Amicus Curiae Brief — Alaska Dept. of Environmental Conservation v. EPA

In The vg be OFEICE OF THE CLERK |

Supreme Court of the Anited States

¢

STATE OF ALASKA, DEPARTMENT OF

ENVIRONMENTAL CONSERVATION,

Petitioner,

v.

UNITED STATES ENVIRONMENTAL

PROTECTION AGENCY, et ai.,

Respondents.

+

On Writ Of Certiorari To The United States

Court Of Appeals For The Ninth Circuit

+

BRIEF FOR ENVIRONMENTAL DEFENSE,

THE NATIONAL PARKS CONSERVATION

_ ASSOCIATION, THE NORTHERN ALASKA

ENVIRONMENTAL CENTER AND THE ALASKA

COMMUNITY ACTION ON TOXICS AS AMICI

CURIAE IN SUPPORT OF RESPONDENTS

S

MICHAEL C. LEVINE SEAN H. DONAHUE

EARTHJUSTICE Counsel of Record

325 Fourth Street WASHINGTON AND LEE

Juneau, Alaska 99801 UNIVERSITY SCHOOL

(907) 586-2751 OF LAW

Lexington, Virginia 24450

ELIZABETH A. FAYAD

NATIONAL PARKS (540) 458-8400

CONSERVATION ASSOCIATION VICKIE L. PATTON

1300 19th Street, NW, ENVIRONMENTAL DEFENSE

Ste. 300 2334 North Broadway

Washington, D.C. 20036 Boulder, Colorado 80304

(202) 454-3306 (303) 440-4901

Counsel for Amici Curiae

July 15, 2003

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

OR CALL COLLECT (402) 342-2831

\ \ \

TABLE OF CONTENTS

Page

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STATEMENT OF INTEREST ..................::cccesseeeeseees 1

IEG Ti xesaccessecnssescenenninsenentsenesninnisinmntennentien 2

SUMMARY OF ARGUMENT.................cccsecssseeeeeeeeee 9

PTS cccsnennsecsssnvsiitanintinnnimniaciiieininiinatinaiemiien 10

I. EPA HAS STATUTORY AUTHORITY TO EN-

FORCE THE SUBSTANCE OF THE BACT

PE PEREEEEIUE cocccscccccccsnssssccncsssosncossotoonsones 10

A. The Plain Language of the Act’s Enforce-

ment Provisions Authorizes EPA to En-

force Any PSD “Requirement.” ................... 10

B. BACT Is Integral to the Act and Is a Bind-

ing National “Requirement.”..................0++++ 11

C. The “Case-by-Case” Nature of Permitting

Authorities’ BACT Determinations Does

Not Defeat EPA’s Enforcement Authority .. 20

D. EPA Has Understood its Limited Role in

Reviewing State PSD Determinations, and

Disavowed any Power to “Second-Guess”

Reasonable State BACT Determinations.... 22

E. Relegating EPA to an Appeal Before a

State Agency or Court Is Inconsistent

With the Statute and Would Create an

Ungainly Procedure for EPA Oversight

RID TOONS, ccccccscncctsncstassenisiniiintoommneeia 24

ii

TABLE OF CONTENTS -— Continued

Page

Il. EPA PROPERLY DETERMINED THAT THE

PERMIT ISSUED BY PETITIONER IS ARBI-

TRARY AND INCONSISTENT WITH THE

iil eaenantesusesesscssessnsnosencesosseseoceeconsocccovenseceeseoee 26

SEITE ussdsodsinasarcesoceeenesecececcssosncoccceosvecescoceese 30

iii

TABLE OF AUTHORITIES

Page

CASES

AT&T Corp. v. lowa Utilities Bd., 525 U.S. 366

eee 25

Alabama Power Co. v. Costle, 636 F.2d 323 (D.C.

IL Titties btetreteerenntmpeniguseaiininansnredpmunenineens 13, 29

American Wildlands v. Browner, 260 F.3d 1192

Sa TTT tinier eine etn intareapatlareeaeeneerenaaeeeae | 24

Arizona v. San Carlos Apache Tribe, 463 U.S. 545

iii leis edneen innate ngeaaaneaenminnmmaensel 25

EI. Du Pont De Nemours & Co. v. Train, 430 U.S.

STITT irtstaidiaeaknaasiiiehinaiiarnanataleniaaanannnieneemameremeneinniel 20

FERC v. Mississippi, 456 U.S. 742 (1982)...................000005 14

General Motors Corp. v. EPA, 496 U.S. 530 (1990) ............ 3

Hodel v. Virginia Surface Min. and Reclamation

Ass’n, Inc. , 452 U.S. 264 (1981) ..............ccssessersssessereeeees 19

Hughes Aircraft Co. v. Jacobson, 525 U.S. 432

i ita taser nat pennareteiainamsasemnainnpienimenenninetts 10

King v. St. Vincent’s Hosp., 502 U.S. 215 (1991)............... 11

McCulloch v. Maryland, 17 U.S. 316 (1819)...................... 20

Missouri v. Holland, 252 U.S. 416 (1920)...................c.000e 20

Missouri v. Illinois, 200 U.S. 496 (1906) .............:ccccceeee 20

Motor and Equipment Mfrs. Ass’n, Inc. v. EPA, 627

RK ee 24

PUD No. 1 of Jefferson County v. Washington Dep't

of Ecology, 511 U.S. 700 (1994)...............ccesssssssesseseeeeeees 25

Panhandle Oil Co. v. Mississippi ex rel. Knox, 277

ee 23

iv

TABLE OF AUTHORITIES — Continued

Page

Sierra Club v. Ruckleshaus, 344 F.Supp. 253

(D.D.C. 1972), aff’d, 4 E.R.C. 1815 (D.C. Cir.

1972), aff’d by equally divided Court sub nom.

Fri v. Sierra Club, 412 U.S. 541 (1973) ..............ccccceee 4,5

Tennessee Valley Auth. v. Whitman, __ F.3d __.,

2003 WL 21452521 (11th Cir. June 24, 2003) ............... 10

Train v. NRDC, 421 U.S. 60 (1975) .........cccccccccceeeeeees 3, 4, 15

Union Elec. Co. v. EPA, 427 U.S. 246 (1976)....... 3, 4, 18, 24

United States v. AM General Corp., 34 F.3d 472 (7th

SE TT canienisetenichttiatinicnaiicciaieeiaiithdaniaiteiaaalbaiahlilaiiaaeiaaniiiaiall 23

Vermont Yankee Nuclear Power Corp. v. NRDC, 435

es Crt hsisscsensinneininssietanhinietinhieneaiainbinainasitadianiaaitiiasiiaiaatiead 12

Virginia v. Browner, 80 F.3d 869 (4th Cir. 1996)................ 8

STATUTES

Clean Air Act of 1963, Pub. L. No. 88-206, 77 Stat.

Sir cicichnceriaramsicincientaatieeitieaitata anaemia iiiaaidibianisaeniainiaieiditiaa 3

Clean Air Act Amendments of 1970, Pub. L. No. 91-

SC, Ti ntecineniniettrerenmenieimeenrteieneel 2,3

Clean Air Act Amendments of 1977, Pub. L. No. 95-

Fs Oe OE ecnrn ncnscenetrsicneinterennemsiigainiieniamcmneenteieeeil 3,17

Clean Air Act Amendments of 1990, Pub. L. No.

eee 3,8

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TE 25

_ 42 es OIE, cxcunncnsemnsemmmene 12

GS ee ee PD erences 3

° v

TABLE OF AUTHORITIES - Continued

Page

Ce Te, 3

| Tn ee eS mee 3

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4B U.B.C. § T4UBMENE) ...2.2000c0cececerecccesececececececesesesesceseseseees 12

EE ee nee passim

42 U.S.C. § 7413(a)(5) (1988).........ccceccceceseseeececseseeeseeees 8, 24

a 23

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vi

TABLE OF AUTHORITIES — Continued

Page

NTC aE 8

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IT thniinscinniiecninininnsninentatsicaniisnenmndiadadbicdmeens 6

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ee ieiinsinenciciisiitiianiiciiaiiitinaaaata 13

8 a eee 5

ae PE rtensncunennnnsnnsinenneimnmaiencsimmnanintil 9, 16

42 U.S.C. § 7475(aN(2) 0.0.0... perinnesiedebenesemasmmmnteninisines 7, 26

es Oe ST niciaciensinnssicrinretnnietnanmcenbinnsimmeninnaneinialilies 5

ry ET ctcsnciscnecrsmnsenintnsmenenseninninniannial 2,6, 12

ee ee ED cctctennnnniiccsrensnmerenintimnieninmiianinn 7

aii ciecisnchibcaninaianal passim

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ey a i crctriccnmnccenininncarentciiannentaninimsiniis 24

en 15

vii

TABLE OF AUTHORITIES - Continued

Page

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REGULATIONS

18 Alaska Admin. Code (“A.A.C.”) 50.900(9) (1991)........... 6

18 Alaska Admin. Code (“A.A.C.”) 50.375...........ccccccceeeeeees 13

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8k Eee ee 7

en ee a 7

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IER 28

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ns I ancien tae iateninrnaiinniasinnantiniaiiiaiiaat 6

aT nisi creertesinnnicnptininnsenttnainaiinnneininntiienbiniien 6

ey ee icinsiniictisininsticnansnsuncuindentibiinnidiitiaanigiiinaiii 13

ee ED citrsininecirsssnicesiiceiintibiniastictnaiininenetesinaatiaiatiniibaiinianiaia 7

TABLE OF AUTHORITIES -— Continued

Page

I ik scinisniicccinianinnaiigisaiiiiatesll 28

ici cccatstininiiininibaaniieaiell 6

eT ee 13

ee ee Nem TT Foe RT 7

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PS OMEN sen. erne rie anew -

i tle -

aii chitin tiieaiiinililicaiapcicaailteii ~

a eR CT erent Te -

57 Fed. Reg. 28,093 (June 24, 1992)..........00++: Whelantanen 22

58 Fed. Reg. 15,422 (March 23, 1993) ........:s::secsesesseeseeneene 23

63 Fed. Reg. 13,795 (March 23, 1998) .........:sessessssesseseeseens 23

67 Fed. Reg. 80,186 (Dec. 31, 2002).......::c:secsessssessesnesneneenes 7

LEGISLATIVE HISTORY

1 Senate Comm. on Public Works, 93d Cong., 2d

Sess., A Legislative History of the Clean Air Act

Amendments of 1970 (Comm. Print 1974)...........::00000« 3

OO i cccccensectinseccinnianitiiinasabenensian 19

ORD, Rhee, Bin, CUGOG COTY ecccccceccrcccsesoscencsscnsesecscmssvisien 15

BE, Beam. Bie, COREE CIT ID cccccccceccsccccntnsenccenensencentencens passim

122 Cong. Rec. $3905 (March 22, 1976) .........e+s:sesseesesseens 17

123 Cong. Rec. S9169 (June 8, 1977).....ccs:cccsesserseseeseeeeneens 15

*

;

a

4

2

7)

7

ix

TABLE OF AUTHORITIES -— Continued

Page

AGENCY DECISIONS

In re Columbia Gulf Transmission Co., PSD Appeal

No. 88-11, 1989 WL 266361 (E.A.B. 1989) .............. 16, 18

In re General Motors, Inc., PSD Appeal No. 01-30,

2002 WL 373982 (E.A.B. 2002)..........ccccccccsesceeeeee seees 6, 7

In re Steel Dynamics, PSD Appeal Nos. 99-4, 99-5,

2000 WL 833062 (E.A.B. 2000)............::cccccceseseeeeeresseesees 7

OTHER AUTHORITIES

David P. Currie, Air Pollution: Federal Law and

PE Ee 3, 4,17

John P. Dwyer, The Practice of Federalism Under

the Clean Air Act, 54 Md. L. Rev. 1183 (1995)............. 3,4

Daniel Esty, Revitalizing Environmental Federal-

ism, 95 Mich. L. Rev. 570 (1996)...............0ccseerersereereeeees 3

Craig N. Oren, Clearing the Air, 9 Va. Envtl. L.J. 45

Sa eiirectecnncnnesttebinllenbetenneniiaimacisiaaia ieee tea aratmaaae 17

Craig N. Oren, Prevention of Significant Deteriora-

tion: Control-Compelling Versus Site-Shifting, 74

Iowa L. Rev. 1, 3 (1988) (“PSD”) .............c0c0s0000ee00e0 5, 6, 21

Craig N. Oren, The Protection of Parklands from

Air Pollution: A Look at Current Policy, 13 Harv.

EE aD 19

National Commission on Air Quality, To Breathe

ETE ne ae 16, 17

Robert V. Percival, Environmental Federalism:

Historical Roots and Contemporary Models, 54

I is aaa 3

xX

TABLE OF AUTHORITIES -— Continued

Page

Arnold W. Reitze, Jr., The Legislative History of

U.S. Air Pollution Control, 36 Hous. L. Rev. 679

STITT aetesciasinenarnitideniteasiieidndbiiepmnenanininatadeisnnmieitieimabeinenatenieen 3

1 William H. Rodgers, Environmental Law: Air and

en TIE cnntenienenieciniientenpanncnmnimaninnmaiionmmund 5, 18, 24

Richard B. Stewart, Pyramids of Sacrifice: Prob-

lems of Federalism in Mandating State Imple-

mentation of Federal Environmental Policy, 86

eles i rnrnnscecumsenseninctinnmienstannanenmneinninn 3

Symposium: Environmental Federalism, 54 Md. L.

eee

1

STATEMENT OF INTEREST’

Environmental Defense (formerly the Environmental

Defense Fund) is a national nonpartisan, nonprofit organi-

zation representing more than 300,000 members nation-

wide. Since 1967 it has linked science, economics, and law

to create innovative, equitable, and cost-effective solutions

to the most urgent environmental problems. Environ-

mental Defense has helped design such landmark clean

air programs as the market-based pollution cap and

allowance trading program adopted in the 1990 Clean Air

Act amendments to abate acid deposition. Protecting

public health and the environment from harmful airborne

contaminants is a core organizational mission.

The National Parks Conservation Association (“NPCA”)

is the only nonprofit citizen organization solely dedicated

to protecting, preserving and enhancing the U.S. National

Park System for the benefit of present and future genera-

tions. Founded in 1919, NPCA currently has over 300,000

members from all fifty states. NPCA has a longstanding

interest in the use of the Clean Air Act and the federal

government's responsibility to protect air quality and visibil-

ity in National Park units, including the Noatak National

Preserve and the fifteen other National Park units in Alaska.

The Northern Alaska Environmental Center (North-

ern Center) promotes environmental conservation in

Interior and Arctic Alaska through advocacy, education,

and sustainable resource stewardship. The organization is

a leading conservation voice for Interior and Arctic Alaska.

Northern Center was founded in 1971 by a group of

* Pursuant to Rule 37.6, amici state that no counsel for any party

authored this brief in whole or in part, and that no person or entity

other than amici made a money contribution for the preparation or

submission of this brief. This brief is being filed with the written

consent of the parties, and the corresponding documentation is simul-

taneously being filed with the Court.

2

concerned residents and now has 1,100 members, of which

40% are from the Fairbanks area. Northern Center has

members who visit, recreate, and rely on the natural

resources of the Red Dog Mine region. True to its grass-

roots origins, Northern Center focuses on projects, such as

enforcement of environmental protections at the Red Dog

Mine, responsive to its members’ concerns.

The Alaska Community Action on Toxics (“ACAT”) is a

nonprofit organization based in Anchorage. Its mission is

to protect human health and the environment from the

effects of toxic contaminants, and it represents about 300

Alaska residents. ACAT is dedicated to achieving envi-

ronmental justice and ending production and release of

toxic chemicals.

STATEMENT

Petitioner challenges orders of the United States

Environmental Protection Agency (“EPA”) pursuant to

Sections 113(a)(5) and 167 of the Clean Air Act (“CAA” or

“Act”), 42 U.S.C. §§ 7413(a\(5), 7477, prohibiting construc-

tion of a new power generation unit, known as MG-17,

operated by Teck-Cominco, Inc. (“Cominco”), at the Red

Dog Mine in northwest Alaska. EPA issued the orders

after concluding that Cominco’s permit, granted by peti-

tioner as permitting authority, failed to comply with the

Act’s requirement that major emitting facilities install the

“best available control technology” (“BACT”) to prevent

significant deterioration of air quality. 42 U.S.C.

§ 747&aX4). Petitioner approved the use of a control technol-

ogy approximately one-third as effective as another it had

identified as technically feasible, environmentally prefer-

able, and economically affordable, on the basis of unspeci-

fied “competitive impacts” and the company’s “contributions”

to the region. The court of appeals upheld EPA's authority

to enforce the BACT requirement.

The Clean Air Act. The Clean Air Act amendments of

1970, Pub. L. No. 91-604, 84 Stat. 1676, were enacted

“to protect and enhance the quality of the Nation’s air

3

resources so as to promote the public health and welfare

and the productive capacity of its population.” 42 U.S.C.

§ 7401(b).’ They represented “a drastic remedy to what

was perceived as a serious and otherwise uncheckable

problem of air pollution,” Union Elec. Co. v. EPA, 427 U.S.

246, 256-57 (1976), and followed a series of prior congres-

sional efforts to encourage states to address that problem.

See Train v. NRDC, 421 U.S. 60, 63-67 (1975).° Still,

Congress preserved a central role for the states, establish-

ing an intricate “partnership,” under which the states

could, if they chose, assume responsibility for implement-

ing some of the Act’s central regulatory programs.‘

Subject to qualifications required by its notorious

complexity, the Act adopts two basic approaches to

structuring the federal-state partnership. See John P.

Dwyer, The Practice of Federalism Under the Clean Air

* The 1970 amendments, Pub. L. No. 91-604, 84 Stat. 1676,

amended the Clean Air Act of 1963, Pub. L. No. 88-206, 77 Stat. 392.

The Act was again comprehensively amended in 1977, Pub. L. No. 95-

95, 91 Stat. 685, and 1990, Pub. L. No. 101-549, 104 Stat. 2399. It is

codified at 42 U.S.C. §§ 7401 et seg.

* See, e.g., Arnold W. Reitze, Jr., The Legislative History of U.S. Air

Pollution Control, 36 Hous. L. Rev. 679, 684-702 (1999); Robert V.

Percival, Environmental Federalism: Historical Roots and Contempo-

rary Models, 54 Md. L. Rev. 1141, 1155-57 (1995). On pre-1970 state

regulation, see David P. Currie, Air Pollution: Federal Law and

Analysis, §§ 1.08-1.12 (rev. ed. 1991); 1 Senate Comm. on Public Works,

93d Cong., 2d Sess., A Legislative History of the Clean Air Act Amend-

ments of 1970, at 123-25 (Comm. Print 1974). On other rationales for

federal regulation, see Richard B. Stewart, Pyramids of Sacrifice:

Problems of Federalism in Mandating State Implementation of Federal

Environmental Policy, 86 \ale L. J. 1196, 1212-13 (1977), and Daniel

Esty, Revitalizing Environmental Federalism, 95 Mich. L. Rev. 570

(1996).

* General Motors Corp. v. EPA, 496 U.S. 530, 532 (1990); see 42

U.S.C. § 7401(aX3) (CAA provision dating from 1963 Act stating that

“air pollution prevention * * * and air pollution control at its source is

the primary responsibility of States and local governments”).

4

Act, 54 Md. L. Rev. 1183, 1193-96 (1995). One is to

establish federal goals for air quality while leaving states

discretion to select measures necessary to meet the federal

air quality goals. This approach is exemplified in the 1970

amendments’ provision for national ambient air quality

standards (“NAAQS”). 42 U.S.C. §§ 7408, 7409(a). States

were to prepare and submit for EPA review and approval

state implementation plans (“SIPs”) providing for

implementation, maintenance, and enforcement of the

NAAQS, 42 U.S.C. § 7410, but state plans could include

“whatever mix of emissions limitations” on existing

pollution sources the state chose to meet the national

standard. Train, 421 U.S. at 79.

Congress has typically taken a markedly different

approach, based on “direct federal regulation,” for new or

expanded stationary sources. Currie, Air Pollution, § 3.01

at 3-2. For such sources, the Act imposes technology-based

national standards to “force” the development of new

control technologies, see Union Elec., 427 U.S. at 457, and

to constrain states’ incentives to under-protect air quality

to attract business and to shunt pollution onto other

jurisdictions. See, infra, pp. 18-20. For example, the New

Source Performance Standards (“NSPS”), introduced in

1970, require new and modified sources to meet technol-

ogy-based standards set by EPA based on “the best system

of emission reduction * * * adequately demonstrated.” 42

U.S.C. § 7411(aX1).

As developed below, this fundamental distinction

between state discretion to set and allocate controls for

existing sources and federal technology-based require-

ments for new or modified sources is reflected in the

prevention of significant deterioration program.

The Prevention of Significant Deterioration Program.

In Sierra Club v. Ruckelshaus, the court held that the Act’s

purpose to “protect and enhance” the nation’s air quality,

eet Te PROBE +

5

42 U.S.C. §7401(b)(1), prohibited EPA or states from

allowing substantial increases in air pollution levels in

relatively “clean” areas meeting the NAAQS.’ In response,

in 1974 EPA promulgated an administrative “prevention of

significant deterioration” (“PSD”) program under which

new or expanded pollution sources would be required to

adopt the “best available control technology.”®

Congress enacted a statutory PSD program as part of

the comprehensive 1977 amendments. 42 U.S.C. §§ 7470-

7479. To ensure that states did not allow air pollution

levels in “clean air” areas to degrade toward “bare compli-

ance” with the NAAQS, the program “requires that each

new or expanded ‘major emitting facility’ in ‘clean air

areas’ use the ‘best available control technology (BACT)

for minimizing additional air pollution [and] also estab-

lish[es] ‘increments’ that limit the cumulative increase in

pollution levels over the ‘baseline concentrations’ in clean

air areas.” Craig N. Oren, Prevention of Significant Dete-

rioration: Control-Compelling versus Site-Shifting, 74 lowa

L. Rev. 1, 3 (1988) (citations omitted). The PSD requirements

are supplemental to other obligations under the Act; to

comply with its PSD obligations, a facility must also

comply with the NAAQS, NSPS, and other statutory

standards. 42 U.S.C. § 7475(aX3).

The PSD provisions establish a pre-construction

permitting requirement for new or modified “major emit-

ting facilities.” 42 U.S.C. § 7475. See 42 U.S.C. § 7479(1);

40 C.F.R. § 51.166(b)(4). “There are in practice two major

requirements” for obtaining a permit: installing BACT and

demonstrating that applicable PSD increments will not be

° 344 F.Supp. 253 (D.D.C. 1972), affd, 4 E.R.C. 1815 (D.C. Cir.

1972), aff’d by equally divided Court sub nom. Fri v. Sierra Club, 412

U.S. 541 (1973).

* See 1 William H. Rodgers, Environmental Law: Air and Water,

§ 3.21 (1986).

6

exceeded. Oren, PSD, 74 Iowa L. Rev. at 22-23. The incre-

ments are maximum allowable increases and concentra-

tions of designated pollutants that serve to “limit the

cumulative increase” in pollutant levels (measured against

baseline concentrations specific to each clean air area). 42

U.S.C. 8§ 7473, 7479(4). See 40 C.F.R. § 51.166(b), (c).’

In addition, each major emitting facility to be con-

structed or modified is “subject to the best available

control technology for each pollutant subject to regulation

under this chapter emitted from, or which results from,

such facility.” 42 U.S.C. § 7475(a)(4). Section 169(3) defines

BACT as: .

an emission limitation based on the maximum

degree of reduction of each pollutant subject to

regulation under this chapter emitted from or

which results from any major emitting facility,

which the permitting authority, on a case-by-case

basis, taking into account energy, environmental,

and economic impacts and other costs, deter-

mines is achievable for such facility * * * .

42 U.S.C. § 74793). EPA regulations and Alaska’s feder-

ally-approved PSD program reflect the statutory defini-

tion. See 40 C.FR. § 51.166(bX 12), § 52.21(bX 12); ISAAC.

50.900(9) (1991). EPA uses the “top-down” approach to —

determining BACT, as described in the New Source Re-

view Workshop Manual and many permitting decisions.

See In re General Motors, Inc., PSD Appeal No. 01-30, 2002

’ Increments depend on an area's classification. See 42 U.S.C.

§§ 7472-74. Class I areas, subject to the most stringent increments,

include most National Parks and other special federal lands; Class II

areas include most “clean air” areas; and Class II] areas are permitted

the greatest degree of degradation. States may reclassify areas subject

to certain limitations.

7

WL 373982, slip op. at 9 (E.AB. 2002) (citing decisions)."

Under that approach, the applicant must identify all “avail-

able” technologies; eliminate those shown to be technically

infeasible; then select the technology most effective at

reducing emissions, unless proven energy, environmental, or

economic impacts require its rejection in favor of the next

most effective technology. Jd. at 6 & n.4; see J.A. 175-77."

The PSD permitting program may be administered by

states with EPA-approved PSD programs or by EPA itself.

42 U.S.C. §§ 7410(aX2XC), 7410(c), 7471. See 40 C.F.R.

§§ 51.166, 52.21, 52.96(a) (Alaska program approval). In

either case, PSD permit applications must be reviewed

and analyzed “in accordance with regulations promulgated

by the Administrator,” and there must be a public hearing.

42 U.S.C. §§ 7475(aX2), 7475(eX3). Like the NSPS and

other CAA requirements for new and modified sources,

PSD is a component of EPA’s “New Source Review”

(“NSR”) program. See 40 C.F.R. §§ 51.165, 51.166, 52.21,

52.24, Pt. 51 App. S; 67 Fed. Reg. 80,186, 80,187-88 (Dec.

$1, 2002). As explained below, as part of the PSD program

* The Manual is 1990 draft guidance from the EPA's Office of Air

Quality Planning and Standards. As petitioner's staff noted, EPA has

“published numerous policy memoranda and guidance documents to

assist applicants and permitting authorities in using the top-down

approach.” J.A. 175.

* EPA’s Environmental Appeals Board has stated that “a strict

application of the top-down methodology” is not mandatory for state

permitting authorities, but that in evaluating the “rationality and

defensibility of BACT determinations by permitting authorities,” EPA

has “required an analysis that reflects a level of detail in the BACT

analysis comparable to the methodology in the NSR Manual.” Jn re

General Motors, slip op. at 9 (citing decisions); see also In re Steel

Dynamics, PSD Appeal Nos. 99-4, 99-5, 2000 WL 833062, slip op. at 25-

26 (E.A.B. June 22, 2000) (“top-down analysis is not a mandatory

methodology, but it is frequently used by permitting authorities to

ensure that a defensible BACT determination, involving consideration

of all requisite statutory and regulatory criteria, is reached”).

8

enacted in 1977, Congress gave EPA express authority to take

enforcement action to prevent the construction of a facility in

violation of the Act. See Section 167, 42 U.S.C. § 7477.”

The 1990 Amendments. The 1990 amendments ex-

panded the scope of Section 113(a)(5), which now provides:

“Whenever, on the basis of any available information, the

Administrator finds that a State is not acting in compliance

with any requirement or prohibition of the chapter relating

to the construction of new sources or the modification of

existing sources,” the Administrator may issue an order

prohibiting the construction or modification of a source, issue

an administrative penalty order, or commence a civil action.

42 U.S.C. §7413(aX5)." Because the PSD program (42

U.S.C. §§ 7470-7492) is part of the designated “chapter”

(Chapter 85, 42 U.S.C. §§ 7401-7671(q)), Section 113(aX5)

gives EPA authority to enforce any “requirement” of the PSD

provisions. *

* Congress broadened Section 167 in 1990 to cover facility

modifications. See 104 Stat. 2399, 2684.

" Before 1990, Section 113(aX5) was limited to violations in non-

attainment areas. 42 U.S.C. § 7413(aX5) (1988).

” The 1990 amendments added Title V of the Act, 42 U.S.C. §§ 7661a-

7661f, under which each “major source” of air pollutants must obtain an

“operating permit” consolidating all its CAA obligations. See 42 U.S.C.

§§ 766la, 766icia); 40 CPR. §70.1(b); 40 CFR. Pt. 70 (EPA Title V

regulations); Virginia v. Browner, 80 F.3d 869, 873 (4th Cir. 1996). S.ates

administering Title V must submit proposed permits to EPA for review. 42

USC. § 7661d(a); 40 C.PR. § 70.8(a). If EPA objects within 45 days that

the permit “is not in compliance with the requirements of [the CAA],” the

permitting authority “may not issue the permit.” 42 U.S.C. § 7661d(bX 1)

(2), (c); 40 C.F.R. § 70.8(c). Unless the deficiency is cured, EPA “shall issue

or deny the permit in accordance with the requirements” of the CAA 42

U.S.C. § 766id(c). EPA may “terminate, modify, or revoke and reissue”

operating permits. 42 U.S.C. § 7661d(e). Cominco applied for a Title V

permit for the Red Dog Mine on December 8, 1997; petitioner has not yet

acted on the application. See Alaska Dep't of Environmental Conservation,

available at www:state.ak us/dec/dawq/aqm/sched_xis (permit review status

for permit application No. 290) (last visited June 27, 2003).

9

SUMMARY OF ARGUMENT

The Act’s language, structure and history demonstrate

that EPA may enforce the substance of the BACT require-

ment when a state has failed to do so. Petitioner wrongly

portrays BACT as a kind of legislative afterthought that

gives states “sole discretion” (Br. 27) to allocate pollution-

control burdens, subject only to procedural requirements

and ambient air quality standards like the PSD incre-

ments. In fact, however, BACT is an essential feature of

the PSD program, intended to provide pollution controls

beyond those necessary to comply with the PSD incre-

ments and other air quality standards. See 42 U.S.C.

§ 7475(a). Congress intended BACT to “force” the adoption

of new control technologies, to counter states’ tendency to

under-protect air quality in order to attract or keep indus-

try, and to preserve air quality in adjacent states and on

special federal lands such as National Parks. See 42

U.S.C. § 7470.

In Sections 113(aX5) and 167, Congress gave EPA

authority to take enforcement action when the agency

concludes that a proposed major emitting facility fails to

meet any “requirement” of the PSD program. A facility's

obligation to install BACT is such a requirement, and the

legislative history of the 1977 amendments pointedly

confirms EPA’s enforcement authority.

EPA has long acknowledged that state permitting

authorities have discretion in determining BACT, and has

disclaimed any power to “second-guess” reasonable state

judgments. But that discretion is not a license to ignore

tue statutory text or BACT’s intended function in the PSD

program. Petitioner’s account of BACT as hopelessly stan-

dardless (Br. 24) is incompatible with the statutory text and

BACT's technology-forcing function. Its argument that EPA's

remedy for an arbitrary BACT determination is to seek state

review would, without statutory warrant, create an anoma-

lous system for enforcement of a federal statute.

In issuing Cominco’s PSD permit, petitioner acted

inconsistently with its own determinations that Selective

19

Catalytic Reduction (“SCR”) technology is far more protec-

tive of the environment than the Low NOx technology

petitioner ultimately endorsed, and that SCR is techni-

cally feasible and economically affordable. Petitioner based

its decision on vague and undocumented concerns about

“socioeconomic impacts” and “world competitiveness,”

reasoning that would eviscerate the BACT requirement.

EPA acted within its express statutory powers in taking

enforcement action.

ARGUMENT

I. EPA HAS STATUTORY AUTHORITY TO EN-

FORCE THE SUBSTANCE OF THE BACT RE-

QUIREMENT”

A. The Plain Language of the Act’s Enforce-

ment Provisions Authorizes EPA to Enforce

Any PSD “Requirement.”

Statutory construction “begins” with the statutory

text and “ends there as well” when the text yields a “clear

answer.” Hughes Aircraft Co. v. Jacobson, 525 U.S. 432,

“ The court below (Pet. App. 18a) concluded that EPA's orders

represented “final action” reviewable under 42 U.S.C. § 7607(bX1). A

panel in another circuit has since held EPA compliance orders non-fina!

and unreviewable, reasoning that the CAA cloaks such orders with

serious legal consequences without giving regulated entities a meaning-

ful opportunity to challenge their factual or legal basis. Tennessee Valley

Auth. v. Whitman, __ F.3d __, 2003 WL 21452521 (11th Cir. June 24,

2003). In our view, the TVA decision is faultily reasoned. The Act does

not support the panel’s pivotal conclusion (id. at ** 17-18) that Congress

sought to preclude parties from disputing the factual or legal founda-

tion of EPA compliance orders in judicial enforcement proceedings.

Here, by comparison, the Ninth Circuit construed the statute to require

review of the underlying merits of the EPA compliance orders and

directed the Agency to submit a complete administrative record for

réView by the court of appeals, withdraw its orders, or file an enforce-

ment action in district court. Pet. App. 22a.

11

438 (1999). A statute “is to be read as a whole, since the

meaning of statutory language, plain or not, depends on

context.” King v. St. Vincent’s Hosp., 502 U.S. 215, 221

(1991).

The Act provides a “clear answer” to the question of EPA

enforcement authority presented here. The orders EPA

issued to Cominco on February 8 and March 7, 2000, J.A.

253, 260, 264, and the December 10, 1999 finding and order

issued to petitioner, Pet. App. 26a, 36a, were authorized

under Section 167, 42 U.S.C. § 7477, which allows EPA to

enforce by administrative order or otherwise “the require-

ments” of the Act’s PSD provisions. Section 167 provides:

The Administrator shall, and a State may, take

such measures, including issuance of an order, or

seeking injunctive relief, as necessary to prevent

the construction or modification of a major emit-

ting facility which does not conform to the re-

quirements of [part C, codifying the PSD program].

EPA likewise had express statutory authorization for

these actions under Section 113(a)(5) of the Act. Section

113(aX5) authorizes EPA to take enforcement action when

it finds that a state “is not acting in compliance with any

requirement or prohibition of [the CAA] relating to the

construction of new sources[.]” 42 U.S.C. § 7413(a)(5). The

enforcement power delegated to EPA includes issuing an

order “prohibiting the construction or modification of any

major stationary source.” Jd. On April 25, 2000, EPA,

however, withdrew the order portion of the December 10

document issued to petitioner, because petitioner had

already (and in defiance of EPA’s action) issued Cominco a

PSD permit. Pet. App. 19a; J.A. 300.

B. BACT Is Integral to the Act and Is a Bind-

ing National “Requirement.”

Confronted with statutory language plainly authoriz-

ing EPA to enforce PSD “requirements” and requiring new

and modified major emitting sources to install BACT,

12

petitioner is forced to argue that the “only ‘BACT require-

ment’ pertinent here” is the requirement that a permit

“contain a BACT limitation devised by the state after

considering the applicable factors.” Pet. Br. 22. Petitioner

thus maintains that as long as the state reaches some

BACT determination and complies with the PSD permit-

ting procedures, and as long as the facility will not exceed

the governing ambient air quality standards (such as the

PSD increments and NAAQS), the state has necessarily

complied with the Act. Pet. Br. 22-23. As for the substance

of the BACT requirement, petitioner’s position is: De

gustibus non est disputandem. The BACT determination,

petitioner asserts, is fraught with “case-specific policy

judgments” that make it as subjective and standardless as

“asking different people to pick the ‘best’ car.” Pet. Br. 24.

All this bears little resemblance to that requirement as

established by Congress. Reading petitioner’s account, one

might forget that the Act “requires” BACT in order “to mini-

mize emissions.” S. Rep. No. 95-127 at 29 (1977). It does not

subject facilities to “whatever-technology-the-state-adopts-

after-holding-a-hearing-and-discussing-the-statutory-factors.”

Cf. Vermont Yonkee Nuclear Power Corp. v. NRDC, 435

U.S. 519, 55° (1978) (noting “essentially procedural”

nature of Natio: a. Unvironmental Policy Act, 42 U.S.C.

§§ 4321 et seg.). 1c.ead, it subjects facilities to “the best

available control .<.unology,” 42 U.S.C. § 7475(aX4). The

text rebuts petitioner’s claim (Br. 25-26) that the BACT

standard is one of uncabined subjectivity: BACT is “an

emission limitation based on the maximum degree of

reduction of each pollutant *** which the permitting

authority, on a case-by-case basis, taking into account

energy, environmental, and economic impacts and other

costs, determines is achievable for such facility[.]” 42

U.S.C. § 7479(3) (emphases added). The strong, normative

terms “maximum” and “achievable” — also used in the 1977

amendments’ standards for new sources in nonattainment

areas, 42 U.S.C. §§ 7501(3), 7503(aX2) (“lowest achievable

emission rate”), and the Act’s technology-based standard for

hazardous emissions (42 U.S.C. §7412(dX2) (“maximum

13

degree of reduction * ** achievable”) — are inconsistent

with petitioner’s reading of BACT as inviting the freedom

and even caprice of consumers making automoiive pur-

chases.

When the 95th Congress wanted to restrict EPA's

authority to enforcing “procedural” requirements, it knew

how to say so. See 42 U.S.C. § 7474(b)(2) (EPA may reject

state’s redesignation of PSD area classification if “such

redesignation does not meet the procedural requirements

of this section”). No such limitation, however, is found in

Sections 113(a) or 167.“ This is unsurprising: Given

BACT’s centrality to the PSD program, it would have been

odd for Congress to have empowered EPA to block con-

struction due to a faulty hearing but not an arbitrary

choice of control technology.

Petitioner’s understanding (Br. 22) of the BACT

“requirement” as purely procedural is not shared by the

courts, administrative agencies, or Congress. The leading

decision refers to “BACT requirements” and to BACT as

“[ojne of the principal substantive prerequisites to obtain-

ing a PSD permit,” Alabama Power Co. v. Costle, 636 F.2d

323, 358, 407 (D.C. Cir. 1980); EPA’s and petitioner’s

regulations refer to “BACT requirements,” e.g., 40 C.F.R.

§§ 51.166(s)(4); 52.21(v\4); 18 AAC. 50.375, and the 1977

Senate Report refers to BACT (S. Rep. No. 95-127 at 12) as

a “national requirement” and confirms that EPA may “go

to court to stop a permit for activities which *** did

not comply with the requirements of this section, including

the use of best available control technology.” BACT is a

“ The Title V provisions authorizing EPA to block proposed

operating permits, 42 U.S.C. § 7661d(b), similarly fail to restrict EPA to

“procedural” violations of the PSD provisions, indicating that Congress

in 1990 did not accept petitioner’s view that the substance of BACT

determinations lies within the “sole discretion” of the state.

14

substantive standard that states consenting to implement

the PSD program must apply, not just consider. Cf. FERC

v. Mississippi, 456 U.S. 742, 764 (1982). It is no less a

“requirement” than the Act’s other technology-forcing

obligations, like “lowest achievable emission rate,” 42

U.S.C. § 7503(a)(2), or “best system of emission reduction

* * * adequately demonstrated,” id. § 7411(a).

While making liberal use of the 1977 legislative

history for the undisputed point that states with approved

PSD programs determine BACT (Pet. Br. 18, 30-33),

petitioner ignores passages that expressly confirm EPA's

oversight and enforcement authority. The same 1977

Senate Report that rates a “passim” in petitioner’s brief

explains that:

The [EPA] Administrator’s role is one of monitor-

ing state actions. States have authority to issue

construction permits to new major emitting facili-

ties in clean air areas. The Administrator thus

could go to court to stop a permit for activities

which would exceed the increments of pollution or

which otherwise did not comply with the re-

quirements of this section [setting forth the PSD

program], including the use of best available con-

trol technology. But the Administrator could not

and should not attempt to burden this section

with unnecessary regulations and guidelines.

The Administrator should tell the States the ba-

sis for his review. When asked, [EPA] should be-

come involved at an early date in particularly

difficult permit applications so that States and

localities will know of any potential differences.

S. Rep. No. 95-127 at 12 (emphasis added).

* See also S. Rep. No. 95-127 at 36 (Administrator may take

“measures that would be necessary to prevent the issuance of a permit

(Continued on following page)

7 AOD OR ED eee ET >

15

Despite statutory text and legislative history confirm-

ing EPA's enforcement authority, petitioner insists the PSD

program is part of an “overall approach” (Br. 26) in the Act in

which EPA sets “national standards to achieve and maintain

clean air,” and states “decide how to allocate the available

increments among competing sources.” Pet. Br. 17. Similarly,

petitioner argues (Br. 27), the PSD increments are analo-

gous to the NAAQS and the BACT determination resem-

bles states’ authority under the 1970 amendments to select

“whatever” controls they choose (Train, 421 U.S. at 79) for

existing sources as long as the federal air quality stan-

dards are satisfied.

For new and modified facilities, the Act’s “overall

approach” has never been as petitioner describes. To the

contrary, the 1970 amendments not only established the

nationwide NSPS (supra, p. 4), but also called for technol-

ogy-forcing emissions limitations for hazardous air pollut-

ants (as amended, 42 U.S.C. § 7412), automobiles (42 U.S.C.

§§ 7521-7544), and aircraft (42 U.S.C. § 7571). In 1977,

Congress added new national, technology-based standards

for new and modified stationary sources in both “clean air”

areas, supra, pp. 5-7, and nonattainment areas, 42 U.S.C.

§ 7502(c).* A structure combining technology-forcing federal

for a new source if it did not comply with the [PSD] requirements”);

H.R. Rep. No. 95-564 at 153 (1977) (“The Administrator shall issue

orders and seek other action to prevent the issuance of an improper

permit.”). As Senator Muskie put it: “Once a State adopts a permit

process in compliance with this provision, [EPA's] role is to seek

injunctive relief or other judicial relief to assure compliance with the

law.” 123 Cong. Rec. S9169 (daily ed. June 8, 1977).

* Petitioner is again off the mark when it suggests (Br. 26-27) that

the early NAAQS/SIP model represents some universal template for

federal-state relations under the federal environmental statutes. Federal-

state relationships vary enormously both between statutes and within

particular statutory schemes on basic matters like standard-setting,

(Continued on following page)

16

standards and optional state implementation backed by

EPA enforcement authority — rather than open-ended state

discretion — has been the Act’s “overall approach” for new

and modified sources.

Mischaracterizing BACT as (at best) a mechanism for

states to meet the PSD increments, petitioner disregards

the intended function of the BACT requirement and its

centrality to the PSD program. The 1977 amendments

establish a “national requirement that each new major

facility to be located in a clean air area install the best

available control technology.” S. Rep. No. 95-127 at 12

(emphasis added). Facilities’ obligation to install BACT is

separate and distinct from their obligation to comply with

the PSD increments: Each major emitting source that

complies with the increments must also implement BACT.

See 42 U.S.C. §7475(a).” Because pollution controls

“ultimately determine the emissions from a source, an

accurate BACT analysis is essential to a successful PSD

review.” National Comm’n on Air Quality (““NCAQ”), To

program approval and revocation, permitting authority, enforcement,

and preemption. See Symposium: Environmental Federalism, 54 Md. L.

Rev. 1141 (1995).

" Reviewing a state’s BACT determination, EPA Administrator

Reilly rejected a similar argument, explaining that the Act “separates

issues of overall air quality from issues of technology” and that, in

contrast to the requirements that facilities comply with the increments,

BACT is “principally a technology-forcing measure that is intended to

foster rapid adoption of improvements in control technology.” In re

Columbia Gulf Transmission Co., PSD Appeal No. 88-11, 1989 WL

266361 (E.A.B. 1989). “Both of these provisions,” the Administrator

explained, “must be satisfied by an applicant seeking a PSD permit,

and compliance with one provision does not relieve or lessen an

applicant’s burden of complying fully with the other.” Jd.

a PP SORES ie ioe as —_—s

RL Sa SRE PERE 8 8 Py Sie

17

Breathe Clean Air at 157 (1981). BACT was specifically

intended to produce pollution control beyond that neces-

sary to meet the PSD increments: As explained in the

Senate Report, BACT would compel the “rapid adoption of

improvements in technology as new sources are built,”

while the increments would operate as a “second level of

protection” and a “second stimulant to improved controls”

on air pollution. S. Rep. No. 95-127 at 18.” Petitioner’s

treatment of BACT goes far toward reading it out of the

statute.

An independent BACT requirement is essential to

maintaining the increments themselves. Congress adopted

BACT in part to “minimize the consumption of PSD

increments and thus expand the affected area’s potential

for future economic growth.” NCAQ, To Breathe Clean Air

at 157. “If the allocation were left entirely to the states,

they might give the whole pie to the first comers and

create irresistible pressures to relax the ambient limits

themselves.” Currie, Air Pollution, § 7.08 at 7-21. See also

122 Cong. Rec. S3905 (March 22, 1976) (BACT would

“prevent the first source moving into an area from using

up the full increment”) (quoting article by Sen. Domenici);

S. Rep. No. 95-127 at 31.”

* The NCAQ was established by 1977 amendments to undertake

an independent analysis of air pollution programs. 91 Stat. 685, 785

(1977).

" By prescribing the category-wide NSPS as a minimum for BACT,

42 U.S.C. § 74793), the statutory PSD program ended EPA's prior

practice of equating BACT with NSPS. See Craig N. Oren, » Coarng the

Air, 9 Va. Envtl. L.J. 45, 75 (1989).

* Indeed, the NCAQ found that “a program requiring best avail-

able control technology alone (without the increment system) would

result in emissions growth equivalent to that obtained through the current

program with increments, if best available control technology determina-

tions were made in a manner consistent with its current definition.”

NCAQ, To Breathe Clean Air at 23. See Rodgers, Environmental Law, at

(Continued on following page)

18

Congress intended BACT, as “[pJossibly the most

important” of the 1977 Act’s many technology-fostering

measures, to spur “improvements in the technology of

pollution control.” Petitioner’s treatment of BACT as a

“subjective” appeal to states’ “sole discretion” ignores the

technology-forcing philosophy that was “fundamental” to

the adoption of BACT and congressional efforts through-

out the 1977 amendments “to accelerate technological

innovation in the control of air pollution.” S. Rep. No. 95-

127 at 10. Ascheme that gave states unfettered discretion

to adopt pollution control technologies for particular

sources would not perform this vital “forcing” function. See

Union Elec., 427 U.S. at 257. Had BACT been left to

states’ “sole discretion” (Pet. Br. 27), it would. have done

little. Before 1977, states already had ample authority

under their police powers and the CAA’s savings clause (42

U.S.C. § 7416) to impose more stringent emissions limita-

tions on new and modified sources in clean air areas. A

federally unenforceable invitation to consider various

factors would have provided states no new incentive to

force development of new control technologies.

Petitioner’s approach is also at odds with Congress's

intent through the PSD program to insure that “economic

375-76 (NCAQ study suggests that “BACT is the cake and the incre-

ments the mere frosting”).

* S. Rep. No. 95-127 at 17-18. See 42 U.S.C. §§ 7501(3), 7503(a)(2)

(“lowest achievable emission rate” for new sources in nonattainment

areas), 7502(c)1) (“reasonably available control technology” for existing

sources in nonattainment areas), 7491(g)(2) (requiring “best available

retrofit technology” for existing sources impairing visibility in national

parks and certain other clean air areas); In re Columbia Gulf Transmis-

sion Co., 1989 WL 266361 at *3 (discussing BACT’s “technology-forcing”

role). The Senate Report noted that the technology-forcing provisions of

the 1970 amendments had brought about “positive changes” by

stimulating “more effective, less-costly systems to control air pollution.”

S. Rep. No. 95-127 at 17-18.

19

growth will occur in a manner consistent with the preser-

vation of existing clean air resources,” 42 U.S.C. § 7470(3),

and “to prevent competition for industry to be waged

among States on the basis of air quality.” H.R. Rep. No. 95-

294 at 141 (1977). See Hodel v. Virginia Surface Min. and

Reclamation Ass’n, Inc., 452 U.S. 264, 282 (1981). “With-

out national guidelines for the prevention of significant

deterioration,” legislators feared, firms would “play one

State off against another with threats to locate in which-

ever State adopts the most permissive pollution controls.”

H.R. Rep. No. 95-294 at 134. The PSD program was

intended to forestall a “flight of industry — and jobs” from

dirty-air to relatively clean air areas, and “to protect

States choosing to retain clean air resources from ‘envi-

ronmental blackmail’ by industrial sources that may

attempt to play one State off another with threats to locate

or relocate plants in States with weaker environmental

requirements.” Jd. at 133, 140. Leaving the states, as

petitioner urges, with “sole discretion” to select their own

version of the “best” technology would reinforce the inter-

jurisdictional pressures Congress was trying to restrain.

State permitting authorities would scarcely take an

ambitious view of what level of control technology is

“achievabie” if they knew that competing states had “sole

discretion” to choose their own versions of BACT. Indeed,

the National League of Cities and the National League of

Counties supported the 1977 PSD legislation precisely

because of “the competitive struggle that exists among

States and localities for new industry.” H.R. Rep. No. 95-

294 at 133, 135, 152, 202.

Finally, giving states “sole discretion” over the sub-

stance of control technology choices is in tension with

Congress’s intent through the PSD program to protect

federal parklands, wilderness areas, and other areas of

“special national or regional *** value,” 42 U.S.C.

§ 7470(2), as well as the air resources of neighboring

states, id. § 7470(4). See Craig N. Oren, The Protection of

Parklands from Air Pollution: A Look at Current Policy, 13

Harv. Envtl. L. Rev. 313, 321-27 (1989). Congress had

20

time-tested reasons to provide for a federal “backup” role

regarding state BACT determinations: States have limited

incentives to protect resources belonging to the nation as a

whole or to other states. See Missouri v. Holland, 252 U.S.

416, 435 (1920); Missouri v. Illinois, 200 U.S. 496, 520-21

(1906); McCulloch v. Maryland, 17 U.S. 316, 431-35

(1819). See also 42 U.S.C. § 7474(b) (federal land man-

ager’s role in state reclassification decisions). By denying

federal enforcement authority, petitioner again attributes

to Congress a “conspicuous[] fail{ure]” to “provide EPA

with the authority needed to achieve the statutory goals.”

E.l. Du Pont De Nemours & Co. v. Train, 430 U.S. 112, 133

(1977).”

C. The “Case-by-Case” Nature of Permitting

Authorities’ BACT Determinations Does

Not Defeat EPA’s Enforcement Authority.

Despite the plain statutory language establishing

EPA’s authority to enforce PSD requirements, peti ‘ioner

attempts to create an exemption to the text by argui ig (Br.

21-22, 28-29) that the “case-by-case” nature of the BACT

determination shows that Congress intended to commit

the substance of BACT entirely to states. But, in fact, the

facility-specific BACT inquiry was intended to produce

more effective pollution control and accommodate local

differences in raw materials or plant configuration that

might make a technology “unavailable” in a particular

area. Case-by-case BACT evaluation ensures that permits

* The importance of a federal oversight role is particularly apt in

this case: The Red Dog Mine is located in an otherwise pristine and

scenic region of Alaska, five miles from the Noatak National Preserve,

which protects a spectacular mountain-ringed river basin containing an

intact Arctic ecosystem. According to the National Park Service, which

is responsible for managing the Preserve, vegetation in the area is

likely to be sensitive to nitrogen deposition. See J.A. 228, 284.

21

incorporate “the latest technological developments,” in

contrast to “the stagnation that occurs when everyone

works against a single national standard for a new

source.” S. Rep. No. 95-127 at 18. Whereas the rigid NSPS

standard “must take into account what is best for the

weakest performer in a category,” case-by-case identifica-

tion of BACT “can take advantage of the control potential

of the particular proposed source.” Oren, PSD, 74 Iowa L.

Rev. at 33. It was not intended to give states “sole discre-

tion” to subordinate air quality to other priorities.

BACT determinations are guided by administrable

factors —- “maximum” pollution reductions, consideration of

energy, environmental, and economic impacts, and speci-

fied abatement techniques. 42 U.S.C. § 7479(3). The case-

by-case application of these factors resembles other de-

terminations that agencies and courts regularly confront;

it may not always point to a “single, objectively ‘correct’

BACT determination” (Pet. Br. 23), but it does rule out a

range of unreasonable determinations that if adopted

present appropriate occasions for EPA action. Certainly

nothing about BACT makes it so unsuited to EPA review

as to require the manufacture of an implied exception to

EPA's enforcement authority.

Similarly groundless is petitioner’s effort (Br. 25) to

elicit from Congress’s reference to the “permitting author-

ity” — usually the state, but not infrequently EPA itself -

an implied intent to preclude EPA enforcement. Had

Congress wished to foreclose EPA oversight, it readily

could have so provided. But Sections 113(aX5) and 167

empower EPA to enforce the “requirements” of the PSD

provisions, and neither contains any limitation for BACT

or for state-issued permits. To be sure, Congress intended

to allow states with EPA-approved PSD programs to

22

determine BACT for individual sources, a function

previously performed by EPA alone (S. Rep. No. 95-127 at

8).” But it does not follow that Congress thereby intended

to exempt states from EPA enforcement. Sections 113(aX5)

and 167 show that it did not. See also S. Rep. No. 95-127

at 36 (“Once the State submits an adequate [PSD pro-

gram], [EPA’s] role is restricted to assuring compliance

with the law.”).

D. EPA Has Understood its Limited Role in

Reviewing State PSD Determinations, and

Disavowed any Power to “Second-Guess”

Reasonable State BACT Determinations.

Petitioner is off the mark when it accuses EPA of

asserting a power to “second-guess” petitioner's BACT

determination. See Pet. Br. i, 21, 35. EPA has long ac-

knowledged that its enforcement authority respecting

BACT is circumscribed. Memorandum from Michael S.

Alushin, Associate Enforcement Counsel for Air (July 15,

1988) (J.A. 272-73) (recognizing that BACT determination

involves “the exercise of judgment,” but stating that EPA

may pursue enforcement action if determination is “not

based on a reasonable analysis”). EPA has disavowed any

power to “second-guess” state BACT determinations, and

has repeatedly acknowledged its limited oversight and

* EPA has not contended that Sections 113(a) and 167 “require

EPA approval” (Pet. Br. 25) of state BACT determinations. Instead of

requiring EPA to approve BACT determinations, Sections 113(aX5) and

167 authorize EPA to act in those rare instances when a state has acted

arbitrarily. See, e.g., 57 Fed. Reg. 28,093 (June 24, 1992) (“EPA ac-

knowledges that states have the primary role in administering and

enforcing the various components of the PSD program. States have

been largely successful in this effort, and EPA’s involvement in inter-

pretative and enforcement issues is limited to only a smal] number of

cases.”).

—

o_— -

23

enforcement role.” It adhered to that limited role here,

explaining why petitioner's BACT determination was

“arbitrary” and contrary to petitioner’s own findings. J.A.

149-50. EPA’s limited but vital role in enforcing BACT is

consistent with a scheme that “places primary responsi-

bilities and authority with the States, backed by the

Federal Government.” S. Rep. No. 95-127 at 29.

Nor is there merit to petitioner’s warning that EPA

could upset state BACT determinations “months, even

years, after a permit has been issued.” Pet. Br. 35. EPA’s

exercise of its enforcement powers is subject to judicial

review. See 42 U.S.C. §§ 7607(b)\(1), 7413(b). EPA could not

engage in the conduct hypothesized by petitioner while the

federal courts sit to review EPA's actions. See Panhandle

Oil Co. v. Mississippi ex rel. Knox, 277 U.S. 218, 223 (1928)

(Holmes, J., dissenting). Cf. United States v. AM General

Corp., 34 F.3d 472, 475 (7th Cir. 1994) (upholding dis-

missal of enforcement action where EPA did not act until

well after facility received PSD permit and completed

plant modifications).

* As it noted in approving Virginia's PSD program, “EPA may not

intrude upon the significant discretion granted to states under new

source review programs, and will not ‘second guess’ state decisions.” 63

Fed. Reg. 13,795, 13,796 (March 23, 1998). EPA inquires whether the

State’s decision rested “on reasonable grounds properly supported on

the record, described in enforceable terms, and consistent with all

applicable requirements.” Jd. See also, e.g., 58 Fed. Reg. 15,422, 15,426

(March 23, 1993).

24

E. Relegating EPA to an Appeal Before a State

Agency or Court Is Inconsistent With the

Statute and Would Create an Ungainly Pro-

cedure for EPA Oversight and Enforce-

ment.

There is nothing unduly “awkward[]” (Pet. Br. 19)

about Congress’s decision to subject states’ decisions in

implementing the PSD program to EPA's oversight and

enforcement authority, to be followed by an opportunity for

federal judicial review of any final EPA actions in particu-

lar instances. Such policy considerations are no defense

against plain statutory language. See 42 USC.

§§ 7413(aX5), 7477; Rodgers, Environmental Law, § 3.36

at 523 (“For better or worse, this forum that places EPA in

an appellate position reviewing ‘major’ state permits is the

principal source of recorded law on compliance orders.”)

Nor is there anything unusual about authorizing EPA

(subject to judicial review) to oversee state implementation

of the BACT requirement. Similar federal oversight roles

abound under the CAA and other federal statutes. EPA

reviews SIPs, and federal courts of appeals then review

EPA’s actions, see 42 U.S.C. §7410(a), (k); 42 U.S.C.

§ 7607(b\(1); Union Elec., 427 U.S. at 252, even though

those state plans involve discretion-laden policy judg-

ments. Section 209(b\1) of the CAA provides that the

Administrator shall deny a state’s request for a waiver of

the Act’s preemption of state auto emissions standards if

EPA concludes that the state’s determination that condi-

tions for a waiver exist is “arbitrary and capricious,” 42

U.S.C. § 7543(bX 1). See Motor and Equipment Mfrs. Ass’n,

Inc. v. EPA, 627 F.2d 1095 (D.C. Cir. 1979). Under the

Clean Water Act, federal courts review EPA's decisions to

approve or set aside state-promulgated water quality

standards. See 33 U.S.C. § 1313(c); American Widdlands v.

Browner, 260 F.3d 1192, 1196 (10th Cir. 2001).

Indeed, it is petitioner’s alternative enforcement

scheme that diverges from the norm under federal envi-

ronmental laws. Petitioner (Br. 23) acknowledges that EPA

ae eee ~

25

itself can take “appropriate action” under Sections

113(aX5) and 167 when a state has failed to issue any

BACT determination; granted a permit that allows viola-

tions of NSPS or ambient standards; denied a hearing; or

failed to conduct the statutorily required analysis of the

proposed source. After a discreet interval of pages, how-

ever, petitioner asserts (Br. 36) that, if EPA disputes the

substance of a state BACT determination, its only recourse

is to file a state administrative appeal and seek review in

state court. Petitioner does not explain whether the state

court then would apply federal law, some unspecified state

law, or whether (as petitioner elsewhere suggests, Pet. Br.

24-25) the BACT definition simply has no legally binding

substance (rendering any appeal a fool's errand). In any

event, petitioner complains (Br. 19, 36, 37) that EPA

improperly “bypassed” or “short-circuited” this putative

review scheme.

Congress has not traditionally been in the practice of

subjecting federal agencies charged with enforcing federal

law to exclusive state jurisdiction. Cf AT&T Corp. v. Iowa

Utilities Bd., 525 U.S. 366, 378 n.6, 385 n.10 (1999).”

Among other defects, petitioner’s approach would require

EPA to litigate in two fora at once — federal courts for

procedural violations, and state courts for claims of sub-

stantively unlawful misapplications of the BACT stan-

dard. Such a scheme would hardly conduce to “certainty

- We are aware of no comparable regime in any federal environ-

mental statute. The McCarran Amendment, 43 U.S.C. § 666, contains

an express waiver of federal immunity and rests on considerations

unique to general water rights adjudications. See Arizona v. San Carlos

Apache Tribe, 463 U.S. 545, 571 (1983). State water quality certifica-

tions under Section 401 of the Clean Water Act are reviewable only in

state court, but Section 401 expressly incorporates state law, 33 U.S.C.

§ 1341(d). See PUD No. 1 of Jefferson County v. Washington Dep't of

Ecology, 511 U.S. 700 (1994). BACT determinations, by contrast, rest

exclusively on federal law.

26

and finality’ or “cl{arity]” (Pet. Br. 35, 36) in the permit-

ting process. The statute refutes petitioner’s contention

that the same Congress committed the core of the BACT

decision — the choice of control technology and explanation

for that choice — to the unreviewable discretion of state

agencies and courts.”

Il. EPA PROPERLY DETERMINED THAT THE

PERMIT ISSUED BY PETITIONER IS ARBI-

TRARY AND INCONSISTENT WITH THE ACT

The question presented is whether EPA has the

“authority” to take enforcement action with respect to the

Red Dog PSD permit. Pet. i. As demonstrated, the answer

to that question is affirmative. The Court need not reach

the further issue whether EPA properly exercised its

authority on the facts here. If the Court does address that

issue, however, petitioner’s own reasoning demonstrates

that its BACT determination for MG-17 violated the

statute. Under the top-down approach petitioner pur-

ported to apply, see J.A. 62, 109, 176, petitioner repeatedly

determined, and still does not dispute, that SCR is be-

tween two and three times as effective as “Low NOx”

technology at reducing NOx emissions. See J.A. 188-89

(SCR achieves 80-90% reductions in emissions); J.A. 191

(30% for Low NOx); see also J.A. 65, 110, 181. Tracking the

statutory factors, 42 U.S.C. § 74793), top-down analysis

proceeds to consider whether the top-ranked technology is

* 42 U.S.C. §§ 7413(aX5), 7477. See also S. Rep. No. 95-127 at 12.

Petitioner also points (Br. 38) to language ensuring “interested persons

including representatives of the Administrator” an opportunity to

participate in PSD permit hearings. 42 U.S.C. § 7475(aX2). This

language guarantees EPA a chance to participate in state hearings,

thereby encouraging early mediation of any disagreements with the

state. See S. Rep. No. 95-127 at 12. It does not, however, purport to

limit the enforcement authorities described in Sections 113(aX5) and

167.

27

technically and economically feasible. Petitioner estab-

lished that SCR was technically feasible and never devi-

ated from this finding. See J.A. 65, 80, 181.” On May 4,

1999, petitioner found that SCR was also economically

feasible, with a control cost effectiveness of about $1600

per ton, well within the established range for NOx BACT

determinations. J.A. 83.

At Cominco’s urging, however, petitioner reversed

course in its September 1, 1999 report, this time deeming

SCR’s costs “excessive.” J.A. 116. Petitioner, however,

never significantly altered its estimate that SCR cost-

effectiveness was about $2000 per ton nor disputed that

this value fell within the established range for NOx BACT.

J.A. 113, 204. Cominco never presented any evidence that

the capital cost of SCR would seriously impair the profit-

ability of the mine, and refused to provide this information

when EPA requested it.” In its final report, petitioner

stated that “[aJnother perhaps better way to determine

BACT is for the applicant to present detailed financial

information showing its effect on the operation. However,

* In its September 28, 1999 letter to petitioner, EPA informed

petitioner that Wartsila, the manufacturer of Cominco’s generators, had

provided it with a list of 33 facilities that had installed SCR on more

than 50 of their engines. J.A. 124.

* It is not self-evident that installing SCR would adversely affect

Cominco’s “competitiveness,” let alone the regional economy. Cominco’s

1999 annual report lists its revenues as $1.645 billion, and its operating

profits from zinc operations as $234 million. See 1999 Annual Report,

available at http//www.teckcominco.com/investors/reports/clt/clt-99-ar.

pdf (last visited June 26, 2003). The report described the Red Dog Mine

as the company’s “flagship operation,” holding “approximately 23% of

the world’s zinc mine reserves,” the “largest and richest ever discov-

ered,” and “key” to Cominco’s “strategic efforts to become the world’s

lowest cost and most profitable zinc producer.” Jd. at p. 2. Teck-

Cominco’s annual report lists its 2002 revenues as $2.187 billion. See

2002 Annual Report, available at http//www.teckcominco.com/investors/

reports/ar2002/tc-2002-highlights.pdf (last visited June 26, 2003).

28

the applicant did not present this information. Therefore,

no judgment can be made as to the impact of a $2.1 million

control cost on the operation, profitability, and competi-

tiveness of the Red Dog Mine.” J.A. 116; see also J.A. 207.

To explain its about-face, petitioner stated that

Cominco’s mine provides jobs in a depressed region, and

that the ongoing expansion ensured that it “will continue

to influence and benefit the residents and the economy of

this region.” J.A. 208.” Petitioner explained that it had

“chosen to consider the direct cost of SCR technology and

its relationship to retaining the Mine’s world competitive-

ness as it relates to community socioeconomic impacts for

the foremost consideration to judge economic impacts.

J.A. 208. In this opaque language lurk rationales that

would, if tolerated, eviscerate the PSD program. First,

petitioner’s reliance on competitiveness impacts and job

losses was baseless given its statement a page earlier that

“no judgment can be made as to the impact of a $2.1

million control cost on the operation, profitability, and

® Petitioner (Br. 13) also reprises an argument it expressly rejected

in the permitting proceedings, namely, that Cominco’s agreement to

install Low NOx on existing generators MG 1, 2, 3, and 5, meant that

the net emissions of the project as permitted were lower than if

Ceminco had installed SCR on MG 17 only. As EPA explained (J.A. 96-

97) and as petitioner acknowledged (J.A. 111-12, 199), the CAA and

implementing regulations do not allow for such an approach. “Netting”

can be used to exempt modified sources from PSD review requirements

if there will be no significant project-wide increase in emissions. See 40

C.F.R. § 51.166(bX3), 40 C.F.R. a pacer oye Cominco CO, however, =

roposing an expansion that would result in a net increase in

a sn of 1100 tons per year. J.A. 169. (The BACT threshold for NOx

emissions is 40 tons per year.) Furthermore, Cominco had an independ-

ent legal imperative to install Low NOx controls on units 1,2,3 and 5.

Once Cominco sought to have the operating caps removed from these

units, leading to pollution increases, it had to use low-NOx technology

to keep pollution from these units below previously permitted levels.

J.A. 139. Had Cominco declined to do so, these units would have been

independently subject to BACT. J.A. 129, 139.

29

competitiveness of the Red Dog Mine.” J.A. 207. More

fundamentally, petitioner’s stated grounds for decision are

contrary to the statute’s focus on what is “achievable” and

BACT’s intended function as a meaningful technology-

forcing standard to counter interstate competitive pres-

sures to lower air quality requirements. Supra, p.19.

If states could reject effective and “available” tech-

nologies based on undocumented claims about “boost[ing]”

the local economy and “world competitiveness” (J.A. 207-

208), the BACT requirement would mean little. Surely

most “major emitting facilities” - which by definition emit

hundreds of tons of pollutants per year, see 42 U.S.C.

§ 7479(1), and under the instant permit, almost 4000 tons

per year of NOx, J.A. 156-57 — are subject to “world

competition.” By relying on the massive Red Dog facility’s

“socioeconomic impacts,” petitioner flouted Congress’

intent in the PSD program “to identify facilities which,

due to their size, are financially able to bear the substan-

tial regulatory costs imposed by the PSD provisions and

which, as a group, are primarily responsible for emissions

of the deleterious pollutants that befoul our nation’s air.”

Alabama Power, 636 F.2d at 353. The Act cannot be read to

excuse facilities from installing effective contro] technology

by invoking competitive conditions that are ubiquitous in a

market economy.

Petitioner changed course based on a desire to “sup-

port Cominco’s Red Dog Mine Production Rate Increase

Project, and its contributions to the region” and to reward

Cominco for its “unique and continuing impact on the

economic diversity of this region[.]” J.A. 208. Whatever the

precise contours of permitting authorities’ discretion,

concerns like these cannot be lawful rationales to reject

otherwise more effective and available control technolo-

gies. States then would have unbridled discretion to adopt

dramatically less effective control technologies based on a

bare desire to reward local businesses. Petitioner’s solici-

tude for a local company at the expense of air quality

illustrates the kinds of local pressures that led Congress to

30

impose BACT as a “national requirement,” supra, p. 16,

and stands as an example of why the EPA enforcement

authority expressly provided for in Sections 113(a) and 167

of the Act is essential in maintaining the integrity of the

PSD program.

CONCLUSION

The judgment of the court of appeals should be af-

firmed.

Respectfully submitted,

MICHAEL C. LEVINE SEAN H. DONAHUE

EARTHJUSTICE Counsel of Record

325 Fourth Street WASHINGTON AND LEE

Juneau, Alaska 99801 UNIVERSITY SCHOOL

(907) 586-2751 OF LAW

Admitted to practice only Lexington, Virginia 24450

in California (540) 458-8400

ELIZABETH A. FAYAD VICKIE L. PATTON

NATIONAL PARKS ENVIRONMENTAL DEFENSE

CONSERVATION ASSOCIATION 2334 North Broadway

1300 19th Street, N.W., Boulder, Colorado 80304

Suite 300 (303) 440-4901

Washington, D.C. 20036

(202) 454-3306

Counsel for Amici Curiae