Amicus Curiae Brief — General Motors Corp. v. United States

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In THE

Supreme Court of the United

OCTOBER TERM, 1989

GENERAL MoTorRS CORPORATION,

7 Petitioner,

UNITED STATES OF AMERICA,

Respondent.

On Writ of Certiorari to the

United States Court of Appeals

for the First Circuit

BRIEF AMICI CURIAE OF

MOTOR VEHICLE MANUFACTURERS ASSOCIATION

OF THE UNITED STATES, INC,

AMERICAN PETROLEUM INSTITUTE,

CHEMICAL MANUFACTURERS ASSOCIATION, AND

EDISON ELECTRIC INSTITUTE,

ALABAMA POWER CO-. ET AL.

IN SUPPORT OF PETITIONER

G. WILLIAM FRICK

American Petroleum Institute

1120 L Street, NW

Washington, DC 20005

(202) 682-8240

Davw ZOLL

Chemical Manufacturers

Association

2501 M Street, NW

Washington, DC 20037

(202) 887-1100

HENRY V. NICKEL

HUNTON & WILLIAMS

2000 Pennsylvania Avenue, NW

P.O. Box 19230

Washington, DC 20036

(202) 955-1500

(Counsel for Edison Electric

Institute, et al.)

January 18, 1990

FRANCIS S. BLAKE *

Jerome C. Muys, JR.

SwipLer & BERLIN, CHTD.

3000 K Street, NW, Suite 300

Washington, DC 20007-3851

(202) 944-4711

(Counsel for Motor Vehicle

Manufacturers Association

of the United States, Inc.)

WILLIAM H. CRABTREE

Vice President &

General Counsel

THOMAS R. MERLINO

Motor Vehicle Manufacturers

Association of the

United States, Inc.

7430 Second Avenue, Suite 300

Detroit, MI 48202

(313) 872-4311

* Counsel of Record

Wi.eon - Eras Printing Co... Inc. -

33h

II.

III.

IV.

TABLE OF CONTENTS

BACKGROUND: THE STATE IMPLEMEN-

TATION PLAN REVISION PROCESS

THE FOUR MONTH DEADLINE IS A NEC-

ESSARY ASPECT OF EPA’S SECONDARY

THE FOUR MONTH DEADLINE IS REA-

SONABLE AND ATTAIN ABLE

THE AGENCY'S VIEW OF THE ENFORCE-

ABILITY OF THE PRIOR PLAN IS INCON-

SISTENT WITH THE REMAINDER OF THE

1 .— — —

— . —.— a.

TABLE OF AUTHORITIES

Cases Page

American Cyanamid Co. v. EPA, 810 F.2d 493

(5th Cir. 1987) — ä—jA 3, 7, 8, 15, 17, 26, 27

Bethlehem Steel v. EPA, 638 F.2d 994 (7th Cir.

1980) . 19

Bowen v. Georgetown Univ. ‘Beep. — US. —.,

IL. 26

Brock v. Pierce County, 476 U.S. 253 1986) — 12

Buckeye Power, Inc. v. EPA, 481 F.2d 162 (6th

Cir. 1973), cert. denied sub nom. Big Rivers

Electric Corp. v. EPA, 425 U.S. 934 (1976) 14

Council of Commuter Organizations v. Gorsuch,

683 F.2d 648 (2d Cir. 1982) 3

Duquesne Light Co. v. EPA, 698 F.2d 456 (D.C.

Cir. 1983) 3, 7,8

General Motors Corp. ¢ v. EPA. 871 F.2d 495 (5th

> .Q:3 äVWG60 ˙ 18. 19

Indiana and Mick. Elec. Co. v. _EPA, 509 F.2d 839

(7th Cir. 1975) 14

Metropolitan Weshington Coalition fer Clean Air

v. District of Columbia, 511 F.2d 809 (D.C. Cir.

1975) 21

New Jersey v. EPA, 626 F.2d 1038 (D.C. Cir.

1980) — 14

NRDC v. EPA, 478 F.2d 875 (ist Cir. 1972) a 21

Train v. NRDC, 421 U.S. 60 (1975) 5-7, 20-23

United States v. Alcan Foil Products, 889 F.2d

1513 (6th Cir. 198999 3, 8. 12, 13, 15, 17, 18

United States v. Ford Motor Co., 814 F.2d 1099

(6th Cir. 1987), cert. denied, 484 U.S. 822

| , ·˖ ß... 21

United States v. General Motors Corp. 28 Env't

Rep. Cas. (BNA) 1844 (N.D. Tex. 1988)... 19

United States v. General Motors Corp., 876 F.2d

1060 (ist Cir. 1989), cert. granted, —— US.

, 110 S.Ct. 537 (1989) 3. 8. 11-13, 18, 24, 26

United States v. General Motors Corp., No. 87-

2068-Mc (D. Mass. May 16, 1989), reversed, 876

F.2d 1060 (ist Cir. 1989), cert. granted.

US. ——, 110 S.Ct. 587 (1989) 20

iii

TABLE OF AUTHORITIES—Continued

Page

United States v. Wheeling-Pittsburgh Steel Corp.,

818 F.2d 1077 (3d Cir. 1987) ............................... 21

United States v. Zimmer Paper Products, Inc., No.

IP 88-194-C (S.D. Ind. Dec. 5, 19899 19

Statutes

r 14

33 U.S.C. § 1261 ot seq. (1962) ................................... 11

CC Ee 24

Clean Air Act, 42 U.S.C. § 7401 et seq. (1982) passim

ä 20

42 U.S.C. § 7410 (a) (1982 6, 8-11, 14, 21, 23, 25

48 US.C. § 7410(e) (1962) ............................ 6, 9, 10, 23, 27

4 USC. § T410(E) (1968) «..-............-..-...............- 20, 25, 26

TTD 27

ee ...................................- 18, 20, 22

42 U.S.C. § 7416 (1982) K 9, 23

e 8 22

42 U.S.C. § 7508 (4) (19822ꝗ50%ꝙ)5 TuN 27

e 27

42 U.S.C. § 7506 (b) (198277 n 23

rr 27

42 U.S.C. § 7604 (1982) 3 3 ö 23

ä 8,18

Administrative Actions

“Final Report of the Task Group in SIP Process-

ing,” October 1987 (incorporated in Notice of

Procedural Changes, 54 Fed. Reg. 2214, 2215 n.2

(1989)) . . * 15

r 17

46 Fed. Reg. 44,476 (19817777 | 14

V 17

re —————7rð ͥ •— 14

48 Fed. Reg. 39,580 (1983))))))) 17

I ———— 17

V 9

ä — 9

— 18

TABLE OF AUTHORITIES—Continued

Page

53 Fed. Reg. 46,636 (1988 6 17

J . 19

. I a accccccsccccecescoccerececeseccseneseene 19

4 T 15

. | ene 15, 16, 18

Legislative Materials

House Debate on H.R. 3199, 95th Cong., Ist Sess.,

reprinted in 3 Legislative History of the Clean

Water Act of 1977, 299 1 hin OE ST 11

S. Rep. No. 95-127, 95th Cong., Ist Sess. 10

— 1 ˙ 10-12

Other

R. Stewart, Pyramids of Sacrifice? Problems of

Federalism in Mandating State Implementation

of National Environmental Policy, 86 Yale L.J.

ee Soar udiniahiiehonsiesiaiiianinasiinertariiaacuntssnteicsndiiiaddiamaaes 22

IN THE

Supreme Court of the United States

OCTOBER TERM, 1989

No. 89-369

GENERAL MOTORS CORPORATION,

8 Petitioner,

UNITED STATES OF AMERICA,

Respondent.

On Writ of Certiorari to the

United States Court of Appeals

for the First Circuit

BRIEF AMICI CURIAE OF

MOTOR VEHICLE MANUFACTURERS ASSOCIATION

OF THE UNITED STATES, INC.

AMERICAN PETROLEUM INSTITUTE,

CHEMICAL MANUFACTURERS ASSOCIATION, AND

EDISON ELECTRIC INSTITUTE,

ALABAMA POWER CO., ET AL.,

IN SUPPORT OF PETITIONER

INTRODUCTION

On behalf of their respective members, the Motor Ve-

hicle Manufacturers Association of the United States,

Inc. (“MVMA”), the American Petroleum Institute

(“API”), Chemical Manufacturers Association (“CMA”),

and Edison Electric Institute, Alabama Power Co., et al.,

jointly submit this brief amici curiae in support of peti-

tioner General Motors Corporation.“

1 This brief is filed with the written consent of the parties, pur-

suant to Supreme Court Rule 36.1. Letters of consent are on file

with the Clerk of the Court.

MVMA is a voluntary non-profit association of domes-

tie companies engaged in the manufacture and sale of

motor vehicles in the United States. MVMA’s members

assemble ninety-seven percent of the cars, trucks, and

buses produced in the United States and operate more

than three hundred manufacturing facilities.

API is a national trade association with over two

hundred companies as members, representing all facets

of the petroleum industry: exploration, production, trans-

portation, refining, and marketing.

CMA is a trade association whose member companies

produce, market, and use industrial chemicals. Its mem-

bers make up more than ninety percent of the productive

capacity for basic industrial chemicals in the United

States.

Edison Electric Institute, Alabama Power Co., et al.,

comprises fifty-nine individual electric utilities and three

trade associations: Edison Electric Institute, the Na-

tional Rural Electric Cooperative Association, and the

American Public Power Association. This umbrella group

participates in major rulemaking and litigation under the

Clean Air Act.

The members of MVMA, API, CMA, and Edison Elec-

trie Institute, et al., operate a wide range of facilities,

most of which are subject to local, state, and federal air

pollution control regulations. Their members, therefore,

have a stake in the outcome of this litigation. All four

associations represent the interests of their respective

members before government agencies, in Congress, and

in the courts, frequently appearing as a party or amicus

curiae in litigation involving important environmental

issues.

With respect to the issues in this case, the collective

interests of their members coincide with the interest of

General Motors and with the public interest. Like Gen-

eral Motors, their members often find themselves strug-

gling to determine the appropriate method of compliance

with air pollution control regulations in the face of con-

flicting federal and state requirements. These conflicts

arise directly from the failure of the Environmental Pro-

tection Agency EPA“ or “Agency”) to approve or dis-

approve a revision to a State Implementation Plan

(“SIP”) within the four month deadline established by

statute.

In the decision below, United States v. General Motors

Corp., 876 F.2d 1060 (1st Cir. 1989), cert. granted, ——

U.S. ——, 110 S.Ct. 537 (1989) (“General Motors“), the

First Circuit Court of Appeals addressed two major is-

sues: (1) whether the statutory four month deadline for

EPA to take action when EPA reviews a SIP also ap-

plies to EPA’s review of SIP revisions, and (2) if so,

whether EPA may enforce the existing SIP wien it has

failed to timely take action on a SIP revision. We are

not separately briefing the issue of the applicability of

the four month requirement to SIP revisions. We rely on

the arguments presented by General Motors on this issue

and on the uniform holdings of the courts of appeals that

have considered the issue.“

SUMMARY OF ARGUMENT

A bar on enforcement of the prior State Implementa-

tion Plan (SIP) is the only appropriate remedy for

EPA’s failure to reach a decision on a SIP revision

within four months. EPA has deliberately used its en-

forcement authority in combination with delayed SIP re-

views to overturn state pollution control decisions. In

2 See United States v. Alcan Foil Products, 889 F.2d 1513, 1518

(6th Cir. 1989); United States v. General Motors Corp., 876 F.2d

1060, 1066 (ist Cir. 1989), cert. granted, ——— U.S. 110 S.Ct.

537 (1989); American Cyanamid Co. v. EPA, 810 F.2d 493, 495 (5th

Cir. 1987); Council of Commuter Organizations v. Gorsuch, 683

F.2d 648, 651-652 n.2 (2d Cir. 1982). See also Duquesne Light Co.

v. EPA, 698 F.2d 456, 471 (D.C. Cir. 1983).

doing so, it has stepped outside the secondary role in-

tended for it by Congress in the determination of local

air pollution control strategies.

The First Circuit erred in fashioning a remedy for

EPA’s delay that would allow district courts to reach

their own determination of the “reasonableness” of the

delay. Congress specified the four month deadline to en-

sure that EPA would act consistently with its secondary

role. The lower courts cannot substitute their judgment

on what EPA’s role should be or how long EPA’s review

should take.

EPA’s own studies demonstrate that the four month

deadline is reasonable and attainable. The Agency has

failed to meet the deadline because, directly counter to

Congressional intent, it has Used the SIP review process

to “micromanage” state decisions.

The four month dealine also serves a central role in

the statute by preventing prolonged periods of incon-

sistency between state and federal law. The statute is

premised on a complementary state and federal system.

EPA’s interpretation of the “applicable implementation

plan” under which it may bring an enforcement action

without regard to the four month deadline destroys this

complementary relationship. It places individual sources

in the untenable position of having to choose between com-

pliance with state or federal law; it allows EPA to avoid

its decisional responsibilities under the Act: and it is in-

consistent with the remainder of the statute.

Finally, the Agency claims that unabridged enforce-

ment powers are necessary to prevent a flood of improper

SIP revisions. There is no factual basis for the Agency’s

concern. And even if there were, Congress has provided

other sufficient mechanisms for the EPA to respond to

such alleged, but unproven, state abuses.

ARGUMENT

I. BACKGROUND: THE STATE IMPLEMENTATION

PLAN REVISION PROCESS

The Clean Air Act (“CAA” or “Act”), 42 U.S.C.

§ 7401 et seg. (1982), ogg ag Rage —

state regulatory partnership for attainment

maintenance of national ambient air quality standards.

This rt has already described the essential contours

of the partnership: EPA has the responsibility for set-

ting the national air quality standards, but it has only

a “secondary role” in determining the source-by-source

controls necessary to achieve the standards. The princi-

pal responsibility for that function rests with the states

and local governments. Train v. NRDC, 421 U.S. 60, 79

(1975).

The SIP is the main building block of the Act and em-

bodies the cooperative effort between the federal and

state governments. In its most straightforward form,

the Act envisions that the states will develop SIPs that

contain the mix of control strategies that both best fit

local needs and achieve the national standards; EPA will

review and approve the SIP; and the particular measures

contained in the SIP will then be enforceable as a matter

of state and federal law.

The SIP, however, is not a static set of emission lim-

itations and controls. Congress recognized that local

needs and control strategies would evolve over time and

that SIPs would have to change as well. The Act, there-

fore, contains several provisions cither directing or allow-

ing SIP revisions. In each of these provisions, the re-

sponsibility for developing the SIP revision rests squarely

with the state, although EPA is given the opportunity, as

a last resort, to promulgate a federal plan. The three

principal provisions involve (1) SIP submissions in re-

3 All references herein to 42 U.S.C. are to the 1982 edition.

sponse to a change in a national ambient air quality

standard, CAA 110% (1), 42 U.S.C. § 7410(a) (1);

(2) SIP revisions in response to a determination that

the SIP “is substantially inadequate” to achieve the na-

tional standards, CAA §110(a)(2)(H), 42 U.S.C.

§ 7410(a)(2)(H); and (3) SIP revisions initiated by

the state. g., to correct technical deficiencies in the

SIP, to tighten or relax control requirements, or to en-

courage innovative technologies, CAA § 110(a)(3)(A),

42 U.S.C. § 7410(a) (3) A).*

Because a SIP revision represents a change from the

mutually agreed upon federal and state plan, it poses the

potential for discordance between the applicable federal

and state requirements.“ Timely action by the Agency on

a SIP revision is, therefore, not just a matter of Con-

gress’s general interest in expeditious environmental im-

provement; it is essential to preserve the complementary

relationship between state and federal law under the Act.

The issue presented in this case involves the third cate-

gory of SIP revisions outlined above: a SIP revision sub-

mitted by the state on its own motion. Under the statute,

EPA has four months in which to approve or disapprove

the state revision.“ EPA “shall approve” the revision if

it meets the basic requirements of the Act and has been

adopted “after reasonable notice and public hearings.”

CAA §110(a)(3)(A), 42 US.C. §7410(a)(3)(A).

Clearly, if EPA disapproves the revision within that

time, the prior SIP remains in effect and the federal

decision governs. Train, 421 U.S. at 92. As this Court

noted in Train, v ariances under section 110/a) (3)

cannot be granted until first the state, and then the

The corresponding federal promulgation authority is set forth

at CAA § 110(c)(1), 42 U.S.C. § 7410(¢)(1).

Indeed. the Act requires that a state adopt.“ not simply pro-

pose, its SIP or SIP revision as a precondition to submittal to the

Agency. CAA $110(a)(1), 42 U.S.C. § 7410(a)(1).

* See supra n.2.

—

771

SIP remains in effect and the Agency can

without regard to the four month limitation of

110(a)(3)(A). In this fashion, through inaction

state submission and through use of its enforcement

thority, the Agency can exercise a “pocket veto” over

state’s judgment on the appropriate emission limitations

for particular sources. Congress never intended, and the

statute does not countenance, this abuse of the SIP revi-

sion process.

7871

Three different approaches have emerged.

The first court of appeals to address the issue was the

D.C. Cireuit, in Duquesne Light Co. v. EPA, 698 F. 2d

456 (D.C. Cir. 1983). In Duquesne, the Court held that

when EPA is delinquent in taking action on a revision,

EPA must “hold the noncompliance penalty in abeyance

pending final action oa the SIP.” Id. at 472. However,

the Court limited the remedy by providing that if EPA

ultimately rejects the SIP revision, the penalty should be

calculated back to the four month deadline, with interest.

Id.

In contrast, the Fifth Cireuit in American Cyanamid

Co. v. EPA, 810 F.2d 493 (5th Cir. 1987), held that the

proper remedy is to bar EPA from enforcing the original

SIP until and unless it rejects the SIP revision. Id. at

502. The Fifth Circuit explicitly rejected the Duquesne

limitation that would allow back calculation of penalties,

stating that

the Duquesne holding provides little or no incen-

tive to the EPA to abide by [section 110’s) four

month rule; the EPA loses nothing by its contuma-

ciousness.

American Cyanamid, 810 F.2d at 499 (footnote omitted).

A third approach is found in the opinion below in this

case, General Motors, 876 F.2d 1060. After rejecting

the approaches of the D.C. and Fifth Circuits, the First

Circuit formulated a rule under which the district courts

must inquire into the reasonableness of EPA’s failure to

act and take that factor into account in determining the

amount of penalties to be imposed. The Court also con-

cluded that a citizen suit under CAA § 304(a)(2), 42

U.S.C. § 7604(a) (2), to compel EPA action on a pend-

ing SIP revision provides a satisfactory alternative

remedy.

The Sixth Circuit adopted a variation of the First Cir-

cuit “reasonableness” rule in United States v. Alcan

Foil Products, 889 F.2d 1513 (6th Cir. 1989). The Sixth

Circuit articulated a shifting burden of proof under that

rule:

If the source demonstrates that it has met the stand-

ards of the proposed revision, the government has the

burden of justifying EPA's delay in acting on the

proposal. The court must then balance the reason-

ableness of the delay against whatever prejudice the

source is able to establish.

Id. at 1521.

The First Circuit in the decision below made three

critical errors in analyzing the consequences of EPA's

missing the four month deadline of section 110/a) (3)

that the Fifth Cirevit was correct in concluding

enforcement bar is necessary.

II. THE FOUR MONTH DEADLINE IS A NECESSARY

ASPECT OF EPA’S SECONDARY ROLE IN THE

SIP PROCESS

There are only two mechanisms explicitly set out in the

statute that allow EPA to impose requirements more

stringent than those adopted by a state.’ First, EPA can

promulgate its own plan under section 110(c), 42 U.S.C.

§ 7410(c); second, EPA can disapprove a state plan as

specified in section 110(a), 42 U.S.C. § 7410(a).

Direct federal promulgation under section 110(c) is

an authority that the Agency has rarely exercised.* And

there are obvious reasons for the Agency’s hesitance to

7A state is not precluded from adopting more stringent regula-

tions on its own. See CAA § 116, 42 U.S.C. § 7416.

* See, e.g., 52 Fed. Reg. 45,466, 45,467 (1987) (In considering

promulgation of Federal Implementation Plan (“FIP”) for Maricopa

and Pima Counties in Arizona, EPA recognized that “EPA must try

to serve the general principles of the Clean Air Act, including the

goal of minimizing the amount of federal intrusion into an area

that is primarily the State’s responsibility.”); 53 Fed. Reg. 17,378,

17,380 (1988) (EPA cautioned, in the same matter, that statutory

scheme prefers State plans to federal plans because “the implemen-

tation of air pollution control measures in an area is always facili-

tated if carried out at the State level, and clearly Congress intended

such planning to be done by the States“) With respect to both

Maricopa and Pima Counties, EPA ultimately concluded that pro-

mulgating a FIP would be unnecessary. 53 Fed. Reg. 30,220 (1988) ;

53 Fed. Reg. 30,224 (1988).

use this authority: it represents a clear intrusion on

state prerogatives, it is a measure that has proven his-

torically to be politically unpopular, and direct federal

promulgation is resource intensive for

Agency's principal experiment with direct federal prom-

ulgation occurred in the mid-1970s when it mandated lo-

cal transportation control measures, such as bridge tolls,

parking surcharges, and gas rationing. This touched off

a legal and political controversy that ended with Con-

gress, in the 1977 Clean Air Amendments, stripping EPA

of authority to require such transportation control mea-

sures. See CAA § 110(c) (2)-(5), 42 U.S.C. § 7410(c)

(2)-(5).

The practical and legal restraints on direct federal

promulgation dovetail with the Congressional division of

responsibility between EPA and the states. Congress

specifically intended that EPA not engage in “microman-

agement” of SIPs:

The Federal role must be one of support rather than

control. The Federal Government does not have and

will not have the resourcés required to do an effec-

tive job of running the air pollution control pro-

grams of the states. And yet the Federal Govern-

ment can and must provide the technical information

and enforcement assistance that states and localities

need. Fulfilling this latter role effectively will pro-

tect and enhance air quality more than fulfilling the

former role inadequately.

S. Rep. No. 95-127, 95th Cong., Ist Sess. 10, 10-11

(1977).

By making direct federal promulgation both a visible

and difficult process, Congress provided an inherent check

on any EPA tendency te “run” a state’s air pollution con-

trol program. The four month deadline for SIP review

serves a comparable function. Congress gave the states

nine months to develop a SIP or SIP revisions under sec-

tion 110(a) (1); it is not accidental that EPA was given

less than half that time to serve its review function. The

limited scope of review which Congress intended EPA to

perform is also reflected in the language of section 110

(a) (2 (H), 42 U.S.C. § 7410(a) (2 H, which contem-

lint

;

the states, and the four month deadline reflects that

Yet, as discussed in greater detail below, that is

Both the First Circuit in General Motors the Sixth

Cireuit in Alcan tacitly accepted the view that E

review

* In discussing the analogous issue of EPA

discharge permits under the Clean Water Act, Congress made clear

State in

proposed permit; EPA may object to a State proposed permit

House Debate on H.R. 3199, 95th Cong. Ist Sess. (statement setting

forth the views of House conferees), reprinted in 3 Legislative His-

tory of the Clean Water Act of 1977, 299 at 346.

™ See infra pp. 15-17.

missing the deadline amounted to only a procedural fail-

ure and concluded that t be public should not suffer

because of EPA's failure Alcan, 889 F.2d at 1520;

General Motors, 876 F.2d at 1067. Both Courts contem-

plated a remedy for the failure in which a district court

would weigh the “reasonableness” of EPA's delay. They

apparently concluded that the public interest would be

better served if EPA takes a “reasonable” amount of

time reviewing de details of state SIP submissions. But

that is not what Congress concluded. Congress reached

the judgment that, in the long run, the national goal of

clean air would be better served by EPA's playing a

“secondary role” in the SIP development process. As the

legislative history indicates, Congress believed that fl ul-

filling this latter role the secondary role] effectively will

protect and enhance air quality more than fulfilling the

former role running state air programs] inadequately.”

S. Rep. No. 95-127, 95th Cong. Ist Sess. 10, 10-1

(1977) (emphasis added The Courts below should not

The Court of Appeals below cited Brock v. Pierce County, 476

U.S. 253 (1986), as support for its position. General Motors, 876

F.2d at 1068. But Brock is materially different from this case. In

Brock the Government's failure to observe the deadline did amount

to only a procedural failure. Because the statutory scheme at issue

in Brock was not premised on the cooperative federalism model, the

Government's delay did not compromise the basic structure of the

statute established by Congress. Here, as the Fifth Circuit correctly

pointed out in American Cyenemid, “(t)he issue .. is not so much

[the violation by the source) but the default of the EPA in carrying

out the congressional intent to work in close cooperation with the

states in implementing standards and enforcing the Clean Air Act.

American Cyanemid, 810 F.2d at 500 (emphasis added).

Second, the misuse of funds in Brock was a completed act, not

subject to extension by the Government's delay. Here, in contrast.

the EPA's delay directly increases the source's exposure to poten-

tial penalties. Third, this Court in Breck considered whether the

Government wied its right te recover the misused funds. The

remedy in American Cyenemid for which we argue is not nearly as

drastic as the waiver considered in Brock, because it does not bar

EPA from ultimately disapproving a SIP revision, and it does not

permanently bar enforcement of an existing SIP. See infre 2.27.

have substituted their judgment on the public interest for

Congress’s.

Furthermore, it is difficult to structure a “reasonable-

ness” test for EPA’s delay unless there is a predicate

determination of what EPA is supposed to be doing in its

review. Nine months might be a reasonable period of

time for extensive review of all the details of a SIP sub-

mission; it is not reasonable for the secondary role de-

scribed by Congress. Congress specified the reasonable

time for that function: four months. The result of a

process in which every district court reaches its own as-

sessment of EPA’s proper role in SIP reviews is likely

to be confusion and a muddied compromise under which

EPA serves neither of its roles effectively.

The Courts below may have been influenced in reach-

ing their conclusions by a sense that the four month dead-

line is unattainable. The First Circuit noted that “EPA

inevitably will often miss the deadline,” General Motors,

876 F.2d at 1067, and the Sixth Circuit queried whether

“the requirement is unrealistic.” Alcan, 889 F.2d at 1520.

Both Courts were then led to seek a “less drastic” remedy

than the enforcement bar. These concerns are misplaced.

EPA is missing the deadline because it persists in at-

tempting to manage state SIP revisions in minute detail,

counter to Congress’s express intent. Indeed, the filing of

enforcement actions during the pendency of a SIP revi-

sion is part of a pattern of deliberate EPA activity in

which the Agency seeks to override state decisions out-

side of the limited provisions specified in the Clean Air

Act.

III. THE FOUR MONTH DEADLINE IS REASONABLE

AND ATTAINABLE -

The lower courts’ perception that delay in the SIP re-

view process is an “inevitability” is unsubstantiated and

inaccurate. The delay is a matter of the Agency’s own

choice and its decision to use the SIP review process to

assert control over state decisions in a manner that Con-

gress rejected.

First, the four month deadline is not unrealistic. The

Clean Air Act already specifies that a state’s SIP revision

must be adopted after reasonable notice and public hear-

ings.” CAA 110 (a (3) (A), 42 U.S.C. § 7410(a) (3)

(A). The federal regulatory process is, therefore, not

the only public airing of the issues involved in a SIP

revision; in fact, the state process itself is a lengthy one,

often taking years to complete. EPA has chosen to pro-

ceed sequentially, rather than concurrently, with the

state’s public review process. But that is a choice the

Agency has made, not one mandated by statute.

In the early 1980s, EPA initiated a program aimed at

shortening the time for SIP review. 46 Fed. Reg. 44,476

(1981); 47 Fed. Reg. 27,073 (1982). A cornerstone of

the program was a “parallel processing” approach under

which the “State and EPA propose the regulation at the

same time, announce concurrent comment periods, and

jointly review the comments.” 47 Fed. Reg. 27,073, 27,074

(1982). EPA found that the parallel processing approach

resulted in a total time of 128 days for review, on aver-

age almost exactly the statutory requirement. Id.“

EPA, however, dropped its parallel processing program.“

The Agency did not return to the issue of shortening

SIP review time until 1987—just after the Fifth Cir-

12 There has been dispute over whether EPA approval of SIP

submissions constitutes rulemaking covered by the notice and com-

ment requirements of the Administrative Procedure Act, 5 U.S.C.

§ 553 (1982). Compare Buckeye Power, Inc. v. EPA, 481 F.2d 162,

170-71 (6th Cir. 1973), cert. denied sub nom. Big Rivers Electric

Corp. v. EPA, 425 U.S. 934 (1976), with Indiana and Mich. Elec.

Co. v. EPA, 509 F.2d 839, 846-47 (7th Cir. 1975). The Agency has,

however, concluded that rulemaking is required, and the courts have

accepted that conclusion. See, e.g., New Jersey v. EPA, 626 F.2d

1038 (D.C. Cir. 1980).

18 This time period should not be construed as EPA’s best“

attempt to comply with the four month requirement, because the

Agency has maintained that the requirement does not apply to SIP

revisions.

14 To our knowledge, the EPA has never explained its decision to

discontinue the parallel processing program.

cuit’s decision in American Cyanamid. At that point,

the Agency commissioned a “senior level task group” to

assess the problem of SIP delays and to make recommen-

dations for change. Their report was completed in Oc-

tober 1987, and the Agency made proposals to imple-

ment their recommendations in January 1989. 54 Fed.

Reg. 2138 (1989) ; 54 Fed. Reg. 2214 (1989).

There are several aspects of the Agency’s own analysis

that deserve note in the context of this case. First, not-

withstanding the then nearly uniform holdings of the

courts of appeals that the Agency has a statutory obliga-

tion to review SIP revisions within four months,“ EPA’s

internal target for reviewing SIPs was 14 months—a

target that was often missed. 54 Fed. Reg. 2214, 2215

(1989). And the Agency gave no indication that it would

even attempt to meet the statutory deadline.

Second, according to the senior level report, the aver-

age number of SIP submittals is 350 per year. Approxi-

mately fifty percent of these involve imposition of a new

regulation, ten percent an administrative clarification,

and twenty percent a source specific “relaxation.”

Thus, contrary to EPA’s intimations, the SIP review

system is not flooded with states seeking to relax require-

ments. In fact, most SIP revisions involve stricter con-

trol requirements.

1 »Final Report of the Task Group in SIP Processing,” October

1987 (hereinafter Report“). This Report is a public document; it

was included in the docket of the Agency’s Notice of Procedural

Changes, 54 Fed. Reg. 2214, 2215 n.2 (1989), and much of the

Report was incorporated in that notice.

16 At the time of the Agency’s analysis, all circuits that had de-

cided the issue held that the four-month rule applies to SIP revi-

sions, with the apparent exception of the Sixth Circuit. The Sixth

Circuit resolved that possible disagreement in Alcan, 889 F.2d at

1518, holding that the four month rule does apply to SIP revisions.

* The remaining twenty percent were either air quality control

region “redesignations” or source specific actions other than “relaxa-

tions.” Report, supra n.15, at Appendix D.

Third, the Agency identified the following three fac-

tors as a major cause of SIP review delay: i] nordi-

nate concern for the consequences of individual deci-

sions,” „el xcessive EPA review,” and [ul neertainty

concerning the outcome of the process.” 54 Fed. Reg.

2214, 2216-2217 (1989). In describing its “inordinate

concern for individual actions,” the Agency acknowledged

that it has used the SIP review process to require that

“all decisions . . . be similar state to state and source to

source.” Jd. at 2216. This is, of course, the antithesis

of local decisionmaking (within a broad federal frame-

work) intended by Congress. Also, the Agency conceded

that “the SIP process has been depended upon as a ve-

hicle to identify, resolve, and articulate national [EPA

policy issues, often at the expense of timely decisionmak-

ing,” id., and that the Agency’s policy keeps shifting.

The Agency termed this the “moving target syndrome“:

“a SIP may be under review at EPA for months and

eventually be deemed inappropriate because it doesn’t

conform to a newly evolved policy, even though it con-

formed to the policy in place when it was submitted.”

Id. Finally, EPA identified as an additional cause of

delay the Agency’s “nurturing” relationship with the

states. Id. at 2217. Because of the “nurturing” relation-

ship, “Headquarters and Regional Office personnel are

reluctant to formally reject [SIP] packages.” /d.

This, then, is the SIP process that the Agency itself

describes: it is one in which EPA is excessively con-

cerned with individual SIP decisions and drives to im-

pose uniform federal policy on the states, even as the

policy keeps shifting. At the same time, though, EPA is

unwilling to take direct action against the state—either

because of its “nurturing” relationship or because of the

political controversy that confrontation would create. In-

stead, EPA indirectly confronts the state’s decisions by

bringing enforcement actions based on the prior SIP

against individual sources. The individual sources then

bear the burden of the “moving target syndrome” and

the delay and indecision of EPA’s SIP review process.

This pattern is apparent in each of the enforcement cases

that have involved the SIP delay issue.

For example, in American Cyanamid, Louisiana sub-

mitted its SIP revision, which contained a so-called “bub-

ble“ or “emissions trading” proposal, in July 1982."* At

the time of submission, it was the Agency’s expressed

policy “to encourage use of emissions trades to achieve

more flexible, rapid and efficient attainment of national

ambient air quality standards.” 47 Fed. Reg. 15,076

(1982). But the Agency was in the process of revising

its policy, a policy that had already been through several

different iterations. See 44 Fed. Reg. 71,780 (1979); 47

Fed. Reg. 15,076 (1982); 48 Fed. Reg. 39,580 (1983).

It ultimately issued a new policy in December 1986. 51

Fed. Reg. 43,814 (1986). In the interim, it brought an

enforcement action against American Cyanamid. Two

years after the new policy was announced, six years

after the enforcement action was brought, and presum-

ably after the nurturing had run its course, the Agency

finally moved to propose to disapprove the Louisiana sub-

mission. 53 Fed. Reg. 46,636 (1988).

Similarly, in Alcan, the state submitted its initial SIP

revision based on an emissions trading approach in July

1982. In the face of EPA inaction on the revision, the

state submitted a second revision in March 1986 spe-

cifically applying the bubble policy to the Alcan plant.

EPA again failed to take timely action. Instead, in De-

cember 1986, it published the new policy regarding

bubble plan reviews. 51 Fed. Reg. 43,814 (1986). With-

out taking any formal action on the revision or otherwise

Under the bubble, or emissions trading, concept, a plant can

comply with site-wide emissions limitations by means of off-setting

emissions at one source within the plant with extra reductions at

another source within the plant. See American Cyanamid, 810 F.2d

at 497.

dealing definitively with the state, the Agency then filed

an enforcement action.“ Two years after the second sub-

mission, in October 1988, the Agency finally proposed to

disapprove the revision—citing the new policy as

basis for its proposed disapproval. 53 Fed. Reg. 40,745

(1988). And in General Motors, 876 F.2d 1060, the

state submitted its SIP revision in December 1985, based

on an EPA policy issued in 1981. The Agency used the

same pattern of a changed policy,” delay in review of

the SIP revision, and interim enforcement action to over-

ride the state’s decision.

Nor are these the only examples. The Agency has

used a similar approach in other contexts, such as de-

layed compliance orders. See, e.g., General Motors Corp.

v. EPA, 871 F.2d 495 (5th Cir. 1989) (Texas issued a

delayed compliance order, EPA failed to act on it within

the statutory time period and filed a notice of violation

against General Motors.“ More generally, EPA has as-

1% Prior to EPA’s commencement of an enforcement action against

Alcan, the Air Pollution Control District of Jefferson County had

commenced an action under CAA § 304(a), 42 U.S.C. § 7604(a), in

an effort to resolve the stalemate with EPA over the SIP revision.

As the Alcan Court observed, this proved a wholly ineffective “rem-

edy,” given that EPA's final ruling on the revision came three years

after the section 304(a) suit was filed and after EPA commenced

its enforcement action against Alcan. Alcan, 889 F.2d at 1521.

This, we believe, demonstrates that the First Circuit's “unreason-

able delay” remedy is ineffective.

2° The General Motors case illustrates another aspect of EPA's

SIP process that the Agency itself has admitted: “silent” policy

changes or, as the Agency calls it, “informal communication.” 54

Fed. Reg. 2214, 2217 (1989). Announced policies of the Agency,

such as the 1981 Volatile Organic Compounds Policy on which Gen-

eral Motors and the Commonwealth of Massachusetts relied, are

silently eroded or altered through informal decisions within the

Agency.

21 Section 113(d) of the Act authorizes states to issue delayed

compliance orders (“DCOs”) to sources and requires EPA to review

DCOs within ninety days. CAA § 113(d), 42 U.S.C. §7413(d). In

an action that fits precisely the pattern of the case here, EPA dis-

ating policies and guidance.” 54 Fed. Reg. 36,307, 36,308 (1989)

(emphasis added). Thus, EPA asserts not only the authority to

interpret the Act but also to make binding on the states its “inter-

pretations, operating policies and guidance.” These interpretations,

policies and guidance documents have, for the most part, never been

Env't Rep. Cas. (BNA) 1844 (N.D. Tex. 1988) (Court disallowed

EPA's after-the-fact reinterpretation of a disputed provision in

the Texas SIP). See also United States v. Zimmer Paper Products,

Inc., No. IP 88-194-C (S.D. Ind. Dec. 5, 1989).

conditions Congress created in recognition of the im-

portance of state decisionmaking.

The four month deadline is reasonable and attainable,

contrary to the assumption of the First and Sixth Circuit

Courts. EPA’s own studies prove this. EPA has elected

to scrutinize SIPs and SIP revisions to a degree never

contemplated by Congress and not authorized by the Act,

and EPA resists any effort to limit its ability to do so.

For this reason, the approach of the First and Sixth

Circuits is fatally flawed.

IV. THE AGENCY'S VIEW OF THE ENFORCEABILITY

OF THE PRIOR PLAN IS INCONSISTENT WITH

THE REMAINDER OF THE STATUTE

At bottom, the Agency's argument for its enforcement

authority rests on the following syllogism: (1) A SIP

remains in effect as the “applicable implementation plan”

until EPA approves a revision; 2 EPA can bring an

enforcement action for violation of an “applicable” plan

under section 113; and (3) therefore, EPA can bring en-

forcement actions against individual sources without re-

gard to the SIP revision and the four month deadline.

This argument melds the Court's decision in Train with

a mech: nical reading of section 110% d of the Act

‘which defines “applicable implementation x

way that distorts the meaning of both. ee

This Court in Train set out a orward prin-

ute, all of the questions, to say

that may arise... .” Jd. at 93 n.28.

n Train, the Court considered whether the states and

EPA may use their section 110(a) (2) revision power

months after the state has submitted a proposed revision

was not directed to the situation here. This Court noted:

Should either the State or EPA determine

granting the variance would — —

maintenance . . ., the polluter is within

his rights in seeking judicial review. This litigation

however, is carried out on the polluter’s time . ._

for during its pendency the . . failure to comply

may subject him to a variety of enforcement pro-

cedures.

Id. at 92 (emphasis added).

* The other cases typically relied on by the Agency for -

ciple that a SIP revision does not become effective until a

by EPA are similarly not dispositive of the issue presented here

See United States v, Ford Motor Co, 814 F.2d 1099, 1102 (6th Cir

1987), cert. denied, 484 U.S. 822 (1987). United States v. Wheeling-

Pittaburgh Steel Corp, 818 F 2d 1077, 1084 (3d Cir. 1987): Metro-

politan Washington Coalition for Clean Air v. District of Columbia

611 F.2d 809, 812 (D.C. Cir. 1975); NRDC v. EPA, 478 F24 878

886 (ist Cir. 1972). Not a single one of these cases involved an

EPA enforcement action brought in the face of a SIP revision left

pending for more than four months.

This statement was clearly directed at a situation in

which EPA has disapproved a revision and the source

then appeals that action. Id. It does not address the sit.

uation where neither the state nor the source has received

a decision from EPA on the SIP revision. In fact, the

Court in Train took comfort from the Agency's own as-

sertions that it would have no difficulty meeting its

statutory responsibilities. Id. at 93.

The Agency has taken Train's straightforward prin-

ciple and converted it to a statutory license to ignore the

four month deadline and to undercut state decisionmak-

ing through enforcement actions. As a result, the statu-

tory concept of the “applicable implementation plan” is

stretched beyond recognition. The statutory structure of

the Clean Air Act is built upon a matching of state and

federal law in the SIP. As the Agency's experience with

transportation control plans demonstrates, discordance

between state and federal law creates severe practical,

political, and legal problems. See generally, R. Stewart,

Pyramids of Sacrifice? Problems of Federalism in Man-

dating State Implementation of National Environmental

Policy, 86 Yale L.J. 1196 (1977). The statutory dead-

lines in the Act governing EPA’s SIP review authority

serve a critical function not only in setting the appro-

priate level of EPA involvement, but also in limiting the

time during which there is a state command in conflict

with a federal command.“

This limitation on the window of potential conflict

four months in the case of SIP reviews—provides sources

with some certainty with respect to their compliance ob-

ligations and sets the framework for the Act's coopera-

tive federalism. Most importantly, the Act simply does

not contemplate extended periods of time where state and

2 Similar functions are served by time deadlines governing EPA

review of delayed compliance orders under CAA 11304 42 U.S.C.

§7413(d), and primary nonferrous smelting orders under CAA

£119, 42 U.S.C. £7419.

federal law differ under the applicable“ SIP.“ EPA's

misapplication of the Train principle creates not only

equitable concerns but also fundamental confusion in the

basic statutory structure.

For example, the Act requires, as a condition for the

approval of a SIP, that the emission limitation it con-

tains be enforceable as a matter of state law. CAA § 110

(a 2% and (FPF), 42 U.S.C. §7410(a)(2)(D) and

(F). Yet in order to submit a SIP revision, the state

must adopt the revised requirement (see supra n.5, thus

directly affecting the enforceability, as a matter of state

law, of the prior SIP. In section 176/b) of the Act, Con-

gress directed EPA to cut off grants under the Act to a

state that “is not implementing any requirement of an

approved or promulgated plan under section 7410 of this

Title.” CAA §176(b), 42 U.S.C. 706 (b. Congress

used mandatory language for this provision: “the Ad-

ministrator sha!’ not make any grants under this chap-

ter” if the state is not implementing the applicable plan.

Id. (emphasis added). Does this mean that after the

four month review period has passed without EPA deci-

sion, the state is subject to a funding cutoff? It is no

answer to say that EPA would never take such an action

penalizing a state for the Agency's own delay. Under sec-

tion 304 of the Act. citizens can sue to enforce this man-

datory duty. CAA § 304, 42 U.S.C, § 7604.

The funding sanctions, mandatory duties, and citizen

suit provisions in the Act presume a clarity in the de-

termination of the “applicable plan“ that EPA's ap-

proach destroys. At a minimum, the structure of the

statute is premised on prompt decisions by EPA harmo-

nizing federal and state obligations. Under EPA's theory,

a source would be subject to a citizen suit throughout the

* Exceptions to this rule occur in the context of Federal Imple-

mentation Plans (FIPs), CAA #1 110(c¢), 42 U.S.C. §7410(e), and

“more stringent state laws, CAA $116, 42 U.S.C. § 7416.

less stringent than the prior SIP. It is often the case,

or that a state will revise its SIP to tighten

an emission limitation but provide the necessary addi-

It should be noted here that the First Circuit misread section

§7410(g). General Motors, 876 F.2d at 1069 n6. Section 110%

provides that a state may issue a “temporary emergency sus-

pension” of the prior SIP if the state has submitted a SIP re-

vision “which the Administrator has not approved or disapproved

under this section within the required four month period... .”

CAA $110(g@)(1), 42 U.S.C. § 7410(g)(1) (emphasis added). The

state's authority under the section is limited to situations of severe

economic emergency, and the suspension can only last for four

months. The First Circuit assumed that this suspension authority

dealt with situations in which EPA had missed the four month

deadline, and, therefore, concluded that the enforcement bar is

inconsistent with the section. In fact, though, section 110% deals

with the state's authority to suspend its prior SIP within EPA's

four month review period. The section thus provides a very limited

entitlement to the states to take action before FPA has had its

chance to review the SIP revision. The First Circuit's reading both

ignores the statutory term “within the required four month period”

and renders the emergency authority hollow, since the “emergency

suspension“ could not take effect until four months after submission.

hardly an expeditious, “emergency” time frame.

would be skewed in favor of the federal government.

Under either the statutory or

standing of the term, as EPA delays in the

of a SIP revision, the state is not remiss in its

; to

ici

111

prior plan.” Once outside of the statutorily allowed

This would not mean, however, that EPA's delay renders

any subsequent Agency approval (or disapproval) invalid. It is only

This reading of section 110/d)

tent with the remainder of the statute and reinforces the

correctness of the enforcement bar approach of American

Cyanamid. Moreover, any approach which would permit

retroactive application of EPA's action, such as the ap

proach of the D.C. Circuit in Duquesne, is inconsistent

with the doctrine that a statutory grant of legislative

rulemaking authority shall not be construed to convey

the power to apply retroactive rules unless the statute

expressly provides. See, ¢.g.. Bowen . Georgetown Unir.

Hosp. — U.S. ——. 109 S.Ct 468 (1988) Here, the

statute does not provide for retroactivity, and it would be

manifestly unfair to allow substantial accumulation of

penalties against individual sources based on EPA's non-

compliance with the statute.”

Finally, the Agency argues that its interpretation is

necessary to fend off attempts by the states to enact im-

proper relaxations of Clean Air standards. In the

First Circuit, the Agency argued that with the enforce-

ment bar, “states might simply flood the Agency with

disingenuous SIP revisions at the behest of influential

companies.” General Motors, 876 F.2d at 1067. Not only

is this argument a disservice to the states, but it is also

factually unsupported. In the two and a half years that

American Cyanamid has been the governing precedent in

the Fifth Circuit, we are not aware of, and EPA has not

pointed to, any increase in “disingenuous” SIP revisions,

during the period of delay, when EPA has failed to meet its deci-

sional obligation under section 120(a)(3)( A), that the “applicabil-

ity” of the plan is compromised.

a Also. as discussed, it will often not be clear to the source

whether the Clean Air Act requires compliance with the revised

state law or the prier SIP

never mind a “flood” of such revisions. But even if EPA’s

self-serving specter of state irresponsibility were ac-

cepted, Congress provided EPA with broad authorities

that would directly address that problem. EPA can as-

sume federal enforcement of the state plan, CAA § 113

(a) (2), 42 U.S.C. 7413 (a (2); it can promulgate a

federal plan in place of the state plan, CAA § 110(¢) (1),

42 U.S.C. § 7419/c¢) (1); it can cut off grants to the state,

CAA § 176, 42 U.S.C. § 7506; it can ban the construction

of any new or modified major source in the area, CAA

£17314), 42 U.S.C. § 7503(4); it can bring an action to

halt any imminent endangerment, CAA § 303, 42 U.S.C.

7603; and, of course, it can disapprove any revision and

bring an enforcement action against the individual source.

With this array of authorities, it is nothing short of ri-

diculous for the Agency to claim that it needs the threat

of enforcement during the pendency of delayed SIP re-

view to stem the tide of improper SIP revisions.

It should be emphasized that the American Cyanamid

rule places only a limited restriction on the Agency’s au-

thority: the Agency cannot enforce a prior SIP where a

SIP revision has been pending for more than four months

until it disapproves that revision, and it cannot collect

penalties for the period of its own delay. These restric-

tions are entirely within the Agency’s ability to control,

and, as discussed, there is no sound reason why the Agency

cannot meet the four month deadline. The Congressional

mandate here is straightforward: EPA must act on state

submissions within four months. This Court should hold

the Agency to that requirement.

CONCLUSION

For these reasons, the amici curiae respectfully urge

this Court to rule that when EPA fails to take action on

a SIP revision within the four month period for review,

then (1) EPA may not bring an enforcement action for

failure to comply with an existing SIP unless and until

it rejects the pending SIP revision, and (2) EPA may

not collect penalties for the period between (a) the end

of the four month period for review and (b) the date

that EPA rejects the revision.

Respectfully submitted,

G. WILLIAM FRICK FRANCIS S. BLAKE *

American Petroleum Institute Jerome C. Muys, JR.

1120 L Street, NW Sumi R & BERLIN, CHTD.

Washington, DC 20005 3000 K Street, NW, Suite 30°

(202) 682-8240 Washington, DC 20007-3851

Davip ZOLL (202) 944-4711

Chemical Manufacturers (Counsel for Motor Vehicle

Association Manufacturers Association

2501 M Street, NW of the United States, Inc.)

Washington, DC 20037 WU aM H. CRABTREE

(202) 887-1100 Vice President &

Henry V. NICKEL General Counsel

HUNTON & WILLIAMS THOMAS R. MERLINO

2000 Pennsylvania Avenue, NW Motor Vehicle Manufacturers

P.O. Box 19230 Association of the

Washington, DC 20036 United States, Inc.

(202) 955-1500 7430 Second Avenue, Suite 300

(Counsel for Edison Electric Detroit, MI 48202

Institute, et al.) (313) 872-4311

January 18, 1990 * Counsel of Record

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.