in the fact that Congress clearly contemplated that
there was to be a uniform ceiling“ which no polluter
would be permitted to exceed. The key to understanding
the interrelationship between sections 301 and 304 can,
we believe, be found in the following excerpt from the
Senate Report:
“In defining best practicable for any given industrial
category, the Committee expects the Administrator
to take a number of factors into account. These
factors should include the age of plants, their size
and the unit processes involved and the cost of ap-
plying such controls. In effect, for any industrial
category, the Committee expects the Administrator
to define a range of discharge levels, above a certain
base level applicable to all plants within that cate-
gory. In applying effluent limitations to any indi-
vidual plant, the factors cited above should be ap-
plied to that specific plant. In no case, however,
should any plant be allowed to discharge more pol-
41. Id. at 169 (emphasis added).
53a
Appendix D.
lutants per unit of production than is defined by
that base level.“ 42
In our view, the section 301(b) limitations repre-
sent a single number effluent limitation which prescribes
the minimum amount of control (the “base level’’), or
conversely, the maximum amount of effluent discharge
(a ceiling“) that is permissible. In determining this
“base level,“ and concomitant pollutant ceiling, the Ad-
ministrator is to consider the numerous differences in
processes and capabilities of point sources.“ 24a Having
determined the base level,“ and the “ceiling,” he must
then promulgate guidelines which are to guide the
permit-issuing authorities in deciding whether, and by
how much, the limitation to be applied to any individual
point source is more stringent than the base level (in
terms of requiring more effective technology), and more
stringent than the ceiling (in requiring a lower amount
of effluent discharge). Thus, we reconcile sections 301
and 304 in the following manner: the section 301 limita-
tions represent both the base level or minimum degree
of effluent control permissible and the ceiling (or maxi-
mum amount of effluent discharge( permissible nation-
wide within a given category, and the section 304 guide-
lines are intended to provide precise guidance to the
permit-issuing authorities in establishing a permissible
level of dicharge that is more stringent than the ceiling.
42. Id. at 1468 (emphasis added).
42a. While Congress used the term “base level,“
henceforth in our discussion of limitations we will refer
to a ceiling of effluent discharge which the polluter can-
not exceed, since we believe that the latter term more
clearly expresses Congress’ intent.
Appendix D.
III
We now turn to the regulations being challenged
to see if they comply with our interpretation of the
statutory scheme. It is immediately apparent that the
regulations establish only single number effluent limit-
ations for each of twelve subcategories within the
iron and steel industry.43 While the regulations comply
with the requirement in sections 304(b)(1)(A) and
304 (b) (2) (A) that they identify . the degree of ef-
fluent reduction attainable” through application of the
relevant standard of technology (“BPCTCA” or
“BATEA”’), they do not specify any factors to be taken
into account in determining the control measures to be
applied to individual point sources within the categories
and classes, as required by sections 304 (b) (1) (B) and
304 (b) (2) (B). Furthermore, they do not specify per-
missible ranges“ of limitations below the ceiling.
The Administrator, however, contends that he satis-
fied these requirements. In the regulations themselves,
he states:
“The Agency considers that the limitations already
represent ranges, taking into account differences
in processes used and other factors. Subcategoriza-
tion has been used to take these factors into account
with different limitations for each subcategory.
Within subcategories, exceptions to the limitations
have been provided where appropriate, thus con-
43. Those twelve subcategories are: by-product
coke, beehive coke, sintering, blast furnace (iron), blast
furnace (ferromanganese), basic oxygen furnace (semi-
wet air pollution control methods), basic oxygen furnace
(wet methods), open hearth furnace, electric arc furnace
(semi-wet methods), electric arc furnace (wet methods),
vacuum degassing, and continuous casting.
55a
Appendiz D.
stituting a range. Each numerical limitation repre-
sents a maximum value over a given period of time.
This, in effect, represents a range from zero up to
the specific limitation.” 39 Fed.Reg. 24117 (com-
ment # 25).
We believe that this response is insufficient. We do
not agree that the “exceptions” referred to satisfy the
“range” requirement, since only one of the twelve sub-
categories—By-Product Coke—contains any such ex-
ception. The statement that a range exists from zero up
to the limitation is unsupportable since for all of the
subcategories the Administrator concluded, with respect
to the new source standards, that a “zero discharge“
level was not feasible at this time. Thus, the “range” ad-
mittedly encompasses standards that cannot be met.
More important, the regulations provide absolutely no
guidance to the permit-issuing authorities as to what
factors to consider or how to set the particular dis-
charge level within a feasible range below the ceiling
established under Section 301(b). Finally, we disagree
with the Administrator’s contention that “sub-categori-
zation” provides a range. The Administrator’s subcate-
gorization merely divided the entire iron and steel mak-
ing industry by means of the types of processes em-
ployed, and it does not reflect any of the innumerable
differences within the particular subcategories. No guid-
ance is given by respect to the remaining section 304 (b)
factors, such as age, costs and engineering aspects,
which we previously concluded must be “specified” in
order to guide the permit grantors in exercising their
carefully circumscribed discretion in setting precise
standards for individual point sources.
The Administrator contends that sufficient flexibil-
ity in the regulations is provided through the “variance”
56a
Appendiz D.
procedure, which allows individual discharges to obtain
variances from the limitations upon a showing that the
factors relevant to a particular point source are “funda-
mentally different from the factors considered in the
establishment of the guidelines.“ Our responsibility,
however, is not to determine whether the Administrator
has provided for flexibility, but whether he has followed
the statutory scheme established by Congress. Regard-
less of whether the establishment of a variance proce-
dure is within the Administrator’s discretion, we do not
believe that the Administrator can ignore his obligation
to promulgate guidelines specifying factors to be con-
sidered and ranges above a base level. We also note that
the variance procedure provides for less flexibility than
we believe Congress contemplated, since it permits de-
viations from otherwise rigid and unitary limitations
only where the-circumstances of the particular plant are
“fundamentally different” than those from which the
effluent limitation was derived.
Having concluded that the regulations failed to con-
stitute valid “guidelines” (despite their title), since they
failed to provide meaningful ranges or guidance in con-
sidering individual factors, the question then arises as
to the scope of our remand. Should we merely remand
for promulgation of guidelines, leaving the single num-
ber limitations intact, or should we also remand for
reconsideration of the limitations? We conclude that the
latter approach is preferable. The guidelines can serve
a meaningful purpose under our analysis only if they
are coupled with limitations which represent the “ceil-
ing” or maximum degree of effluent discharge permis-
sible. In promulgating these regulations, the Adminis-
trator appears to have considered it his duty to establish
uniform nationwide limitations, rather than establishing
57a
Appendix D.
a ceiling with detailed guidelines to guide the grantors
within a feasible range below the ceiling.44 Consequent-
ly, although we do not suggest that the present limita-
tions cannot perforce represent ceilings, it is possible
that those limitations might be more stringent than
they would have been if they had merely been intended
to represent such levels. Thus, we believe that the Ad-
ministrator, in addition to promulgating guidelines,
should reconsider the limitations with the base level and
ceiling concepts in mind.
IV
Petitioners raise several other contentions with re-
spect to the process by which the Administrator deter-
mined the 1977 “BPCTCA” and 1983 “BATEA” stand-
ards in his regulations. As noted in part II of this opin-
ion, we believe it was clearly Congress’ intent, despite
44. While it is true that the Final Development
Document accompanying the regulations makes some
references to “base levels,” it is clear that the Document
used the term in a very different sense than the one in
which we believe Congress used it. As we noted earlier
(see notes 42 and 42a supra and accompanying text), we
believe that Congress in referring to “ level“ meant
a “ceiling” on the permissible amount of effluent dis-
charge. Page 257 of the Development Document (Appen-
dix at 1521a), however, states that the Agency first de-
‘termined the “base or minimum level of treatment
already in existence for practically all ts within the
industry in any given subcategory,” and then added on”
to that base level to reach the levels required by the
“BPCTCA” and “BATEA” standards. Thus, the “base
level” referred to in the Final Development Document
was in reference to the level of treatment “already in
existence,” rather than to the maximum degree of efflu-
ent discharge the Administrator determines is permis-
sible under the Act. We see nothing in the Development
Document wer nee ap edge oo omy of the type of “base
level” or “ceiling” a which we are concerned.
58a
Appendix D.
the ambiguous wording in section 304 (b), that the Ad-
ministrator consider the enumerated factors in setting
standards for classes and categories of industries. Peti-
tioners contend that the Administrator failed to give
sufficient consideration to these factors or to articulate
his reasoning with sufficient clarity.
At the outset, it is important for us to articulate
our standard of review. As in other cases involving re-
view of an administrative agency’s rule-making actions
we are governed by an “abuse of discretion” standard—
in other words, we must not substitute our judgment for
that of the agency, but must determine whether the
Administrator’s actions were “arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with
law.” Administrative Procedure Act § 10(e), 5 U.S.C.
§ 706(2); Citizens to Preserve Overton Park v. Volpe,
401 U.S. 402, 416, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971) ;
Delaware Citizens for Clean Air, Inc. v. Administrator,
480 F. 2d 972, 975-76 (3d Cir. 1973). In order to facilitate
meaningful judicial review, we should require adminis-
trative agencies to “articulate the standards and prin-
ciples that govern their discretionary decisions in as
much detail as possible.” Environmental Defense Fund,
Inc. v. Ruckelshaus, 142 U.S.App.D.C. 74, 439 F.2d 584,
598 (1971). See also Greater Boston Television Corp. v.
FCC, 143 U.S. App. D. C. 383, 444 F.2d 841, 851 (1970), cert.
denied, 403 U.S. 923, 91 S.Ct. 2229, 29 L.Ed.2d 701
(1971). However, we should not reverse an agency’s de-
cision that is not fully articulated where we can reason-
ably discern the basis for the agency’s action. Bowman
Transportation, Inc. v. Arkansas—Best Freight System,
Inc., 419 U.S. 281, 286, 95 S.Ct. 438, 42 L.Ed.2d 447
(1974). Furthermore, the Administrator’s conduct is en-
——
„2
59a
Appendiz D.
titled to a “presumption of regularity.” Citizens to Pre-
serve Overton Park, supra, 401 U.S. at 415, 91 S.Ct. 814.
A. Age“ — The first factor enumerated in section
304(b) which petitioners contend the Administrator did
not fully consider was that of “age.” Petitioners contend
that the Administrator, faced with the statutory man-
date to consider age, concluded that age was not rele-
vant. However, this inaccurately states what the Ad-
ministrator did. The Administrator did in fact consider
age, but concluded, after studying the plants sampled,
that “the processes and treatment systems are similar
regardless of the age and size are similar regardless of
the age and size of the plant.45 Furthermore, as the
regulations themselves state, the division of the in-
dustry by process was also, generally speaking a divi-
sion by age:
“The Agency has subdivided the steel making seg-
ment primarily along operational lines because the
waste water volumes and pollutant parameters vary
with the type of operation being conducted. In addi-
tion, the processes reflect the age of the technology
employed. Subcategorization of coke making by the
older beehive and the newer by-product operations
and steel making by the older open hearth and the
newer basic oxygen and electric arc furnace opera-
tions is indirectly subcategorization by age.
“The treatment technology to be applied is primar-
ily a function of the pollutants present and hence
is a function of the type of operations conducted.
The type of pollutants present is not a function of
the size or age of the operating facilities. Land
45. Final Development Document at 107, i
at 1401a. 1 „
Appendiz D.
availability for application of the treatment tech-
nology is not a function of size or age since many
new as well as old mills are limited on the area
available for installation of treatment facilities and
vice versa... Many of the older mills have better
treatment than some of the newer ones and vice
versa.” 39 Fed.Reg. at 24116, comment # 16 (em-
phasis added).
We believe that this quotation shows that the Ad-
ministrator did consider age and did sufficiently articu-
late his reasoning, to the extent that he concluded that
age was not by itself relevant to the type of treatment
technology or processes to be installed, and that sep-
arate and explicit categorization by age was not war-
ranted. We further believe, after examining the data in
the Final Development Document, that the Administra-
tor’s conclusions in this respect are fully supportable.
Where we believe the Administrator erred, however, was
in his failure to consider age as it had a bearing on the
cost or feasibility of retrofitting plants. While all the
plants in a certain older subcategory (e.g., beehive
coke) may require the same technological processes to
reduce effluent discharges, the fact that all the plants
within that subcategory were built long before plants
in another subcategory may present special problems
in installing anti-pollution devices. Similarly, in a sub-
category where there is considerable variation in age,
the fact that the processes are similar may mean that
the processes are similar may mean that the same type
of control technology can be installed, but it does not
necessarily mean that the ease with which that tech-
nology can be installed, or the ability to comply with
ellluent limitations once it has been installed, is not af-
fected by age. Since we see no evidence that the Ad-
61
Appendiæ D.
ministrator considered age in this light, remand is ap-
propriate. If he concludes on remand that age is not
revelant to the cost or feasibility of retrofitting plans,
as well as to the processes and treatment system, that
conclusion will be valid to the extent it is supported by
the record.
B. Engineering Aspects. —Petitioners raise sev-
eral points here in contending that the Administrator
did not sufficiently consider this factor. They contend,
inter alia, that for several subcategories the Adminis-
trator has suggested technology which is not currently
available; that virtually all of the limitations are based
on reduced flow rates which have not been demon-
strated; and that many of the limitations are based on
transfer technologies but lack guidelines on the engi-
neering requirements for such transfers. Instead of con-
sidering these points as they affect the regulations in
their entirety, we will defer any consideration of them
until part VII of this opinion, in which we consider the
specific challenges to individual limitations.
The only contention we shall consider here is that in
each of two subcategories—vacuum degassing and con-
tinuous casting—the Administrator surveyed only two
plants which were not representative of the subcate-
gories as a whole. In particular, they contend that the
plants surveyed were built on “green field sites,” which
enabled them to construct large lagoons for the treat-
ment of waste materials, and that the treatment sys-
tems were built simultaneously with the production
facilities, thereby making it easier for them to meet
effluent limitations than plants which must be retro-
fitted. The Administrator’s response to petitioner’s chal-
lenge is that given the extraordinary complexity of pro-
62a
Appendiz D.
mulgating uniform guidelines and limitations, he can-
not be expected to consider all the engineering factors
in specific situations. He further contends that, to the
extent that a particular plant’s inability to comply with
an effluent limitation is attributable to the fact that it
is operating under conditions “fundamentally different”
than the surveyed plants, it could obtain a variance.
Petitioners in support of their challenge have failed to
document their assertions that reliance on studies of
plants with “unrepresentative” engineering characteris-
tics has resulted in unrealistic limitations. They refer to
no record deficiency that would overcome a presumption
of regularity in the Administrator’s conduct. According-
ly we are convinced that the regulations cannot be de-
clared arbitrary or capricious on this ground.
C. “Non-water quality environmental impact (in-
cluding energy requirements).”—Petitioners contend
that there is no evidence in the record to indicate that
the Administrator considered these factors. We dis-
agree, however, and believe that the Final Development
Document accompanying the regulations (especially
section VIII of the Document, found in Appendix at
1522a-1581a) clearly shows that he did consider them
in some detail. For each category, and for each level of
technology (1977 “BPCTCA” and 1983 “BATEA” stan-
dards), the Administrator considered both the problems
of air pollution and solid waste disposal, as well as the
problem of additional energy requirements caused by
installation of the necessary anti-pollution devices. In
the by-product coke subcategory, for example, the Docu-
ment identified the types of air pollution emissions likely
to occur and concluded that [il f a vapor recirculation
or solvent extraction facility for dephenolization is
63a
Appendiz D.
added to the system, significant reductions in both
parameters are achieved.” (Appendix at 1534a). Sim-
ilarly, the Document identified the solid wastes likely
to be generated by treatment systems, and concluded
that they could either be internally consumed through
reuse in the mill, incinerated, or used as landfill (Id.)
With respect to additional energy requirements, the
Document estimated the additional annual operating
costs in terms of power for each of the two treatment
alternatives—$2,175.00 for alternative I, and $31,500.00
for alternative II (Appendix at 1523a). The Administra-
tor then evaluated the overall impact of the limitations
on air quality, solid waste problems and energy require-
ments for all subcategories (Appendix at 1583a-1584a,
1629a and 1630a), and concluded that [the enhance-
ment of water quality management provided by these
proposed effluent limitations substantially outweighs
the impact on air, solid waste, and energy requirements”
(Appendix at 1584a). Given the failure of petitioners to
present contrary evidence as to the effects of the limita-
tions in these areas,“ s we cannot say that the Admin-
46. For example, after noting that the Adminis-
trator determined that the additional energy require-
ments for alternative I treatment technology for by-
product coke in 1977 would be 0.22 kwh/kkg, petitioners
claim: “Nowhere is it shown how this number was es-
tablished, whether it is good, bad or indifferent.” Peti-
tioners, however, have pointed to no evidence indicating
that the Administrator's figure is unrealistic. Further-
more, as noted previously, the Administrator estimated
the cost of the additional energy uirement to be
$2,175.00. From this, and from the A tor’s later
statement that the environmental benefits outweighted
any impact cu. energy requirements, we believe we can
infer, within the meaning of Bowman Transportation,
supra, that the Administrator found the figure to repre-
sent a tolerable level.
64a
Appendiæ D.
istrator's consideration of these factors was insufficient
or that his conclusions vere arbitrary and capricious.
A special problem is presented by CF&I Steel Cor-
poration. As noted at the outset of this opinion, CF&I
objects to the effluent limitations on the ground that
they did not take into account the problem of water loss
caused by recycle systems, 7 a problem which it claims
is serious in the arid and semi-arid western states. It
appears, however, that CF&I never raised this conten-
tion at the agency level, when these regulations were
being formulated with extensive participation on the
part of the rest of the petitioners. Normally, this would
preclude our consideration of this contention for the
first time at this stage. See Unemployment Compensa-
tion Commission of the Territory of Alaska v. Aragon,
329 U.S. 143, 155, 67 S.Ct. 245, 91 L.Ed. 136 (1946) ;
Portland Cement Association v. Ruckelshaus, 158 U.S.
App.D.C. 308, 486 F.2d 375, 394 (1973). Petitioners
claim that the rule barring de novo consideration of
challenges to agency action in a reviewing court should
not apply here since the agency proceedings were rule-
making rather than adjudicatory and since the Admin-
istrator failed to follow his mandatory and affirmative
responsibility to consider certain statutory factors.
Whatever merit there may be to this contention in the
abstract, we do not believe that this is an appropriate
case to deviate from the general rule. Labelling these
proceedings “rule-making” cannot obscure the fact that
47. CF&I estimates that at present its plant causes
the loss of 4.65 million — of water per day and
that, upon installation of the necessary anti-pollution
devices, this amount would increase by an additional 7
million gallons per day. The Administrator, however,
disputes these estimates.
65a
Appendiz D.
CF&I’s challenge is to actions of the Administrator
which affect it alone. Only three other steel mills in the
entire country are located in arid or semi-arid regions, 48
and CF&I is the only company which has elleged that
installation of anti-pollution devices would have an
adverse effect on the water supply. Thus, this contention
is one of particular and localized concern, and was not
a problem which we believe was so obvious to the Ad-
ministrator that it was arbitrary and capricious for him
to have failed to consider it sua sponte during the rule-
making stage.“ 9 We believe it would be highly disrup-
tive to the administrative process to allow a company to
sit back and wait until the regulations were published
in final form before coming forth and contending that
48. Besides CF&I plant in Colorado, those plants
are a United States Steel plant in California. Appendix
at 1343a-1344a.
49. CF&I contends that the Adminietrator should
have been aware of the water shortage problem because
of the Federal Government’s funding and sponsorship of
water resource projects throughout semi-arid regions
of the country, such as the Fryingpan-Arkansas Project,
and because the EPA was specifically advised of Colora-
do’s water shortage problem with respect to effluent
guidelines for the beet-sugar industry. However, the fact
that the Administrator perhaps should have been aware
of the water scarcity problems in Colorado does not mean
that it should have known that recycling systems re-
quired to meet effluent limitations for the steel industry
a have had a potentially serious effect on the water
supply.
We also reject CF&I’s contention that the regula-
tions are invalid because they conflict with state law
requiring water conservation. To the extent that these
federal regulations are valid and are in conflict with state
law, they take precedence under the Supremacy Clause
of the Constitution. Cf. Florida Avocado Growers v.
Paul, 373 U.S. 132, 83 S.Ct. 1210, 10 L.Ed.2d 248 (1963).
66a
Appendiz D.
the agency had failed to consider the peculiarly local
impact of its regulations in a certain region. However,
while we do not believe that we can invalidate the regu-
lations on the ground that the Administrator failed to
consider this problem, we have already indicated that
the matter should be remanded to the Administrator for
the promulgation of guidelines and for the reconsidera-
tion of the limitations in light of the base level’ and
“ceiling” concepts. We do not mean to preclude CF&I
from raising its particular concerns about water
scarcity in the context of the proceedings on remand.
Cf. Portland Cement Association, supra at 394-95.
D. “Costs.”—The final factor which petitioners
contend the Administrator did not sufficiently consider
was that of “costs.” We have already concluded that the
Administrator did not sufficiently consider the problem
of age as it pertained to the cost and feasibility of retro-
fitting existing plants, and our present discussion of the
cost factor will not repeat what was said previously. Our
first task here is to clarify what Congress intended when
it directed the Administrator to take costs into account.
It is immediately apparent that Congress contemplated
that the Administrator should give greater considera-
tion to the cost of compliance when defining 1977
“BPCTCA” technology levels than he should when de-
fining the 1983 BATEA“ levels. Section 304 (b) (1) (B),
states that the factors relating to an assessment of
“BPCTA” “shall include consideration of the total cost
of application of technology in relation to the effluent
reduction benefits to be achieved from such application.
This is in contrast to section 304 (b) (2) (B), which
merely requires that the assessment of the factors “shall
take into account... the cost of achieving such effluent
reduction.”
67a
Appendiz D.
Nevertheless, while costs were intended to be given
greater weight in defining “SPCTCA”, it is clear that
even with that 1977 standard, the cost of compliance
was not a factor to be given primary importance. Fur-
thermore, Congress clearly intended that the Adminis-
trator consider costs on a class or category basis, rather
than as a plant-by-plant basis. As Senator Muskie stated
in support of the House-Senate Conference Committee
Report:
“The modification of subsection 304 (b) (1) is in-
tended to clarify what is meant by the term prac-
ticable.“ The balancing test between total cost and
effluent reduction benefits is intended to limit the
application of technology only where the additional
degree of effluent reduction is wholly out of propor-
tion to the costs of achieving such marginal level
of reduction for any class or category of sources.
“The Conferees agreed upon this limited cost-bene-
fit analysis in order to maintain uniformity within
a class and category of point sources subject to
effluent limitations and to avoid imposing on the
Administrator any requirement to consider the lo-
cation of sources within a category or to ascertain
water quality impact of effluent controls, or to de-
termine the economic impact of controls on any
individual plant in a single community. 50
With respect to the 1983 “BATEA” standards, Sen-
ator Muskie intended that the type of assessment should
be basically the same, except that there should be no
cost-benefit analysis. Although there is some ambiguity
as to precisely how much weight should be given to cost,
50. Leg.Hist. at 170 (emphasis added).
68a
Appendiz D.
it seems that the Administrator would be governed by
a standard of “reasonableness” :
“In making the determination of ‘best available’ for
a category or class, the Administrator is intended
to apply the same principles involved in making
the determination of ‘best practicable’ (outlined
above), except as to cost-benefit analysis
“While cost should be a factor in the Administra-
tor’s judgment, no balancing test will be required.
The Administrator will be bound by a test of rea-
sonableness. In this case, the reasonableness of what
is ‘economically achievable’ should reflect an evalua-
tion of what needs to be done to move toward the
elimination of the discharge of pollutants and what
is achievable through the application of available
technology—without regard to cost. 51
With respect to the overall impact of the legislation,
Congress clearly contemplated that cleaning up the na-
tion’s waters might necessitate the closing of some mar-
ginal plants. As Senator Bentsen stated:
“There is no doubt that we will suffer some disrup-
tion in our economy because of our efforts; many
marginal plants may be forced to close.“ 2
51. Jd. (emphasis added). The ambiguity here is
created by the evident inconsistency between the state-
ments that “cost should be a factor” and that reason-
ableness should be determined “without regard to cost.”
Nevertheless, it is clear that for “BATEA” standards,
cost was to be less important than for the “BPCTCA”
standards, and that for even the BPCTCA“ standards
cost was not to be given primary importance.
52. Id. at 1282.
69a
Appendiæ D.
In sum, while it is clear that the Administrator must
consider cost, some amount of economic disruption was
contemplated as a necessary price to pay in the effort
to clean up the nation’s waters, and the Administrator
was given considerable discretion in weighing costs.
With these expressions of legislative intent in mind,
we turn to consider the specific points raised by peti-
tioners. Their contentions are essentially two-fold: (1)
that the Administrator’s consideration of costs was in-
sufficient and incomplete, in part because he excluded
certain cost factors and because his promulgatian of
regulations for only “primary” (or “phase I”) opera-
tions precluded him from evaluating the full impact
of pollution control devices; and (2) that the Admin-
istrator acted arbitrarily and capriciously in promulgat-
ing regulations in the face of evidence that many plants
cannot raise the necessary capital to finance the instal-
lation of anti-pollution devices and would be forced to
close.
With respect to the first contention, we believe it
is clear that the Administrator did consider the cost
impact of the regulations. The EPA contractor developed
operating and capital cost estimates for each level of
technology within each subcategory, and cost-benefit
diagrams were prepared for each subcategory.5+ The
53. See note 3 supra and accompanying text.
54. Petitio-ers chall the cost-benefit studies
as being inadequate and usory. As we noted before,
however, a cost-benefit analysis is not required at all for
any technol level other than the 1 “BPCTCA”
standards, even there it is supposed to be only a
amt — —3 th 4 Abine
; 0 we e impossi
of obtaining a mathematically accurate cost-benefit —
70a
Appendix D.
estimated costs were based on an “average size plant,”
as determined from the surveyed plants, and were then
multiplied by the total number of facilities within each
subcategory to obtain a figure representing the industry-
wide costs per subcategory. The EPA also estimated
the total cost (including amortization) of complying
with both the “BPCTCA” and “BATEA” standards to
be $82.3 million, a figure which represented 0.37% of
the 1972 gross revenue of the steel industry. It further
estimated that the total annual costs for both air and
water pollution controls after 1983 would be $1.24 billion,
or 5.54% of the industzy’s gross revenue in 1972. On
the basis of these figures, and after referring to the
section of the Final Development Document discussing
the deleterious effects of the pollutants sought to be
controlled, the Administrator concluded:
= in the area of pollution control. The portion of the
ate Report discussing § 302 of the Act, which re-
quires a more specific cost benefit analysis for “water
quality standards” than does § 304, states:
“The Committee recognizes that no mathematical
balance can be achieved in considering relative costs
and benefits nor would any precise formula be de-
sirable, but in each case the Administrator or the
State will be able to determine whether there is an
reasonable connection at all between the costs whic
a particular effluent limitation would im and
any benefits (including the attainment of natural
water quality) which might be derived.”
Leg.Hist. at 1466. This difficulty in = g such a
balance has also been discussed in Note, The Federal
Water Pollution Control Act Amendments of 1972: Am-
biguity as a Control Device, 10 Harv.J.Legis. 565, 587-88
(1973). Cf. Portland Cement Association v. Ruckezlshaus,
158 US.App.D.C. 308, 486 F.2d 375, 387 (1973). The
necessarily subjective nature of such an analysis sup-
ports the view that the Administrator must have broad
discretion in weighing the costs and benefits.
71
Appendiæ D.
The Agency believes that the benefits of thus re-
ducing the pollutants discharged justify the as-
sociated costs, which though substantial in absolute
terms, represent a relatively small percentage of
the total capital investment in the industry.”55
Given our standard of review of agency action and the
relative weights we believe Congress intended the Ad-
ministrator to assign as between the need for pollution
abatement and costs, we conclude that this assessment,
when coupled with the economic impact analysis to be
discussed below, was neither arbitrary nor capricious.
A troublesome question is presented by petitioners’
contention that the costs estimated by the Administra-
tor were artificially low because certain factors were
excluded. Petitioners point to the fact that the Final
Development Document listed several factors which ad-
mittealy affected costs, but which were excluded from
the cost analysis. Petitioners contend that these factors,
which include such things as land acquisition and site
clearance costs, generate costs which are as large as
those which the Administrator included in his estimates.
However, petitioners have pointed to no data which
would support their allegation as to the magnitude of
these excluded costs factors.56 Furthermore, many of
these factors were excluded because they were inher-
ently site-specific or because they could not be evaluated.
For these reasons, we do not believe we can conclude
that the exclusion of these factors from the costs an-
alysis was arbitrary or capricious.
55. 39 Fed.Reg. 24118.
56. Their brief merely cites the conclusory and un-
documented statement which they had made in a report
to the agency during the rule-making proceedings. Ap-
pendix at 1098a.
72a
Appendiz D.
Petitioners’ chief objection here is that since regu-
lations for only primary (or phase I) operations were
promulgated, no cost consideration was given to the
impact of the yet-to-be-promulgated regulations for
secondary operations. The “Kearney Report” estimated
that those costs would be very substantial, and that the
total water pollution control costs would be three to
five times as high as those for primary operations ( Ap-
pendix at 214a, 314a). However, we believe that the
Administrator acted within the permissible scope of his
discretion in dividing the steel industry into two phases.
Nothing in the Act precludes him from doing so,57 and
he was operating under rigid time constraints, a court
57. Petitioners argue that the Administrator’s con-
sideration of the costs for only phase I operations was
contrary to the mandate in § 304(b) (1) (B) that he con-
sider “total cost.” We note initially that there is no such
requirement in § 304 (b) (2) (B), pertaining to 1983
“BATEA” standards. More important, we note that
Con intended by the phrase “total cost” only to
consideration of both “internal” and external“
costs; there is no indication that Congress intended by
this phrase to preclude separate cost studies for separate
tions governing two or more broad types of opera-
tions within a particular industry. As Representative
Jones stated:
“The term ‘total cost of application of technology’
as used in section 304 (b) (1) (B) is meant to include
those internal, or plant costs sustained by the owner
or operator and those external costs such as poten-
tial unemployment, dislocation, and rural area eco-
nomic development sustained by the community,
area, or region.”
Leg.Hist. at 231. As discussed later in this opinion, we
believe that the Administrator gave sufficient considera-
tion to these factors.
73a
Appendiæ D.
in junctions and severe manpower problems. Given our
conclusion that the Administrator had the power to
promulgate regulations for the two phases separately, 59
we do not believe that the fact that costs were not con-
sidered for secondary or phase II operations necessarily
requires invalidation of the phase I regulations, for
which costs were thoroughly considered. Given Congress’
desire that progress toward pollution abatement be
expeditious, we do not think it would be advisable to
require that these regulations be stayed until the Ad-
ministrator has assessed the costs of phase II regula-
tions and we are limiting the scope of our remand to
what we believe are the most essential points.
Nevertheless, we are concerned that the Adminis-
trator be required at some point to assess the overall
impact of his regulations in both phases. Otherwise, it
is possible that the Administrator might consider the
costs reasonable for each phase separately, without ever
58. National Resources Defense Council, Inc. v.
Train, 6 ERC 1033 (D. D. C. 1973), rev’d in part, 166 U.S.
App.D.C. 312, 510 F.2d 692 (1974).
59. We also do not see much merit to petitioners’
contention that the failure to promulgate — II — 5
lations deprives them of the ability to plan ration
in determining which — cannot economi-
cally and should be rather than retrofitted with
pollution abatement equipment. Petitioners have present-
ed no evidence to show that the design of treatment
works for one phase would be dependent on the cther.
Furthermore, petitioners have been participating active-
ly in the rule-making proceedings now under way for
phase IT regulations, and thus have a general idea as to
what will be required of them. While petitioners do not
yet know — — numerical figures to be established
in the limitations and guidelines, we believe they have
sufficient knowledge to be able to make informed busi-
ness decisions.
74a
Appendiæ D.
considering whether the aggregate costs on a particular
industry warrant such strict standards. We thus believe
that the competing interests can best be served by re-
quiring the Administrator, when he promulgates the
phase II regulations, to evaluate the total costs involved
for those regulations as well as for phase I regulations.
Turning to petitioners’ other main contention, we
are satisfied that the Administrator considered the prob-
lem of the industry’s capability of meeting these costs,
and we cannot say that his conclusion was arbitrary or
capricious. Petitioners rely heavily on the “Kearney Re-
port,” which was commissioned and adopted by the
EPA.®° It is true, as petitioners contend, that this Re-
port predicts that enforcement of the regulations may
force some plants to close. However, the Report believed
that only 9 of the 63 integrated steel plants in the
country were “prime candidates for closure or curtail-
ment of a significant portion of their operations,” and
these were all identified as marginal“ plants. As the
Report concluded:
“Generally, it cannot be stated that the problems
and costs of pollution control are the only, or even
the principal reasons for the potential curtailments
of closures of these plants. They have had a history
of problems and were considered marginal opera-
tions before the impact of pollution control was
felt. Rather it can be stated that pollution control
is the final blow, like the ‘straw that broke the
camel’s back.’ It is entirely probable that some of
those plants would ultimately have been partially
or entirely close, even without pollution control re-
quirements...” Appendix at 305a.
60. 39 Fed.Reg. 24116 (comment * 23) ; Appendix
at 1692a.
75
Appendix D.
The Report further stated that, on the basis of past
experience, it was probable that a significant number of
laid off workers (roughly 50%) would be rehired at
other plants within the industry. (Appendix at 3072).
Petitioners also rely on another report (the “Booz,
Allen Report”) as well as on the Kearney Report as
support of their contention that they could not raise
the necessary capital to finance the expenditure. How-
ever, both reports relied in part on the fact that the
steel industry at the time was under price controls (Ap-
pendix at 258a, 284a, 349a). Subsequent to the publica-
tion of those reports, controls were lifted, resulting in
a substantial increase in steel prices. Furthermore, the
economic position of the steel industry improved dra-
matically in 1974, to the extent that several companies
announced large-scale expansion and modernization
plans.61 The Booz, Allen Report indicated that financing
of pollution control devices would be impossible only
in the absence of price increases. It further indicated
that if an increase in $10 per ton were achieved, the
industry could not both expand capacity as desired and
install pollution abatement equipment, but would have
to make a choice (Appendix at 349a). Given Congress’
61. While these developments occurred subsequent
to the promulgation of the regulations in question, we
believe that we should not close our eyes to such evidence
where it has an important bearing on agency assump-
tions and predictions. See Amoco Oil Co. v. Environmen-
tal Protection A 163 U.S.App.D.C. 162, 501 F.2d
722, 729 n.10 (1974). ile this evidence was not in the
nature of sworn testimony, as in Amoco Oil, it consisted
of the com es’ own announcements as to their earn-
I ern
liable. Furthermore, the petitioners do not con the
accuracy of this evidence.
76a
Appendiæ D.
clearly expressed concern that pollution control devices
be installed even at the expense of some economic dis-
location, we cannot conclude that the Administrator’s
regulations, to the extent that they would require post-
ponement of capacity expansion in order to install pol-
lution abatement devices, are arbitrary and capricious. 62
It is not the role of the courts to determine whether
capacity expansion is preferable to installation of pollu-
tion control equipment. Rather, it is a choice for the
Administrator to make, governed only by a standard of
reasonableness.
Youngstown makes a special appeal based on the
allegedly disproportionate impact that enforcement of
the regulations would have on its plant and on the sur-
rounding community in the Mahoning Valley. However,
as the quotation in text accompanying footnote 50 in-
dicates, the Administrator is not required “to consider
the location of sources within a category.” Furthermore,
the “Ernst and Ernst Report,” which was primarily
concerned with the impact in the Mahoning Valley of
more stringent water quality standards, 63 concluded
that of the several options available to the steel industry
in that region, it was most likely that all operations
would be maintained. It also noted the possibility that
some older and less efficient open hearth furnaces would
62. The Kearney Report also concluded that pollu-
tion control equipment could be financed through the use
of tax-exempt bonds. Appendix at 290a-293a. See 26
U.S. C. § 103 (e) (4) (E) & (F).
63. The validity of the water quality standards is
not before us in this case. Such standards are more
stringent than effluent limitations, since they are intend-
ed to maintain water quality where effluent limitations
are insufficient. See § of the Act, 33 U.S.C. § 1312.
77a
Appendiæ D.
be replaced by cleaner and more efficient basic oxygen
furnaces, and it gave only a 25% chance to the possibility
that all of the plants usin
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