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

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No. 89-369 SEPH F. SPANIOL

——$ eee

In The

Supreme Court of the United States

October Term, 1989

—o—

GENERAL MOTORS CORPORATION,

Petitioner,

UNITED STATES OF AMERICA.

—+

On Petition For A Writ Of Certiorari

To The United States Court of Appeals

For The First Circuit

—_@——

BRIEF OF

GOLDEN WEST REFINING COMPANY,

ENVIRONMENTAL AUDIT, INC., AND

SECURITY ENVIRONMENTAL SYSTEMS, INC.

AS AMICI CURIAE

IN SUPPORT OF PETITIONER

—

LAWRENCE J. STRAW, JR.

(Counsel of Record)

KENNETH A. MANASTER

Straw & GILMARTIN

A PROFESSIONAL Law CorPORATION

100 Wilshire Boulevard, Suite 1325

Santa Monica, California 90401

Telephone: (213) 395-5577

Counsel for Amici Curiae

Golden West Refining Company,

Environmental Audit, Inc., an

Security Environmental Systems, Inc.

EEE,

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

TABLE OF CONTENTS

STATEMENT OF INTEREST ..........ccccscccccees

SUMMARY OF ARGUMENT.................:...-.

ARGUMENT

THE CLEAN AIR ACT ESTABLISHES A FED-

ERAL - STATE PARTNERSHIP FOR THE PRO-

TECTION OF OUR NATION’S AIR............

A. CONGRESS GAVE THE STATES THE

AUTHORITY TO MODIFY FEDERALLY

APPROVED AIR POLLUTION CONTROL

REGULATIONS OR PROVIDE TEMPOR-

ARY RELIEF FROM THEM ...............

B. THE CLEAN AIR ACT IMPOSES A REQUIRE-

MENT THAT EPA DECIDE IN A TIMELY

FASHION TO APPROVE OR DISAPPROVE

STATE - ISSUED SIP REVISIONS ...........

THE FAILURE OF EPA TO APPROVE OR DIS-

APPROVE DCOs AND SIP REVISIONS WITHIN

THE STATUTORY TIME LIMITS INFRINGES

UPON THE AUTHORITY OF THE STATES,

LEAVES THE REGULATED COMMUNITY IN

LIMBO, AND DEPRIVES THE PUBLIC OF AN

OPPORTUNITY TO PARTICIPATE IN THE PRO-

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A. THE AUTHORITY OF THE STATES IS

USURPED BY THE EPA’S FAILURE TO ACT

WITHIN THE STATUTORILY DEFINED

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B. THE REGULATED COMMUNITY IS

PLACED IN COMPLIANCE LIMBO.......

Fe en

TABLE OF CONTENTS - Continued

Page

C. MEMBERS OF THE PUBLIC ARE

DEPRIVED OF THEIR ABILITY TO PAR-

TICIPATE IN THE PROCESS..............

Ill ONLY THE CASE LAW IN THE FIFTH CIRCUIT

IS CONSISTENT WITH THE STATUTORY

SCHEME OF THE ACT ............cccccccece.

A. THE RULE IN THE FIFTH CIRCUIT 1S

CONSISTENT WITH LEGISLATIVE

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B. THE RULES IN THE D.C., FIRST AND

SIXTH CIRCUITS ARE BASED UPON

ERRONEOUS ASSUMPTIONS

1. The approach of the First and Sixth Circuits

ignores the practicalities of air pollution

control compliance under the Congressional

scheme

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2. The practical results of the approaches taken

by the various circuits can be clearly con-

trasted

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iii

TABLE OF AUTHORITIES

Cases

American Cyanamid v. U.S. Environmental Protection

Agency, 810 F.2d 493 (5th Cir. 1987)............. Ts

Bethlehem Steel Corporation v. Gorsuch, 742 F.2d

CE 7, ta,

Bethlehem Steel Corporation v. United States Environ-

mental Protection Agency, 638 F.2d 994 (7th Cir.

OEE ee 7,

Council of Commuter Organizations v. Gorsuch, 683

Ee 7,

Council of Commuter Organizations v. Thomas, 799

Co 7, 14, 17,

Duquesne Light Company v. Environmental Protec-

tion Agency, 698 F.2d 456 (D.C. Cir. 1983)

PEM MEMNGRER 460000 osseucessneeednes 7, 8, 14, 18,

General Motors Corp. v. Environmental Protection

Agency, 871 F.2d 495 (5th Cir. 1989)..7, 13, 19, 20,

Hallstrom v. Tillamook County, __ US. __, 110

Ns soso vesecsacccccccceseece 9, 10,

Train v. Natural Resources Defense Council, Inc., 421

EE 4, 10,

Union Electric Company v. Environmental Protection

Agency, 427 US. 246 (1976) .................. 3, 4,

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

Ere 7, 8, 14, 20, 21,

United States v. General Motors Corporation, 876

oe ee 7, 20,

TABLE OF AUTHORITIES - Continued

Page

United States v. Mobil Oil Corporation, pending in

U.S. District Court, Eastern District of Califor-

SE Ge EE PEG G0 660.04 8Gavee Gs veceseeses 11

United States v. National Steel Corp., 767 F.2d 1176

Se ery ree re re es 7

FEDERAL STATUTES

Clean Air Act

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TABLE OF AUTHORITIES - Continued

— Page

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Act of December 17, 1963, Pub. L. No. 88-206, § 1,

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CALIFORNIA STATUTES

Cal. Health & Safety Code § 39602 ................. 24

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REGULATIONS

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TABLE OF AUTHORITIES - Continued _

Page

LEGISLATIVE MATERIAL

H.R. Rep. No. 95-294, 95th Cong., Ist Sess. (1977)

reprinted in 1977 U.S. Code Cong. & Ad. News

i oe See ee eh a CPP EE oie ee kx 5

TREATISES

Selmi and Manaster, State Environmental Law,

i a nn eek couse 5, 26

Novick et al., Law of Environmental Protection,

Fee ER See ee a ne 23

MISCELLANEOUS

90 Fed. Reg. 36732-36733 (1985)................. ee

Marvin Durning, Assistant Administrator for

Enforcement, to Regional Administrators and

Regional Enforcement Directors, “Enforcement

Under Clean Air Act Amendments - Orders

under Section 113(a) and 113(b)”, July 27, 1978 .... 13

“Source Specific SIP Revisions”, July 29, 1983....... 21

“Clean Air Act Stationary Source Civil Penalty

a BE 25

“Settlement of Noncompliance Penalties Under

Section 120 of The Clean Air Act,” October 30,

EE OU Mie I obec cr esc teccsccecenevesces 25

Dante, The Divine Comedy: Hell, Canto IV ........ 11, 12

ee ee ee a ee

With consent of the parties, Golden West Refining Com-

pany, Environmental Audit, Inc., and Security Environmental

Systems, Inc. submit this amicus curiae brief in support of the

Petitioner.

STATEMENT OF INTEREST

Golden West Refining Company, Environmental Audit,

Inc., and Security Environmental Systems, Inc. submit this

amicus curiae brief in support of appellant General Motors

Corporation. !

Golden West Refining Company (“Golden West”), a Cali-

fornia corporation, is engaged in the refining of petroleum

and the distribution of refined petroleum products. Golden

West operates a 45,000 barrel per day refinery in Santa Fe

Springs, California.

Security Environmental Systems, Inc. (“SES”) is a Dela-

ware corporation engaged in the business of incinerating

classified documents and biohazardous wastes. SES is cur-

rently engaged in the process of securing permits for and

constructing a hazardous waste incineration facility in Ver-

non, California.

Environmental Audit, Inc. (“EAI”) is a California corpo-

ration which provides environmentally related consulting ser-

vices to clients located throughout the United States. These

services include assisting in the permitting of facilities and

identification of technologies for compliance with applicable

air pollution control regulations.

Amici Golden West and SES operate facilities which are

subject to numerous local, state, and federal air pollution

control regulations. Amicus EAI attempts to assist sources to

comply with local, state and federal air pollution control

regulations. They therefore have a stake in the outcome of

this litigation.

! This brief is filed with the written consent of the parties, pursuant

to Supreme Court Rule 37.3. Letters of consent are on file with the Clerk

of the Court.

In the context of the issues at bench, the interests of

amici coincide with the interest of General Motors and with

the public interest in this matter. Amici often find themselves

Struggling to determine the appropriate method of compliance

with air pollution control regulations in the face of conflicting

federal and state requirements.

SUMMARY OF ARGUMENT

The Clean Air Act acknowledges the primary role of the

States in developing and enforcing air pollution control laws

within their individual borders. The federal government was

given the responsibility for developing clean air goals and

overseeing the States’ attempts to reach these goals. One of

the more significant vehicles created by Congress for achiev-

ing these goals was the State Implementation Plan (“SIP’’).

The States were to determine the strategies for achieving

the clean air goals, choosing the approaches which best suited

the particular circumstances within their borders and incor-

porating these strategies into a SIP. The States were also

authorized by Congress to revise these plans as warranted by

changing circumstances and to provide individual air pollu-

tion sources temporary relief from the mandates of the plans

under limited circumstances. These revisions have indepen-

dent authority under State law, apart from their role within the

framework of the Clean Air Act. If the States’ plans and

revisions thereto met the requirements of the Act, Administra-

tor of the Environmental Protection Agency (“EPA”) was

required to approve them.

EPA has unashamedly failed to approve or disapprove

revisions within the deadlines mandated by Congress. At the

same time, EPA seeks to penalize sources attempting in good

faith to comply in a timely fashion with the requirements of

the States’ revisions. The EPA’s lack of timeliness has under-

cut the designated and proper role of the States in developing

and enforcing clean air laws within their borders. The EPA’s

actions seeking to penalize sources for not complying with

old SIP requirements while revisions are pending places the

regulated community in a quandary as to the appropriate

method of compliance.

The Clean Air Act does not delineate consequences for

EPA’s failure to timely complete its review of SIP revisions

adopted by the States. The various Circuit Courts of Appeals

have attempted to fashion a solution and, in so doing, they

have come to conflicting conclusions. The remedy adopted by

the Fifth Circuit, for dealing with EPA attempts to enforce

SIP provisions while EPA review of revised provisions is past

due, is the response which most closely reflects the intent of

Congress. That remedy bars EPA enforcement against a

source not complying with an old SIP provision until EPA has

acted to disapprove a revised SIP provision.

ARGUMENT

THE CLEAN AIR ACT ESTABLISHES A FED-

ERAL - STATE PARTNERSHIP FOR THE

PROTECTION OF OUR NATION’S AIR

The proper role of the States in controlling air pollution

within their respective borders was delineated by Congress in

§§ 7401(a)(3) and 7407(a) of the Clean Air Act, 42 U.S.C.

§ 7401, et seq. Section 7401(a)(3) provides, in relevant part:

“{t}hat the prevention and control of air pollution at its source

is the primary responsibility of the States and local govern-

ment. . . .”2 [Emphasis added]. In determining the nature of

emission limitations to be imposed within its borders, a State

is free to select whatever controls it deems best suited for that

State’s particular needs. Industries with technological prob-

lems or particular economic concerns may seek special treat-

ment in the plan in order to take these concerns into account.

Union Electric Company v. Environmental Protection Agency,

427 U.S. 246, 266 (1976). The only limitation on a State’s

selection of controls is that they must comply with the criteria

2 This primary responsibility imposed upon the States predated the

Clean Air Act of 1970. See Act of December 17, 1963, ‘ub. L. No.

88-206, § 1, 77 Stat. 392.

set forth in § 7410(a)(2)(A)-(K). “The Act gives the agency

no authority to question the wisdom of a State’s choices of

emission limitations if they are part of a plan which satisfies

the standards of § 110(a)(2) [§ 7410(a)(2)].” Train v. Natural

Resources Defense Council, Inc., 421 U.S. 60, 79 (1975).

While the States were given the primary responsibility

for assuring air quality within their borders by developing and

enforcing the SIPs, the federal government was given the

responsibility of assuring that the SIPs met the requirements

of the Clean Air Act. If the SIPs met these delineated require-

ments, the Administrator was required to approve them.

Union Electric, 427 U.S. at 257. The Act required that this

process of determining whether the initial SIPs met these

enumerated requirements be accomplished within four

months. 42 U.S.C. § 7410(a)(2). “No one can aoubt that

Congress imposed upon the Agency [EPA] and States a com-

prehensive planning task of the first magnitude which was to

be accomplished in a relatively short time.” Train, 421 U.S. at

68. The imposition of this “short time” SIP review process

accomplished two objectives: it got the overall federal-state

effort off to a fast start, and it minimized the time during

which state air quality requirements would have binding force

under state law but would not yet have the force of federal

law.

A. CONGRESS GAVE THE STATES THE AUTHORITY

TO MODIFY FEDERALLY APPROVED AIR POL-

LUTION CONTROL REGULATIONS OR PROVIDE

TEMPORARY RELIEF FROM THEM.

In recognition of changes in technology, air pollution

levels, economic circumstances, or other unforeseen factors

within a State’s borders, as well as a State’s desire to accom-

modate the legitimate needs of a source or an industry operat-

ing at variance from an approved SIP, Congress provided that

the plans can be revised by the State if the revisions meet the

same standards required of original plans. See 42 U.S.C.

§ 7410(a)(3)(A). Union Electric, 427 U.S. at 267 n. 16.

“Essentially a SIP is a constantly evolving conglomeration of

substantive and procedural regulations applicable to catego-

ries of air pollution sources, and supplemented by specific

compliance schedules governing individual sources which are

not meeting the regulations’ terms.” Selmi and Manaster,

State Environmental Law, § 6.02(1}[b] at 6-7 (1989).

Where a SIP revision is developed by a State, it is subject

to the criteria listed in § 7410(a)(2)(A)-(K), the requirements

of § 7410(a)(3)(A) and 40 C.F.R. §§ 51.100, 51.104 and

51.105. These requirements include the State’s obligation to

provide notice and public hearings upon the proposed SIP

revision before it may be adopted by the State. If the SIP

revision meets all the above-enumerated requirements, the

Administrator is required to approve it. 42 U.S.C.

§ 7410(a)(3)(A).

Additionally, the 1977 amendments to the Clean Air Act

added subsection 113(d) (42 U.S.C. § 7413(d)) providing for

the States’ issuance of delayed compliance orders (“DCOs”),

a form of temporary relief from the requirements of a SIP, in

order to affirm the role of the States as the primary authority

for enforcement of SIPs. See H.R. Rep. No. 95-294, 95th

Cong., Ist Sess. (1977), reprinted in 1977 U.S. Code Cong. &

Ad. News 1077, 1135-1136. The Administrator is required to

approve a DCO if he determines it does not violate the

requisites of the Act. 42 U.S.C. § 7413(d)(2). When approved

by the Administrator, a DCO becomes part of the State’s SIP.

40 C.F.R. § 65.03(a)(1).

The case pending before the Court addresses the appro-

priate remedy for the Administrator's failure to approve or

disapprove a proposed SIP revision under § 7410 of the Act

within the statutory four month limit. There are numerous

other cases where the EPA has similarly failed to act upon

proposed SIP provisions arising from DCOs issued under

§ 7413 of the Act within the 90 days mandated by the Act.

This widespread pattern of EPA’s disregard of its obligations

to timely act upon all forms of state-granted relief, as pro-

vided for in the Clean Air Act, has resulted in many enforce-

ment actions being initiated by the EPA against sources

attempting to comply with the directives of state-issued SIP

revisions and DCOs prior to EPA’s determination of their

approvability. Amici believe the Court should be cognizant of

this parallel concern involving proposed SIP provisions initi-

ated as DCOs issued under § 7413 because the Court’s deci-

sion in this case will likely be viewed by the lower courts as

also influencing the outcome of enforcement actions initiated

during the pendency of the DCO approval/disapproval

process.

B. THE CLEAN AIR ACT IMPOSES A REQUIRE-

MENT THAT EPA DECIDE IN A TIMELY FASHION

TO APPROVE OR DISAPPROVE STATE - ISSUED

SIP REVISIONS.

Consistent with its goal of assuring that progress did not

fall victim to bureaucratic delay, Congress provided short

deadlines for federal approval or disapproval of state-granted

relief from SIP requirements. Under the terms of 42 U.S.C.

§ 7413(d)(2), a DCO for a “minor” source became imme-

diately effective upon issuance by a State and only ceased to

be effective upon express disapproval by the Administrator.

The Administrator was only given 90 days to approve or

disapprove a state-issued DCO for a “major” source.?

While the Clean Air Act does not separately state the

time within which the Administrator must approve or disap-

prove a SIP revision, the Act does require approval or disap-

proval of an original SIP submitted by a State within 120 days

of the Administrator’s receipt of the State’s plan. 42 U.S.C.

§ 7410(a)(2). Section 7410(a)(3)(A), dealing with revisions to

SIPs, incorporates all the requirements of § 7410(a)(2). It

must therefore be presumed that the 120-day deadline for

acting, expressly contained in § 7410(a)(2), is also incorpo-

rated therein. Further evidence of Congressional intent is

found at § 7410(g)(1), which discusses circumstances where

3 A “major stationary source” is a stationary facility which emits or

has the potenual to emit 100 tons per year or more of any air pollutant. A

“minor stationary source” emits or has the potential to emit less than this

amount. 42 U.S.C. § 7602(j).

the Administrator has not acted on a SIP revision “within the

required four month period.’’*

The weight of case law holds that the four month dead-

line for the Administrator to approve or disapprove original

SIP submissions applies to SIP revisions as well. Every court

that has expressly dealt with the issue has so held.> See

Duquesne Light Company v. Environmental Protection

Agency, 698 F.2d 456, 471 (D.C. Cir. 1983); Council of

Commuter Organizations (“CCO” ) v. Gorsuch, 683 F.2d 648,

651 n. 2 (2d Cir. 1982); Council of Commuter Organizations

(“CCO” ) v. Thomas, 799 F.2d 879, 888 (2d Cir. 1986); Ameri-

can Cyanamid v. U.S. Environmental Protection Agency, 810

F.2d 493, 495 (Sth Cir. 1987); United States v. General

Motors Corporation, 876 F.2d 1060, 1066 (1st Cir. 1989); and

United States v. Alcan Foil Products, 889 F.2d 1513 (6th Cir.

1989). «

Despite the legal mandate that EPA act in a timely fash-

ion to approve or disapprove SIP revisions and DCOs, the

actual practice of EPA is not in accordance with this mandate.

Reported decisions demonstrate EPA’s repeated and consistent

failure to adhere to this statutory mandate of timeliness. See,

e.g., Bethlehem Steel Corporation v. United States Environ-

mental Protection Agency, 638 F.2d 994 (7th Cir. 1980); CCO

v. Gorsuch, 683 F.2d 648; United States v. National Steel

Corporation, 767 F.2d 1176 (6th Cir. 1985); Bethlehem Steel

Corporation v. Gorsuch, 742 F.2d 1028 (7th Cir. 1984); CCO

v. Thomas, 799 F.2d 879; American Cyanamid, 810 F.2d 493;

General Motors Corp. v. Environmental Protection Agency,

871 F.2d 495 (Sth Cir. 1989); United States v. General

4 In a Federal Register notice relating to proposed regulations

dealing with noncompliance penalties pursuant to § 120 of the Act, EPA

acknowledged the four month limit applied to SIP revisions. 50 Fed. Reg.

36732 et seq. at 36733 (Sept. 9, 1985).

5 The Sixth Circuit once suggested by way of dictum in a footmote

that the four-month rule did not apply to SIP revisions. United States v.

National Steel Corp., 767 F.2d 1176, 1182-1183 n. 1 (6th Cir. 1985). That

court later expressly rejected this suggestion and held the four-munih rule

did apply to SIP revisions. U.S. v. Alcan Foil Products, infra.

Motors, 876 F.2d 1060; and United States v. Alcan Foil

Products, 889 F.2d 1513. Cf., Duquesne Light v. EPA, 698

F.2d 456. The foregoing list could surely be supplemented by

unreported district court decisions and by federal enforcement

actions resolved prior to or during litigation. It can be readily

assumed that both large and small business entities have

succumbed to the threat of such federal enforcement mea-

sures. Rather than absorb the substantial cost burden of chal-

lenging EPA’s disregard of the statutory timetable, they have

settled with EPA and paid monetary penalties. The clear

message is that EPA has seldom, if ever, approved or disap-

proved a DCO or SIP revision within the 90 or 120 days

mandated by Congress.

II.

THE FAILURE OF EPA TO APPROVE OR DIS-

APPROVE DCOs AND SIP REVISIONS

WITHIN THE STATUTORY TIME LIMITS

INFRINGES UPON THE AUTHORITY OF THE

STATES, LEAVES THE REGULATED COM-

MUNITY IN LIMBO, AND DEPRIVES THE

PUBLIC OF AN OPPORTUNITY TO PARTICI-

PATE IN THE PROCESS

Businesses have relied in good faith upon the primary

authority of the States to grant relief from SIP requirements.

Consistent with State law, they have operated their facilities

in accordance with the DCOs or SIP revisions, even before a

final EPA decision has been made upon the state-granted

relief. However, it may take years, if ever, to obtain a final

EPA decision on SIP revisions or DCOs. It often appears as if

the EPA is a “black hole” for the submission of SIP revisions

and DCOs.° EPA has initiated considerable litigation, includ-

ing the case at bench, against these good faith attempts to

comply with the mandates of state government while awaiting

EPA decisions.

* A “black hole” is a dense, stellar body from which no light

emerges.

If EPA can take forever, and still keep the source in

jeopardy of penalties for the entire, unpredictable period, all

certainty and fairness of the Congressionally crafted DCO-

SIP revision process are destroyed. The regulated source is

stymied in its effort to know what the law expects of it. The

State’s primary role under the Clean Air Act becomes a

charade. Whether by virtue of being an overworked bureau-

cracy or an overzealous claimant of the prerogatives of pros-

ecutorial discretion, the EPA in this posture asserts its power

as an obstacle to the State’s implementation and enforcement

of the Act.

A. THE AUTHORITY OF THE STATES IS USURPED

BY THE EPA’S FAILURE TO ACT WITHIN THE

STATUTORILY DEFINED TIME LIMIT.

Providing for both SIP revisions and DCOs to be issued

by the States, Congress required they be approved by the

Administrator expeditiously: 120 days for a SIP revision; 90

days for a DCO. 42 U.S.C. §§ 7410(a)(2), (a)(3)(A) and

(g)(1), 7413(d)(2). Unless EPA honors these time limits, the

States are effectively prevented from real-time response to

changing economic, technological, or pollution circum-

stances. While considerable state resources may be expended

in seeking accommodation to changing circumstances through

negotiation and preparation of SIP revisions and DCOs, the

conduct of public hearings thereon, and their submission to

EPA, these efforts are rendered useless if EPA fails to act as

mandated.

A central aspect of the allocation of power in the Clean

Air Act is the pivotal role of the States in implementing and

enforcing the Act's pollution standards. As this Court recently

confirmed in Hallstrom v. Tillamook County, __U.S. __, 110

S.Ct. 304 (1989), a private citizen cannot initiate an enforce-

ment suit under federal environmental statutes such as the

Resource Conservation and Recovery Act (“RCRA”) or the

Clean Air Act until, after proper statutory notice, government

prosecutors have had an opportunity to act first against the

alleged violator. Citizen enforcement, in short, is supplemen-

tary or secondary to government enforcement. The present

case requires a similar but further refinement: federal

enforcement under the Clean Air Act is secondary to state

enforcement.

The Agency [EPA] is plainly charged by the Act

with the responsibility for setting the national ambi-

emt air standards. Just as plainly, however, it is

relegated by the Act to a secondary role in the

process of determining and enforcing the specific

source-by-source emission limitations which are

necessary if the national standards it has set are to

be met.

Train, 421 U.S. at 79 [Emphases added].

As a private suit cannot be brought until the government,

including the State, has had a full opportunity to give effect to

its choice of enforcement approach, so too the federal govern-

ment should be prevented from prosecuting an enforcement

case until the State has had a full opportunity to give effect to

its choice of enforcement approach. This Court gave full

effect to the RCRA statutory scheme in Hallstrom. So too

should the Court give full effect to the Clean Air Act's

assignment of power to the States in the first instance by

eliminating federal enforcement powers until the State’s pre-

ferred scheme for regulation of the source has been accorded

the definitive treatment by EPA prescribed by the Act. In this

case, as in Hallstrom, the proper approach should be a strict

one: the enforcement plaintiff assigned a secondary role under

the statutory scheme (i.e., the private citizen in Hallstrom and

the federal government in this case) cannot proceed unless

and until the entity assigned the primary enforcement role

(i.e., the State under the Clean Air Act) has been provided the

Statutorily envisioned opportunity for its enforcement strategy

to take effect.

EPA's failure to determine the approvability of SIP revi-

sions and DCOs within the allotted time actually constitutes a

“pocket veto” of the States’ proposals. It impairs the ability

of the States to achieve the National Ambient Air Quality

Standards by the means they determine are preferable and

practical. It deprives the States of the opportunity to timely

explore alternative methods of regulation. It also creates a

vast national reservoir of businesses at risk of prosecution for

non-compliance with “old” SIP provisions while complying

with the States’ “new” SIP provisions.’ The reported cases

are but the tip of the iceberg as to the number of sources at

risk. Should this Court condone EPA’s conscious disregard of

its statutory deadlines, EPA would thereby be encouraged to

bring even more enforcement actions against sources comply-

ing, in good faith, with State directives.

B. THE REGULATED COMMUNITY IS PLACED IN

COMPLIANCE LIMBO.

The failure of the EPA to adhere to statutorily mandated

deadlines for approval or disapproval of SIP revisions not

only intrudes upon the primary role of the States, but also

places members of the regulated community in compliance

limbo.* The procedure urged by the EPA, in this web of

? It may be in the economic interest of certain divisions within EPA

to maintain a pool of technically non-complying businesses. For instance,

in EPA Region IX, the resources allotted to the Compliance Section and

the Regional Counsel’s Office are in proportion to the number of cases

referred for prosecution. That is, they have an annual minimum number

of cases which they are required to initiate in order to maintain their

personnel, travel and training funds. See Declaration of Allan Zabel, EPA

Region IX Assistant Regional Counsel (Oct. 29, 1987), at 415 and 6 filed

in United States v. Mobil Oil Corporation, pending in U.S. District Court,

Eastern District of California, Case #87-0627 LKK.

8 In The Divine Comedy, Dante asked his guide upon approaching

the First Circle - Limbo, why the souls within that ring were tormented.

The response seems an apt description of those awaiting EPA action on

SIP revisions and DCOs.

They sinned not; yet their merit lacked its chiefest

Fulfillment, lacking baptism, which is

The gateway to the faith which thou believest;

Or, living before Christendom, their knees

Paid not aright those attributes that belong

To God; and I myself am one of these.

(Continued on following page)

litigation involving EPA power during the period a DCO or

SIP revision is being “considered”, leaves members of the

regulated community confronted with a brutal choice: (1) shut

down operations in order to cease “offending” air emissions

until EPA renders a decision, however long that may take; (2)

comply with the state-approved plan but operate in violation

of the existing SIP; (3) attempt to comply with the existing

SIP but violate the state-approved plan; or (4) initiate a suit

seeking to mandate EPA action.

None of these four alternatives makes sense. Given that

EPA’s failure to act on State SIP revisions may exceed ten

years, as noted in Bethlehem Steel v. Gorsuch, 742 F.2d at

1035, the first alternative, shutting down a facility to await

action by the EPA, would likely constitute economic suicide

for a business.

The second response, operation in compliance with a

State’s “new” SIP revision and in violation of the “old”

federally-approved SIP provision, is no more attractive given

EPA’s enforcement posture as demonstrated in the cases,

including that at bench. The current civil penalty for violation

of a SIP is up to $25,000 per day, and criminal penalties may

also be sought. A business operating under these circum-

stances is in an awkward position and is acutely vulnerable. It

usually has gone to the state regulatory authority and admitted

it is not in compliance or cannot come into compliance with

the existing SIP provision. It has either requested a change in

the SIP or a delay in compliance with the SIP. If the State

grants relief, after the required notice and public hearing, the

source then must publicly embark on a program to adhere to

the terms of the state-granted relief. Thereafter, the State

provides EPA with notice of this situation when it seeks

approval of the SIP revision or DCO. Hence, a source

(Continued from previous page)

For such defects alone — no other wrong -

We are lost; yet only by this grief offended:

That, without hope, we ever live, and long.

Dante, The Divine Comedy: Hell, Canto IV at lines 34-42.

honestly seeking relief has of necessity placed itself in a

position of peril.?

As suggested by the factual context of the case at bench,

if a source chooses the second alternative and ignores the old

SIP requirements and acts to meet the mandate of a new SIP

revision or DCO, it faces the specter of massive civil penal-

ties or the possibility of criminal prosecution if the SIP

revision or DCO is eventually disapproved. In the case of

General Motors, however, EPA did not even wait to disap-

prove the proposed SIP before seeking penalties.

The third alternative set out above is no more reasonable.

Initially, it must be noted that if the source could readily

comply with the old SIP requirement, it would not be seeking

relief. Hence, this “alternative” may be illusory. But even if it

were possible to comply with the existing SIP while awaiting

EPA’s determination on the relief granted by the State, the

source would most likely subject itself to penalties for viola-

tion of state law. When a SIP revision or a DCO is approved

by the State, it becomes enforceable under state law. A source

failing to comply with its terms could, therefore, be pros-

ecuted. Indeed, this circumstance is encouraged by the EPA.

It has urged the States to prosecute sources for non-compli-

ance with the terms of DCOs during the period when EPA

approval is pending.!°

If the source complies with the old SIP, assuming it can

do so, and ignores the requirements of the SIP revision or

9 EPA’s approach may actually create disincentives to honor the

regulatory scheme. A source may be tempted to engage in “self-help”,

deliberately ignoring the statutory scheme for obtaining relief, so as to be

at less risk of prosecution than a source calling attention to itself by

seeking a SIP revision or a DCO.

10 See Memorandum from Marvin Duming, Assistant Administrator

for Enforcement, to Regional Administrators and Regional Enforcement

Directors, “Enforcement Under Clean Air Act Amendments — Orders

under Section 113(a) and 113(b)”, July 27, 1978, at p.10, reprinted in

Government Institutes, Inc., EPA Clean Air Act Compliance/Enforcement

Guidance Manual, at 428 (1985). This memorandum was addressed on

this point in General Motors v. EPA, 871 F.2d at 501.

DCO, not only is it subject to prosecution by the State for

noncompliance with the new SIP, but if the SIP revision or

DCO is later approved by the Administrator, the source can

find itself immediately in retroactive violation of the SIP

revision which likely required completion of some act at a

prior time.

The final alternative, initiation of an action seeking man-

date of a decision upon the state-generated relief, is also

ineffective. It was the Second Circuit’s recommended

response to the Administrator’s tardy review of a New York

SIP revision proposal. CCO v. Thomas, 799 F.2d at 888. Such

action would necessarily be initiated under 42 U.S.C.

§ 7604(a)(2). This section provides an action may be brought

against the Administrator where he has failed to perform a

non-discretionary duty. At the outset, it must be noted the

action may not be commenced until the Administrator has

been afforded 60 days’ notice of his alleged dereliction of

duty. This notice, in turn, cannot be provided until the statu-

tory period within which he may act (i.e., 90 days for a DCO

or 120 days for a SIP revision) has run. Then and only then

may an action be initiated. Thus, by the time suit may be

filed, a source is already “at risk” at least 50% longer than

mandated by Congress."

i Thus, the practical consequences of EPA procrastination

are significant no matter which strategy a source adopts. A

11 The pace and vagaries of litigation can only further extend this

period of risk. Of particular note, as referenced in the recent Sixth Circuit

decision, an action under § 7604(a)(2) was initiated by the Jefferson

County (Kentucky) Air Pollution Control District in an attempt to force a

timely decision on a SIP revision proposal. The source which was the

subject of the proposed revision nevertheless became the subject of an

EPA enforcement action. The court in that case observed, “[t}he alterna-

tive remedy of suit under Section 304(a) [42 U.S.C. § 7604(a)] to compel

EPA to rule is not very effective. . . . The final ruling on the proposed

revision came well over two years after the section 304(a) suit was filed.”

United States v. Alcan Foil Products, 889 F.2d at ___. The ineffectiveness

of such a suit as a safeguard to EPA inaction was also noted by the D.C.

Circuit. Duquesne Light, 698 F.2d at 472.

source may choose economic ruination or alternatively may

risk the possibility of substantial civil or criminal penalties

either at the hands of the federal government if it abides by

the State’s new SIP requirements, or at the hands of the State

if it ignores the new State requirements and adheres to the old

SIP. Certainly Congress did not intend to create such a quand-

ary. Clearly the question of constitutional guarantees of due

process and equal protection is raised by such a dilemma.

In crafting the provisions of the Clean Air Act, Congress

recognized there would be time required to accommodate the

federal government’s review of a proposed SIP revision or

DCO. For this reason, the authors of the Act provided 90 or

120 days for the Administrator to conduct his review and

issue his decision. This short time frame was allotted for the

Administrator’s decision-making process so as to place a

finite limit on a source’s exposure to fines or penalties during

the Administrator’s review.

Admittedly, regulated sources are inescapably in a deli-

cate position for these brief statutory periods, operating in

jeopardy of enforcement penalties from one level of govern-

ment or the other. But the limited time period of such jeop-

ardy chosen by Congress can be dealt with, as a practical

matter, by both the source and the State authorities. Both can

know that the approval or disapproval from the federal gov-

ernment will be forthcoming by a date certain. Private invest-

ment and pollution control planning, and state government

enforcement initiatives, can proceed on sensible, predictable

schedules. Absent such a limitation on exposure to penalties,

sources are in the dark, not knowing for certain, possibly for

years, what is required by way of compliance.

Delay in rendering a decision will often place a source in

the position of being unable to avoid penalties. The instant

case is a clear example of such a situation. The Agency's

disapproval decision on Massachusetts’ proposed SIP revision

was not finalized until two years and nine months after it was

submitted to EPA by the Commonwealth. Since General

Motors’ act of compliance with the new, revised SIP (and in

contravention of the old SIP) was by then complete, there was

no way General Motors could change its operations to avoid

the attempted imposition of penalties.

C. MEMBERS OF THE PUBLIC ARE DEPRIVED OF

THEIR ABILITY TO PARTICIPATE IN THE

PROCESS.

The Clean Air Act, in addition to providing for a federal-

state partnership in air pollution control, mandates that sub-

stantial participation by the citizens of the country be possi-

ble. Congressional desire for public participation is manifest

in the sections of the Act dealing both with SIPs and with

DCOs.!2 An action to challenge the Administrator’s approval

must be initiated in the appropriate U.S. Circuit Court of

Appeals within 60 days of publication.? 42 U.S.C.

§ 7607(b)(1).

The Act’s invitation to the public to participate in the

process is effectively withdrawn by Agency inaction. The

case at bench is a clear example. There is no suggestion that

the Commonwealth shirked its duty to provide notice and

public hearing on the proposed revision. Presumably, resul-

tant public comment was considered by Massachusetts prior

to its determination to revise the SIP. The Administrator's

final decision on the Commonwealth’s proposed SIP revision

did not occur until after the facility which was the subject of ~

that proposal had ceased operation. If the Administrator had

approved the revision, it would have been too late for any

citizen to challenge that result.

12 E.g., § 7410(a)(1) provides for original state SIP submissions

“(a}fter reasonable notice and public hearings”; § 7410(aX(3)(A), dealing

with state SIP revisions, incorporates “reasonable notice and public

hearings”; and § 7413(d)(1)(A) provides for public notice and opportunity

for public hearing prior to a state’s adoption of a DCO. Additionally, the

EPA’s consideration of SIP revisions or DCOs is published in the Federal

13 An action to challenge the disapproval of a DCO may also be

possible under the authority of § 7607(b)(1). Bethlehem Steel v. Gorsuch,

742 F.2d at 1032.

—a —

Ill.

ONLY THE CASE LAW IN THE FIFTH CIR-

CUIT IS CONSISTENT WITH THE STATU-

TORY SCHEME OF THE ACT

The Circuit Courts of Appeals which have articulated

responses to EPA’s avoidance of its statutorv mandate to

timely act upon proposed SIP revisions and DUOs have pro-

vided a variety of approaches. The Seventh Circuit first com-

mented on the failure of EPA to comply with time deadlines

in the Act. In Bethlehem Steel Corporation v. United States

Environmental Protection Agency, 638 F.2d 994 (7th Cir.

1980), the court considered the EPA’s failure to determine the

approvability of a DCO within the 90 day period prescribed

by § 7413(d)(2). Woven into the facts of the case were

allegations that EPA personnel improperly commingled adju-

dicative and prosecutorial functions and arrived at their deci-

sion to disapprove the DCO in order to enhance EPA’s

prosecutorial position in an ongoing enforcement action.

The Bethlehem court chastised EPA for its failure to

adhere to the mandate to decide DCOs within 90 days of their

submittal. The court dismissed EPA’s claim that it had an

indefinite time to reach a final determination on a DCO so

long as some “predisposition” was issued within 90 days. In a

footnote, the court stated its belief that the filing of a civil

enforcement action prior io the issuance of a disapproval of

the DCO “[w]jould open up many questions concerning the

continued viability of the action. . . .” Bethlehem Steel, 638

F.2d at 1002-1003 n. 9.

In the wake of Bethlehem Steel, the Second Circuit was

called upon in a pair of related cases to review SIP revisions

for the New York City area. See CCO v. Gorsuch, 683 F.2d

648; CCO v. Thomas, 799 F.2d 879. In both cases, EPA failed

to act upon proposed SIP revisions within the four months

allotted.

Despite being taken to task by the court in CCO vy.

Gorsuch, 683 F.2d at 661 for its delay, when it came time to

review a subsequent proposed SIP revision by New York, EPA

again took approximately three years to reach a decision. In

CCO v. Thomas, the court reiterated its concern that the EPA

was not honoring its time-sensitive, statutory mandate. As a

remedy for EPA’s delay, the Court recommended “{a|n

enforcement action [against EPA] in district court under sec-

tion 7604(a)(2).” CCO v. Thomas, 799 F.2d at 888. As dis-

cussed above, this is not a realistic solution.

In Duquesne Light v. EPA, 698 F.2d 456, the D.C. Circuit

was petitioned by over a dozen entities to review final EPA

regulations dealing with non-compliance penalties provided

for by section 120 of the Act (42 U.S.C. § 7420). Petitioners

objected to an EPA regulation (40 C.F.R. § 66.3(c)(1)) which

allows penalty assessments against a major source in violation

of existing SIP requirements, despite the pendency of a pro-

posed SIP revision before the EPA for approval. The D ©.

Circuit’s solution to this quandary was to suggest that once

the statutory deadline for acting on a SIP revision passes, the

non-compliance penalty should be held in abeyance until

EPA’s final action on the SIP. “Should EPA ultimately reject

the SIP, the penalty should be calculated back to the deadline,

with interest.” Duquesne Light, 698 F.2d at 472.'* The court

then remanded EPA’s regulation (40 C.F.R. § 66.3(c)(1)) back

to the Agency and directed that a new regulation be developed

which incorporated the court’s determination. A review of 40

C.F.R. § 66.3 indicates that, to date, the EPA has still not

reissued the regulation, as directed by the Circuit Court.

A. THE RULE IN THE FIFTH CIRCUIT IS CONSIsS-

TENT WITH LEGISLATIVE INTENT.

Because the statutory framework requires EPA to

approve SIP revisions or DCOs before they can become part

of the federally-enforceable SIP, there is necessarily a lag in

time between a State’s adoption of a revision and EPA's

review and approval of it. It is also apparent that during this

period of federal review, a source is often unable to comply

'4 The Court also observed that the initiation of an action under

§ 7604(a)(2), as suggested by the Second Circuit in CCO v. Thomas, 799

F.2d at 888, does not safeguard the rights of the source

with both the existing SIP requirements and the new obliga-

tions adopted by the State but not yet approved by EPA.

American Cyanamid was confronted by such a dilemma

when it was under an obligation to install air pollution control

equipment on “floating roof” tanks in order to comply with

the “old” SIP but had the opportunity to achieve the same

quantitative emission reductions under a revision to the SIP.

In the Fifth Circuit case of American Cyanamid v. EPA, 810

F.2d 493, EPA was requested by the State of Louisiana,

pursuant to § 7410 of the Act, to approve revision of the SIP

to reflect this change in the State’s regulatory strategy. Over

two years later, EPA sent American Cyanamid, the source

subject to the SIP revision, a Notice of Non-compliance under

§ 7420 of the Act. At the time the Notice was sent, indeed

even two years later at the time of the court’s ruling, EPA had

not acted on the Louisiana SIP revision. The court determined

that when a proposed SIP revision has been pending for more

than four months, EPA may collect penalties only for viola-

tions which occur after the EPA finally rejects the proposed

SIP revision. /d. at 500. While the American Cyanamid case

was brought under § 7420 of the Act, instead of under § 7413

as in the present case, the court’s reasoning is fully applicable

in both contexts, as the Fifth Circuit later declared.

The Fifth Circuit recently reviewed the circumstances of

EPA's failure to act upon a DCO within the 90 days provided

by statute. In General Motors v. EPA, 871 F.2d 495, the State

of Texas issued a DCO to General Motors and submitted it to

EPA for approval. Prior to acting to approve or disapprove the

DCO and after it had expired by its own terms, EPA issued a

Notice of Violation to General Motors. The Court reviewed

the rationale underlying its decision in American Cyanamid

and found that it was equally applicable in the General

Motors case, remarking, “(t]he § 7413(d) deadline applicable

to delayed compliance orders is no less important than the

§ 7410 deadline governing revision to state plans.” General

Motors v. EPA, 871 F.2d at 498. Consistent with the holding in

American Cyanamid, the Fifth Circuit held EPA must forfeit

its power to collect penalties between the end of the 90-day

period for EPA action and the expiration date of the DCO if

EPA had still not acted when the DCO expired.

The rule in the Fifth Circuit effectuates Congressional

intent. It provides incentives for EPA to act within the allotted

time by eliminating EPA’s ability to seek penalties from a

source until EPA acts to approve or disapprove the revision. It

limits the period of time during which a source is uncertain as

to appropriate conduct. It deters needless litigation and its

concomitant expense to sources and the taxpayers.

Even the Fifth Circuit's rule does not entirely eliminate

the harsh problems confronting sources as a result of EPA

delay. A source is still subject to penalties after the EPA's

ultimate decision, and the source risks that even slavish

compliance with the terms of a proposed SIP revision or DCO

may ultimately result in non-compliance with the State's SIP

if EPA eventually disapproves. For example, a State may

adopt a SIP revision calling for installation of a particular

type of control by a date certain, ¢.g., two years hence, with

increments of progress to be met along the way. A subject

source may thereafter expend millions of dollars installing

appropriate air pollution control technology, in full compli-

ance with the defined progress milestones, successfully

achieving compliance by the date certain. Then, perhaps

months later, the source may again become at risk if EPA

disapproves the proposed revision because the source is not in

compliance with the existing SIP. While the Fifth Circuit rule

has these burdensome shortcomings, it is the one which most

closely effectuates Congressional intent. Clearly, the EPA's

timely fulfillment of its responsibilities best adheres to that

intent and its underlying rationale.

B. THE RULES IN THE D.C., FIRST AND SIXTH CIR-

CUITS ARE BASED UPON ERRONEOUS

ASSUMPTIONS.

The final line of cases dealing with the failure of EPA to

timely fulfill its obligations includes the First Circuit's Gen-

eral Motors case at bench and the Sixth Circuit's decision in

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

upon the First Circuit's view. In U.S. v. General Motors, 876

F.2d 1060, the First Circuit addressed the consequences

resulting from EPA’s failure to honor its statutory obligation.

The court adopted a rule which places responsibility upon the

trial court to take the Agency's delay and any resultant preju-

dice to the source into consideration when determining the

appropriate amount of penalties to assess. The court indicated

a belief that this possible reduction in penalties would provide

EPA sufficient incentive to timely act.'5

Finally, the Sixth Circuit's decision in Alcan Foil Products

reviewed the D.C., Fifth and First Circuit approaches. Observing

that “the public should not suffer because of EPA’s failures,” the

Sixth Circuit adopted the First Circuit's rule that the amount of

civil penalties in an enforcement action may be adjusted to take

into account any prejudice to the source caused by EPA delay. '®

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

The Duquesne Light and General Motors lines of deci-

sions are predicated on erroneous assumptions. Each case

expresses the concern that the “public not be injured” through

impediment to EPA enforcement of an old SIP provision

while a revision is pending.'? While concern for the public

'S It seems unworthy, almost venial, that incentives for prompt EPA

action on SIP submissions should relate so overwhelmingly to the quan-

uty of penalties EPA can collect. Congressional mandates and the broader

policy impacts of delay are more appropriate incentives.

the Sixth Circuit failed to take into account the States’ primary respon-

sibility for enforcement, as well as the fact SIP revisions are enforceable

under State Law even before approval by the EPA.

'? These concerns are apparently not shared by the EPA. In a

memorandum to Regional Air Management Directors, Sheldon Meyers,

Director of EPA's Office of Air Quality Planning and Standards, sug-

gested the States be discouraged from submitting a SIP revision where the

delay sought to be accomplished by the revision will be less than the time

required for EPA to process the State's proposal. Since it often takes three

or more years for EPA to issue a decision, presumably EPA is not

interested in seeing SIP revisions, such as that issued to GM in the case at

bench, where the pollution ceases before EPA acts upon the proposal. See

“Source Specific SIP Revisions”, July 29, 1983, reprinted in EPA Clean

Air Act Compliance/Enforcement Guidance Manual, supra at 223-24.

welfare is always appropriate, the opinions have ignored the

legitimate expectations of the regulated community that EPA

will comply with the terms of the Act and deal fairly with the

regulated community and the States. The opinions of the

courts in these cases also expose a serious flaw in analysis:

the assumption that regulated sources will be uncontrolled or

unregulated if EPA is precluded from enforcing the existing

SIP.

As is apparent from the language of the Act itself, as well

as decisions of this Court interpreting the Act, the States have

primary responsibility for development and enforcement of

the regulations comprising the SIPs. The EPA’s enforcement

role is secondary. Train, 421 U.S. at 78-79. Once a State

adopts a SIP revision, it has the ability to enforce that regula-

tion under State law, even absent approval of the EPA. In

view of this and the State’s primary responsibility for air

pollution control, the public faces no risk because there would

be no unregulated sources of air pollution even during EPA's

extended review.

Perhaps even more distressing than the EPA's jaundiced

view is its apparent acceptance in at least some of the recent

judicial opinions addressing the issue. For example, in the

First Circuit's decision in the case at bench, the Court charac-

terizes the states’ motivation in these circumstances as “the

States’ interests in protecting its [sic] local industry.” 876

F.2d at 1067. The Court further characterizes the “states’

interests” as being in opposition to “the public's.” /d. at 1068.

That characierization is particularly ironic given the success

of Massachusetts in bringing GM's facility into an environ-

mentally superior operation.

The pejorative and oversimplified view inherent in such a

statement wholly disregards the tremendous labors exerted by

the States, as well as regional and local government units, to

advance the cause of environmental protection. If the States

give some consideration to the economic welfare of their

citizens and businesses, while trying to achieve environmen-

tal goals, that is their right and duty, as this Court firmly

recognized in the Train and Union Electric decisions. But to

recognize the States’ power to balance these competing inter-

ests is not to reduce them to the level of apologists for

pollution. Certainly the thousands of individuals and regu-

lated sources daily striving to comply with state law environ-

mental requirements, and to cope with the strong enforcement

tools of the states — including monetary penalties, judicial

injunctions, administrative variance and abatement orders,

and even criminal sanctions including imprisonment, would

not agree with the characterization suggested by the First

Circuit.

Underlying this judicial depreciation of the role and

motives of the States is an apparent misconception of the

enforceability of State environmental law. It should be clear,

but apparently it is not, that SIP provisions adopted by a State

are in force and enforceable under State law, regardless of

whether they are approved by the EPA. “Perhaps the most

important thing to recognize about state environmental law is

its independence of federal authority. . . .[S)tate environmen-

tal law is not simply a vestige operating with respect to

federal environmental law. Nor does state law operate solely

to ‘fill in the blanks’ set out in federal law. Rather, state law

ordinarily sets out a full program of regulation that may

include not only those elements needed for federal ‘authoriza-

tion’, but also numerous additional elements. . . .” Novick et

al., Law of Environmental Protection, § 6.01 at 6-3, 6-4

(1987). The concurring opinion in Alcan Foil Products plainly

does not understand this, as it refers to a “proposed revised

SIP” as having “no legal efficacy whatever.” The lawyer who

would advise his or her client that a new regulation, DCO, or

variance adopted by state air pollution authorities has “no

legal efficacy whatever” would be risking serious malpractice

liability.

California law is illustrative on this point. The California

Legislature delegated primary authority for developing com-

ponents of the SIP to the local air pollution control districts

(“APCDs”) within the State. Cal. Health & Safety Code

§ 41650(a). The APCDs are to adopt rules and regulations to

execute their powers and duties. Cal. Health & Safety Code

§ 40702. Determination of the APCDs as to the proper air

pollution control measures within their individual jurisdic-

tions is conclusive unless the State Air Resources Board

(“ARB”) determines otherwise after a public hearing. Cal.

Health & Safety Code §§ 41650-41652. The ARB is the air

pollution control agency for all purposes set forth in federal

law. Cal. Health & Safety Code § 39602. The ARB has the

responsibility for SIP submissions to EPA. 42 U.S.C.

§ 7407(a).

The violation of the rules and regulations of an APCD

may be punished either criminally (Cal. Health & Safety Code

§ 42400) or by civil penalties of up to $25,000 per day (Cal.

Health & Safety Code §§ 42400.1-42403). Obviously, a

source faces substantial state law sanctions for failing to

adhere to the requirements of local rules and regulations,

whether or not EPA has yet acted to approve them as part of

the SIP.

Also overlooked is the encouragement of litigation, and

the resultant additional burdens upon the federal courts, if the

approaches of the D.C., First, Second, or Sixth Circuits are

the adopted norm. Plainly, it makes little sense to condone

initiation of enforcement litigation against sources attemptung

to comply with new State regulations while an EPA decision

upon proposed revisions is overdue. If EPA is permitted to

initiate such actions, it has no incentive to issue a final

determination upon pending State revisions until after the

enforcement action is concluded, if then. EPA is able to usurp

the States’ primary role solely by ignoring its own mandate to

act. Similarly, the cases demonstrate that the initiation of an

action against the Administrator under § 7604 fails to incite

timely conduct on the part of EPA. This merely creates

another pointless item of litigation in the federal courts with-

out providing any guidance to the regulated community as to

appropriate conduct.

The First Circuit approach also tends to rewrite the Act.

The court is effectively saying that the failure to meet the

statutory deadline only matters if “prejudice” can be shown to

the source, but not otherwise. This is a dangerous approach to

enforcement of statutory deadlines, reading an escape clause

where Congress has not seen fit to provide one. While “preju-

dice” may not be demonstrable to an individual source, the

State’s whole regulatory approach may be harmed by EPA

delay, yet the First Circuit rule fails to take this into account.

Finally, “adjustment” of penalties, in order to take into

account the “prejudice” suffered by a source due to EPA

inaction, is an illusory sanction. A “penalty adjustment” obvi-

ously does not prohibit the initiation of an enforcement

action. In fact, § 7413(b) requires the initiation of an action

against the operator of a major source where the source

remains “in violation” of a SIP thirty days after being pro-

vided a Notice of Violation as provided by § 7413(a)(1). An

action may be initiated against the operator of a minor source

under these same circumstances. Thus, the mere issuance of a

Notice of Violation of an old SIP requirement, during the

pendency of a SIP revision, has significant consequences.

Sources are pushed down the slippery slope, inexorably

becoming subject to ihe not inconsiderable expense of litigat-

ing an enforcement action with the federal government. Even

assuming that at the conclusion of such litigation a court

determined the prejudice suffered by a source from EPA’s

delay was so great as to negate any award of civil penalties,

the source would necessarily have incurred substantial

defense costs and even public obloquy.

Settlement of civil penalties actions under these circum-

stances will likely be more complex and difficult than ever.

The EPA has published a civil penalty policy which provides

the strictures within which EPA and Justice Department per-

sonnel must operate in settlement discussions. The EPA has a

similar policy for calculation of § 120 noncompliance penal-

ties.1* These policies drastically limit the flexibility of the

18 See, e.g., “Clean Air Act Stationary Source Civil Penalty Policy,”

September 12, 1984, and “Settlement of Noncompliance Penalties Under

Section 120 of The Clean Air Act,” October 30, 1980, and April 2, 1981,

reprinted in —- EPA Clean Air Act Compliance/Enforcement Guidance

Manual, supra at 537-594, 639-641, 656-62. The application of these

(Continued on following page)

government to negotiate settlement dollar amounts in enforce-

ment actions initiated under §§ 7413 and 7420 of the Act.

1. The approach of the First and Sixth Circuits

ignores the practicalities of air pollution control

compliance under the Congressional scheme.

Consistent with the primary role of the States and local

government in control of air pollution, the day to day regula-

tion of sources is performed by State and local authorities. A

source’s understanding of its obligations and timetables for

compliance is largely, if not entirely, derived from those

authorities. Contact with EPA officials is rare; EPA’s activ-

ities under the Act are almost always in the background. This

is all entirely consistent with the intent of Congress and the

statutory scheme of the Act. “[T)he majority of lawyers work-

ing on environmental problems — either on a regular or an

occasional basis — deal in most instances with state law and

local regulations, rather than with federal law and agencies.

In part this is because the underlying federal statutes are

largely implemented at the state level. . . .” Selmi and Manas-

ter, supra, §1.01 at 1-1.

Day in and day out, air pollution sources — private indi-

viduals, small businesses, large corporations, municipalities,

even the federal Government’s own installations which pol-

lute — are trying to comply with the air pollution requirements

(Continued from previous page)

penalty policies is so restricting that once an action is initiated, the

government cannot dismiss the action without the defendant’s payment of

the minimum amount determined by performing the penalty calculation.

Hence, even if a source could ultimately convince EPA personnel of

extreme prejudice, the penalty policy does not permit the action to be

dismissed without payment. The addition of a new “prejudice” factor into

this penalty policy settlement mix will only further inhibit the ability of

prosecutor and defendant to come to a meeting of the minds as to a

settlement. Even if some resolution could be reached, the amount of

government effort expended could well exceed the effort that would have

been required to reach a timely decision on a SIP proposal in the first

place.

of the States. Members of the public, as individuals and in

organized environmental groups, regularly testify, lobby, peti-

tion, and otherwise participate in the regulatory efforts of

state-level environmental agencies. Certainly the public is

served by these regulatory efforts. It is myopic in the extreme

— looking hardly beyond the banks of the Potomac - to

believe that the States’ interests do not serve the public and

do not serve environmental protection. Such a perspective

does not correspond with reality. Nor does it correspond with

the allocation of power Congress embodied in the Clean Air

Act.

2. The practical results of the approaches taken by

the various Circuits can be clearly contrasted.

As this graphic comparison demonstrates, only the Fifth

Circuit rule provides an approach which is consistent with

Statutory intent.

First & Sixth

Fifth Circuit DC Circuit Circuits

1. Exposure to Exposure to Exposure to

penalties only penalties for the penalties for the

during statutory entire period EPA entire period EPA

review period and

if review takes

longer, exposed to

penalties only after

EPA decides.

Provides high

degree of incentive

for EPA to timely

decide.

Reduces incentive

for initiation of

actions before EPA

decides on SIP

revision.

takes to review SIP

proposal.

Provides no

incentive for EPA

to timely decide.

Enhances likelihood

of initiation of

EPA actions even

before EPA decides

on SIP revision.

takes to review SIP

proposal but allows

mitigation based

upon “prejudice” to

source.

Provides limited

incentive for EPA

to timely decide.

Enhances likelihood

of initiation of

EPA actions even

before EPA decides

on SIP revision.

4 Assumes states Assumes federal Assumes federal

have primary SIP government has government has

enforcement primary SIP primary SIP

5 Provides Allows EPA a Allows EPA a

disincentive for “pocket veto” of “pocket veto” of

EPA to attempt state regulation. state regulation

“pocket veto” of

state regulation.

IV.

CONCLUSION

The arguments in this case, and the pertinent decisions of

the Circuit Courts of Appeals, present competing interpreta-

tions of rather technical provisions of the Clean Air Act. The

discourse tends to become highly legalistic in nature, focus-

ing upon the terms of the Act as a discrete object of study.

But this case is neither an academic exercise nor a theoretical

exploration of the concept of federalism. This case reflects

the tremendous practical difficulties the Nation faces in

cleaning up the air we breathe, while at the same time pre-

serving the fundamental fairness of our legal system, the day-

to-day integrity of a system of shared federal-state govern-

mental power, and the ability of individuals and companies to

engage in business for the economic health and welfare of the

Nation without unpredictable regulatory obstacles and even

retroactive penalties being cast in their way.

Petitioner and amici have tried to illuminate the need for

this Court to firmly enforce the statutory deadlines Congress

established in the Clean Air Act. In a broad sense it is only

fair that the federal Government be required to abide by the

deadlines Congress has imposed under the Act, just as must

the States and just as must business entities regulated under

both that Act and state environmental legislation. It is diffi-

cult to imagine the coherent operation of a legal system which

accepts the rationalizations offered by EPA for the pattern of

delay at issue here. Obviously deadlines and procedural

niceiies are not always convenient. In the Hallstrom decision,

this Court rightly insisted upon enforcing Congressionally

chosen procedural prerequisites. The Court did not disregard

the statutory prerequisite to initiation of an action simply

because the citizen's zeal to litigate in the interest of environ-

mental protection would arguably promote the public good.

Similarly, EPA’s zeal to initiate enforcement litigation does

not justify judicial disregard of the procedural deadlines Con-

gress has written into the Act.

These statutory deadlines are not just optional frills and

extras included by the Legislative Branch to make sure fed-

eral bureaucrats keep busy. They reflect the real sharing of

power and responsibilities between the States and the federal

Government which Congress built into the Act. The Act can

only operate fairly, effectively, and efficiently if all partici-

pants — the States, the federal Government, regulated sources,

and citizens — are required to play by the defined rules.

Ironically, the EPA’s position in this case is an attempt to

rationalize for itself a broad disregard for the timetables

imposed by Congress upon the federal Government itself and

to claim the unbridled right to enjoy unlimited delay in

reviewing the States’ allowances of specific, time-limited

delays for regulated businesses. EPA’S overriding concern

appears to be maintenance of total freedom to seek monetary

penalties at any time, even from sources whose compliance

problems are solved and who are covered by pending and

unanswered SIP revisions.

It is obviously most desirable for the Court to resolve a

dispute of this sort on the basis of clear statutory language.

But as all parties appear to agree, this is a case in which

Congress has not spoken clearly on the appropriate remedy

for the EPA’s failure to adhere to the statutory deadlines. It

thus falls to the Court to implement the remedy which best

corresponds with the language, structure, and purposes of the

Act.

Amici have shown it is the Fifth Circuit position which

comports most closely with the Act and which will most fairly

and effectively honor the Congressionally prescribed rights

and needs of all participants in the statutory process. If EPA is

prevented from seeking penalties during the period of its

extra-statutory delay, the States will have the fullest oppor-

tunities to effect and enforce their chosen and evolving mix of

control strategies. Regulated sources and members of the

public will know with much greater certainty just what com-

pliance conduct is required at any given time. The EPA will

retain the right to issue its decisions whenever it wishes and

thereafter to pursue prospectively any appropriate penalties

for continuing violations.

Januafty 18, 1990

Respectfully submitted,

Lawrence J. Straw, Jr.

(Counsel of Record)

KENNETH A. MANASTER

Straw & Gi_MaRTIN

A ProressionaL Law CorporaTION

100 Wilshire Boulevard, Suite 1325

Santa Monica, California 90401

Telephone: (213) 395-5577

Counsel for Amici Curiae

Golden West Refining Company,

Environmental Audit, Inc., and

Security Environmental Systems, Inc.

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.