Amicus Curiae Brief — American Trucking Assns., Inc. v. Browner

[~“Sapreme Geurt, US.

FILED

6) JUL 21 2000

No. 99-1426

| CLERK

IN THE ee

Supreme Court of the United States

AMERICAN TRUCKING ASSOCIATIONS, INC., ef al.,

Cross-Petitioners,

v.

CAROL M. BROWNER, ADMINISTRATOR OF THE

ENVIRONMENTAL PROTECTION AGENCY, ef al.,

Cross-Respondents.

On Writ of Certiorari to the

United States Court of Appeals

for the District of Columbia Circuit

BRIEF OF AMICI CURIAE SENATOR ORRIN HATCH

AND REPRESENTATIVE TOM BLILEY IN SUPPORT

OF CROSS-PETITIONERS

LLOYD N. CUTLER CARTER G. PHILLIPS

C. BOYDEN GRAY ALAN CHARLES RAUL*

WILMER, CUTLER & PICKERING STEPHEN B. KINNAIRD

2445 M Street, N.W. , SIDLEY & AUSTIN

Washington, D.C. 20037 1722 Eye Street, N.W.

(202) 663-6000 Washington, D.C. 20006

(202) 736-8000

Counsel for Amici Curiae

July 21, 2000 *Counsel of Record

WILSON-EPES PRINTING CO., INC. — (202) 789-0096 — WASHINGTON, D. C. 20001

4 | oF

QUESTION PRESENTED

Whether the EPA Administrator is permitted, in setting a Na-

tional Ambient Air Quality Standard (“NAAQS”) under Section

109 of the Clean Air Act, to exercise her judgment by taking

account of considerations such as the cost-effectiveness and net -

benefits of alternative risk levels that would protect the public

health?

(i)

+ tte oN rte

TABLE OF CONTENTS

Page

QUESTION PRESENTED .......cccccecsecscsseserscescesescrssoeeess i

TABLE OF AUTHORITIES. .....0.cccccersessssecsessccesscrsseesees Vv

INTEREST OF AMICI CURIAE .........0.00.0.0csccsssssseesseees I

a I

SUMMARY OF THE ARGUMENT ...:.c:ccsccscscssecseseees 3

ena 5

I. THE CLEAN AIR ACT DOES NOT PRE-

CLUDE EPA’S CONSIDERATION OF ECO-

NOMIC AND NON-HEALTH FACTORS IN

SETTING AIR QUALITY STANDARDG........ 5

A. Lead Industries Irrationally Excluded Eco-

nomic Considerations From NAAQS Stan-

STITT scirscrtentennecsnansssnssssanesseseusecsessssecenes 6

B. The Statute Does Not Limit EPA’s Discre-

tion To Consider Cost-Effectiveness ........... 0)

1. Section 109 Calls For The Administra-

tor, In The Absence Of A Bright Scien-

tific Line, To Exercise “Judgement” In

Determining What Is “Requisite To Pro-

tect The Public Health” .................:cc000 9

2. EPA Relies On A Legally False Dichot-

omy That Purports To Allow Economic

Considerations For The Implementation

Phase But Not For Standard-Setting ...... 11

(iii)

iv

TABLE OF CONTENTS—Continued

3. The Legislative History Confirms That

Congress Did Not Intend To Limit

The Factors The Administrator May

COBRRSEGEP ccccccceseversssccscssesesssnsnseuessessseesenses

4. Lead Industries \s Inconsistent With

EPA’s Interpretation Of Analogous Pro-

visions Of The Clean Water Act............

5. Congress Did Not Intend To Depart

From Fundamental Principles Of Risk

Il. CONGRESS HAS NOT ACQUIESCED IN

LEAD INDUSTRIES ...000...cccscccsscccsscccesscepeosccssecs

Ill. OVERRULING LEAD INDUSTRIES WOULD ~

END THE NAAQS CHARADE .............cccceeeees

HIN LIUIIIIUIIN ..cccccccccccoceseccssccceseccssssesscsssonssscsssosssssssoese

Page

15

19

em em ee

Vv

TABLE OF AUTHORITIES

CASES Page

Adamo Wrecking Co. v. United States, 434 U.S.

PD Gr eR ccscmnscrsnmemmmeneemnennnete 6

American Textile Mfrs. Inst. v. Donovan, 452 U.S.

RD Gee rassssegeestnssenmenmmenneastnngneienntia 9

Board of Governors v. First Lincolnwood Corp.,

GaP Ge BPO Co ee nesses 9

Central Bank v. First Interstate Bank, 511 U.S.

BED Cr ee ncrnecsnamsscennessnsmemnemnenemnemnemennanies 23

Chapman v. Houston Welfare Rights Org., 441

ee Gi CBO i Prcsenseccsscenenenesnpscenesesememesssenmecses 11

Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 (1984) .......cccccceeeeeee 23

FDA v. Brown & Williamson Tobacco Corp., 120

Be GR, FES Gap cccenssnessnsnnsesccnensssnnssesssenssrenens 6, 22

Industrial Union Dep't, AFL-CIO v. American Pe-

troleum Inst., 448 U.S. 607 (1980) ...........cccec00e 10

Lead Indus. Ass'n v. EPA, 647 F.2d 1130 (D.C.

Ge, CRIED cnasnensnesnsmnsssenessemnsesmepesnmninemmnemersanate passim

Michigan v. EPA, No. 98-1497, 2000 WL 180650

GE. GRR, BER. FD, Dep rrncnsscenssssssnesseeesesees 9, 10, 24, 29

NLRB vy. Action Automotive, Inc., 469 U.S. 490

Cie cassnssesnsssnnssssonpsmsenetennsemensemmemmmnsnmnmrnantts 9

National Resources Defense Council, Inc. v. EPA,

824 F.2d 1146 (D.C. Cir. 1987)... ceceeeeeeeees 23

Public Lands Council v. Babbitt, 120 S. Ct. 1815

Gai ccnsenpsennmmnsnusecneremmeememnemnmmisenen 12

TVA V. Hill, 437 U.S. 153 (1978) ........:cccccceeseeeeees 11

Train v. Natural Resources Defense Council, Inc.,

GS WEE, Gp Gar Prcesccasnnssneemnmenenmnenn 28

Union Elec. Co. v. EPA, 427 US. 246

ET isnieseietnettenenstapaensisiiieinpiatnaspeintitpantutiiataais 5, 13, 17, 18

vi

TABLE OF AUTHORITIES—Continued

Vermont Agency of Natural Resources v. United

States, 120 S. Ct. 1858 (2000) ..........ccccceeeseeeeeees 24, 25

Watt v. Energy Action Educ. Found., 454 U.S. 151

| 9

STATUTES

Air Quality Act of 1967, Pub. L. 90-148, 81 Stat.

ee 15,17

Unfunded Mandates Reform Act, Pub. L. No. 104-

4, 109 Stat. 64 (1995) (codified at 2 U.S.C.

Qa 25

Small Business Regulatory Enforcement Fairness

Act, Pub. L. No. 104-121, 110 Stat. 847 (1996)

(codified at 5 U.S.C. § G04(D)) ........cccccccceeeeeeees 25

Departments of Veterans Affairs and Housing and

Urban Development, and Independent Agencies

Appropriations Act, 1997, Pub. L. No. 104-204,

0 0D Boat. FEPS ( IGPG .ccccccccccccsccsvsccsvssscsesscsssssees 3

2 UBL. § USSD) (2) ncccccscccercccccsccccssesessscssssscseesse 25

S UBC. © GGG aD Co recreccccssccscsesccssssecscsnsssssesessesesase 25

21 U.S.C. § S4B(CH3MA) .......sscerrcerrseersseeseeeerereeees 5

SD UBL. B FSD OGRD cccccscccesessccssesesscssesesessscesessssessse 19

QQ 19

4B UB. 8 PER OGRD cccccccsnsccssscccssessvssscversssessssseseeees 1]

(yyy 10, 12, 18, 21, 22

(‘Fai recsnsssesecnsssnssssceesessenscensacensasesnasenees passim

OB FI censensnscsscsssenccssuamensonstnsssssscnssunsanes 12, 24

Q a 22, 25

ORDER AND REGULATIONS

Exec. Order No. 12866, reprinted in 1993

UCLA, BiB cccccccsssccssssszssssesssesscsnsssesscsesenss 8

eee

vii

TABLE OF AUTHORITIES—Continued

Page

Memorandum of July 16, 1997, 62 Fed. Reg.

FTE D asecsneseessmemsemmmncememesnmmannienemmenenenens 28

eS |) Se 20

48 Fed. Reg. 51,405 (1983).........ccccccsseeseeeeeneeenes 19

Implementation Plan for Revised Air Quality Stan-

dards, 62 Fed. Reg. 38,423 (1997) .........ccccccseees 27

National Ambient Air Quality Standards for Par-

ticulate Matter; Final Rule, 62 Fed. Reg. 38,651

CBG U Pesncssanssacesnmnsneusnecsnsssesveseshnessonsnennens 2, 3, 23, 26, 27

National Ambient Air Quality Standards for

Ozone; Final Rule, 62 Fed. Reg. 38,855

QIU W Pcasescenssccscccnssvsserecensesasesnnsesemeeneenessnennsneseans 2, 26

COURT RULES

I GR, Gi. Bee cntoncnncnnnssssscnscenssncsonasemessemisnmassenenese l

Tae Ute Sal crneesenctinciticaneeiemmeniinonipensinnemuienines l

LEGISLATIVE HISTORY

Hearings Before the Subcomm. on Pub. Health and

Welfare (1969), reprinted in 2 Committee on

Pub. Works, 93d Cong., A Legislative History of

the Clean Air Act Amendments of 1970 (Comm.

PORE GUD comenssnesesevansnecssnannnsensemecntenatecnmenneies 16

Hearings Before the Subcomm. on Air and Water

Pollution (1970), reprinted in 2 Committee on

Pub. Works, 93d Cong., A Legislative History of

the Clean Air Act Amendments of 1970 (Comm.

FURS FD censrecssnsnsssspnssenssssnsessocsnsssnessnscesenssnsese 16, 17

H.R. Rep. No. 95-294 (1977)......cccccssesssesseeseeeeeeees 18

H.R. Rep. No. 101-490 (1990) .........cccceeeeeeeeeeeeees 6

H.R. Conf. Rep. No. 104-812 (1996) ..........cccceeee 3

S. Rep. No. 90-403 (1967) .....cccccccccceseseccecsesesessesees 15

S. Rep. No. 91-1 196 (1G7D) ....ccccccccscecccccsessecseeoseees 5

Vili

TABLE OF AUTHORITIES—Continued

House Debate on H.R. 17255 (June 10, 1970), re-

printed in 2 Committee on Pub. Works, 93d

Cong., A Legislative History of the Clean Air

Act Amendments of 1970 (Comm. Print 1974)

(remarks of Rep. Springer).............cccsseeseeeeeees

Senate Debate on S. 4358 (Sept. 21, 1970), re-

printed in | Committee on Pub. Works, 93d

Cong., A Legislative History of the Clean Air

Act Amendments of 1970 (Comm. Print 1974)

(remarks Of Sen. Muskie)...........:cccseccseseeseeeeeeees

Senate Debate on S. 4358 (Sept. 22, 1970), re-

printed in | Committee on Pub. Works, 93d

Cong., A Legislative History of the Clean Air

Act Amendments of 1970 (Comm. Print 1974)

(remarks of Sen. Randolph) .............:::ccceceeeeeeees

Senate Debate on S. 252 (June 8, 1977), reprinted

in 3 Committee on Env’t and Pub. Works, 95th

Cong., A Legislative History of the Clean Air

Act Amendments of 1977 (Comm. Print 1978)

(remarks of Sen. Muskie).............ccscssseeeeeeeeeees

Senate Debate on S. 252 (June 10, 1977), reprinted

in 3 Committee on Env’t and Pub. Works, 95th

Cong., A Legislative History of the Clean Air

Act Amendments of 1977 (Comm. Print, 1978)

(remarks Of Sen. Muskie)............ccccceseeeeeeeeees

SCHOLARLY AUTHORITIES :

C. Boyden Gray, The Clean Air Act Under Regula-

tory Reform, \1 Tul. Envtl. L.J. 235 (1998) ......

Jan C. Semenza et al., Heat-Related Deaths During

The July 1995 Heat Wave in Chicago, 335 New

Eng. J. Med. 84 (1996)........ccccccssseseseeesseeeseneees

Page

18

~ 17

18

22

18

12

12

a

ati 4

ix

TABLE OF AUTHORITIES—Continued

Page

Wendy E. Wagner, The Science Charade in Toxic

Risk Regulation, 95 Colum. L. Rev. 1613

OTHER AUTHORITIES

Budget of the United States Government: Fiscal

FP FES (OSU GP cccccecensssecssenserecssenccscsnsessensnsecese 3

Board on Env’tl Studies & Toxicology, National

Research Council, Research Priorities for Air-

borne Particular Matter: I. lmmediate Priorities

and a_ Long-Range Research Portfolio

GUGD concenssssssesssevessssehessecssvsneenssenassesessssanenssenies 3

Stephen A. Breyer, Breaking the Vicious Circle

FPG ccssecesdseessccsensevencansveccssnemnensusvenvasensssnensent 20, 21, 26

EPA, Safeguarding the Future: Credible Science,

Credible Decisions (1992) ......ccccccescceeeeeeeeseeeeees 26

EPA, Water Quality Standards Handbook (2d ed.

Harvard Sch. of Pub. Health Presentation for the

Monthly Meeting of Dep’t Chairs, Definition of

Public Health Practice (May 23, 1997)

<http://www.hsph.harvard.edu/php/presentation/

GEREUEDIITD .ccscccenscccssecccccnssccssssnccncssesscvesscsessnees 7

Innovative Strategies and Econs. Group, EPA,

Regulatory Impact Analysis for the Particulate

Matter and Ozone National Ambient Air Quality

Standards and Proposed Regional Haze Rule

x

TABLE OF AUTHORITIES—Continued

Innovative Strategies and Econs. Group, EPA,

Draft Document, Regulatory Impact Analysis for

Proposed Particulate Matter National Ambient

Air Quality Standard (Dec. 1996)...

National Research Council, Risk Assessment in the

Federal Government: Managing the Process

CRIED crssasesensannsnnsinsunnndinbinineniasitinaianteitininaine

National Research Council, Science and Judgment

in Risk Assessment (1994) ......ccccccccsccseeeeeseeeeeeees

Office of Air Quality Planning and Standards, Re-

view of the National Ambient Air Quality Stan-

dards for Particulate Matter, Policy Assessment

of Scientific and Technical Information

OMB, Report to the President on the Third Anni-

versary of Executive Order 12866, Chapter 3

(Dec. 1996) <http://www.whitehouse.gov/

OMB/inforeg/3_year_report.html>............00006

President Clinton’s Council on Sustainable

Dev., Sustainable America: A New Con-

sensus for the Prosperity, Opportunity

and a Healthy Environment for the Future

(Feb. 1996) <http://www.whitehouse.gov/PCSD/

Publications/TF_Reports/amer-chap.2.html>....

2 The Presidential/Congressional Comm’n on Risk

Assessment and Risk Management, Final Re-

port: Risk Assessment and Risk Management in

Regulatory Decision-Making (1997) .........00000+

| William H. Rodgers, Jr., Environmental Law: Air

GU CRO CHD cetacean

2 William H. Rodgers, Jr., Environmental Law: Air

GING CE? COED ceneteeminmenns

Page

28

20

xi

TABLE OF AUTHORITIES—Continued

Page

Letter from George Wolff, Chair, CASAC, ‘to

Carol Browner, Administrator, EPA (Nov. 30,

FOP cnetnsssesentsseneenenesmmemansenntnntnsnasememmensemnasstenn 2

INTEREST OF AMICI CURIAE '

Amicus Orrin Hatch is a Member of the United States Senate

from Utah, and amicus Tom Bliley is a Member of the United

States House of Representatives from Virginia. Amici are both

concerned that the Environmental Protection Agency’s (“EPA”)

implementation of the Act is contrary to congressional will and

frustrates effective congressional and judicial oversight. Be-

cause EPA has been hamstrung by an erroneous judicial prece-

dent that irrationally prevents the agency from considering the

cost effectiveness of its regulations, EPA engages in a science

charade wherein policy and economic judgments are masked as

scientific determinations, and makes unreviewable regulatory

determinations that undermine the statutory scheme.

INTRODUCTION

Section 109 of the Clean Air Act, 42 U.S.C. § 7409, unques-

tionably gives EPA a far-reaching mandate to protect the public

health from dangerous air pollutants. The only issue in this case

is whether the Act imposes a regime of regulatory irrationality

and profligacy on the states and the American public, and for-

bids the EPA Administrator to apply the full range of her expert

judgment to determine what standards are requisite to protect

the public health. The Act does give the Administrator that dis-

cretion, despite the contrary decision of the Court of Appeals for

the District of Columbia Circuit in Lead Industries Association

v. EPA, 647 F.2d 1130(D.C. Cir. 1980). That misguided prece-

dent held that the Administrator was precluded from considering

the cost-effectiveness or net benefits of a particular NAAQS in

' Pursuant to Rule 37.6 of the Rules of this Court, amici state that no

counsel for any party authored this brief in whole or in part, and that Citizens

for a Sound Economy has made a monetary contribution to the preparation —

and submission of this brief. The parties have consented to the filing of this

brief. Letters evidencing such consent have been filed with the Office of the

Clerk of this Court. See Sup. Ct. R. 37.3.

2

exercising judgment to protect the public health, and instead

must set NAAQS solely on the basis of the health effects of the

pollutant itself. /d. at 1147-55.”

Applying the Lead Industries rule, in 1997, EPA issued a new

and more stringent primary NAAQS level for ozone that would

entail an incremental cost of up to $9.6 billion annually to attain,

even though EPA valued the expected benefits of attainment at

only $1.5 to $8.5 billion.’ Yet, scientific evidence of dangers to

public health from ozone did not drive this hugely consequential

regulatory decision. After reviewing the available data and

various alternative NAAQS (including maintaining the existing

standard), the Clean Air Scientific Advisory Committee

(“CASAC”) advised EPA that “there is no ‘bright line’” distin-

guishing any of the alternatives as “significantly more protective

of public health.”

EPA’s rulemaking for particulate matter (“PM”) was equally

dubious. EPA for the first time established a NAAQS for the

finer fractions of PM (particles with a diameter of 2.5 microns

and less, referred to as PM25). EPA took that step despite its

” EPA has endorsed Lead Industries as reflecting its view of section 109,

but also regards it as binding precedent from which it has no discretion to

depart. National Ambient Air Quality Standards for Particulate Matter, Final

Rule, 62 Fed. Reg. 38,651, 38,683-89 (1997) (“PM Rule” ); National Ambi-

ent Air Quality Standards for Ozone; Final Rule, 62 Fed. Reg. 38,855,

38,878-83 (1997) (“Ozone Rule” ). The court below likewise regarded Lead

Industries as binding. Pet. App. 15a.

* Innovative Strategies and Econs. Group, Regulatory Impact Analysis for

the Particulate Matter and Ozone National Ambient Air Quality Standards

and Proposed Regional Haze Rule ES-\12, ES-17 (1997) (“Final RIA”).

Given Lead Industries, EPA considers itself legally precluded from using this

analysis in setting NAAQS. /d. at ES-3.

* Letter from George Wolff, Chair, CASAC, to Carol Browner, Adminis-

trator, EPA, 3 (Nov. 30, 1995) (regarding CASAC closure on the primary

standard portion of the staff paper for ozone).

3

acknowledgement of the “significant uncertainties” surrounding

the health effects of PM,° PM Rule, 62 Fed. Reg. at 38,655, and

despite Congress’s funding of a large new research program to

resolve scientific uncertainty about PM2s,° accompanied by an

admonition to EPA characterizing promulgation of new PM

standards as “premature.” H.R. Conf. Rep. No. 104-812, at 70

(1996). EPA predicts (conservatively) that the annual national

incremental cost of partial attainment with the new PM standard

will be $8.6 billion, with full attainment by the year 2010 reach-

ing $37 billion annually. Final RIA at ES-12 to ES-13.

SUMMARY OF THE ARGUMENT

If Lead Industries were correct, section 109 of the Act would

be the odd statutory mandate that precludes the balancing of

economic considerations and weighing of relative harms neces-

sary to produce regulation in the public interest. The text and

history of section 109 make clear that Congress did not in 1970

mandate such an extreme departure from basic tenets of sound

risk management. Rather, the broad textual authority for the

Administrator to set national standards for pollutants “that rea-

* EPA staff, the National Research Council, the Congress, and the Presi-

dent have all emphasized the “unusually large uncertainties” that make prom-

ulgation of a PM, ; standard problematic. Office of Air Quality Planning and

Standards, EPA, Review of the National Ambient Air Quality Standards for

Particulate Matter, Policy Assessment of Scientific and Technical Informa-

tion VII-41 (1996); Board on Env’tl Studies & Toxicology, National Re-

search Council, Research Priorities for Airborne Particular Matter: 1. lmme-

diate Priorities and a Long-Range Research Portfolio 1, 2 (1998); H.R.

Conf. Rep. No. 104-812, at 70 (1996) (noting, prior to rulemaking, that there

were “insufficient data available for the Agency to decide what changes, if

any, should be made to the current standard”); Budget of the United States

Government: Fiscal Year 1998, at 81 (1997) (President requests research

funds to “reduce the great uncertainty about PM's health effects”).

* Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 1997, Pub. L. No. 104-204,

tit. HI 110 Stat. 2874, 2909-10 (1996).

4

sonably may be anticipated to endanger public health and wel-

fare,” to exercise her “judgment” in setting standards “requisite

to protect the public health,” to determine what margins of

safety are “adequate,” to modify such standards after public

comment as she deems “appropriate,” all suggest that the Ad-

ministrator is to apply her full expertise (in health sciences, en-

vironmental technology, and the socioeconomic effects of pollu-

tion and its control) in selecting from among alternative health-

protective standards. There is simply no basis in the statute for

EPA’s false dichotomy between the setting of standards, which

EPA claims must be free of any economic influence, and the

implementation phase, which EPA claims is the unique moment

when economic factors may be considered. The text and legis-

lative history confirm that, in the absence of a determinate

scientific answer as to when the public health is clearly endan-

gered, Congress intended for the Administrator to consider the

same factors in setting public health standards as the states did

under the Air Quality Act of 1967.

Economic considerations such as cost-effectiveness are fun-

damental, non-controversial elements of risk management that

Congress, the Administration, and in analogous contexts, EPA,

have all embraced. Nothing in section 109 precludes considera-

tion of these factors by the Administrator in setting NAAQS.

Contrary to EPA’s claims that Congress has by acquiescence

ratified Lead Industries, subsequent legislation in the 1990s, in-

cluding amendments to the Act itself, suggest that section 109

must be interpreted to favor the promulgation of cost-effective

regulation.

Most fundamentally, adherence to Lead Industries has tuned

the NAAQS process into a charade. EPA does consider costs

and balance harms when it sets a NAAQS, albeit covertly. It

simply masks such judgments as scientific decisions, thus frus-

trating judicial, congressional, and public oversight. See Wendy

E. Wagner, The Science Charade in Toxic Risk Regulation, 95

Colum. L. Rev. 1613, 1617 (1995). Moreover, despite the clear

5

purpose of the Act to achieve attainment of national standards,

EPA has effectively abandoned any attempt to do so. Having

set untenable standards under the Lead Industries approach,

EPA has devised—without statutory authorization, without ex-

plication of its reasons or evidence, and without effective judi-

cial or congressional review—arbitrary cost caps on source

compliance that will subvert attainment. The will of Congress

is undone, and EPA has effectively drawn its own charter. This

Court should overrule Lead Industries to revive the rational

scheme Congress devised, and to permit the EPA to consider all

factors relevant to the proper level of NAAQS when science

does not provide a clear answer.

ARGUMENT

I. THE CLEAN AIR ACT DOES NOT PRECLUDE

EPA’S CONSIDERATION OF ECONOMIC AND

NON-HEALTH FACTORS IN SETTING AIR

QUALITY STANDARDS.

The Clean Air Act, and its history, evince Congress's inten-

tion to authorize extraordinary measures to safeguard the public

health from the dangers of air pollution. They do not support

the conclusion that section 109 is like the well-known “Delaney

Clause,”” a categorical ban of carcinogenic additives that pro-

hibited the exercise of any policy judgment.

To be sure, this Court rightly characterized the original Act as

technology-forcing’ ” and “expressly designed to force regu-

lated sources to develop pollution control devices that might at

the time appear to be economically or technologically infeasi-

ble.” Union Elec. Co. v. EPA, 427 U.S. 246, 257 (1976) (quot-

ing Train v. Natural Resources Defense Council, Inc., 421 U.S.

60, 91 (1975)); see also S. Rep. No. 91-1196, at 2-3 (1970);

“we

’ See 21 U.S.C. § 348(c3)(A) (“no additive shall be deemed to be safe if

it is found to induce cancer when ingested by man or animal”).

6

H.R. Rep. No. 101-490, Pt. 1, at 145 (1990). But, with scant

textual analysis and misplaced reliance on legislative history,

Lead Industries \eapt from the incontrovertible proposition that

Congress placed no feasibility constraints on the EPA’s ability

to protect the public health to a far more radical and unsup-

ported conclusion: namely, that the Act banishes o») considera-

tion of economic consequences from EPA's weighing of the ap-

propriate risk levels, in the face of scientific uncertainty, that

would protect the public health with an “adequate” margin of

safety. 647 F.2d at 1148-56. A “survey of the totality of the

statutory scheme” of the Clean Air Act, Adamo Wrecking Co. v.

United States, 434 U.S. 275, 284 (1978), manifests the error of

Lead Industries.

A. Lead Industries Irrationally Excluded Economic

Considerations From NAAQS Standard-Setting.

This Court's task is to “interpret the statute as a symmetrical

and coherent regulatory scheme, and fit, if possible, all parts

into an harmonious whole,” leavening its interpretation with

“common sense as to the manner in which Congress is likely to

delegate a policy decision of ... economic and political magni-

tude to an administrative agency.” FDA v. Brown & Williamson

Tobacco Corp., 1208. Ct. 1291, 1301 (2000) (internal quotation

marks and citations omitted). Cost-effectiveness is a matter of

common sense, and nothing in the text of the Act—or for that

matter its history, structure, or purposes—ordains the result of

Lead Industries and prohibits EPA from protecting the public

health in a cost effective manner.

While public health trumps private costs under the Clean Air

Act, “public health” is, like nearly everything else in regulatory

life, relative. It turns on the statistical incidence of various

health hazards spread out over disparate sub-populations com-

prised of differentially exposed, susceptible, and sensitive indi-

viduals with varying degrees of acute, chronic, and reversible

disease or discomfort. Under some circumstances, the available

7

data will be so clear-cut, and the risk breakpoints so bright, that

“protect[ing] the public health” with “an adequate margin of

safety” reduces to an exercise in pure science. That is not the

case for the NAAQS in question. For ozone, as noted above,

EPA's own scientific advisers reported the absence of a “bright

line.” For particulate matter, the risks are greater, but are so rife

with the uncertainty acknowledged by EPA, the President, and

Congress that they may have no impact on public health at all.

Overruling Lead Industries would thus not displace the “pub-

lic health” mandate. It would preserve that mandate by main-

taining EPA’s authority to abate any significant health risks,

while obligating EPA to consider and disclose the point on the

continuum of relative protection where it believes the public

health is best served. Cost-effective environmental protection is

not a matter of saving business or government money; it is a

public health benefit to spend the amount of money that is

needed, and not more, to abate significant public health risks.

Protection of the public health necessarily involves “the rational

management and equitable distribution of health care re-

sources.” Money not wasted can be redirected to produce

other environmental, health, and safety benefits.

Lead Industries’ exclusion of economic considerations from

environmental decision making was not only erroneous when

decided, as will be demonstrated below, but the decision also

stands decidedly out of the mainstream of environmental policy.

The Lead Industries straitjacket is fundamentally at odds with

the nearly universal understanding, shared by the current Ad-

minisiration, that overall social well-being suffers “if environ-

mental protection strategies deliver low results at a high cost.

Resources for other economic and social needs will be diverted

“ Harvard Sch. of Pub. Health Presentation For The Monthly Meeting Of

Dep't Chairs, Definition of Public Health Practice (May 23, 1997)

<http://www.hsph. harvard.edu/php/presentation/tsId002.htm>.

if strategies to achieve environmental goals are not designed to

achieve results in the most cost-effective way.” ” The President

has issued an executive order requiring, among other things, the

“design [of] regulations in the most cost-effective manner to

achieve the regulatory objective.” Exec. Order No. 12866, re-

printed in 1993 U.S.C.C.A.N. B82, B83 (1993). That Order

opens with a proposition that explains precisely why Lead In-

dustries is misguided and must not survive:

The American people deserve a regulatory system that

works for them, not against them: a regulatory system that

protects and improves their health, safety, environment,

and well-being and improves the performance of the econ-

omy without imposing unacceptable or unreasonable costs

on society ....

Id. at B82. The Office of Management and Budget (“OMB”)

minced no words in affirming the same principle: “The use of

sound economic analysis in the design of regulations, such as

the benefit-cost and cost-effectiveness analyses called for in

E.O. 12866, is vital to generating maximum health, safety, envi-

ronmental, and other benefits to society from the limited

resources available.” OMB, Report to the President on the

Third Anniversary of Executive Order 12866, Chapter 3

(Dec. 1996) <hitp://www.whitehouse.gov/OMB/inforeg/

3_year_report.html>."” But as “vital” as such economic consid-

erations are to generating maximum health and environmental

benefits, Lead Industries would allow none of them. It had no

warrant in the statute for doing so.

” President Clinton's Council on Sustainable Dev., Sustainable America:

A New Consensus for the Prosperity, Opportunity and a Healthy Environ-

ment for the Future (sic) (Feb. 1996) <http://www.whitehouse.gov/

PCSD/Publications/TF_Reports/amer-chap2.html>.

Congress has also codified cost-effectiveness principles in legislation

discussed infra, at 24-25. -

9

B. The Statute Does Not Limit EPA’s Discretion To

Consider Cost-Effectiveness

This Court does not lightly imply limits in statutes on the fac-

tors an administrative agency may consider in pursuing its statu-

tory mandate. See, e.g., NLRB v. Action Automotive, Inc., 469

U.S. 490, 497 (1985); Watt v. Energy Action Educ. Found., 454

U.S. 151, 168 (1981); Board of Governors v. First Lincolnwood

Corp., 439 U.S. 234, 245-46 (1978). Given the importance of

costs to sound risk management in health-and-safety regulation,

it is always presumed that the implementing agency may con-

sider them unless there is “a rather express congressional direc-

tion” to the contrary. Michigan v. EPA, No. 98-1497, 2000 WL

180650, at *12 (D.C. Cir. Mar. 3, 2000). No such direction can

be gleaned from section 109.

1. Section 109 Calls For The Administrator, In

The Absence Of A Bright Scientific Line, To

Exercise “Judgment” In Determining What Is

“Requisite To Protect The Public Health.”

As more fully explored in the briefs of cross-petitioners, the

text of section 109 neither contains nor suggests any strict limi-

tation on the factors EPA may consider in determining the pre-

cise numeric level at which to seta NAAQS. Congress specifi-

cally provided that the level of standards is a matter for “the

judgment of the Administrator,” to be modified as she deems

“appropriate” after public comment. 42 U.S.C. § 7409(b)(1),

(d)(1). See American Textile Mfrs. Inst. v. Donovan, 452 U.S.

490,512 (1981) (finding such language to suggest wide discre-

tion to consider any factor, including costs, absent contrary

statutory directive). To be sure, the Administrator’s judgment

must be based on the section 108 air-quality criteria, 42 U.S.C.

§ 7409(b)(1), but this requirement does not dictate that the Ad-

ministrator only consider one type of factor (disease incidence)

and not others (e.g., cost-effectiveness of alternatives for pro-

moting health) in choosing among various standards that would —

10

be consistent with those criteria. Nor can such a limitation on

the Administrator’s judgment be implied from the requirement

that she pick a standard “requisite to protect the public health,”

id. Unlike a “Delaney Clause” straitjacket, the Clean Air Act

calls for judgment and balance, not mechanical application. In

selecting what treatment prescribe is “requisite” to ensure the

patient’s health, a good doctor would consider not only how the

disease would respond to each treatment, but how the patient’s

overall health and quality of life would be affected. Congress

expected no less of the Administrator.

That Congress gave the Administrator freedom of judgment

in choosing among health-protective standards is confirmed by

the limitation on EPA’s power to set NAAQS only for pollut-

ants “which may reasonably be anticipated to endanger public

health or welfare,” 42 U.S.C. § 7408(a)(1)(A) (emphasis added),

and by section 109’s directive that the Administrator “allow[] an

adequate margin of safety” in setting the standard, id.

§ 7409(b)(1). Such “safety” and “reasonableness” language

suggests that Congress intended EPA to make inherently eco-

nomic judgments about the relative significance of the risks in

question. See /ndustrial Union Dep't, AFL-CIO v. American

Petroleum Inst., 448 U.S. 607, 642 (1980) (plurality); Michigan,

2000 WL 180650, at *11-*12. Furthermore, while Lead Indus-

tries correctly noted that the margin-of-safety provision re-

flected concern over scientific uncertainty, 647 F.2d at 1150,

such concern cannot explain why Congress gave the

Administrator the discretion to choose any margin of safety that

she deems “adequate.” In enacting this language in 1970,

Congress clearly did not mean for the Administrator to choose

the most stringent health-protective margin of safety, as she

would if she were considering only narrow health data. Con-

gress was instead giving the Administrator discretion to

consider all relevant factors.

Thus, nothing in section 109 requires the Administrator to

blind herself to economic considerations and cost-effectiveness

in choosing among relatively health-protective standards. Such

a reasoned approach is fully consonant with the Act, which, sig-

nificantly, declares that “[a] primary goal of this chapter is to

encourage or otherwise promote reasonable Federal, State, and

local government actions, consistent with the provisions of this

chapter, for pollution prevention,” 42 U.S.C. § 7401(c) (empha-

sis added), and seeks to enhance not only “the public health and

welfare” but also the “the productive capacity of its population.”

Id. § 7401(b)(1). See Chapman vy. Houston Welfare Rights

Org., 441 U.S. 600, 608 (1979) (statute should be interpreted

“in light of the purposes Congress sought to serve”).'!

!

2. EPA Relies On A Legally False Dichotomy

That Purports To Allow Economic Consid-

erations For The Implementation Phase But

Not For Standard-Setting.

The broad language of section 109 does not support the nar-

row Lead Industries rule “barring EPA from considering any

factor other than ‘health effects’ relating to pollutants in the air.”

Pet. App. 15a. In defending Lead Industries, the Government

tries to sap section 109 of its proper vitality in two ways: by

importing a limitation from section 108 that Congress left out of

section 109, and by limiting to section 110, which governs state

implementation plans, the cost-effectiveness and other practical

considerations that properly belong in section 109.

The Government contends that the broad term “public health”

in section 109 is limited to the “health effects” specified in

'' The Lead Industries court felt it necessary to follow the advice given by

this Court in TVA v. Hill, 437 U.S. 153 (1978), to reject the invitation to

“view the. . . Act ‘reasonably,’ ” id. at 194. See 647 F.2d at 1150-51. But

Hill was a case in which completion of the costly Tellico Dam was irrecon-

cilable with the statutory goal of saving the endangered snail darter. By con-

trast, considerations of cost-effectiveness are intrinsic, not opposed, to pro-

tection of the public health.

12

108(a)(2), which calls for the development of scientific criteria

regarding the health effects which “may be expected from the

presence of such pollutant in the ambient air.” 42 U.S.C.

§ 7408(a)(2). See U.S. Opp. 10 (“Section 108(a)(2) makes no

mention whatsoever of effects from implementing the

NAAQS— it mentions only effects resulting from the presence

of a criteria pollutant in the air”). But that construction renders

Congress's choice of broader language in section 109 a nullity,

and violates the canon of construction that Congress uses dis-

tinctive words in the same statute for a purpose. Public Lands

Council v. Babbitt, 120 S. Ct. 1815, 1826 (2000). Congress in-

tended the primary NAAQS to be based on the section 108 crite-

ria, see 42 U.S.C. § 7409(b)(1), but chose broader language to

give rein to the Administrator's expert regulatory judgment.

Any interpretation suggesting that the Act's public-health man-

date prohibits the Administrator from considering health trade-

offs is unreasonable and must be rejected.'”

The Government also attempts to bleed section 109 of its con-

tent by contending that “costs or [other] alleged adverse ef-

fects,” U.S. Opp. at 10, from compliance with a NAAQS come

into play only at the implementation stage of section 110 of the

Act, 42 U.S.C. § 7410, where “Congress provided the States

'? For example, there is no conceivable reason why Congress would pre-

clude EPA from taking into account evidence that further reductions of ozone

may exacerbate ultraviolet radiation, and perhaps result in a net increase in

cancer. C. Boyden Gray, The Clean Air Act Under Regulatory Reform, \\

Tul. Envtl. LJ. 235, 253-54 (1998). Moreover, a rational regulatory scheme

would allow EPA to consider the substitution health risks (such as increased

heat-related deaths) of more expensive air conditioning as utilities pass

through NAAQS-related costs. See Jan C. Semenza et al., Heat-Related

Deaths During The July 1995 Heat Wave in Chicago, 335 New Eng. J. Med.

84, 87 (1996) (finding air-conditioning access to be the single greatest pro-

tection from heat-related mortality, reducing it by 80%); Gray, supra, at 254-

56 (recounting evidence that the poor will reduce their air conditioning usage

to save money, with deadly consequences).

a

13

with flexibility in the implementation process to consider the

economic and technical feasibility of attainment.” U.S. Opp. at

13. According to the Government, given this scheme of state-

by-state flexibility, it “would make little sense if EPA had to

promulgate NAAQS based on an analysis of costs and related

implementation factors at the outset of the regulatory process.”

Id. at 12.

There is, however, nothing in the statutory scheme or in-com-

mon sense which postpones assessment of the public health

issues (as distinguished from the simpler pollutant-related ef-

fects) from section 109 to 110. As the detailed requirements of

section 108 make abundantly clear, section 109 does not consti-

tute the “outset of the regulatory process,” but follows a very

lengthy fact-gathering process designed to inform the rulemak-

ing. Moreover, the Government’s premise—that states indi-

vidually have flexibility under section | 10 to cope with the total

public health and economic impact of the NAAQS—is way off

base. As this Court noted in Union Electric, section 110 only

permits states to consider costs in allocating industry burden if

to do so would not interfere with meeting an attainment dead-

line. 427 U.S. at 268. But full attainment never occurred with

the old ozone standard, and EPA does not foresee it for the new

ozone standard or the new PM2> standard. See infra at 27-29.

Put another way, in the Government's view economics may be

considered only when they don’t really matter—i.e., when a

state is in attainment and its economy is not under stress.'”

Moreover, allowing state-by-state cost-related adjustments in

'* The Government acknowledges as an afterthought that the limits of Un-

ion Electric retlect the fact that Congress “reserved to itself the prerogative

of deciding—as a matter of legislative choice—whether and how to alter the

statutory scheme if public health needs should prove to conflict with an in-

dustry’s economic viability.” U.S. Opp. at 13-14. But Congress did not put

EPA in a straitjacket, and, as we show below, EPA does in fact exercise its

own judgmerit to relax attainment goals on the basis of economic factors. See

infra at 27-29.

14

the absence of full attainment would permit states to gain unfair

advantage over competing states by imposing lower compliance

costs, and would create impossible demands on downwind

states, a condition Congress expressly prohibited in the 1990

Amendments. See infra at 24.

EPA’s reading of the statute also conflicts with a telling pro-

vision of Section 109 added in the 1977 Amendments, but ig-

nored by Lead Industries. This new provision, Section

109(d)(2), provides that CASAC must advise EPA about,

among other things, “any adverse public health, welfare, social,

economic or energy effect which may result from various strate-

gies for attainment and maintenance of such” NAAQS. 42

U.S.C. § 7409(d)(2)(C). The court below, bound by Lead

Industries, dismissed the relevance of this provision by ruling

that the “advice required in Section 109(d)(2)(C)(iv) is pertinent

only to the EPA’s duty under Section 108 to provide the States

with control strategy information.” Pet. App. 21a. But this is

plainly wrong, for nothing in the text or logic of the statute con-

fines CASAC’s advice to the states only. The court cites section

109(d)(1) as authority for the state-advice limitation, id., but that

section says nothing about either the states or subsection (d)(2).

Indeed, it is counterintuitive as well as countertextual to exclude

the advice CASAC is required to provide under 109(d)(2) from

section 109’s standard-setting process. This is simply another

case of EPA donning blinders to constrict the exercise of expert

judgment.

In sum, the claimed dichotomies between health and econom-

ics, and between NAAQS promulgation and state implementa-

tion, are false ones. EPA cannot very well “protect the public

health” without considering all factors, direct and indirect, that

bear upon it.

15

3. The Legislative History Confirms That Con-

gress Did Not Intend To Limit The Factors

The Administrator May Consider.

In placing a rulemaking straitjacket on the EPA, Lead Indus-

tries relied principally on the legislative history. The many

sources cited establish the uncontested proposition that there are

no overriding technical or economic feasibility constraints on

the Administrator’s ability to set standards requisite to protect

the public health, see 647 F.2d at 1148-55, but none supports the

very different proposition that the Act does not “permit[] the

Administrator to consider economic or technological factors in

promulgating air quality standards,” id. at 1150. A closer ex-

amination of the history of the 1970 Amendments shows that no

such limit on the Administrator’s discretion was contemplated.

Before the 1970 Amendments, the setting of standards was

reserved to the states, subject to review and approval by the Sec-

retary of Health, Education, and Welfare (““HEW”). Under the

Air Quality Act of 1967, Pub. L. No. 90-148, 81 Stat. 485, the

Secretary of HEW issued air quality criteria and information on

air pollution control techniques that included “technical data

relating to the technology and costs of emission control” and

“cost-effectiveness analyses,” id. § 107(b)(1) & (c), 81 Stat. at

491. Upon receiving the criteria and control techniques, the

states developed air quality standards, which were to be ap-

proved “if the Secretary determines that such State standards are

consistent with the air quality criteria and recommended control

techniques issued pursuant to section 107.” /d. § 108(c)(1), 81

Stat. at 492. Significantly, Congress thus permitted considera-

tions of costs and technology in setting the standards even

though the 1967 Act was premised on the philosophy that

“{cJonsiderations of technology and economic feasibility ...

should not be used to mitigate against protection of the public

health.” S. Rep. No. 90-403,-at 2 (1967). This is the very dis-

tinction that Lead Industries missed.

16

The standards set by the states under the 1967 Act were ac-

knowledged to be “social-political decisions” by the states that

reflect “the desired socio-economic status of those particular

regions,” but which were to be both based on and constrained by

HEW’s air-quality criteria. Hearings Before the Subcomm. on

Air and Water Pollution (1970) (“1970 Hearings”), reprinted in

2 Committee on Public Works, 93d Cong., Legislative History

of the Clean Air Act Amendments of 1970, at 1183-84 (Comm.

Print 1974) (“Legislative History”) (Statement of Dr. John T.

Middleton, Commissioner, National Air Pollution Control Ad-

ministration). HEW identified fixed numeric levels from the

criteria documents which were to be a ceiling on the concentra-

tions the state standards could allow, and would not approve

more lenient standards. /d. at 1187. For the two pollutants dis-

cussed in the testimony, sulfur oxide and particulate matter,

these were the levels where reliable scientific evidence estab-

lished “probable” adverse health effects that were, in effect, sig-

nificant risks: the 0.04 ppm annual mean for sulfur dioxide was

associated with an increase in mortality from bronchitis and

other respiratory diseases, HEW, Air Quality Criteria for Sulfur

Oxides 9-10 to 9-11 (1969), and the 80 g/m’ level for particu-

late matter was associated with increased death rates for persons

over 50 years old, HEW, Air Quality Criteria for Particulate

Matter 189 (1969). See 1970 Hearings, reprinted at 2 Legisla-

tive History at 1187. Beyond these fixed ceilings, the states, as

part of their risk-management decision making, had the respon-

sibility to set “margins of safety” that would take into account

other factors, including “long-term effects on health.” Hearings

Before the Subcomm. on Pub. Health and Welfare (1969), re-

printed in 2 Legislative History at 1255 (excerpts from criteria

documents).

The 1970 Amendments intervened before the 1967 Act proc-

ess was complete. The Nixon Administration pressed for na-

tional standards in recognition of the national dimension of pol-

lution, to shift state resources to implementation, and to acceler-

aa

17

ate a process bogged down in the cumbersome federal-state

mechanisms of the 1967 Act. 1/970 Hearings, reprinted in 2

Legislative History at 974 (statement of Hon. Robert H. Finch,

Secretary, HEW). There is no indication anywhere in the legis-

lative history that Congress, in federalizing the standard-setting

function, intended to change the factors that could be considered

in setting standards. To the contrary, the legislative history is

replete with statements that the 1970 Amendments continued

the approach of the 1967 Act,'* and simply transferred the stan-

dard-setting function to the federal government. /970 Hearings,

reprinted in 2 Legislative History at 983 (statement of Hon.

Robert H. Finch, Secretary, HEW). The Administration’s testi-

mony before Congress emphasized the continuity with the 1967

Act. The national standards would continue to be below the

level at which scientific evidence in the air-quality criteria dem-

onstrated dangers to the public health. /d. at 999, 1000 (remarks

of John Veneman, Under Secretary, HEW). But now it would

be EPA which makes the overall risk-management judgments

that formerly belonged to the states, although individual states

would be entitled to go farther, Union Electric, 427 U.S. at 263-

65. Nothing indicates that Congress intended to forbid EPA to

consider the factors that states formerly weighed (or that these

factors were only to be considered by the states at the

implementation stage).'”

While the 1970 Amendments omit language from the 1967

Act requiring consistency of air-quality standards with “recom-

mended control techniques issued pursuant to section 107,” Pub.

'* See Senate Debate on S. 4358 (Sept. 21, 1970), reprinted in | Legisla-

tive History at 227 (remarks of Sen. Muskie) (“That concept and philosophy

are behind every page of the proposed legislation.”); see also id. at 225, 229.

'S Cf. 1970 Hearings, reprinted in 2 Legislative History at 1186 (remarks

of Sen. Baker) (determining where a national standard “ought to be set” re-

quires consideration of, inter alia, “the economic impact [of] dislocations”).

L. 90-148, § 108(c)(1), 81 Stat. at 492, this does not suggest the

contrary. That omission reflects only that feasibility concerns

would not trump health given the “‘technology-forcing’” charac-

ter of the 1970 Amendments. Union Elec., 427 U.S. at 257.

And, in any case, such language would have been superfluous

because weighing costs is subsumed in the authority given to

EPA to set “an adequate margin of safety” and make the ulti-

mate determination of what standard is “requisite to protect the

public health.” The continuing structure of the Act, however,

confirms that control technique and cost data gathered under

what is now section 108 (formerly section 107 of the 1967 Act)

are still available for the Administrator’s consideration. Such

data still must be compiled and issued “[s]imultaneously” with

the criteria documents, 42 U.S.C. § 7408(b)(1), and must be

made available for public comment at the same time a NAAQS

is proposed, id. § 7409(a)(1)(B) & (2)—a provision which

would make no sense if the Administrator could not consider

such data (or comments thereupon) before finalizing the

NAAQS. Indeed, the congressional debates indicate that the

use of such information in setting standards was contemplated. '°

'© See Senate Debate on S. 4358 (Sept. 22, 1970), reprinted in | Legisla-

tive History at 341 (remarks of Sen. Randolph) (offering successful amend-

ment requiring advisory committee on control issues because it is “easy for

Government to arrive at a set figure for industry to meet without giving due

consideration to whether those requirements are obtainable on the basis of

available control technology”); House Debate on H.R. 17255 (June 10,

1970), reprinted in 2 Legislative History at 809 (remarks of Rep. Springer)

(“As the scientific details emerge and the control methods are developed, the

air quality standards for the entire nation will be adjusted accordingly.”).

The 1977 legislative history likewise indicates that costs and technology

could be considered in setting NAAQS. See, e.g., H.R. Rep. No. 95-294, at

127 (1977) (rejecting argument that NAAQS could be set at a zero-risk level

because such an approach “ignores all economic and social consequences and

is impractical”); Senate Debate on S. 252 (June 10, 1977), reprinted in 3

Legislative History at 1030 (remarks of Sen. Muskie) (NAAQS are “the

minimum reasonably attainable”).

19

4. Lead Industries \s Inconsistent With EPA’s

Interpretation Of Analogous Provisions Of

The Clean Water Act.

Untenable in its own right, EPA’s adoption of Lead Industries

also cannot be reconciled with its interpretation of analogous

language in section 303 of the Clean Water Act (“CWA”) for

setting water quality standards. Under section 303, the states set

water quality standards based on a designation of the “uses” of a

body of water—such as fishing, swimming, drinking, recreation,

and protection and propagation of fish and wildlife—and the

scientifically derived “water quality criteria” that are required to

protect those uses. 33 U.S.C. § 1313(c)(2); EPA, Water Quality

Standards Handbook INT-8 to INT-10, 2-1 to 2-4, 3-1 to 3-33

(2d ed. 1994) (“Water Quality Standards Handbook”). The

standards (which are subject to review by the Administrator)

must be set “to protect the public health or welfare, enhance the

quality of water and serve the purposes of this chapter.” 33

U.S.C. § 1313(c)(2)(A). In implementing their water quality

management program, states must impose whatever controls are

necessary to implement the water quality standards. Water

Quality Standards Handbook at INT-13.

Despite the similar “protect the public health or welfare”

mandate, and no statutory provision for consideration of costs or

feasibility,'’ EPA has interpreted section 303 to allow a “cost-

sensitive” approach to the setting of water-quality standards. 2

William H. Rodgers, Jr., Environmental Law: Air and Water

§ 4.19, at 291 (1986). Thus, if a particular use is not already

'’ Of the statutory purposes that may be considered, see 33 U.S.C.

§§ 1251(a), 1313(c)(2), the only one that mentions feasibility constraints is

the provision setting, “wherever attainable, an interim goal” of achieving

water quality protective of fish, shellfish, and wildlife by July, 1983. /d.

§ 1251(a)(2). That purpose is irrelevant to the EPA’s regulation, which was

promulgated in November, 1983 and is still in force. Cf. 48 Fed. Reg. 51,405

(1983).

20

existing, the states or the Administrator (if acting in place of a

state) may adjust water quality standards to take into account

certain natural or manmade conditions that prevent the attain-

ment of a designated use, 40 C.F.R. § 131.10(g)(1)-(5), collat-

eral environmental damage that would be caused by attempt

ing such attainment, id. § 131.10(g)(3), and any “substan-

tial and widespread economic and social impact” that

would be caused by imposing controls more stringent than

those required by other provisions of the CWA, id.

§ 131.10(g)(6). There is no reason to interpret section 109 of

the CAA differently.

5. Congress Did Not Intend To Depart From

Fundamental Principles Of Risk Manage-

ment.

Lead Industries is not only contrary to the broad language and

history of section 109, but it also failed to recognize the well

understood distinction between “risk assessment” and “risk

management.” Setting a binding air-quality NAAQS is plainly

an exercise in risk management, which requires discretion and

consideration of non-health factors.

Any regulatory system dealing with hazardous substances

“has two basic parts, a technical part, called ‘risk assessment,’

designed to measure the risk associated with the substance,

and a more policy-oriented part, called ‘risk manage-

ment." Stephen A. Breyer, Breaking the Vicious Circle 9

(1993)."" “Risk assessment is the systematic, scientific char-

acterization of potential adverse effects of human or eco-

logical exposures to hazardous agents or activities.” 2 The

Presidential/Congressional Comm'n on Risk Assessment and

'" The basic framework and terminology for risk regulation was most

comprehensively outlined in National Research Council, Risk Assessment in

the F ederal Government: Managing the Process (1983), based on analysis of

then current and prior regulatory schemes. See id. at 2.

21

Risk Management, Final Report: Risk Assessment and Risk

Management in Regulatory Decision-Making 2 (1997) (“Com-

mission Report’ ). Because of data, measurement, and methodo-

logical uncertainties that result in “several scientifically plausi-

ble approaches ... with no definitive basis for distinguishing

among them,” there are policy choices in risk assessment. Na-

tional Research Council, Science and Judgment in Risk Assess-

ment 27 (1994) (“Science and Judgment’). But they are strictly

“science-policy” choices that “are distinct from the policy

choices associated with ultimate decision-making.” /d. The de-

velopment of air quality criteria, which catalog the health and

welfare effects from the presence of pollutants “in varying quan-

tities,” is a risk-assessment activity. 42 U.S.C. § 7408(a)(2).

Risk management, on the other hand, “is the process of iden-

tifying, evaluating, selecting, and implementing actions to re-

duce risk to human health and to ecosystems,” with the goal of

“scientifically sound, cost-effective, integrated actions that re-

duce or prevent risks while taking into account social, cultural,

ethical, political, and legal considerations.” 2 Commission Re-

port at 2; Science and Judgment at 28 (“Risk management is the

term used to describe the process by which risk-assessment re-

sults are integrated with other information to make decisions

about the need for, method of, and extent of risk reduction.”)

(second emphasis added). In making policy choices among

regulatory options, the risk manager evaluates, for example, the

extent to which the regulation will diminish the risk; the differ-

ent health risks, lost benefits, and costs associated with the regu-

lation; and obstacles to its enforcement. Breyer, supra, at 10.

The Administrator's setting of NAAQS, which establishes a

legally binding level of risk that governs state regulation of pol-

luting sources, is the fundamental risk-management decision for

these pollutants. Yet under Lead Industries, all that the Admin-

istrator—despite being a senior Cabinet official, subject to the

direction of the President, with broad expertise in all aspects of

environmental regulation—may do is make the science-policy

22

choices typically associated with a risk assessment (i.e., the de-

velopment of air-quality criteria). The Administrator, in this

view, must regulate with blinders on, oblivious to whether the

standard she sets will harm the public more than an equally sci-

entifically permissible alternative, despite her broad gathering of

“data relating to the cost of installation and operation, energy

requirements, emission reduction benefits, and environmental

impact of the emission control technology,” 42 U.S.C.

§ 7408(b)( 1); the advice she receives from CASAC on “adverse

public health, welfare, social, economic, or energy effects

which may result from various strategies for attainment

and maintenance of [the NAAQS],” id. § 7409(d)(2)(C); and her

mandate to study the costs and benefits associated with compli-

ance with each NAAQS, id. § 7612(a)(1). Lead Industries de-

fies not only the statutory text and structure, but also the com-

mon sense that Brown & Williamson demands. 120 S. Ct. at

1301.

Risk management is especially important when scientific evi-

dence is ambiguous. Particularly in the case of nonthreshold

pollutants,'” science generally draws no bright line between

standards that are “protective” and those that would be “unpro-

tective.” EPA acknowledges that the Act does not require it to

eliminate all health risks, and thus it must draw the line between

“protected” and “unprotected” populations. To justify not fully

protecting everyone against all adverse health consequences, the

agency must balance the relative significance of health risks vis-

a-vis abatement costs and other collateral effects. If EPA is to

consider stringent ozone and PM regulation in the face of mas-

'* It has long been understood that ozone, particulate matter, and other cri-

teria pollutants are nonthreshold pollutants, meaning that there is a continuum

of adverse health effects at any exposure level above zero. Pet. App. Sa. See

also Senate Debate on S. 252 (June 8, 1977), reprinted in 3 Legislative His-

tory at 781-82 (remarks of Sen. Muskie) (noting “14 years” of testimony that

“[t)}here is no threshold health effect which can be used to say that above this

threshold there is danger to health and below it there is not”).

23

sive uncertainty, see supra at 2-3, at least it should be able to

consider the enormous costs of these doubtful precautions.

Thus, to paraphrase the D.C. Circuit’s discussion of a closely

related provision of the original Act, “[t}hough the phrase ‘to

protect the public health’ evinces an intent to make health the

primary consideration, there is no indication of the factors the

Administrator may or may not consider in determining, in his

‘judgment,’ what level of [ambient pollutant] will provide an

‘[adequate] margin of safety.” National Resources Defense

Council, Inc. v. EPA, 824 F.2d 1146, 1155 (D.C. Cir. 1987).

The Administrator would not comply with section 109 by set-

ting a standard that did not protect against the level where scien-

tific data demonstrate a significant risk to the public health; she

would have failed to set a standard “requisite to protect the pub-

lic health.” But beyond that, the Administrator is free to do

what is best for the American public, based on consideration of

all relevant factors. |

Il. CONGRESS HAS NOT ACQUIESCED IN LEAD

INDUSTRIES.

As Members of Congress, we urge this Court to pay little at-

tention to EPA’s argument that Congress has implicitly acqui-

esced in Lead Industries by failing to overrule it in the interven-

ing decades. PM Rule, 62 Fed. Reg. at 38,685. This Court

rightly looks with great disfavor on arguments of congressional

acquiescence. Central Bank v. First Interstate Bank, 511 U.S.

164, 186 (1994). Acquiescence arguments are especially weak

here, given that environmental legislation is “always” an area of

“legislative struggle.” Chevron U.S.A. Inc. v. National Re-

sources Defense Council, Inc., 467 U.S. 837, 847 (1984). The

inability of Congress to overrule a judicial decision favored by

certain political interests does not suggest that the decision was

rightly decided in the first place. Indeed, far from ratifying Lead

Industries, Congress has enacted new legislation that unques-

tionably reflects new statutory imperatives to analyze and con-

24

sider economic factors, including net benefit maximization and

cost-effectiveness, in environmental rulemaking. See Vermont

Agency of Natural Resources v. United States, 120 S. Ct. 1858,

1870 n.17 (2000) (“it is well established that a court can, and

should, interpret the text of one statute in the light of text of sur-

rounding statutes, even those subsequently enacted”).

As an initial matter, Lead Industries is difficult to reconcile

with the 1990 Amendments to the Clean Air Act. This legisla-

tion fostered greater EPA responsibility over state implementa-

tion in order to promote cost-effective regulation. Two provi-

sions are particularly germane. First, addressing the problems of

interstate transport of acid rain and ozone which cannot be miti-

gated by individual states acting alone, Congress required EPA

to order upwind states to curtail emissions that contribute “sig-

nificantly” to downwind nonattainment, 42 U.S.C.

§ 7410(a)(2)(D)(iD) — so that the Midwestern states have to

take action to mitigate the pollution they send eastward to New

England and the Mid-Atlantic. EPA has openly (and rightly)

interpreted the “significant” contribution rule to allow consid-

eration of the relative costs of reducing pollution, even though

the relevant statutory text provides no more express authority

for such considerations than does section 109. See Michigan,

2000 WL 180650, at *12-*13 (upholding agency interpretation).

If it is going to excuse upwind states from full compliance based

on costs, EPA must equitably adjust the compliance require-

ments of downwind states (which cannot attain NAAQS on their

own). Second, Congress amended section | 10 to provide for the

incorporation of economic incentives in state implementation

plans (“SIPs”), see 42 U.S.C. § 7410(a)(2)(A). But for such in-

centives to work, EPA’s anticipation of such implementation

policies is required at the NAAQS promulgation stage. In other

words, considerations of costs and collateral effects permeate

the entire NAAQS regulatory scheme, and for that scheme to

work rationally, the Administrator must have broad discretion to

consider such factors throughout the standard-setting and im-

25

plementation process. Indeed, Congress in 1990 also

directed the Administrator to consider the costs and bene-

fits associated with NAAQS compliance. 42 U.S.C.

§ 7612(a)(1).

Furthermore, the Clean Air Act must be construed in pari

materia with later-enacted regulatory reform statutes that direct

agencies to favor cost-effective regulatory decisions and to miti-

gate unwarranted regulatory burdens where possible. See Ver-

mont Agency, 120 S. Ct. at 1870 n.17. The Unfunded Mandates

Reform Act (“UMRA”) requires EPA, like ail agencies, to select

the most cost-effective regulatory alternative (or, alternatively,

to explain why a cost-effective option was not chosen). Pub. L.

No. 104-4, § 205, 109 Stat. 64, 66 (1995) (codified at 2 U.S.C.

§ 1535). The Small Business Regulatory Enforcement Faimess

Act (“SBREFA”) compels agencies to consider and minimize

the “significant economic impact” of regulations on “small enti-

ties.” Pub. L. No. 104-121, § 241(b)(5), 110 Stat. 847, 864

(1996) (codified at 5 U.S.C. § 604(a)(5)). EPA is correct that

UMRA and SBREFA do not override the mandates of an

agency's organic statute, see 2 U.S.C. § 1535(b)(2); 5 U.S.C.

§ 604 (a)(5), but, absent clear inconsistency, the Act should not

be interpreted to defeat Congress's clear directive in favor of

cost-effective regulation.

Ill. OVERRULING LEAD INDUSTRIES WOULD END

THE NAAQS CHARADE.

In the end, the true measure of the unreasonableness of Lead

Industries is the charade it induces, in which EPA masks its pol-

icy judgments as scientific findings to comply with an irrational

legal standard. Moreover, EPA, unwilling to force full attain-

ment of NAAQS that are established pursuant to Lead Indus-

tries, subverts the NAAQS scheme by creating cost-of-

compliance caps without authority or explanation. The result is

extra-statutory regulation that evades agency accountability to

Congress, the courts, and the public.

26

EPA acknowledges, as it must, that the “Act does not require

the Administrator to establish a primary NAAQS at a zero-risk

level.” PM Rule, 62 Fed. Reg. at 38,653. Any contrary con-

struction would be nonsensical for nonthreshold pollutants. But

if “zero risk” is neither legally required, nor established as a

goal by EPA, then the Agency must justify setting a level of risk

that is not stringent enough to protect everyone—i.e., certain

groups of unusually sensitive individuals will suffer health im-

pairmerit while others of average or lesser sensitivity will not.

EPA purports to distinguish among health risks based on

“ “decisional criteria’ ” such as “the nature and severity of health

effects, the types of health evidence, the kind and degree of un-

certainties involved, and the size and nature of the sensitive

populations at risk.” Pet. at 15 n.9, Browner v. American Truck-

ing Assn's, No. 99-1257 (filed Jan. 2000), Ozone Rule, 62 Fed.

Reg. at 38,883. In truth, these “decisional criteria” imply a de

facto balancing of net benefits and costs of abatement. How

otherwise could EPA defend denying health protections to one

population but not another if the costs of protecting them were

low? See Breyer, supra, at 65 (“tiny costs may warrant stricter

standards aimed at tiny risks”). The only democratic and moral

justification for setting standards at levels that do not protect all

individuals equally against the same harms is that doing so

would require a disproportionate, cost-ineffective allocation of

society's resources.

EPA has acknowledged the widespread, general perception

that it adjusts science to fit policy,’ but in the case of the

NAAQS, EPA still refuses to admit it is making economic

choices under the guise of “science.” Scholars, however, have

unearthed evidence that behind closed doors, EPA does consider

” EPA, Safeguarding the Future: Credible Science, Credible Decisions

36-37 (1992).

27

costs.”' By overruling Lead Industries, this Court would bring

EPA’s true bases of decision out of the shadows for judicial,

congressional, and public scrutiny, and thus ensure the agency’s

accountability and fidelity to the Act.

For example, despite its argument that cost considerations

and other alleged implementation effects come into play only on

a state-by-state basis in the implementation process, U.S. Opp.

at 13, EPA established a uniform $10,000 per ton compliance

cap in a memorandum issued by the President the same day the

two rules were issued. Under the mantle of “cost-effective im-

plementation,” an unidentified “interagency Administration

group” gave notice on the day the NAAQS were issued that “[i]t

was agreed that $10,000 per ton of emission reduction is the

high end of the range of reasonable cost to impose on sources,”

and that “EPA will encourage” (and no doubt approve) SIPS

that do not exceed those caps. /mplementation Plan for Revised

Air Quality Standards, 62 Fed. Reg. 38,423, 38,429 (1997).

Such a maneuver raises serious questions. There is no mention

of any statutory authority for EPA (or the Administration gener-

ally) to authorize cost caps that frustrate attainment of the

NAAQS, and indeed none exists. There is no rationale given for

the $10,000 cap, no explanation of the public-health tradeoffs,

and no legal justification of the anti-attainment implications of

the $10,000 cap for attainment or its interplay with other im-

plementation mechanisms approved by EPA. It thus appears

that it will not be the newly set NAAQS, or even state-by-state

decisions, but rather an unexplained administrative policy, un-

*" Wagner, supra, at 1641-43 & n.101 (discussing evidence in an earlier

NAAQS rulemaking that “*[t}he economic impact of the selected standard or

alternate standards ... were clearly considered by the Administrator’’); see

also 1 William H. Rodgers, supra, § 3.8, at 252; PM Rule, 62 Fed. Reg. at

38,680-82 (declining to set a more stringent secondary PM NAAQS to pro-

tect visibility because of costs—the unacceptability of “requir|ing] elimina-

tion of all eastern anthropogenic emissions”—and the availability of an

alternative control strategy—the regional haze program).

28

rooted in any statute and unreviewed by any court, that will

principally govern the sufficiency of compliance actions under

EPA regime.

Even though attainment is the “heart” of the NAAQS scheme,

Train v. National Resources Defense Council, Inc.,421 U.S. 60,

66-67 (1975), it is achimera under EPA’s current approach. In

its Final RIA, EPA adopted a $1 billion/ug/m3 cap on PM com-

pliance costs in order “to eliminate control measures that . . . are

extremely costly relative to the air quality benefit they achieve.”

Final RIA, at 6-14; see also Innovative Strategies and Econs.

Group, EPA, Draft Document, Regulatory Impact Analysis for

Proposed Particulate Matter National Ambient Air Quality

Standard 7-6 (Dec. 1996) (control measures beyond the $! bil-

lion/g/m3 cut-off are “extreme measures that are unrealistically

cost-ineffective,” achieving “minimal air quality improvements

at unreasonably high cost”). With such a cap for PM, together

with the $10,000-per-ton cap for both pollutants, EPA recog-

nizes that full attainment for ozone and PM would not be

achieved during the analyzed period. Final RIA, at ES-11 to

ES-12. Given the President’s direction to the Administrator that

the NAAQS “be carried out to maximize common sense, flexi-

bility, and cost-effectiveness,” Memorandum of July 16, 1997,

62 Fed. Reg. 38,421, 38,421, EPA will not pursue full attain-

ment. Thus, the overly stringent NAAQS set under Lead Indus-

tries are nullified through the back door. The purposes of the

Act would be better served by considering cost-effectiveness

openly in setting the NAAQS.

The Government may well argue that its cost-effectiveness

Strategies are not being provided as part of Section 109, but

rather as part of the implementation process under Section 110.

But the states have not yet even to begun to work on their SIPs.

Moreover, and perhaps more importantly, the Government also

argues that Congress reserved for itself the authority to relax

attainment requirements if costs become unsustainable. U.S.

Opp. at 13-14. Yet, while EPA claims that the law precludes it

29

from establishing cost-effective cut-offs, it nonetheless goes

ahead and does so. And all of this takes place without the

agency complying with any objective standards or being subject

to any oversight and review.

Compounding the oversight and review problem is the fact

that after setting a $10,000-a-ton cut-off for compliance pur-

poses, EPA later set a $2,000-per-ton cap for purposes of deter-

mining control of “significant” interstate pollution transport.

See Michigan, 2000 WL 180650, at *2 (discussing cap for ni-

trogen oxides, an ozone precursor). This lesser figure leaves

downwind states with the obligation to fund up to $10,000-a-ton

for reductions that may well be much more cheaply obtained

upwind. In fact, the $2,000 transport cap may well operate as a

de facto cap for all sources in the affected upwind states, since

those tons that go downwind are indistinguishable from those

that do not.

Even if there are no insuperable coordination problems here,

surely a reviewing court is entitled to understand how a particu-

lar cut-off number is calculated—and whether $10,000 is a lot

or a little, and whether the difference between $2,000 and

$10,000 is a lot or a little. The D.C. Circuit was presented with

reasoning relating to the $2,000 figure in the Michigan case.

See Brief for Respondent United States at 58-67, Michigan,

2000 WL 180650. The reviewing courts—and the states and

their sources—are entitled to no less with respect to the far more

important and all-encompassing $10,000 number.

In short, Congress intended the cost-effectiveness of NAAQS

to be considered, but not as part of a closed-door and unreview-

able Administration compromise that effectively undermines the

NAAQS scheme. Rather, as the text, history, and structure of

section 109 make clear, Congress wanted the EPA Administra-

tor to consider such factors openly in setting NAAQS, subject to

judicial review of the adequacy of her reasons and her confor-

mity to the statutory mandate “to protect the public health.”

30

Lead Industries stands in the way of vindication of the congres-

sional scheme, and it should be overruled.

CONCLUSION

For the reasons above, the judgment of the court of appeals

should be reversed and the EPA rules remanded.

Respectfully submitted,

LLOYD N. CUTLER CARTER G. PHILLIPS

C. BOYDEN GRAY ALAN CHARLES RAUL*

WILMER, CUTLER & PICKERING STEPHEN B. KINNAIRD

2445 M Street, N.W. SIDLEY & AUSTIN

Washington, D.C. 20037 1722 Eye Street, N.W.

(202) 663-6000 Washington, D.C. 20006

(202) 736-8000

Counsel for Amici Curiae

July 21, 2000 *Counsel of Record