Petition for Writ of Certiorari — Ohio v. Thomas

Supreme Court, U>

FILED

g5-1378 |

FEB 12 1986

CASE NO. .

_ SPANIOL, JR.

anagil SLERK

Inu Che

Supreme Court of the United States

OCTOBER TERM, 1985

STATE OF OHIO,

Petitioner,

v.

WILLIAM D. RUCKELSHAUS,

Administrator, United States

Environmental Protection Agency,

Respondent.

ON WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

PETITION FOR WRIT OF CERTIORARI

ANTHONY J. CELEBREZZE, JR.

Attorney General of Ohio

MARTHA E. HORVITZ

Assistant Attorney General

State Office Tower

30 East Broad Street, 17th Floor

Columbus, Ohio 43266-0414

(614) 466-2766

Counsei of Record for Petitioner

QUESTIONS PRESENTED FOR REVIEW

‘. Whether the Clean Air Act authorizes the United

States Environmental Protection Agency to disapprove a state

attainment status designation supported by adequate ambient

air quality monitoring data for the reason that emissions from

sources in the area to be redesignated as in attainment with

national ambient air quality standards may potentially impact

upon another, nonattainment area, where the administrative

record contains no monitoring, modeling, or other evidence to

support disapproval, and the Environmental Protection

Agency admits that the area to be redesignated is in fact in

attainment with the standard.

7: Whether the court of appea!s employed the proper

standard of review in deferring to the Environmental Protec-

tion Agency's view that nonattainment designations may be

based on the location of sources of air emissions rather than

on ambient air quality.

QUESTIONS PRESENTED FOR REVIEW

TABLE OF CONTENTS

OPINIONS BELOW

JURISDICTION

STATUTORY PROVISIONS INVOLVED

STATEMENT OF THE CASE

REASONS FOR GRANTING THE PETITION

TABLE OF CONTENTS

THE DECISION OF THE SIXTH CIRCUIT CON-

FLICTS WITH A RECENT DECISION OF THE

SEVENTH CIRCUIT ON THE SAME ISSUE AND

NEARLY IDENTICAL FACTS, RESULTING IN A

DICHOTOMY IN PROCEDURAL SAFEGUARDS

PROVIDED TO THE STATES AND OTHERS

AFFECTED BY ACTIONS OF THE UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY WHICH

SHOULD BE RESOLVED BY THIS COURT..........

A. A Reviewing Court ls Obligated To Conduct A

Thorough, In-Depth Review Of Agency Action

To Ensure That Such Action Was Not Arbitrary,

Capricious, An Abuse Of Discretion, Or Other-

wise Not In Accordance With Law.............

B. Although EPA's Actions In Illinois And Ohio

Were The Same, The Seventh Circuit Applying

The Appropriate Standard Of Review Re-

manded EPA's Action, While The Sixth Circuit

Without Engaging In A Thorough Review, Af-

Wrmed SPAS AGW . iss ca bens canktciesceeuns

THE DECISION OF THE SIXTH CIRCUIT IS CON-

TRARY TO THE INTENT OF CONGRESS EX-

PRESSED IN THE CLEAN AIR ACT AND PRESENTS

AN IMPORTANT QUESTION OF FEDERAL LAW

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TABLE OF CONTENTS cont'd

Page

WHICH SHOULD BE DECIDED BY THIS COURT,

WHETHER THE STATES OR THE UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY ARE

PRIMARILY RESPONSIBLE FOR AIR POLLUTION

rere Seb 6 ew hb aback ssh ei eases 11

A. The Clean Air Act Clearly And Unambiguously

Describes The Criteria For Determining

Attainment/Nonattainment Areas ............. 11

B. Congress Clearly Expressed Its Intent In The

Clean Air Act That The States Are Primarily

Responsible For Air Pollution Control......... 13

Neen eee eye basenacebaces 16

ge 18

APPENDIX A

State of Ohio v. Ruckelshaus,

pe a A-1

APPENDIX B

49 Fed. Reg. 24124 (June 12, 1984) ............. A-15

APPENDIX C

lilinois State Chamber of Commerce v.

United States Environmental Protection

Agency, 775 F.2d 1141 (7th Cir. 1985) ........... A-29

APPENDIX D

ES A-64

iv

TABLE OF AUTHORITIES

Page

Cases:

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

Defense Council, Inc., __U.S.____ , 104

ee Sk Sh We ead tie Cua dewacnennacceee 11

Citizens To Preserve Overton Park, Inc. v.

Volpe, 401 U.S. 402, 416, 91 S. Ct. 814, 28

A: en ee EE daa cca cchaceasawink dacs eehe>s 6

lliinois State Chamber of Commerce v. United

States Environmental Protection Agency,

re, te bi fs, Le Renan i

industrial Union Department v. American

Petroleum Institute, 448 U.S. 607, 100

S. Ct. 2844, 65 L. Ed. 2d 1010 (1980)............... 10

Motor Vehicle Mfrs. Ass'n v. State Farm

Mutual, 463 U.S. 29, 103 S. Ct. 2856,

OU Ge ke IS ob kek acu 54 600cacenaans 6, 10

State of Ohio v. Ruckelshaus,

176 F. 28 1535 Ge Civ. TORS)... wc cc ccc cece 1,12

Train v. Natural Resources Defense Council

Inc., 421 U.S. 60, 86-87, 95 S. Ct. 1470,

TH, Ge U, Ge Be Ft CUTE nace cccccnccsciccuc’ 13

Union Electric Co. v. EPA,

427 U.S. 246, 266,96 S. Ct. 2518,

aoon, 40 L. Be. BG 474 CIBTE) oo vw ccc cceccess 13, 15

Western Oil and Gas Association v. United

States Environmental Protection Agency,

Fe Os ee ee EE ok RA SRA Se 8Gee ce weceésce 15

TABLE OF AUTHORITIES cont'd

Page

Statutes:

ee SN CU ox cb cacanesicacacivcceseseiewceu ts 6

ug ee rr rs” 1

ME ULEAD. RA Ft GEORG. 5 wa ncn cccn cen cceescececes 1

GE UAT S, TT TOMI 6 owns cece cvecnwewsedaucas 1,13

er I EEE ic cuwecccccnaeddaseccennae 1,13

Se ARs SS PED gtk aac acnn nenno60es0 60005555 12

er SS OUI cnn os ccbendec essen Nadneeans 12

ee TE CUED ek cos ceccekunveteusnsewn 1,2, 12

G2 ULES, BGO FOTO) ncn eccseccacesccccccss 11,15

4D UBC. GOCUON TEGTHD on nn cece cccceccccscsss 2, 12,13

GE URES. Be FPUNEEED wa wccccecccvecsccccvecesss 12

ee : SE Wonks <0 8440b46 84 SRN SRA 1,713

RE ne SIE c nv ka cc cnewccwankacsanenen 14

GOP UBC. BOOM TH TOD nn nc ccc cece cnccccscccscsss 14

ARs: SE IN 6.6. 6660 ves dcnedtncncwascaeea 1,12

42 U.S.C. SOMO TERING) nw ccc cc ccascccsences 6, 14, 15

GE ULES. GH FOE oc cece cea cccacncceccdacs 14

gS i ere errs rer 6

Ge UE Se FID oa 6 koko 6s wecececevawanass 6, 14

42 U.S.C. SECON TEDG), GH) ow... ccc ne wecccccccssnces 14

GR URES, SG FOTN 6 beac ckvascccussnassoncsees 4

Oe AR, CD FUDGE 5 chun cadccasvecaucscneuseuhs 14

Miscellaneous:

48 Fed. Reg. 36275 (August 10, 1983)................0.. 2

49 Fed. Reg. 24124 (June 12, 1984)................- 1,23

OPINIONS BELOW

The opinion of the United States Court of Appeals for the

Sixth Circuit in State of Ohio v. Ruckelsnaus, is reported at 776

F.2d 1333 (6th Cir. 1985), and is set out for the Court's

convenience in Appendix A. The final rulemaking action by

the United States Environmental Protection Agency at issue

before the Sixth Circuit is published at 49 Fed. Reg. 24124

(June 12, 1984), and is included for the Court's convenience in

Appendix 8.

JURISDICTION

The judgment of the Sixth Circuit was entered on

November 15, 1985. The jurisdiction of this Court to review

that judgment is invoked pursuant to 28 U.S.C. Section

1254(1).

STATUTORY PROVISIONS INVOLVED

This case involves the interpretation of provisions of the

Clean Air Act as amended, 42 U.S.C. Section 7401 et seq.,

concerning the definition of attainment and nonattainment

areas, 42 U.S.C. Sections 7407(d) and 7501(2), and their

relationship to the authority conferred by Congress on the

states as expressed in the Clean Air Act, 42 U.S.C. Sections

7401(a)(3), 7407(a), and 7410. Relevant provisions of the Clean

Air Act as amended in 1977 are set out in Appendix D.

STATEMENT OF THE CASE

Ohio petitions this Court from the decision of the United

States Court of Appeals for the Sixth Circuit denying Ohio's

petition for review ofthe final action of the Administrator of the

United States Environmental Protection Agency (hereinafter

“EPA”) disapproving the request of Ohio to redesignate Lorain

County from nonattainment to attainment for the national

ambient air quality standard for ozone.

Ohio submitted to EPA on November 29, 1982 a request

to revise the attainment status designations with respect to the

national ambient air quality standard (“NAAQS”) for ozone

under Section 107(d) of the Clean Air Act, 42 U.S.C. Section

7407(d), for forty-six counties from nonattainment to attain-

ment. The request, which was made pursuant to Section

107(d)(5) of the Act, 42 U.S.C. Section 7407(d)(5), was ac-

companied by ozone ambient air quality monitoring data.

Among the counties for which Ohio requested redesignation

were Lorain, Medina, Lake and Geauga, ali of which, along

with Cuyahoga County, are considered part of the Cleveland

urbanized area. EPA approved the redesignation of Medina

County and disapproved the redesignation of Lorain, Lake,

and Geauga Counties. 49 Fed. Reg. 24124 (June 12, 1984).

The ambient air quality monitoring data submitted by

Ohio with its redesignation request covered the years 1980,

1981, and 1982, and showed no violations of the ozone

standard in either Lorain or Medina Counties. 48 Fed. Reg.

36276 (August 10, 1983). Lorain County is west of the City of

Cleveland, which is located in Cuyahoga County, and west of

Medina County. Medina County is south, southwest of Cuya-

hoga County. Summit County is also located south of Cuya-

hoga County and to the east of Medina County. Lake County is

located to the northeast of Cuyahoga County. Lorain, Cuya-

hoga, and Lake Counties are all bordered on the north by Lake

Erie. EPA determined that based on meteorological data, the

prevailing winds in Ohio in the summer are from the south

through the west. Thus, Cuyahoga County is upwind of Lake

County, and Lorain, Medina, and Summit Counties are all

upwind of Cuyatioga and Lake Counties.

Despite the fact that the ambient air monitoring data

showed no violations of the ozone standard in Lorain County

and the acknowledgment of this by EPA, 48 Fed. Reg. 36276

(August 10, 1983), EPA proposed, 48 Fed. Reg. 36275 (August

10, 1983), and then took final action to disapprove the

redesignation of Lorain County as attainment for ozone. 49

Fed. Reg. 24124 (June 12, 1984). The disapproval was based

on EPA's assumption that volatile organic compound (VOC)

emissions from sources in Lorain County would impact the

downwind Cieveland urban area. 48 Fed. Reg. 36276 (August

10, 1983); 49 Fed. Reg. 24125 (June 12, 1984).

EPA raised no question as to the adequacy of Ohio's

monitoring data from Lorain County, and in fact conceded that

based on the monitoring data Lorain County is in attainment of

the ozone standard. The record reflected no air quality

modeling or other studies performed by EPA to verify its

assumption that VOC emissions in Lorain County are causing

or contributing to ozone violations in the downwind Cleveland

urban area. Rather EPA admitted that its decision on Lorain

County was based on monitoring in Chicago, St. Louis, Los

Angeles, and Detroit, instead of monitoring in Lorain County.

49 Fed. Reg. 24125 (June 12, 1984). The rulemaking record

contained no explanation of why these monitoring data

should be deemed applicable to the Cleveland area. Among

the studies cited by EPA there were differences in predomin-

ant wind direction during times of elevated ozone, topography,

orientation of water bodies to the land-based sources and

receptors, and distance and direction of maximum ozone

concentrations from the hydrocarbon sources. None of the

study situations parallels the Cleveland urbanized area situa-

tion.

EPA's final rulemaking also contained a statement in-

dicating that EPA considered Lorain and Medina Counties,

both of which are part of the Cleveland urbanized area, to be in

like situations, justifying the deniai of the redesignation of both

counties. 49 Fed. Reg. 24125 (June 12, 1984). Yet Medina

County's redesignation was approved. 49 Fed. Reg. 24124

(June 12, 1984). Medina County is located generally upwind of

the majority of the Cleveland area, as is Summit County. Data

in the rulemaking record indicate several violations of the

national ambient air quality standard for ozone in Summit

County during the period 1980-1982. However, Summit

County is not part of the Cleveland urbanized area, and the

potential impact of VOC emissions from sources in Summit

County on the downwind Cleveland urbanized area was not

considered by EPA when it acted on Ohio's request to

redesignate Lorain County to attainment for ozone.’

Ohio petitioned the Sixth Circuit pursuant to Section

307(b)(1) of the Ciean Air Act, 42 U.S.C. Section 7607(b)(1), for

review of EPA's denial of its redesignation request for Lorain

County, arguing that EPA's denial of Ohio's attainment status

redesignation request for Lorain County on the grounds that

emissions from Lorain County may potentially impact upon

another, nonattainment area was not authorized by the Clean

Air Act, and that EPA's denial of Ohio's request to redesignate

Lorain County as attainment was not supported by the record,

and was arbitrary, capricious, and an abuse of discretion. The

Sixth Circuit concluded that EPA acted reasonably under the

Clean Air Act, and did not act arbitrarily and capriciously in

denying Ohio's redesignation request. It, therefore, denied

Ohio's petition for review.

At the same time that the Sixth Circuit was considering

Ohio's petition for review, the Seventh Circuit had before it a

petition filed by the State of Illinois and the Illinois State

Chamber of Commerce to review a final action of EPA denying

Illinois’ request to redesignate two counties near Chicago as

in attainment with the national ambient air quality standard for

’ Ace wding to the data contained in EPA’s technical support documents,

Cuyahoga County was meeting the ozone NAAQS during the period 1980 - 1982.

Summit County, in which the City of Akron is located, had several violations of the

ozone standard during this period, and Lake County had a minima! violation of the

ozone standard during this period. Since the monitoring data for Lorain County, which

is located directly west of Cuyahoga and Medina Counties, showed attainment with

the ozone NAAQS, and monitoring in Cuyanoga and Medina Counties also showed

attainment with the ozone NAAQS, obviously emissions from Lorain County were not

adversely impacting Cuyahoga and Medina Counties. Since Summit County is

located more directly upwind of Lake County than is Lorain County, it would have

beer much more logical for EPA to assume that it was VOC emissions from Summit

County, which is not in attainment with the ozone NAAQS, that are responsible for

ozone problems in Lake County, rather than emissions from Lorain County. However,

because Summit County is not considered to be part of the Cleveland urban area EPA

ignored the possibility that sources there may be impacting the downwind Cleveland

urban area.

ozone. Illinois State Chamber of Commerce v. United States

Environmental Protection Agency, 775 F.2d 1141 (7th Cir.

1985). (This decision is included as Appendix C.) Although

EPA had previously granted a request by Illinois to redesig-

nate two other counties upwind of Chicago as attainment, it

denied this particular redesignation request on the same

grounds that it had denied Ohio’s redesignation request.?

Upon review, the Seventh Circuit concluded that EPA had not

provided a sufficient reasoned analysis of its action and that its

action was, therefore, arbitrary and incapable of rational

review in the court. /d. at 1147. EPA’s action was remanded for

reconsideration and Clarification. /d. at 1151.

REASONS FOR GRANTING THE PETITION

This case presents an opportunity for this Court to

resolve a clear conflict between the decisions of two federal

courts of appeals. The conflicting determinations reflect

different standards of review employed by the two courts in

reviewing virtually identical actions by EPA. Thus, it is

necessary for this Court to define the appropriate standard of

review and the extent to which a reviewing court should defer

to EPA’s interpretation of the Clean Air Actin this type of case.

Additionally, this case presents an opportunity for this

Court to consider a question which has not been addressed

by it, but which is of great importance to the states. That

question is whether EPA has authority to deny a state's

request to redesignate an area, which has been shown by

adequate ambient air quality monitoring data to be in com-

pliance with national ambient air quality standards, as in

attainment with national ambient air quality standards, partic-

ularly in light of the congressionally expressed intent in

enacting the Clean Air Act of giving the states primary

responsibility for preventing and controlling air pollution.

2|n the illinois case, however, the rulemaking record did include a study of ozone

transport performed in the Chicago area. /d. at 1143-1144. As previously noted, the

rulemaking record in Ohio's case contained no such study of the Cleveland area.

Because a nonattainment designation automatically results in

the imposition of additional contro] measures (reasonably

available control technology, Clean Air Act Section 172(b)(3),

42 U.S.C. Section 7502(b)(3)), and restrictions on the construc-

tion of new and modified sources (offset requirements and

compliance with lowest achievable emission rate, Section

173(1), (2), 42 U.S.C. Section 7503(1), (2)), and the threat of the

imposition of sanctions if a state fails to submit a control plan

for a nonattainment area that EPA finds to be adequate, the

resolution of this question is of major importance to the states.

I. THE DECISION OF THE SIXTH CIRCUIT CON-

FLICTS WITH A RECENT DECISION OF THE

SEVENTH CIRCUIT ON THE SAME ISSUE AND

NEARLY IDENTICAL FACTS, RESULTING IN A

DICHOTOMY IN PROCEDURAL SAFEGUARDS

PROVIDED TO THE STATES AND OTHERS

AFFECTED BY ACTIONS OF THE UNITED STATES

ENVIRONMENTAL PROTECTION AGENCY

WHICH SHOULD BE RESOLVED BY THIS COURT.

A. A Reviewing Court Is Obligated To Con-

duct A Thorough, In-Depth Review Of

Agency Action To Ensure That Such Ac-

tion Was Not Arbitrary, Capricious, An

Abuse Of Discretion, Or Otherwise Not In

Accordance With Law.

This Court has held that agency action subject to the

standard of review set outin the Administrative Procedure Act,

5 U.S.C. Section 706, requires a “searching and careful”

inquiry into the facts, and a determination “whether the

decision was based on a consideration of the relevant factors

and whether there has been a clear error of judgment.”

Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402,

416,91S. Ct. 814, 824, 28 L. Ed. 2d 136 (1972). In Motor Vehicle

Mfrs. Ass'n v. State Farm Mutual, 463 U.S. 29, 103 S. Ct. 2856,

77 L. Ed. 2d 443 (1983), the Court elaborated further on this

standard of review.

Normally an agency rule would be arbitrary and

Capricous if the agency has relied on factors which

Congress has not intended it to consider, entirely

failed to consider an important aspect of the pro-

blem, offered an explanation for its decision that

runs counter to the evidence before the agency, or is

so implausible that it could not be ascribed to a

difference in view or the product of agency ex-

pertise. The reviewing court should not attempt itself

to make up for such deficiencies: “We may not

supply a reasoned basis for the agency’s action that

the agency itself has not given.” SEC v. Chenery

Corp., 332 U.S. 194, 196, 67 S. Ct. 1575, 1577, 91 L.

Ed. 1995 (1947). 463 U.S. at 43, 103 S. Ct. at 2867.

The Court stressed that “an agency must cogently explain

why it has exercised its discretion in a given manner.” /d. 463

U.S. at 48, 103 S. Ct. at 2869.

In two decisions involving the same issues and almost

identical facts, two United States courts of appeal approached

the review of a rulemaking action by the EPA differently,

resulting in an entirely different outcome. The Seventh Circuit

in Illinois State Chamber of Commerce v. United States

Environmental Protection Agency, supra, engaged in a

thorough, in-depth review of EPA’s action and the rulemaking

record, and concluded that EPA had failed to clearly explain

the rationale for its action and that its action, therefore,

appeared to be arbitrary. The Court remanded the matter to

U.S. EPA for further proceedings. The Sixth Circuit, on the

other hand, did not carefully and thoroughly review EPA's

action. Rather, it deferred to EPA’s interpretation of the statute,

failed to carefully consider whether the facts supported EPA’s

action, and affirmed.

3 Notably, the Seventh Circuit found EPA's action to be arbitrary even though the

rulemaking record in Illinois’ case included a study of ozone transportin the Chicago

area which was the subject of the ruiemaking action. The Sixth Circuit, however,

found EPA's action not to be arbitrary, even though the rulemaking record in Ohio's

case contained no study of the Cleveland area under consideration.

EPA is now facing two divergent views on the adequacy

of its rulemaking records. The result is that certain states, like

Ohio, may be subject to less rational and informed decision-

making by EPA. .

B. Although EPA’s Actions In lilinois And Ohio Were

The Same, The Seventh Circuit Applying The Appro-

priate Standard Of Review Remanded EPA’s Ac-

tion, While The Sixth Circuit Without Engaging InA

Thorough Review, Affirmed EPA’s Action.

A quick review of the Sixth Circuit and Seventh Circuit

cases establishes that the issues and facts of the two cases

are nearly identicai!. Both cases involved a refusal by EPA to

approve a State request to redesignate a county or counties as

in attainment with the national ambient air quality standard for

ozone even though monitoring data in those counties de-

monstrated that there were no violations of the NAAQS for

ozone. In both cases EPA denied the state’s redesignation

request after or concurrently with the approval of a redesigna-

tion request for a similarly situated county or counties. In both

cases EPA's denial of the redesignation request was based on

the same intermixture of theories. The Seventh Circuit found

these different theories to be inconsistent with each other

and/or with positions previously taken by EPA. The Sixth

Circuit failed to recognize that EPA was relying on multiple,

inconsistent theories.

Thus, the Seventh Circuit found that EPA originally listed

attainment/nonattainment designations on a county-by-

county basis rather than on an urbanized area basis, but that

EPA stated variously in the redesignation denial !Ilinois sought

to reverse that a nonattainment area must include an entire

urbanized area, and that a nonattainment area must include all

sources which contribute to pollution in the area. The court

determined that these explanations by EPA were not con-

sistent with each other.

EPA’s action in denying Ohio’s redesignation request

was similarly inconsistent. The attainment/nonattainment

designations in Ohio were also originally made on a county-

by-county basis. At the same time that EPA denied Ohio's

request to redesignate Lorain County as in attainment with the

NAAQS for ozone for the expressed reason that Lorain County

is part of the Cleveland urbanized area, EPA approved the

redesignation of Medina County which is also part of the

Cleveland urbanized area. Moreover, EPA’s rulemaking ac-

tion contained a paragraph explaining that Lorain and Medina

Counties were in a like situation. 49 Fed. Reg. 24125 (June 12,

1984). As in the Illinois case, EPA’s rulemaking action in Ohio

also contained language commenting that a nonattainment

area should include all emission sources contributing to

violations of the NAAQS. /d. Again, however, EPA did not apply

this theory consistently since it did not include Medina or

Summit Counties in the Cleveland ozone nonattainment area.

Nevertheless, the Sixth Circuit failed to identify EPA’s

various theories, or failed to recognize the inconsistencies

among them. It is apparent that the Sixth Circuit did not

perform the careful and probing inquiry into the facts called for

by this Court when reviewing agency action. The concurrring

opinion is particularly revealing in this respect:

| write separately only to bespeak my dissatisfaction

with EPA's failure to conduct measurements of the

wind-factor effect in the Cleveland area of emis-

sions from Lorain County. | find no reasonable

explanation for that failure on the part of EPA in this

case... My only reservation here is this Jack of proof

that would have demonstrated clearly the basis for

the EPA action. State of Ohio v. Ruckelshaus, supra

at 1341. (Emphasis added).

It is apparent that a reviewing court which lamerts the lack of

proof to form the basis for an agency action cannot have

concluded that the agency “articulated a satisfactory explana-

tion for its action including a ‘rational connection between

10

the facts found and the choice made. .. .” Motor Vehicle Mfrs.

Ass'n v. State Farm Mutual, supra, 463 U.S. at 43, 103 S. Ct. at

2866-2867. Clearly the Sixth Circuit did not apply the ap-

propriate standard of review in reviewing EPA’s action in this

case.

EPA's justification for its action in this case bears a

striking similarity to the grounds cited by the Occupe*ional

Safety and Health Administration (“OSHA”) for promulgating

regulations limiting Occupational exposure to benzene. In

industrial Union Department v. American Petroleum Institute,

448 U.S. 607, 100 S. Ct. 2844, 65 L. Ed. 2d 1010 (1980), this

Court struck down these regulations which were based upon

an OSHA policy and a series of assumptions, id., 448 U.S. at

634-635, 100 S. Ct. at 2860, developed from OSHA's interpre-

tation of the statute, which the Court rejected. /d., 448 U.S. at

651, 100 S. Ct. at 2868. Similarly, EPA’s disapproval! of Ohio's

request to redesignate Lorain County is based on EPA’s

policies that ai! portions of an urbanized area must be

designated as nonattainment if any of the urbanized area is

nonattainmeni, and/or that all emission sources must be

included in anonattainment area. These policies are based on

assumptions that emissions from sources in clean-air coun-

ties will adversely affect downwind counties. However, this

policy and these assumptions were notarrived atthrough considera-

tion of factors actually existing in the Cleveland area. More-

over, EPA’s policy and assumptions were developed from its

interpretation of the Clean Air Act that nonattainment designa-

tions may be based on the location of air emission sources

rather than on ambient air quality. !n /ndustrial Union Depart-

ment, this Court recognized the inconsistencies in OSHA’s

position, the overly broad nature of OSHA's interpretation of

the statute, and the impropriety of relying on assumptions in

the absence of definitive proof. EPA’s action in denying Ohio's

redesignation request for Lorain County suffers from the same

fatal defects. The Sixth Circuit, however, did not sufficiently

probe the record to identify these problems with EPA’s action.

11

ll. THE DECISION OF THE SIXTH CIRCUIT IS CON-

TRARY TO THE INTENT OF CONGRESS EX-

PRESSED IN THE CLEAN AIR ACT AND PRE-

SENTS AN IMPORTANT QUESTION OF FEDERAL

LAW WHICH SHOULD BE DECIDED BY THIS

COURT, WHETHER THE STATES OR THE UNITED

STATES ENVIRONMENTAL PROTECTION AGEN-

CY ARE PRIMARILY RESPONSIBLE FOR AIR

POLLUTION CONTROL.

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

Council, Inc., __U.S.___, 104 S. Ct. 2778 (1984), this Court

explained the examination which must be made by a court

which is reviewing an agency’s construction of a statute it

administers. lf Congress has spoken directly to the question at

issue, then the agency and the court are required to give effect

to the congressionally expressed intent. If, on the other hand,

the congressional intent is ambiguous or not expressed, then

the court must determine if the agency’s construction of the

statute is permissible.

The Sixth Circuit incorrectly concluded that the Clean Air

Act was silent or ambiguous as to the precise question at

issue, whether EPA can deny a state's request to redesignate

a county whose air quality meets the national ambient air

quality standards. The court, therefore, deferred to EPA’s

interpretation of the statute. The result is contrary to the clearly

expressed intent of Congress in enacting the Clean Air Act.

A. The Clean Air Act Clearly And Unambiguously

Describes The Criteria For Determining Attainment/

Nonattainment Areas.

Section 107(d)(1) of the Clean Air Act, 42 U.S.C. Section

7407(d)(1), requires states to identify

.. . those air quality control regions, or portions

thereof,... which...

(A) do not meeta national primary ambient air

quality standard for any air pollutant other than

sulfur dioxide or particuiate matter;

(E) have ambient air quality levels better than

any national primary or secondary air quality stan-

dard other than for sulfur dioxide or particulate

matter. ... (Emphasis added).

It is abundantly clear that Section 107(d), 42 U.S.C. Section

7407(d), attainment status designations are concerned only

with the actua! ambient air quality in an area, not with the

location of air pollution sources which may impact ambient air

quality in another area. This conclusion is supported by the

definition of “nonattainment area” in Section 171(2), 42 U.S.C.

Section 7501(2):

The term “nonattainment area” means, for any

air pollutant an area which is shown by monitored

data or which is calculated by air quality modeling

(or other methods determined by the Administrator

to be reliable) to exceed any national ambient air

quality standard for such pollutant. ...

This definition also contains no reference to the location of air

pollution sources. Clearly, nonattainment areas are to be

determined solely on the basis of the ambient air quality in the

area. Redesignations are to be based on the same considera-

tions. Section 107(d)(5), 42 U.S.C. Section: 7407(d)(5).4

* The Sixth Circuit incorrectly stated that redesignations are requested pursuant

to Section 107(e)(1), 42 U.S.C. Section 7407(e)(1), State of Ohio v. Ruckelshaus, supra

at 1336, 1339, and that no standards are provided in that section to govern EPA's

approval or disapproval of redesignation requests. /d. at 1339. The court was

apparently confused. Section 107(e)(1), 42 U.S.C. Section 7407(e)(1), refers to

redesignations of air quality control regions. Air quality control regions are de-

signated pursuant to Sections 107(b), and (c), 42 U.S.C. Sections 7407(b) and (c).

Attainment and nonattainment designations pursuant to Section 107(d), 42 US.C.

Section 7407(d), are not dependent upon air quality control region

Nevertheless, the Sixth Circuit concluded thatthe statute

was notclear. It further decided that EPA’s interpretation of the

statute, which adds consideration of the location of air

pollution sources which may potentially impact a nonattain-

ment area, even though the area where the sources are

lccated is in compliance with national ambient air quality

standards, as a determinative factor in EPA’s approval or

disapprovai of redesignation requests, was a permissible

construction of the Clean Air Act. The result of this decision is

to defeat the will of Congress.

B. Congress Clearly Expressed Its Intent in The Clean

Air Act That The States Are Primarily Responsible

For Air Pollution Control.

In Section 101(a)(3) of the Clean Air Act, 42 U.S.C. Section

7401(a)(3), Congress finds “that the prevention and control of

air pollution atits source is the primary responsibility of States

and local governments.” The theme that the states are

primarily responsible for air quality is repeated in Section

107(a), 42 U.S.C. Section 7407(a), which states: “Each State

shall nave the primary responsibility for assuring air quality

within the entire geographic area comprising such State by

submitting an implementation plan for such State...” This

Court has observed that under the Clean Air Act, “[s]o long as

the national standards are met, the State may select whatever

mix of control devices it desires.” Union Electric Co. v. E.P.A.,

427 U.S. 246, 266, 96 S. Ct. 2518, 2530, 49 L. Ed. 2d 474 (1976).

See also, Train v. Natural Resources Defense Council, Inc.,

421 U.S. 60, 86-87, 95S. Ct. 1470, 1485, 43 L. Ed. 2d 731 (1975).

States are required by Section 110 of the Clean Air Act, 42

U.S.C. Section 7410, to develop State Implementation Plans

(“SIPs”) which provide for achievement and maintenance of

designations, and attainment status designations may be changed without any

changes to or redesignations of air quality contro! regions. Section 107(d)(5), 42 U.S.C.

Section 7407(d)(5), specifically provides that redesignations of attainment status are

to be made on the same basis as the original attainment status designations.

14

NAAQS. For areas which are designated as “nonattainment”

for agiven poilutant, Part D of the Act requires a SIP to include

implementation of stringent control measures to assure air

quality improvement. Sections 171-178, 42 U.S.C. Sections

7501-7508. These are commonly referred to as “Part D SIPs”.

To ensure that states promptly prepare and implement their

Part D SIPs, Congress included several onerous sanctions to

punish the states. Among these are a ban on construction or

modification of major stationary sources (Section 110(a)(2)(I),

42 U.S.C. Section 7410(a)(2)(I)), withholding of federal high-

way, transportation and air quality grants (Section 176(a) and

(b), 42 U.S.C. Section 7506(a) and (b)), and withholding of

sewage treatment construction grants (Section 316(b), 42

U.S.C. Section 7616(b)). These sanctions apply to nonattain-

ment areas for which the state fails to submit an adequate Part

D SIP.

The SIP is the mechanism by which a state determines

which controls are the most efficient and effective means of

improving ambient air quality. In preparing the SIP for the

Cleveland urbanized area, Ohio must look at the sources in

and their impacts on all five counties constituting the urban-

ized area, including sources in attainment areas. Ohio must

then determine the most efficient and effective means of

reducing emissions and thus improving air quality throughout

the urbanized area.

Those controls which, by iaw, are mandatory for non-

attainment areas (e.g., vehicle emission contro! inspection

and maintenance programs, Section 172(b)(11), 42 U.S.C.

Section 7502(b)(11), reasonably available contro! technology

(RACT), Section 172(b){3), 42 U.S.C. Section 7502(b)(3), lowest

achievabie emission rate, Section 173(2), 42 U.S.C. Section

7503(2)), may or may not be the most efficient and effective

means of controlling emissions which contribute to the

formation of ozone. For example, imposition of a vehicle

inspection and maintenance program in an area where

stationary, rather than mobile, sources cause the bulk of the

problem would be a very expensive way to bring about very

littie air quality improvement, and may exhaust limited re-

sources which would be better spent ensuring that stationary

sources are controlled. The SIP—not the attainment status

designation—is the essence of contro! strategy planning,

whereby the state has the ability under the Clean Air Act to

choose the most effective remedies from an array of control

alternatives. Yet by insisting that clean-air areas must con-

tinue to be designated as nonattainment, and therefore

subjecting such areas to the mandatory controls, EPA and the

Sixth Circuit have deprived Ohio of the flexibility to develop the

mix of controls it finds to be most appropriate to achieve and

maintain national ambient air quality standards.5 This clearly

does not comport with the congressional intent expressed in

the Clean Air Act.®

In Union Electric Co. v. EPA, supra, 427 U.S. at 269, 96 S.

Ct. at 2531, this Court rejected an argument that

... would permit the Administrator or a federal court

to rejecta State’s legislative choices in regulating air

pollution, even though Congress plainly left with the

States, so long as the national standards were met,

the power to determine which sources would be

burdened by regulation and to what extent.

5 Although Section 172(b)(3), 42 U.S.C. Section 7502(b)(3), only requires RACT for

existing sources in nonattainment area, Ohio has gone a step further through the SIP

by requiring stringent RACT controls on all existing major sources of volatile organic

compounds in attainment areas as well. Thus, even if Lorain County were re-

designated as attainment, Ohio would continue to impose all necessary controls

through its SIP, but would have the flexibility intended by Congress to achieve and

maintain the NAAQS in the most efficient and effective manner.

®& In support of its decision, the Sixth Circuit cites Western Oil and Gas

Association v. United States Environmental Protection Agency, 767 F.2d 603 (9th Cir.

1985), a decision of the Ninth Circuit upholding EPA's designation of the San

Francisco bay area as nonattainment for the ozone NAAQS. The Ninth Circuit

decision is distinguishable from Ohio's case before the Sixth Circuit for several

reasons. The most relevant distinction here is that in Western Oil and Gas

Association, the nonattainment designations appealed and upheld were the initia/

attainment/nonattainment designations under Section 107(d)(1), 42 U.S.C. Section

7407(d)(1), submitted and supported by the State of California.

16

By refusing to approve Ohio's request to redesignate a clean-

air area as in attainment with national ambient air quality

standards, EPA has eliminated the State's ability to determine

which sources will be burdened by reguiation and to what

extent. The Sixth Circuit's affirmation of EPA’s circumvention

of the will of Congress should be reviewed by this Court.

CONCLUSION

This case involves an issue of great importance to the

states as they have been significantly deprived of the ability to

develop and implement air pollution control programs to attain

and maintain national ambient air quality standards which

they determine to be most efficient and effective by the Sixth

Circuit’s deference without adequate review to EPA's inter-

pretation of the Clean Air Act. The failure of the court below to

implement the instructions of this Court as to the appropriate

standard of review a court should employ in reviewing actions

of an administrative agency, as demonstrated by the con-

flicting decision on the same question by the Seventh Circuit,

requires this Court's intervention, as does the failure of the

Sixth Circuit to implement the will of Congress, plainly

expressed in the Clean Air Act, to place the primary responsi-

bility for controlling air pollution on the states. Therefore, the

State of Ohio respectfully requests this Court to grant a writ of

certiorari to review the decision and judgment of the United

States Court of Appeals for the Sixth Circuit.

17

Respectfully submitted,

ANTHONY J. CELEBREZZE, JR.

Attorney General of Onio

MARTHA E. HORVITZ

Assistant Attorney General

State Office Tower

30 East Broad Street, /7th Floor

Columbus, Ohio 43266-0474

(614) 466-2766

Counsel of Record for Petitioner

18

CERTIFICATE OF SERVICE

This is to certify that three copies of this petition for writ of

certiorari were mailed pursuant to Supreme Court Rules 28.3

and 28.4 by regular U.S. Mail, this __. day of February,

1986, to:

Solicitor General

Department of Justice

Washington, D.C. 20530

Peter S. Everett, Attorney

Environmental Defense Section

U.S. Department of Justice

Washington, D.C. 20530

Catherine Fox, Attorney

Office of Regional Counsel!

U.S. Environmental Protection Agency

Region V

230 South Dearborn Street

Chicago, IL 60604

John C. Ulfeider, Attorney

Office of General Counsel! (LE-132A)

U.S. Environmental Protection Agency

401 M Street S.W.

Washington, D.C. 20460

MARTHA E. HORVITZ

Assistant Attorney General

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

STATE OF OHIO

Petitioner,

Vv.

WILLIAM D. RUCKELSHAUS,

Administrator, United States

Environmental Protection Agency,

Respondent.

PETITION for Review of Final Action

of the United States Environmentai

Protection Agency.

Decided and Filed November 15, 1985

Before: LIVELY, Chief Judge; WELLFORD, Circuit Judge:

BERTELSMAN, District Judge.*

LIVELY, Chief Judge, delivered the opinion of the Court, in

which BERTELSMAN, District Judge, joined. WELLFORD,

Circuit Judge, (p. 14) delivered a concurring opinion.

LiVELY, Chief Judge. Ohio seeks review of final action of the

United States Environmental Protection Agency (EPA) under

the Clear Air Act as amended (the Act). 42 U.S.C. §§ 7401 et

seq. The particular provisions of the Act in controversy are

portions of Part D of Subchapter !, 42 U.S.C. §§ 7501-7508, and

section 107(d) and (e), 42 U.S.C. § 7407(d) and (e), all of which

were added to the Act by the Clean Air Act Amendments of

1977, Pub. L. 95-95.

*The Honorable William O. Bertelsman, Judge, United States District Court for the

Eastern District of Kentucky, sitting by designation.

A-2

The question for decision is whether EPA may refuse a

state’s request to redesignate a county from “nonattainment’

to “attainment” where actual monitoring or modeling data

from the county show that air quality within the county meets

the required ambient standard. EPA denied Ohio's request to

redesignate Lorain County as an attainment area for ozone

upon determining that, although the air within the county

satisfied the National Ambient Air Quality Standards (NAAQS)

for ozone, pollutants originating in Lorain County added signifi-

cantly to the ozone levels in the Cleveland urban area, of

which Lorain County is a part. All of the counties in the

Cleveland urban area are part of the Greater Cleveland

Intrastate Air quality Control Region (AQCR). Ohio argued that

the boundary of the Cleveland urban nonattainment area

should be changed by removing Lorain County and filed a

petition for review of the EPA’s action.

Though the precise question presented in the present

appeal is one of first impression before this court, we have

dealt with the Clear Air Act Amendments of 1977 in a number

of opinions. E.g., Air Pollution Control District of Jefferson

County v. U.S. E.P.A., 739 F.2d 1071 (6th Cir. 1984); National

Stee! Corp. v. Gorsuch, 700 F.2d 314 (6th Cir. 1983); PPG

industries, Inc. v. Costle, 630 F.2d 462 (6th Cir. 1980). In

addition, the Supreme Court succinctly reviewed the history of

the congressional efforts to bring air pollution under control in

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

inc., AIS , 104 S.Ct. 2778, 2783-87 (1984). We will not

repeat this background discussion, but will go directly to the

issues involved in this appeal.

A-3

Acting pursuant to section 107(d)(1) of the Act, 42 U.S.C. §

7407(d)(1),' Ohio listed nonattainment areas within the State. It

identified the counties comprising the Cleveland urban area,

including Lorain, Medina, Lake and Geauga Counties, as

nonattainment for ozone. In 1982 Ohio, acting pursuant to

section 107(e)(1), of the Act, 42 U.S.C. § 7407(e)(1),? requested

a revision of the ozone nonattainment designations to remove

46 counties, including Lorain, Medina, Lake and Geauga

Counties. There was no request that Cuyahoga County, where

the City of Cleveland is located, be redesignated.

\

'42 U.S.C. §7407(d)}(1) provides:

(1) For the purpose of transportation control planning, part D (relating to

nonattainment), part C (relating to prevention of significant deterioration of air

quality), and for other purposes, each State, within one hundred and twenty

days after August 7, 1977, shall submit to the Administrator a list, together witn a

summary of the available information, identifying those air quality control

regions, or portions thereof, established pursuant to this section in such State

which on August 7, 1977—

(A} do not meet a national primary ambient air quality standard for any air

pollutant other than sulfur dioxide or particulate matter;

(B) do not meet, or in the judgment of the State may not in the time period

required by an applicable implementation pian attain or maintain, any

national primary ambient air quality standard for sulfur dioxide or particu-

late matter;

(C) do not meet a national secondary ambient air quality standard;

(D) cannot be classified under subparagraph(B) or (C) of this paragraph on

the basis of available information, for ambient air quality leveis for sulfur

oxides or particulate matter; or

(E) have ambient air quality levels better than any national primary or

secondary air quality standard other than for sulfur dioxide or particulate

matter. or for which there is not sufficient data to be classified under

subparagraph (A) or (C) of this paragraph.

2 42 U.S.C. § 7407(e)(1) provides:

(1) Except as otherwise provided in paragraph (2), the Governor of each State

is authorized, with the approval of the Administrator, to redesignate from time to

time the air quality control regions within such State for purposes of efficient

and effective air quality management. Upon such redesignation, the list under

subsection (d) of this section shall be modified accordingly.

A-4

EPA published a notice of proposed rulemaking on August

10, 1983 in response to the request. The notice invited public

comment and stated that EPA proposed to grant the request

as to 36 counties and deny it as to ten, including Lorain and

Medina. Following the period of comment, EPA issued its final

rulemaking, approving Ohio’s redesignation of 37 counties

and desapproving the redesignation of nine counties, includ-

ing Lorain. 49 Fed. Reg. 24124 (June 12, 1984). The county

approved for redesignation as “attainment” in the final action

that had been refused redesignation in the first EPA, proposal

was Medina. Following the final action of EPA, the Cleveland

urban nonattainment area consisted of Cuyahoga, Lorain,

Geauga and Lake Counties.

It is undisputed that monitoring data showed that the air

within Lorain County met the NAAQS for ozone. EPA recog-

nized this fact, but refused to redesignate Lorain County on the

ground that a significant portion of the ozone pollution in the

Cleveland urban nonattainment area derives from emissions

in Lorain County, which lies upwind from the other three

counties in the nonattainment area. The geographical relation-

ship of the four counties in the designated nonattainment area,

plus Medina County, is shown in the portion of the Ohio map of

counties reproduced here:

In its comments on proposed rulemaking Ohio conceded

that “[e]missions from Lorain County contribute to the ozone

concentrations in the Cleveland area and should be included

in the design of any control program.” (Letter from Ohio EPA to

U.S. EPA, August 12, 1983). However, Ohio took the position

that Lorain County was not in air quality violation for ozone

and should not be listed as nonattainment.

A-5

Though Ohio makes a number of subsidiary arguments, its

basic position is that the Act does not authorize EPA to

disapprove a reascnable state designation of an area as

“attainment” on the ground that emissions from the area may

potentially add to the pollution of a nonattainment area.

Underlying this argument is the contention that the state may

treat a county as an “area” for purposes of § 7407(d)(1) and

require EPA to so treat it, despite the fact that EPA has

designated the county as part of a larger area. Ohio relies on

the definition of “nonattainment area” in section 171(2) of the

Act, 42 U.S.C. § 7501(2) (1982), “an area which is shown by

monitored data or which is calculated by air quality modeling

(or other methods determined by the Administrator to be

reliable) to exceed any national ambient air quality standard

for such pollutant.” Since Lorain County has shown by

monitored data that its air does not contain ozone in excess of

the NAAQS, it cannot be brought within this definition and,

thus, may not be designated “nonattainment.”

Ohio recognizes that Lorain County is in the Cleveiand

urban area but insists that it may subdivide that area by

counties on the basis of air quality information. Ohio argues

that the states have the primary role in making such decisions,

and EPA should accord deference to state determinations

regarding the size of areas designated. Given the measured

air quality data on which the request for redesignation of

Lorain County was based, cPA acted arbitrarily and capri-

ciously in continuing to designate Lorain County “nonattain-

ment,” according to Ohio.

A-6

Ohio also argues that EPA had an alternative and preferable

means at its disposal for dealing with the Cleveland ozone

problem. EPA should have approved the redesignation of

Lorain County to attainment, but required Ohio to amend its

State Implementation Pian (SIP) to insure that pollutants from

Lorain County, though an attainment area, did not add

significantly to the ozone problems of the downwind Cleve-

land area. Ohio contends that SIPs are at the heart of the entire

scheme for improving the quality of the Nation’s air, and that

EPA should be required to follow this path to achieve NAAQS

within Ohio, including the Cleveland area. Ohio's preference

for this alternative means of enforcing compliance with the

NAAQS arises from the fact that Part D of the Act, which

applies only to nonattainment areas, contains significant

enforcement tools not available to EPA under other provi-

sions. For example, EPA can impose a ban on new construc-

tion, require a new source review program that may require

greater emissions reduction than other sections of the Act

would require, require a motor vehicle inspection and mainten-

ance program with a cuttoff of federal funds for noncom-

pliance and require ozone sources to meet emissions limita-

tions at least reflective of reasonably available control tech-

nology. The possibility of a ban on new construction and the

loss of federal funds for failure to implement a vehicle

inspection and maintenance program are matters of serious

concern to a local government unit.

Finally, Ohio contends that the record does not support

EPA's disapproval of the request for redesignation of Lorain

County. Instead of relying on modeling or monitoring in the

Cleveland area, EPA based its conclusions about Lorain

County’s contributions to Cleveland’s ozone levels on findings

made with respect to other majcr urban centers such as

Chicago, St. Louis, Los Angeles and Detroit. In addition, Ohio

charges that EPA was totally inconsistent in approving

redesignation of Medina County, which also has a direct

association with the Cleveland area, while disapproving the

request for Lorain County.

EPA maintains that it acted reasonably and within its clear

authority under § 7407 in disapproving Ohio's request with

respect to Lorain County. It is not required to designate

nonattainment areas by reference to county boundaries. Thus,

the fact that a county within a nonattainment area is not in

violation of NAAQS for a pollutant is irrelevant. As EPA

interprets § 7407(d), itis permitted to designate nonattainment

areas by boundaries which include important sources of

pollution that contribute to the pollution leveis of the area,

without making a separate determination for each politicai

subdivision within the area. EPA asserts that its interpretation

of the statute is reasonable since it serves the underlying goal

of the Act by requiring steps to be taken that will move an area

toward attainment. EPA finds nothing in the language or

legislative history of the Act or the 1977 Amendments that

would require it to make Lorain County a “section 107(d) area”

separate from the general Cleveland urban area of which itis a

part

EPA argues that keeping Lorain County within the nonattain-

ment area serves the purpose behind the enactment of Part D.

That purpose was to bring about incremental air quality

improvement and timely attainment of national standards in

those areas that failed to attain the NAAQS by the deadlines

Originally set out in the Act. The fact that EPA might have

proceeded by the alternate route of requiring Ohio to revise its

SIP does not deprive it of authority to proceed under § 7407(d)

and Part D, which were designed specifically to deal with the

nonattainment problem to which the 1977 Amendments were

directed.

EPA responds to Ohio's charge that its denial of redesigna-

tion was not supported by the record with several contentions.

In the first place, it points to Ohio’s admission that pollutants

from Lorain County contribute to Cleveland’s ozone problem.

A-8

it also argues that the record contains meterological data

which indicate that the prevailing winds during the peak

ozone season do fiow from Lorain County to Cuyahoga and

Lake Counties. Further, monitoring results in the Cleveland

urban area showed ozone violations. These are included in

the record. In addition, the record contains documentation

that significant quantities of ozone precursors are emitted

from sources in Lorain County. Lorain County’s emissions

constitute 18.7% of the total organic pollutant emissions

Originating in the four county Cleveland urban nonattainment

area.

With respect to the use of data from other urban areas, EPA

makes two responses. In the first place, it notes that Ohio did

not object to the use of these data during the administrative

proceedings, and argues that it may not object at this stage. in

addition, EPA maintains that the causes of ozone buildups in

the area of other large cities provides valid data for deter-

mining the effect of Lorain County’s emissions on Cleveland.

IV.

A.

In considering an agency’s construction of a statute which it

administers a court applies a narrow standard of review. If

Congress has spoken directly to the precise question in issue,

and its intent is clear, that ends the inquiry because both the

agency and the court “must give effect to the unambiguously

expressed intent of Congress.”’ Chevron, U.S.A., Inc. v.

National Resources Defense Council, Inc., _U.S._, 104 S.Ct.

2778, 2781-82 (1984) (footnote omitted). If the court deter-

mines that Congress has not addressed the precise question

directly, the duty of the court is to determine whether the

agency has based its answer to the question “on a permissible

construction of the statute.” /d., at 2782. The Supreme Court

has long recognized the principle of deference which requires

courts to accord ‘considerable weight’ to the construction by

an executive department of a statute that it administers. /d.

A-9

The principle of deference does not permit the court to

become a rubber stamp, automatically approving every

agency interpretation of a statute. Rather, it requires “a

searching and careful” inquiry into the facts of each case to

determine that the agency has acted within the scope of its

statutory authority. Citizens to Preserve Overton Park v. Volpe,

401 U.S. 402, 416 (1971). After this determination has been

made, in order to approve agency action the reviewing court

must find that the agaency’s choice satisfies the standard of

the Administrative Procedure Act (APA), that is, that it is not

“arbitrary, capricious, an abuse of discretion, or otherwise not

in accordance with law.” 5 U.S.C. § 706(2)(A). This court has

recently held that the APA standard presumes that agency

actions are valid and that we are required to uphoid EPA

decisions supported by a “rationa! basis.” Air Pollution

Controi District of Jefferson County v. United States Environ-

mental Protection Agency, 739 F.2d 1071, 1083 (6th Cir. 1984).

As we noted in National Steel Corp. v. Gorsuch, 700 F.2d 314,

321 (6th Cir. 1983), it is not necessary that the agency’s

construction of the statute be the only permissible one. Rather,

its construction “must be upheld unless that view is plainly

unreasonable.” (Emphasis in original).

With these firmly established principles in mind, we turn to

the issues in this case. The statutory provision in question, §

7407(d)(1), does not speak directly to the precise question of

whether EPA may include in a nonattainment area a county

whose air quality meets national standards. The statute

requires each state to identify “those air quality regions, or

portions thereof” which do not meet the NAAQS for any air

pollutant. Counties are not mentioned, but both Lorain and

Medina Counties had previously been included in the Greater

Cleveland AQCR. Part D of the Act defines “nonattainment

area’ as ‘an area which is shown by monitored data or which

A-10

is calculated by air quality modeling (or other methods

determined by the Administrator to be reliable) to exceed any

national ambient air quality standard” for a particular pol-

lutant. § 7501(1). Again, Congress has not directly dealt with

the question posed by this appeal. This definition addressed

“nonattainment” v'ithout prescribing any criteria for deter-

mining the proper components of an “area.” In addition, §

7407{e)(1) provides no standard which is to be followed by the

administrator of EPA in approving or disapproving a request

for redesignation. Thus under the Chevron formulation we

seek to determine whether EPA’s answer to the question is

“based on a permissible onstruction of the statute.” 104 S.Ct.

at 2782.

We conclude that EPA acted reasonably in determining that

Lorain County should be included in the Cleveland urban

nonattainment area even though actual monitoring disclosed

an acceptable level of ozone within the county. The purpose of

the Clean Air Act Amendments of 1977 was to ensure

additional efforts to bring those areas of the country which had

not met the time requirements of the Act into compliance.

Congress adopted the scheme of divding states into attain-

ment, nonattainment and unclassified areas. For nonattain-

ment areas it provided new stringent sanctions which could

be applied by EPA to encourage compliance. United States

Stee/ Corp. v. United States Environmental Protection Agency,

605 F.2d 283, 284-85 (7th Cir. 1979), cert. denied, 444 U.S.

1035 (1980). Once a state has designated an area “nonattain-

ment,” that area may be redesignated only with the approval of

EPA. It appears a permissible exercise of this authority for EPA.

to deny redesignation with respect to a component of a

nonattainment area which produced a substantial portion of

the area’s pollution even though the air within that component

tests at an acceptable level. If it were otherwise, the fortuitous

circumstance that pollutants and precursors emitted within a

county are moved by prevailing winds to a neighboring county

would deprive EPA of the tools Congress provided for

A-11

attacking pollution in the area of which the county is logically a

part. The Cleveland urban area fits the definition of a nonattain-

ment area because the ozone leveis in and around Cleveland

exceed the NAAQS.

In response to 1980 directions from the United States Court

of Appeals for the Ninth Circuit, EPA promulgated criteria for

defining nonattainment status. 46 Fed. Reg. 55722-25 (1981);

see Western Oil and Gas Association v. United States Envrion-

mental Protection Agency, 633 F.2d 803, 813 (9th Cir. 1980)

(WOGA 1). Criterion No. 5 stated

A nonattainment area should be as small as

~possible while encompassing all areas of expected

violation and all sources of significant impact on

those violations.

46 Fed. Reg. 55724 (1981).

Western Oil and Gas Association (WOGA) criticized the

criterion to the extent it prescribed the inclusion of all sources

of significant impact on violations. When EPA included

Criterion No. 5 in a final rulemaking, WOGA petitioned for

review, seeking an “attainment” designation for portions of the

San Francisco Bay Area which contained heavy industrial

concentrations, but would have been attainment areas if

treated separately. As in the present case, the disputed areas

were upwind from portions of the Bay Area which were clearly

nonattainment. The Court of Appeals upheld EPA’s designa-

tion of the downwind portions of the area as nonattainment

even though the air within those portions satisfied the NAAQS.

Western Oil and Gas Association v. United States Environ-

mental Protection Agency, 767 F.2d 603 (9th Cir. 1985) (WOGA

/). The court determined that Criterion No. 5 was entirely

consistent with the language of the Act, as amended, and with

the legislative history.

—————

A-12

We agree with the Ninth Circuit's conclusions in WOGA il.

As did WOGA in that case, Ohio relies in the present case on

Alabama Power Co. v. Costle, 636 F.2d 323 (D.C. Cir. 1979).

The Ninth Circuit dismissed WOGA's arguments by stating

that Alabama Power concerned Part C of the Act, which was

notin issue. We agree that Alabama Power is not controlling.

Part C deals with the prevention of significant deterioration of

air quality in areas that have attained national staiidards for

ambient air quality. The court in Alabama Power concluded

that for purposes of the requirements of Part C, Congress

intended that tne location of a proposed source of pollution

should be the key determinant in deciding whether a PSD

(prevention of significant deterioration) permit should be

required for construction in “any area to which this part [Part

C] of the Act applies.” /d. at 365-66. The court vacated EPA’s

denial of a PSD permit because the proposed source was not

in an area to which the PSD requirements applied. From this

holding Ohio argues that the location of pollution emitting

sources in Lorain County, where the NAAQS have been met,

provides no justification for including the county in a nonaitain-

ment area.

The D.C. Circuit found in Alabama Powerthat Congress had

clearly stated its intention that !ocation control in dealing with

PSD permits under Part C. No such clear intent can be

discerned with respect to the designation of nonattainment

areas for purposes of Part D. In the absence of such a clear

statement, EPA is authorized to require the boundaries of a

nonattainment area to include those places whose emissions

contribute significantly to measured “exceedences.” This is

not an unreasonable construction of the Act, given its over-

riding purpose.

A-13

Cc.

Having concluded that EPA acted within the scope of its

authority, we must now consider whether it acted arbitrarily

and capriciously in this case, as claimed by Ohio. Ohio

admitted on the record that emissions from Lorain county

contribute to the ozone concentrations in the Cleveland area.

Given this concession, it is difficult to conceive how EPA

could be found to have acted arbitrarily or capriciously by

including Lorain County in the Cleveland urban nonattain-

ment area. The technical materials in the record support the

conclusion that the contribution of Lorain\County’s emissions

to the Cleveland ozone problem is significant. We do not

believe the fact that EPA did not conduct measurements of the

wind-factor effect in the Cleveland area is important. The tests

in other major urban areas demonstrated satisfactorily that

ozone precursors are carried long distances in the atmos-

phere and combine with other substances to form ozone in

such areas. The results of tests in a number of urban areas

were Sufficiently similar to form a reliable basis for concluding

that the same condition would occur in Cleveland. Even if

these data were not sufficient to support EPA's conclusion,

Ohio cannot escape its own concession of the effect of Lorain

County's emissions on the ozone concentrations in the

Cleveland area.

Ohio also argues that EPA acted arbitrarily in redesignating

Medina County while refusing to remove the “nonattainment’

designation from Lorain County. Both counties lie upwind

from both Cleveland and Lake County which have ozone

levels in excess of the NAAQS. However, compared with the

emissions from Lorain County, those from Medina County are

insignificant. Lorain County is heavily industrialized while

Medina is iargely rural with only scattered sources of pollu-

tion. EPA acted in the exercise of its discretion in removing

Medina County from the nonattainment area while refusing to

redesignate Lorain County. We find no abuse of discretion.

|

A-14

The petition for review is denied.

WELLFORD, Circuit Judge, concurring. | concur with the able

analysis of the issues in this case by Chief Judge Lively. | write

separately only to bespeak my dissatisfaction with EPA's

failure to conduct measurements of the wind-factor effect in

the Cleveland area of emissions from Lorain County. | find no

reasonable explanation for that failure on the part of EPA in

this case, and the conducting of such tests would certainly

have made this case less difficult in disposition. My only

reservation here is this lack of proof that would have demon-

strated clearly the basis for the EPA action.

APPENDIX B

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 81

[A-5-FRL-2602-8]

Designation of Areas for Air Quality Planning Purposes;

Attainment Status Designations: Ohio

AGENCY: U.S. Environmental Protection Agency (EPA).

ACTION: Final rulemaking.

SUMMARY: EPA is approving a request from the State of Ohio

to revise the attainment status designations, at 40 CFR 81.336,

of 37 counties in Ohio from nonattainment to attainment

relative to the ozone National Ambient Air Quality Standard.

These counties are: Allen, Ashland, Belmont, Brown, Carroil,

Champaign, Darke, Erie, Fairfield, Fayette, Fulton, Hancock,

Harrison, Henry, Highland, Hocking, Holmes, Huron, Knox,

Lawrence, Logan, Madison, Marion, Medina, Morrow, Ottawa,

Perry, Pickaway, Richland, Ross, Sandusky, Seneca, Shelby,

Tuscarawas, Union, Wayne, and Wood.

Additionally. EPA is denying the State's request to re-

designate Columbiana, Delaware, Geauga, Greene, Lake,

Licking, Lorain, Miami, and Trumbull Counties from nonattain-

ment to attainment.

The intent of this notice is to discuss the result of EPA's

review of the State’s redesignation request and the public

comments received regarding EPA's proposed action, and to

approve and deny the State’s request as noted above. Under

the Clean Air act, designations can be changed if sufficient

data are available to warrant such change.

A-16

EFFECTIVE DATE: July 12, 1984.

ADDRESSES: Copies of the redesignation request, technical

support documents and the supporting air quality data are

available at the following addresses:

Environmental Protection Agency, Region V, Air Programs

Branch, 230 S. Dearborn Street, Chicago, Illinois 60604

Ohio Environmental Protection Agency, Office of Air Pollution

Control, 361 East Broad Street, Columbus, Ohio 43216.

FOR FURTHER iNFORMATION CONTACT: Debra

Marcantonio, Air and Radiation Branch (5AR-26), Environ-

mental Protection Agency, Region V, Chicago, Illinois 60604,

(312) 886-6088.

SUPPLEMENTARY INFORMATION: Under section 107(d) of

the Clean Air Act (CAA) the Administrator of EPA has promul-

gated the National Ambient Air Quality Standards (NAAQS)

attainment status for all areas within each State. See 43 FR

8962 (March 3, 1978) and 43 FR 45993 (October 5, 1978).

These area designations are subject to revision whenever

sufficient data become available to warrant a redesignation. In

the State of Ohio, 63 counties are currently designated as not

attaining the NAAQS for ozone.

On November 29, 1982, the Ohic EPA (OEPA) submitted:

(1) Arequestto EPA to revise the section 107 attainment status

designations for the 46 counties listed in the Summary portion

of this notice; and, (2) Recent ozone ambient air quality

monitoring data collected in the State. in reviewing OEPA’s

redesignation request EPA analyzed the monitoring data

submitted by the State, along with supplemental monitoring

data from areas adjoining the counties for which the State

requested redesignation. EPA also analyzed population data,

volatile organic compound (VOC) emissions data, and the

locations of the counties under consideration in culated from

observed number of exceedances by making the assumption

that the relation to the proximity of other non-attainment areas.

A-17

Redesignation Criteria for Ozone

The NAAQS for ozone is defined to be violated when the

annual average expected number of daily exceedances ofthe

standard (0.12 parts per million (ppm), 1-hour average) is

greater than one (1.0). A daily exceedance occurs when the

maximum hourly ozone concentration monitored during a

given day exceeds 0.124 ppm (“Guideline for the Inter-

pretation of Ozone Air Quality Standard”, EPA-450/4-79-

003). The expected number of daily exceedances is cal-

nonmonitored days (invalid or incomplete) have the same

fraction of daily exceedances as observed on monitored days

(EPA-450/4-79-003).

Specific criteria for ozone redesignation reviews are

given inan EPA April 21, 1983, memorandum entitled “Section

107 Designation Policy Summary” from Sheldon Meyers,

Director of the Office of Air Quality Planning and Standards,

and a December 23, 1983, memorandum entitled “Section 107

Questions and Answers” from G. T. Helms, Chief Control

Programs Operations Branch. These documents are in the

record for this rulemaking action and are available for public

review at the Region V office. These documents indicate that

the three most recent years of ozone data at each site should

be considered in the review of redesignation requests. The

April 21, 1983, guidance indicates that less than three years of

ozone data may be considered as adequate support for

redesignations to attainment if no exceedances of the ozone

standard have occurred in the most recent year or two years

and if enforceable emission reductions can be demonstrated

to be the cause of the recent air quality improvements.

Consideration of only the most recent year also requires the

use of a state-of-the-art modeling analysis (such as city-

specific EKMA) to demonstrate the adequacy of recent

emission reductions. Finally, and of significant importance for

today’s rulemaking, the guidance indicates that urban ozone

nonattainment areas should include ali of the urbanized area,

and fringe areas of development, and all of the significant

Volatile Organic Compound (VOC) sources assumed to be

responsible for the downwind ozone problem.

A-18

The current EPA redesignation policy as defined in the

April 21, 1983 policy memorandum, specifically states that

redesignations from nonattainment to unclassifiable are un-

acceptabie. The current policy is based on the assumption

that states have had ample time since 1978 to thoroughly

study each nonattainment area to determine the correct

nature of the area. However, contrary to the assumptions

reflected in this policy, some nonattainment areas have not

been monitored. A number of areas were designated as non-

attainment based purely on the assumption that, due to their

locations, these areas would experience violations of the 0.08

ppm standard (the standard prior to February 8, 1979). Many of

these areas have never been monitored. In these areas, it is

necessary to base the designations upon the nature of ozone

formation/transport observed in other monitored areas.

Based on EPA’s review of the State’s request and the

supporting monitored ozone concentrations during the 1980

thru September 1982 period, on August 10, 1983 (48 FR 36275)

EPA proposed to revise the designation status relative to the

ozone NAAQS to attainment for Allen, Ashland, Belmont,

Brown, Carroll, Champaign, Darke, Erie, Fairfield, Fayette,

Fulton, Hancock, Harrison, Henry, Highland, Hocking,

Holmes, Huron, Knox, Lawrence, Logan, Madison, Medina,

Morrow, Ottawa, Perry, Pickaway, Richland, Ross, Sandusky,

Seneca, Shelby, Tuscarawas, Union, Wayne, and Wood

Counties. Additionally, EPA proposed to deny the State’s

request to redesignate Columbiana, Delaware, Geauga,

Greene, Lake, Licking, Lorain, Marion, Miami, and Trumbull

Counties from nonattainment to attainment/unclassifiable.

Today EPA is taking final action to approve and deny the

portions of the States request as noted above with one

exception. As aresult of EPA’s review of the public comments,

EPA now agrees that Marion County should also be

designated to attainment. Therefore, EPA is redesignating the

36 counties it proposed to redesignate on August 10, 1983 and

Marion County to attainment of the ozone NAAQS. Further

discussion on EPA's action on designating Martion County is

contained in the public comment section of this notice.

A-19

Response to Comments on EPA’s Proposed Rulemaking

During the public comment period three sets of

comments were received. Each issue is discussed below.

Comment

The State commented that EPA’s proposed disapproval

of the State’s request to redesignate Lorain County to attain-

ment is contrary to the definition of a nonattainment area

contained in section 171(a)(2) of the CAA. Section 171(a)(2)

defines a nonattainment area as “* * * an area which is shown

by monitored data or which is calculated by air quality

modeling (or other methods determined by the Administrator

to be reliable) to exceed any national ambient air quality

standard * * *.” The State contends that, since available

ozone monitoring data show no violations of the ozone

standard in Lorain County during the most recent three years

and no modeling data exist to prove otherwise, EPA should

approve the redesignation of Lorain County. This redesigna-

tion should be approved regardless of the VOC emission

characteristics of Lorain County.

EPA Response

- EPA disagrees with the State’s narrow interpretation of

nonattainment. Part D of the CAA requires states to develop

SIPs for nonattainment areas which provide for the attainment

of the NAAQS. Since Part D plans are required only for the

nonattainment areas, it is important that the nonattainment

areas are of sufficient size to include all emission sources

(YOC sources in the case of ozone nonattainment areas)

which contribute significantly to the violations of the NAAQS.

lf, as the State comments, the nonattainment area is

interpreted to be a smaller area (including only those counties

with monitored ozone violations), it could be further argued

that the planning agencies should only inventory and control

those sources within the nonattainment area even when

sources upwind are significant contributors to NAAQS viola-

tions.

A-20

Under this scenario, the probable under-control of

sources outside of the nonattainment area could resu!t in a

technically unsound control strategy and continued NAAQS

violations.

Based on the regional nature of ozone formation and on

the above arguments, EPA’s current designation policy (Apr.

21, 1983 memorandum) requires an urban ozone nonattain-

ment area to include al! of the urbanized area and adjoining

areas of significant VOC emissions. Since it was previously

determined that Lorain County contains part of the Cleveland

urbanized area as wel! as the contiguous Lorain-Elyria

urbanized area and is a significant VOC emission area with

potentially significant downwind ozone impacts, EPA disa-

grees with the State’s comment and continues to consider

Lorain County as part of the Cleveland ozone nonattainment

area. EPA cannot, therefore, approve the State’s request to

redesignate Lorain county to attainment.

Comment

The State comments that EPA has previously evaluated

ozone designations on a county-by-county basis. The State

considers EPA’s proposed rulemaking for those counties for

which EPA proposed to deny Onio’s redesignation request to

be contrary to past actions.

EPA Response

EPA Region V has not previously redesignated to attain-

ment any counties containing significant portion of an urban-

ized area which has experienced current ozone standard

violations at other locations within the urban nonattainment

area. Therefore, EPA has not not previously redesignated to

attainment areas on a strict county-by-county basis.

EPA has in the past redesignated non-monitored/non-

urban (rural) counties to “unciassifiable”. Such a redesigna-

tion, however, is no longer acceptable, as discussed above.

x

A-21

- EPA believes that, lacking other supporting data, proximity to

major VOC emission areas (primarily major urbanized areas)

and consideration of prevailing wind directions forms an

appropriate and reasonable basis for assessing requested

redesignations from nonattainment to attainment. EPA bases

its decision in this case on ozone concentrations monitored in

and downwind of major urbanized areas, such as Chicago, St.

Louis, Los Angeles, and Detroit. Based on these observations

and on the direct association of Lorain and Medina Counties

with the Cleveland urban area, EPA continues to believe that

the deniai of the redesignation of the ten counties, as listed

above, is appropriate.

Comment

The State contends that no basis in law exists to support

EPA’s implication of nonattainment based on proximity to

nonattainment counties. !n addition, an Ohio property owner

protested “the depriving of any county of the United States

from having a Classification of attainment due to its proximity

to any other county”, and alleged that the Agency was

engaged in unconstitutional activity as a result. More specific-

ally, the citizen complained that the Agency was unlawiully

seizing property rights of people in rural areas, in violation of

the 4th and 5th Amendments of the Constitution.

EPA Response

Section 107 of the CAA gives EPA the authority to review

and rulemake on area air quality designations. Since it is

EPA's current policy (April 21, 1983 memorandum) to redesig-

nate areas as only attainment or nonattainment, it is necessary

for EPA to establish some criteria for the redesignation of

non-monitored areas. For anon-monitored area, itis logical to

assume a designation based on its proximity to major pre-

Cursor source areas (generally major urban nonattainment

areas) taking into consideration prevailing wind directions.

Data from areawide ozone/ precursor studies in the vicinity of

major urban areas, such as St. Louis and Philadelphia, as well

A-22

as data from rural sites in Region V indicate that ozone

transport at significant concentration levels can occur over

considerable distances downwind from urban areas. Based

on this observation, EPA believes that non-monitored

counties immediately downwind of major urban nonattain-

ment areas should be assumed to be nonattainment until such

time as in-county ozone data become available proving other-

wise or until the urban area is redesignated to attainment.

EPA does notagree that this policy leads to any unconsti-

tutional activity on the part of the Agency through the unlawful

seizure of property rights of rural land owners. Property rights

do not exist independent of certain responsibilities to the

public interest. Courts have consistently applied a type of

balancing test to the concept of private property such that the

public interest in preserving or preventing further deterior-

ation to land may outweigh the conflicting interest of a private

owner in fully exploiting the economic profitability of his land.

Any restrictions which may be imposed on ozone nonaittain-

meni areas in the form of growth restrictions do not prohibit

the landowner from making a limited but reasonable use of his

land, and cannot be viewed as a permanent taking of property

rights.

Comment

The St-*> comments that, since prevailing winds, as

discussed by .ne EPA in the proposed rulemaking, are from

the south-west in Ohio, Columbiana County, Delaware

County, and Trumbull County are not “downwind” of their

associated, adjacent urban nonattainment areas, as claimed

by EPA.

EPA Response

The State has misinterpreted EPA’s discussion in the

proposed rulemaking to imply that a single prevailing wind

direction may be considered. When EPA refers to an area as

being downwind of a major VOC emission source area, EPA is

A-23

referring to the area into which ozone or its precursors is

transported from the VOC emission area. Wind directions

fluctuate considerably on any given day and from day-to-day.

During an ozone season, a wide range of trajectories exist

over which ozone or its precursors is transported from a

source area. Inspection for windroses for Ohio during pre-

vious Ozone seasons indicates wind directions from the

quadrant of south thru west predominate. These analyses

focused on the days with high ozone formation potential by

only considering data for days with peak temperatures in

excess of 75 degrees Fahrenheit. Based on the results of

these analyses, it is assumed that areas lying in the general

direction of north through east of major urban areas may be

considered to be predominately downwind of these urban

areas during the ozone season. The downwind areas are

relatively large in extent.

Recognizing that ozone concentrations in excess of the

standard have been monitored in excess of fifty kilometers

downwind of major urban areas, such as Chicago, St. Louis,

Los Angeles, New York, Detroit, etc., it is appropriate to

assume that some of the non-monitored/nonattainment areas

in Ohio would currently experience ozone standard violations.

These areas include Columbiana (downwind of Canton),

Delaware (downwind of Columbus), and Trumbull (downwind

of Youngstown) counties. Therefore, the EPA disagrees with

the State’s comments on this issue.

Comment

The State comments that Geauca County lies close to

Lake Erie and may be subject to lake breeze effects, which the

State believes EPA did not take into account in its analysis.

EPA Response

It is unclear to EPA what the State intended to imply in this

comment. If the State implies that lake breezes would be

responsible for ozone standard violations in Geauga County

A-24

and should not be considered, EPA must point out that lake

breezes are common occurrences along the areas adjoining

Lake Erie and other large bodies of water. EPA does not

consider these to be abnormal, infrequent phenomena and,

therefore, does not exiude from consideration ozone exceed-

ances caused by such phenomena.

lf the State implies that lake breezes lead to significant

ozone transport between Cleveland, and Geauga County,

EPA agrees that such a pollutant effect could exist. This may

explain a means by which ozone standard exceedances

could occur in Geauga County as a result of ozone precursor

emissions in Cleveland. It does not argue against the possible

existence of such exceedances. EPA continues to believe that

Geauga County is a nonattainment area tor ozone.

Comment

The State comments that it does not consider Jefferson

County to be a significant VOC source area affecting ozone

levels in Columbiana County. As evidence for this, the State

indicates that only one ozone standard exceedance occurred

in Jefferson County during the 1981 through 1982 period and

that no exceedances have been recorded thus far in 1983. The

State is opposed to EPA’s denial of the redesignation of

Columbiana County.

EPA Response

Considering the fact that Steubenville (the largest city in

Jeffson County) is not a major urbanized area (defined to have

a population equal to or in excess of 200,000), EPA agrees

with the State that a solid conclusion can not be drawn

concerning the potential impact of Jefferson County VOC

emissions on Columbiana County ozone levels. Nevertheless,

Columbiana County is immediately east of Stark County,

which contains the major urban area of Canton. Under the

assumptions applied by EPA in the review of Ohio's redesig-

nation request, Columbiana County is still considered to be an

A-25

ozone nonattainment area due to its proximity to the Canton

urban nonattainment area.

Comment

The State comments that the areas of West Virginia

immediately adjacent to Columbiana County have always

been designated as attainment for ozone. The State considers

this to be an inconsistency in designation based on regula-

tions contained in 40 CFR Part 56. The implication of this

comment is that the West Virginia area adjoining Columbiana

County should be redesignated to nonattainment or that

Columbiana County should be redesignated to attainment.

EPA Response

Conceding that Jefferson County, Ohio may not be a

significant VOC source area causing downwind ozone stan-

dard exceedances, one must conclude that the West Virginia

counties do not adjoin an upwind major VOC source area.

Therefore, the West Virginia counties in question would

pass the tests for attainment as applied to the non-monitored,

rural Ohio counties. Columbiana County should remain as

nonattainment based on its proximity to the Canton urbanized

nonattainment area.

Comment

The State comments that EPA may not use the implication

of nonattainment based on association with major urban

nonattainment areas or monitored rural nonattainment areas

to deny the redesignation of Columbiana, Delaware, Geauga,

Greene, Licking, Miami, and Trumbull Counties.

EPA Response

Current EPA designation policy (Apri! 21, 1983 memor-

andum), as noted above, requires that potentia! redesignation

A-26

areas be determined to be either in attainment or nonattain-

ment of the NAAQS. Under this policy, designation of unclassi-

fiabie is no longer appropriate. Prior observations of ozone

formation and transport in the vicinity of major urban areas

support the policy applied in the August 10, 1983 notice of

proposed rulemaking. In other words, EPA continues to

consider Columbiana, Delaware, Geauga, Greene, Licking,

Miami, and Trumbull Counties to be nonattainment for ozone

based on their proximity to major urban nonattainment areas,

and the regional nature of ozone formation.

Comment

The State and an industrial commenter have commented

that Marion County should be considered to be in attainment

of the ozone NAAQS based on in-county data and ozone data

from monitors in other surrounding counties. This data had

certain deficiencies in that certain monitoring data which

should have been collected at the Marion County site was

missing for anumber of days. Despite the deficiency, the State

indicates that peak ozone data from six monitors in Clark,

Lucas, and Franklin Counties on days where data was missing

at the Marion County site would imply that the Marion County

site would not have experienced an exceedance of the ozone

standard during the missing days. The support data supplied

by the State are included in the technical support document

for this rulemaking action.

The industrial commenter has established correlations

between Marion County peak ozone data and peak ozone

data from Franklin and Sandusky counties during 1980. These

correlations have been used to estimate the probable peak

ozone concentrations at the Marion County site on the

missing days.

It is the opinion of both of these commenters that the

expected ozone exceedances for Marion County should be

calculated assuming that the missing days did not have ozone

standard exceedances.

A-27

EPA Response

Although the approaches put forward by the State and the

industria! commenter are not standard data review proce-

dures applied by EPA, the data presented do support an

assumption that exceedances did not occur on any of the days

with missing data. The State-supplied data, in particular,

support this assumption.

These data were collected in the urban nonattainment

areas most likely to impact the Marion County area. Marion

County contains no major urban area. Any ozone standard

exceedances experienced in Marion County may be reason-

ably expected to result from ozone transport from the nearby

major urban areas covered by the State’s data. These data

imply that the days in question probably were not conducive to

formation of high ozone concentrations in excess of the

standard. Therefore, EPA agrees that the expected number of

ozone standard exceedances should be 1.0 for the year

monitored, and that Marion County should be redesignated to

attainment for ozone.

Conclusion

Based on EPA's review of the State’s redesignation

request and the construction of the public comments EPA is

approving and disapproving the State’s redesignation request

to redesignate counties relative to the ozone NAAQS as

follows:

1. Redesignating to attainment (approval of requent):

Allen, Ashland, Belmont, Brown, Carroll, Champaign, Drake,

Erie, Fairfield, Fayette, Fulton, Hancock, Harrison, Henry,

Highland, Hocking, Holmes, Huron, Knox, Lawrence, Logan,

Madison, Marion, Medina, Morrow, Ottawa, Perry, Pickaway,

Richland, Ross, Sandusky, Seneca, Shelby, Tuscarawas,

Union, Wayne, and Wood Counties.

A-28

2. No charge (denial of request): Coiumbiana, Delaware,

Geauga, Greene, Lake, Licking, Lorain, Miami, and Trumbull

Counties.

The Office of Management and Budget has exempted this

rule from the requirements of Section 3 of Executive Order

12291.

Under section 307(b)(1) of the Act, petitions for judicial

review of this action must be filed in the United States Court of

Appeals for the appropriate circuit by August 13, 1984. This

action may not be chalienged later in proceedings to enforce

its requirements. (See 307(b)(2).)

List of Subjects in 40 CFR Part 81

Air pollution control, National parks, Wilderness areas.

This notice is issued under authority of Sections 107(d)

and 301 of the Act, as amended (42 U.S.C. 7407(d) and 7601).

Dated: May 31, 1984.

William D. Ruckelshaus,

Administrator.

APPENDIX C

ILLINOIS STATE CHAMBER OF COMMERCE, Petitioner,

v.

UNITED STATES ENVIRONMENTAL PROTECTION

AGENCY, Respondent.

and

ILLINOIS ENVIRONMENTAL PROTECTION AGENCY,

Petitioner,

v.

UNITED STATES ENVIRONMENTAL PROTECTION

AGENCY, Respondent.

Nos. 84-2364, 84-2365.

United States Court of Appeals,

Seventh Circuit.

Argued June 6, 1985.

Decided Nov. 4, 1985.

Before CUDAHY and COFFEY, Circuit Judges, and PELL,

Senior Circuit Judge.

CUDAHY, Circuit Judge.

In 1970, Congress passed the provisions that form the

basis of what we know today as the Clean Air Act. Pub. Law

No. 91-604, 84 Stat.1676 et seq. (1970) (codified at 42 U.S.C. §

7401 et seq.). At the same time the Environmental Protection

Agency (“EPA”) was created by Executive Order. 35 Fed.Reg.

15623 (1970).

A-30

In 1977 Congress amended the Act, adding, among other

things, a Part D: “Plan Requirements for Nonattainment

Areas.” §§ 171-178, 42 U.S.C. §§7501-08. The notion of a

nonattainment area was a new one introduced with the 1977

amendments; the idea was to allow the construction of new

facilities even in areas not in attainment with national

standards for pollution, provided that certain conditions were

met. It also required the imposition of certain controls—for

example, inspection and maintenance programs for vehicles-

in areas that continued to fall short of the standards after

certain deadlines.

The standards were to be set by the EPA, and ways of

determining attainment and nonattainment were also up to

EPA. The states, on the other hand, were responsible for

determining the geographic boundaries of the attainment and

nonattainment areas, subject to EPA’s approval; and they

were also responsible for submitting to EPA, in 1978, a list of

all such areas, with an indication, for each area, whether it was

in attainment with respect to the standards. Since the stan-

dards were different for different pollutants, and since the

appropriate size of the areas might differ for different

pollutants, the states really submitted a number of lists, one for

each pollutant. The EPA undertook to provide guidance as to

the appropriate size of the areas for different pollutants, and

was in a position to enforce those guidelines, since final

approval of the lists rested with it.

A-31

When anonattainment area reached attainment (accord-

ing to EPA criteria), the state was entitled to revise and

resubmit its list. If EPA agreed with the redesignation to

attainment, it approved the revision. If it did not, it wes required

to turn down the request within a certain time period, to aive

reasons for the refusal and to invite comments before taking

final action. (§ 107(5), 42 U.S.C. § 7407(5); § 107(2), 42 U.S.C. §

7407(2).)

In 1978 Illinois submitted its lists and they were approved.

The list for ozone—or rather, at that time, for photochemical

oxidants'—divided the Chicago urban area into counties, all

of which were listed as nonattainment.

In 1983, Illinois revised the list to show that Will and

McHenry Counties, two counties near Chicago, were in

attainment, and EPA approved the change. A short time later

Illinois proposed to upgrade Kane and Du Page Countties, two

counties closer to the geographical center of Chicago. This

time EPA denied the proposal. By way of explanation EPA did

not claim that the counties had failed to meet the ozone

standard; instead, EPA pointed to the ozone problem in the

larger Chicago urban area. Appeals were taken (directly to this

court under § 307(b)(1) of the Clean Air act, 42 U.S.C. §

7607(b)(1)) both by the Illinois Environmental Protection

Agency, the agency entrusted with carrying out the state’s part

in the regulation process, and by the Illinois Chamber of

Commerce.?

‘From 1971 to 1979 EPA set down standards for photochemical oxidants. !n 1979 the

standards were restated in terms of ozone, a major component of photochemical

oxidants. 44 Fed. Reg. 8202 (1979).

2The Chamber brings this appeal on Dehalf of its members. EPA has argued that the

Chamber has no standing. Clearly the possibility of losing hignway funds and the

likelihood of increased controls threaten an increase in the cost of doing business in

Kane and Du Page Counties, and threaten directly to affect the Chamber's members. It

appears to us, therefore, that the Chamber does have standing. Besides, we have

already asked the Chamber and the Illinois agency to divide the issues between ther

rather than duplicating each other's briefs, and we would be obliged to consider the

Chamber's arguments in any case, if only as amicus curiae.

A-32

Ozone is a significant component of the health-endanger-

ing smog that is one product of modern industry and transpor-

tation. Ozone can cause serious respiratory problems; when it

reaches levels of moderate concentration in the air around us,

normal men and women may begin to cough and may feel

their chests tighten; they may begin to experience eye

irritation; the very sensitive may have asthma attacks. At

higher concentrations hospitalization becomes a possibility.

Ozone is one of the substances that make up what we call air

pollution, and Congress has given the Environmental Protec-

tion Agency the task of bringing it under control.

Ozone, unlike many other pollutants, is not discharged

directly into the atmosphere by the offending source. Ozone

production depends on the emission of volatile organic

compounds?’ which, under the appropriate meteorological

conditions, react to form ozone. Since this reaction requires a

certain amount of time, ozone concentrations are typically not

found overhead of the sources that produce them, but rather

downwind.

This process of ozone formation is now rather well

documented. Scientists were at first surprised to find ozone

concentrations over remote rural areas; there was some

speculation that nature itself might be responsible for these

formations. But at least by the 1970s it was clear that ozone in

rural areas was largely due to the airborne “transport” of

ozone precursor chemicals—vo!‘ile organic compounds—

together with meterological conditions that eventually would

*The substances of which ozone is formed, known as ozone precursors, are oxides of

nitrogen and organic pollutants. Oxides of nitrogen are formed as a resuit of fuel

combustion from mobile and stationary sources. Organic pollutants are emitted

primarily from mobile sources and manufacturing facilities. These precursors

undergo photochemical oxidation in the presence of sunlight, and form ozone.

A-33

support the production of ozone. In general, ozone appeared

to reach peak concentrations downwind of the sources.

Thus, studies carried on in 1973 showed that sources in

Houston were responsible for ozone concentrations about

15-25 miles downwind, and showed similar, though not so

pronounced, results in the Phoenix area. Martinez & Meyer,

Urban-Nonurban Ozone Gradients and Their Significance,

Symposium Paper, March 12, 1976 (reprinted in Appellee’s

Appendix at A-76). In 1974, peak values of ozone were found

to arise 5 to 15 miles downwind of Columbus, Ohio. id.A 1975

study of sites in the Pennsylvania and New Jersey areas

tended to show that ozone concentrations would occur 27 to

49 kilometers downwind of the source areas. “This accounts

for some of the ozone previously observed in the non-

industrial, low-traffic density area of Ancora, N.J., where

concentrations of primary pollutants are low, but where ozone

daily maxima frequently exceed the federal standard. Thus,

photochemical air pollution [ozone] in this area is a regional

rather than a local phenomenon, and ozone resulting from

emissions from the urban complex is widespread and not

confined to the complex itself.” Kieiner, Transport of Photo-

chemical Air Pollution, 9 Environmental Science and Tech-

nology 886 (1975). See aiso EPA 600/3-77-017, Proceedings

of a Symposium on 1975 Northeast Oxident Transport Study,

Research Triangle Park, N.C. (1976); EPA, Mt. Storm, W.Va.-

Gorman, Md.-Keyser, W.Va. Air Pollution Abatement Activity,

No. APTD—0656 (April 19771).

Given these studies, it is natural to suppose that the

Chicago-northwest Indiana area contributes much of the

ozone pollution that occurs along the western shore of Lake

Michigan; and indeed one study concludes that that is

precisely the case: long Lake Michigan, through Milwaukee

and beyond, “Chicago-northwest Indiana acts as a giant

A-34

volume source resulting in a significant fraction of the ozone

monitored on alert-level days.” Lyons & Cole, Photochemical

Oxidant Transport, 15 J. Applied Meteorology 733 (1976). In

1976 hourly average values as high as .30 ppm (parts per

million) (the national standard is now set at .12 ppm), with

excursions above .40 ppm, recorded in southeastern Wiscon-

sin were attributed by the study to sources in the Chicago

area. Nevertheless, we will not, in this opinion, make any

factual assumptions about the direction in which ozone is

transported away from the Chicago area; our only assumption,

one which is not denied by either party, is that ozone tends to

show up at varying distances downwind from the source.

il

A.

Prior to the passing of the 1977 Amendments to the Clean

Air Act, the EPA had developed an “offset” policy to moderate

some of the harsh consequences ofa state’s failure to attain a

standard set under the 1970 Act. 41 Fed.Reg. 55528-29 (1976);

D. Currie, Air Pollution 6-2 (1981). Instead of prohibiting the

construction of all new facilities in areas that had not attained

federal standards, the EPA was prepared to permit such

construction provided that the pollution produced by the new

source was at least offset by reductions in emissions from

existing sources. Because of the regional nature of the ozone

problem, EPA advocated allowing ozone created by new

sources to be offset by reductions anywhere within a large,

urban, ozone-producing area. EPA, Effectiveness of Organic

Emission Control Programs as a Function of Geographic

Location (April 1977 memorandum) (reprinted in Appellee’s

Appendix at A-249). EPA saw little benefit from focusing VOC

(volatile organic compounds) programs on urban areas with

A-35

fewer than 200,000 inhabitants; instead, ozone control was

aimed at the larger areas. In the memorandum just cited, amap

indicated the urban-ozone problem areas with shaded

circles; Chicago and northwest Indiana were together in one

large shaded area. Of the offset policy, the memorandum says

that

a major new VOC source locating within one of the

shaded areas should be required to obtain emission

offsets from existing sources within that same area.

id. at 32 (emphasis in original). The assumption that the offset

policy would apply in all urban areas—that is, the assumption

that urban areas failed to meet the ozone standard (at the time,

.08 ppm)—was not based on any monitoring of the air in those

areas, but on general knowledge of the process of ozone

production.

One important reason for the 1977 Amendments to the

Clean Air Act was to provide a statutory basis for the offset

policy. See D. Currie, supra, at 6-2. This Congress did by

introducing the notion of a “nonattainment area.” § 171, 42

U.S.C. § 7501. Each state was, with EPA approval, to providea

list dividing the state into areas—perhaps a different division

for different pollutants—showing for each area whether it was

in attainment ofthe standard for a certain pollutant; nonattain-

ment ofthe standard; or as of yet unclassifiable. § 107(d)(1), 42

U.S.C. § 7407(d)(1). Within the nonattainment areas provisions

of the statute based on the offset policy were to apply. See, e.g.,

§ 173, 42 U.S.C. § 7503.

It was up to the states to determine the appropriate

geographic size of these areas; but EPA had to approve and

promulgate the list, and it was up to EPA to offer guidance as to

what sizes would be acceptable, and what sizes would not.

A-36

H.R. REP. No. 294, 95th Cong., 1st Sess, 1977 U.S. CODE

CONG. & AD.NEWS 1077, 1292; § 107(d), 42 U.S.C. § 7407(d).

For some poilutants, EPA discharged this duty with a fair

amount of precision. Thus, for sulfur dioxide:

Generally where EPA promulgated.a designation for

SO, the minimum area was to be the county in which

the violating monitoring site was located.

And for carbon monoxide:

A designation of nonattainment for the entire urban

core area... was desirable, but smaller area

designations were acceptable since CO violations

are most pervasive in downtown areas. ...

43 Fed.Reg. 8962-63 (1978).

But in the matter of ozone, perhaps because of the

essentially different way ozone is produced, EPA gave no

clear guidance. There was talk that suggested that an entire

urbanized area should be considered one nonattainment area

for ozone, because all of the sources in a city were assumed to

contribute to the ozone problem in the area. 44 Fed.Reg.

20376 (1979); 43 Fed.Reg. 45997 (1978); 43 Fed.Reg. 8962

(1978). See also Raffle, Env.Rep. (BNA) Monograph #27 (1979)

(most major urban areas in the U.S. designated as nonattain-

ment areas); 9 Env.Rep.—Current Developments (BNA) 1812

(1979) (most cities nonattainment in spite of lowered stan-

dard). On that theory, the larger Chicago urban area should

have been one nonattainment area; and yet vhen Illinois

submitted its first list, the Chicago urban area was divided into

counties, each county listed as—apparently—a separate

nonattainment area. 43 Fed.Reg. 8962, 8988-89 (1978). EPA

also advanced a slightly different theory, that a nonattainment

A-37

area for ozone must be large enough to include both the

polluted area and all major sources of the ozone pollution in

that area, a theory obviously rooted in the offset theory out of

which the notion of a nonattainment area had come. See

Memorandum from David Hawkins to Regional Administrators

of USEPA, January 3, 1978 (reprinted in Appellee’s Appendix

at A-39) (for ozone, regional offices should require “that the

designated area be of sufficient size to include most of the

hydrocarbon sources’); 46 Fed.Reg. 55724 (1981) (“A non-

attainment area should be as small as possible while encompass-

ing all areas of expected violations and al! sources of

significant impact on those violations.”); 48 Fed.Reg. 46084

(1983) (“[T]he designated nonattainment area shouid be of

sufficient size to include most of the significant hydrocarbon...

. sources.”) But it is clear that EPA never took that theory

seriously. It never proposed that southeastern Wisconsin and

Chicago be part of the same nonattainment area, for example,

as it should have under the theory, if Chicago sources cause

Wisconsin ozone. This theory is also inconsistent with the

“urbanized area” theory, since on the urbanized area theory

the peak ozone concentration area, miles downwind, would

not be included in the nonattainment area for a city; but under

the “polluted area plus sources” theory, it must be. Again,

under this theory EPA should not have approved the division

of the area into counties, since pollution in one county may be

caused by sources in another. And finally, to top off the

confusion, in 1983 EPA granted a change in status from

nonattainment to attainment for Will and McHenry counties,

48 Fed.Reg. 21947 (1983); yet later EPA conceded that Will

County, at least, contained significant sources of VOC emis-

sions contributing to ozone pollution in the Chicago area. 49

Fed.Reg. 24130 (1984). If sources are to be in the same

nonattainment area as the pollution they produce, Will County

ought to be in the Chicago nonattainment area.

A-38

We might have supposed that EPA was not serious about

either theory, having aliowed Illinois to treat the separate

counties in the Chicago metropolitan area as separate non-

attainment areas, if it were not for the EPA action that gives rise

to the present litigation. For EPA has refused to upgrade two

counties in the Chicago area, in spite of the fact that no

violations have been monitored in those counties.

Section 107(d)(5) of the Clean Air Act, as amended in

1977, permits states to propose a revision in the status of

nonattainment areas to the EPA:

A State may from time to time review, and as

appropriate revise and resubmit, the list required

under this subsection. The Administrator shall con-

sider and promulgate such revised list in accor-

dance with this subsection.

42 U.S.C. § 7407(d)(5). A change in status is called for when an

area is in attainment with the national standard set by EPA. For

ozone the following standard applies:

The level of the national primary and secondary

ambient air quality standards for ozone... is 0.12

part per million. ... The staridard is attained when the

expected number of days per calendar year with

maximum hourly average concentrations above

0.12 parts per million is equal to or less than one....

40 C.F.R. § 50.9 (1979). As proof of attainment EPA requires

data showing no violations over the previous year, or on the

average less than one full day in violation per year, over three

A-39

years. Violations are measured at monitoring sites. Guidelines

for the Interpretation of Ozone Air Quality Standards (EPA

450/4-79-003).

In January, 1983, Illinois submitted a revised list in which

Kane and Du Page Counties each would have been upgraded

to attainment status for ozone, along with data showing that no

violations had been monitored in those counties. EPA refused

to approve the change. In the proposed rulemaking that

denied Illinois’ request, EPA said:

Because the prevailing winds during the ozone

season are from south through west, ozone pre-

cursor emissions from DuPage and Kane Counties

can contribute significantly to ozone NAAQS [na-

tional ambient air quality standards} exceedances

which continue to be observed in the Chicago

area.... These counties must continue to be con-

sidered as part of the Chicago urbanized ozone

nonattainment area for the purpose of the 1982

[state implementation plan].

48 Fed.Reg. 46084. Later, in the fina! rulemaking, answering

objections raised by the state, EPA continued to rely on two

separate theories, first, thata nonattainment area must include

all the sources that contribute to pollution in that area; and

second, that an urban ozone nonattainment area must include

the entire urbanized area:

[I]t is important that the nonattainment areas be of

sufficient size to include all emissions sources...

which contribute significantly to the violation of

NAAQS.

49 Fed.Reg. 24130.

A-40

EPA’s determination is based upon the fact that

these counties are part of major urbanized areas....

49 Fed.Reg. 24130. As we have pointed out already, these

theories are not only apparently inconsistent with one another

(the first would require Chicago sources to be part of the

southeastern Wisconsin nonattainment area, if EPA meteor-

ologicai information is right, whereas the second evidently

would not), they are both inconsistent with the action EPA took

in originally approving the Illinois ozone list for the Chicago

area by counties.

Illinois, having gotten its list by counties approved in

1978, and having gathered data to show that two of the original

nonattainment areas, Kane and Du Page Counties, are now in

attainment, brings this appea! to protest the EPA action.

(Although separate actions were brought by the Illinois

Environmental Protection Agency and the Illinois Chamber of

Commerce, for simplicity we will treat their arguments to-

gether as arguments of the Illinois litigants.) Illinois argues

that, since no vioiations have been monitored in Kane or Du

Page Counties, and since those counties have been approved

as separate attainment-nonatiainment areas, EPA is either

basing a nonattainment status for those areas on air quality

monitored in other areas; or else it is now trying to change the

borders of the nonaitainment areas to make all of the Chicago

area—including Kane and Du Page Counties—one non-

attainment area. If itis doing the first, the state argues, then itis

doing something not authorized by the statute, which author-

izes the EPA to use only local air quality to determine the

status of an area; and in addition, according to Illinois, EPA has

not shown that emissions in Kane and Du Page actually

contribute to the ozone problem in the core Chicago area and

downwind. if, on the other hand, it is trying to change the

borders, then under Bethlehem Steel v. EPA, 723 F.2d 1303

(7th Cir. 1983) (as Illinois reads it), it is doing something it may

A-41

not do. As the state sees it, EPA’s authority over the

boundaries of nonattainment areas is limited to modifying

changes in those boundaries proposed by the states, and

does not extend to changing the boundaries when the state

has proposed a change in attainment status.

C.

Since the statute does not require a hearing before EPA

promulgates a rule denying a state’s redesignation request,

the proper standard of review, under § 706(2)(A) of the

Administrative Procedure Act, 5 U.S.C. § 706(2)(A), is the “arbi-

trary and capricious” standard.

In this case EPA announced a proposed rulemaking that

was apparently in conflict with earlier decisions. EPA is

entitled to change its policy, but it must do so on the basis ofa

reasoned analysis. Motor Vehicle Manufacturers Assoc. v.

State Farm Mutual Automobile Ins., 463 U.S. 29, 57, 103 S.Ct.

2856, 2874, 77 L.Ed.2d 443 (1983). If EPA changed its policy, it

did not say so; and neither did it explain how its justification of

its most recent action could be made consistent with its earlier

actions, if no change in policy was involved. It must do one or

the other. If it has changed its policy, it must explain how and

why; if it has not, it must articulate an explanation that will

account for both the earlier and the most recent actions it has

taken. Until it has done one or the other, its actions will appear

to be arbitrary, and rational review in this court will be

impossible.‘

4 The Chamber of Commerce argues that EPA did not follow proper procedures, and

that redesignation proceedings must include a formal hearing. It argues that such

proceedings are adjudications rather than rulemaking, and thus are subject to the

requirements of 5 U.S.C. § 554(c), which requires an agency to provide opportunity for

a hearing. Section 554 in which a hearing is required by statute. The Clean Air Act

—————EEeEeEeEEEeEr

A-42

We are aware of atleast four different ways in which EPA

might justify the action it has taken. Each is more or less

cansistent with the available evidence concerning ozone; but

each is also inconsistent with something EPA has said or done

in the past. It is not our duty, in reviewing EPA's action, to pick

and choose among the various justifications that might be

given. State Farm, 463 U.S. at 43, 103 S.Ct. at 2866. We feel

obliged, however, to say enough about the various theories to

show how they fall short of making a recognizable pattern out

of the pieces in this puzzle, and to suggest how those

shortcomings might be remedied.

does in the case not require a hearing for redesignation proceedings. It is true that an

“opportunity for the oral presentation of data” must be given to interested parties in

the case of proceedings that fall under § 307 of the Clean Air Act, 42 U.S.C. § 7607(d)(5)

but a § 107 redesignation proceeding is not one that fails under § 307 by the terms of

that section. Thus redesignation proceedings would not require hearings (“oral”

hearings) even if they were adjudications.

Moreover, there is no good reason to think that these proceedings must be

considered adjudications. The Administrative Procedure Act defines “rule” to mean

any statement “of general or particular applicability and future effect designed to

implement, interpret or prescribe law or policy.” 5 U.S.C. § 551(4). That description

seems to fit not only “statements” that issue from designation proceedings, see D.

Currie, Air Pollution 6-8 n. 9 (1981), but those that issue from redesignation

proceedings as well. It is true, as the Chamber points out, that we said in U.S. Stee! v.

EPA, 605 F.2d 283, 285-86 n. 3 (7th Cir. 1979), that the question whether designation

proceedings were rulemaking was “not without difficulty;” our concern there,

however, was whether designations might be merely preliminary proceedings,

governing the future formulation of actual regulations concerning the designated

areas, and thus not subject even to the notice and comment requirement. Thus, we

cited Citizens to Preserve Overton Park v. Voipe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d

136 (1971), as involving an analogous proceeding that the Supreme Court held did not

rise to the ieve! of rulemaking. The problem in U.S. Stee/ was thus not whether to

require more procedure than notice and comment, but whether even that much was

required. In the end we did not decide the issue because the EPA, in calling the

proceeding a rulemaking, had brought itself under the requirement to provide notice

and the opportunity to comment. To suppose that U.S. Stee/ decided that these

proceedings should be considered adjudications, or that we even considered the

question in that opinion, is to misread the opinion and to suggest how those

shortcomings might be remedied.

A-43

Although the choice of a theory rests ultimately with EPA,

we have already seen that one of these theories does not have

much to recommend it: the theory which would make a

polluted area, together with all areas containing sources

contributing to pollution in that area, one nonattainment area.

For one thing that theory does not explain the original division

into counties, or the separate upgrading of Will and McHenry

Counties, acknowledged sources of pollution in the Chicago

area. For another thing, in the case of ozone the areas would

have to be large; and since ozone pollution occurs downwind

of the sources, in some cases the polluted area itself might

contribute nothing to the pollution. It should be within EPA’s

discretion to allow the upgrading of such areas (something it

could not do if both the polluted area and the source made up

one nonattainment area). Moreover, our beliefs about the

movement of ozone and ozone precursors are subject to

revision, as the environment and our knowledge of the

environment changes; but the limits of a nonattainment area

ought not to be subject to constant revision. And finally a look

at the boundaries originally approved by EPA in the eight

largest metropolitan areas shows that, with the exception of

the Chicago area, the boundaries were large enough in each

case to include the entire urbanized area, but that no attempt

was made to draw up the boundaries in such a way as to track

the movement of ozone away from the sources, as this theory

would require. 40 C.F.R. §§ 81.333 (New York), 81.305 (Los

Angeles), 81.314 (Chicago), 81.339 (Philadelphia), 81.323

(Detroit), 81.305 (San Francisco), 81.322 (Boston), 81.309

(Washington, D.C.). Hence the theory fails to explain not only

what EPA did in the Chicago area, but what it did in those other

areas as well.

The remaining three theories are more plausible. On the

assumption that EPA did approve the counties as separate

nonattainment areas in 1978, EPA may now be arguing that

—

A-44

ozone attainment must be determined at monitors downwind

and outside the area itself; or EPA may be arguing that

attainment of the ozone standard is to be determined on the

basis of ozone precursors monitored within the area itself.

Both these theories are consistent with EPA’s desire to make

the source area a nonattainment area, without involving the

apparently unworkable notion that a polluted area together

with all its sources must make up one nonattainment area.

Under either of these theories, the present county boundaries

remain the boundaries of the nonattainment areas in Chicago,

but the attainment status of those areas will depend on ozone

pollution elsewhere.

On the other hand, EPA may be arguing that it never

approved the division of the area into counties, and that Kane

and Du Page are part ofa unitary Chicago nonattainment area.

This theory requires an explanation of the original listing, and

for the fact that Will and McHenry Counties, arguably part of

the larger Chicago area, were upgraded individually.

The first of the theories—that attainment of the standard

in one area may be determined by the presence of ozone in

another area—is not inconsistent with the statute. The

relevant provision is a definition:

The term “nonattainment area” means, for any air

pollutant, an area which is shown by monitored data

or which is calculated by air quality modeling (or

other methods determined by the Administrator to

be reliable) to exceed any national ambient air

quality standard for such pollutant.

§ 171(2), 42 U.S.C. 7501(2). Nothing in the statute says that

monitoring must be done within the area itself; indeed, the

facts suggest that the best, and perhaps only, way to monitor

A-45

for ozone would be to monitor downwind. (The word “ambi-

ent’ is defined in the statute to mean roughly the same as

“outdoor,” it does not carry the connotation of “local.”) Since

the statute gives the Administrator a certain amount of

discretion (“other methods determined by the Administrator to

be reliable’), and since other provisions of the Act do not limit

that discretion, it would seem to be within the authority of the

agency to monitor ozone production at sites downwind.5

EPA has not set down standards for this sort of off-

location measuring, however; existing guidelines suggest a

determination of status by means of monitoring within the

area. See Guideline for the Interpretation of Ozone Air Quality

Standards (EPA 450/4-79-003). If EPA has something differ-

ent in mind, it should make clear how ozone pollution is to be

measured downwind, and that is something it so far has not

done.®

Something similar is true of the second theory, which

would base attainment status on the measurement of ozone

precursors within the area itself: as the monitoring guideline is

currently written, it is written in terms of ozone, and not ozone

precursors.

Nevertheless, the guidelines are within the power of EPA

to change. The current state of scientific knowledge suggests

that it would be worse than foolish to start with geographically

small areas, for ozone, and then base the attainment status of

* Among the virtures of this theory is the fact that it would reserve the decision

about the boundaries primarily to the state, and the decision about monitoring

methods primarily to the EPA.

® In its Brief, EPA claims to have relied on monitoring sites in areas downwind of

Kane and Du Page Counties (Deerfield, lll.; Libertyville, Ili; Evanston, Ill; Skokie, ill;

Kenosha, Wis.; and Racine, Wis.), all of which recorded violations of the ozone

standard between 1980—82. No general criteria for selecting sites downwind have

ever been suggested, however

a

A-46

each area on the monitoring of ozone within that area.

Attainment and nonattainment are meant to reflect the con-

tribution of an area to the pollution problem; and perhaps the

worst way to determine the contribution of a smali area to the

ozone problem is to measure for ozone within the area itself. It

cannot have been the intention of Congress that EPA choose

the worst possible way to measure for the production of

pollutants, and nothing prevents EPA from changing its

guidelines to reflect one of these views.

What we have said so far is on the assumption that EPA in

fact approved a division of the Chicago area into counties. As

we will see, that is not so clear as Illinois would have us

believe. EPA has argued, and we find the argument persua-

sive, that although the Chicago area is listed by counties, it has

been clear all along that insofar as any county was part of the

urbanized area or its fringe of development it was to be part of

a single nonattainment area, not to be upgraded until the

entire area reached attainment.

Suppose, for example, Illinois had submitted the original

list with Du Page County marked as “attainment” because

monitors had shown no violations. It is clear as these things

can be that EPA would have disapproved the rating, on the

grounds that Du Page was, for purposes of ozone pollution,

part of the larger Chicago area. That is precisely what

happened with Porter County, Indiana. When EPA solicited

comments on the original list, there was an objection to the

nonattainment status of Porter County in northwest Indiana. In

its reply, EPA did not allege that there had been monitored

violations in Porter; instead, it said:

The nonattainment designation of Porter County

was based on the fact that portions of Porter County

are part of the Chicago-northwest Indiana urban-

ized area.

A-47

43 Fed.Reg. 45997 (1978). EPA, as we have seen, had

suggested that all urbanized areas were to be treated as units,

for ozone, and were to be assumed at the outset not to have

attained the standard.

Thus, the original listing by counties was very possibly no

more than an accident of record-keeping. Congress de-

manded alist from the states. The EPA asked the states to treat

urban areas as unitary nonattainment areas for ozone, as it

was authorized to do. Illinois submitted a list, by counties, in

which all the counties in the Chicago urban area—and thus

the urban area itself—were listed as not in attainment.

Although such alist, out of context, is ambiguous between the

two interpretations—is Chicago one area consisting of the

listed counties, or is each county a separate area? —the

circumstances surrounding the promulgation of the list sug-

gest that EPA's interpretation may be the proper one. When

EPA proposed to turn down the request to upgrade Kane and

Du Page Counties, it used language that echoed the 1978

comment explaining Porter County's status:

Because the prevailing winds during the ozone

season are from south through west, ozone precur-

sor emissions from DuPage and Kane counties can

contribute significantly to ozone NAAQS exceed-

ances which continued to be observed in the

Chicago area.... These counties must continue to be

considered as part of the Chicago urbanized ozone

nonattainment area for the purpose of the 1982 SIP.

48 Fed.Reg. 46084. If we could be certain that this was indeed

EPA’s practice all along, we would be unwise to reverse

agency action on the basis of the happenstance ofa particular

way of listing the Chicago urban area in a 1978 list. This

“urbanized area” theory would also explain the different

Paes

A-48

treatment of Will and McHenry Counties which, although EPA

concedes they contain significant sources of ozone precur-

sors, do not—unlike Kane and Du Page County—contain any

part of the Chicago urbanized area, as defined by EPA on the

basis of the 1970 census.

While this last theory may be the least problematic under

existing standards, it suffers from problems of its own.

Although large cities are prime contributors to the problem of

ozone, so that it makes sense to impose ozone controis on

them, there remains the question of how the attainment status

of an urban area is to be changed. Will itdepend on monitoring

within the area itself? For reasons we have explained, a good

deal of the ozone created in the Chicago area apparently finds

its way downwind into Wisconsin. Although making the area

larger reduces the problem—much of the ozone is also found

within the urban area itself—the theoretica! basis for monitor-

ing for ozone only within an urban area as defined by the

census is not presently clear enough to allow for proper

review of EPA's action in this Court.

IV

lilinois argues that there are other ways for EPA to do

what it feels must be done without denying Illinois’ application

to upgrade Kane and Du Page Counties. The fact that the

parties have brought this litigation to the court of appeals

shows that neither side believes that any of the alternatives

will provide exactly equivalent results. If EPA could get the

same results without blocking the upgrading of Kane and Du

Page Counties, then Illinois would have nothing to gain, and

EPA nothing to lose, however the appeal came out. Clearly the

outcome of the appeal does make a difference; for one thing,

certain controls apply to nonattainment areas by operation of

the statute. It is essential to the success of the Clean Air Act

A-49

that these controis apply in the appropriate areas, and we

refuse to construe the law in such a way that the controls will

apply to areas that suffer from but do not produce ozone

pollution but not to areas that produce but do not suffer from

such pollution. The automatic imposition of controls gives

EPA a certain leverage over the states, and we think such

leverage should be available where, but only where, it will be

useful.

Moreover, since Bethlehem Stee/ it has been clear that if

these areas are mistakenly upgraded, the EPA will not be abie

unilaterally to return them to their nonattainment status. The

consequences of a mistaken upgrading are extremely seri-

ous, therefore, and we cannot treat the revision process as a

game which EPA must lose if it has failed on a previous

occasion to be clear about its rationale. The states are entitled

to a clear understanding of how areas will be evaluated; but

Congress clearly did not intend technical missteps to defeat

EPA’s ability to implement the best of current opinions about

the nature of pollution.

The state suggests that we vacate, and, since the record

supports redesignation, reverse the decision of the EPA. It is

not true that the record supports redesignation; but since EPA

has not made clear the rationale for its action, and since

certain of the possible rationales rely on empirical assump-

tions that should be subjected to the give and take of notice

and comment we therefore vacate the decision in its present

form and remand for further proceedings consistent with this

opinion. State Farm, supra; Atchison, Topeka & Santa Fe

Railway Co. v. Wichita Board of Trade, 412 U.S. 800, 93 S.Ct.

2367, 37 L.Ed.2d 350 (1973).

Our remand is for reconsideration by EPA and for

clarification of the grounds upon which it has dealt or will deal

<<

A-50

with the Illinois request. EPA will, of course, give Illinois an

appropriate opportunity to respond.

COFFEY, Circuit Judge, dissenting.

The majority concludes that the Environmental Protec-

tion Agency (“EPA”) acted arbitrarily and capriciously in

failing to adequateiy explain its basis or theory in denying

Kane and Du Page Counties’ request to be reclassified froma

status of nonattainment to one of attainment. To support its

position, the majority posits several theories (i.e. urban v.

county designation) that may explain the EPA’s denial of Kane

and Du Page Counties’ redesignation request; and the

majority argues that the EPA has failed to consistently apply

either of these alleged theories in defining what constitutes an

appropriate nonattainment area. Because the majority be-

lieves that the EPA failed to consistently apply the same theory

in assessing the requests for redesignation, it remands this

case to the EPA for further explanation. After reviewing the

previous statements issued by the EPA concerning the

appropriate size for nonattainment areas and the reason

proffered by the EPA for denying Kane and Du Page Counties’

request for redesignation—namely, that Du Page and Kane

Counties are within the Chicago urban ozone area and

contribute to the urban area’s ozone problem—t is clear that

the EPA has applied the same theory in assessing a request

for redesignation from nonattainment to attainment. Specific-

ally, the theory applied by the EPA is that the entire Chicago

urban area is considered to be one nonattainment zone and

that Kane and Du Page Counties are within that nonattainment

zone for purposes of assessing their redesignation requests.

Since the EPA has consistently applied the theory that the

entire Chicago urban area is considered one nonattainment

area, there is no reason to remand this case to the EPA to

Clarify its ruling. Thus, | respectfully dissent.

A-51

This court’s standard of review of a federal agency

decision was most recently stated in Motor Vehicle Mfrs. Assn.

v. State Farm Mut., 463 U.S. 29, 103 S.Ct. 2856, 77 L.Ed.2d 443

(1983).

“The scope of review under the ‘arbitrary and

Capricious’ standard is narrow and a court is not to

substitute its judgment for that of the agency.

Nevertheless, the agency must examine the relevant

data and articulate a satisfactory explanation for its

action including a ‘rational connection between the

facts found and the choice made. ...In reviewing that

explanation, we must ‘consider whether the deci-

sion was based on a consideration of relevant

factors and whether there has been a clear error of

judgment.’ ..Normally, an agency rule would be

arbitrary and capricious if the agency has relied on

factors which Congress has not intended it to

consider, entirely failed to consider an important

aspect of the problem, offered an explanation for its

decision that runs counter to the evidence before

the agency, or is so implausible that it could not be

ascribed to a difference in view or the product of

agency expertise. The reviewing court should not

attempt itself to make up for such deficiencies; we

may not supply a reasoned basis for the agency's

action that the agency itself has not given.... We will,

however, ‘uphold a decision of less than ideal clarity

if the agency’s path may reasonably be discerned.”

ld. at 43, 103 S.Ct. at 2866 (citations omitted) (emphasis

added). The theory the EPA employed in denying Kane and Du

Page Counties’ request for redesignation—that Kane and Du

Page Counties are part of the Chicago urban area and will be

considered to be in nonattainment until the Chicago urban

area achieves attainment—can certainly be “reasonably dis-

cerned” from the record.

ae

A-52

Congress passed the Clean Air Act in 1970 and estab-

lished a combined state and federal program to control air

pollution. See Pub.L. No. 91—-604, 84 Stat. 1676 et seq. 1970.

As part of this program Congress required the EPA to

establish a National Ambient Air Quaiity Standard (“NAAQS”),

see sections 108 and 109, and required that each state adopt

and submit a “state implementation plan” (“SIP”) to the EPA

designed to attain the NAAQS in the designated Air Quality

Regions (“AQCRs’”), section 107(b)-(c), 42 U.S.C. § 7407(b)-(c).

Attainment of the NAAQS was to be achieved by 1977. Currie,

Air Pollution, § 6—1 (1981). It became apparent, however, that

many of the AQCRs would not meet the deadline for com-

pliance with the Clean Air Act. /d. at 62. Thus, in 1977

Congress added subsection (d) and (e) to Section 107 of the

Act. See 42 U.S.C. § 7407(d) and (e). Subsection (d) provides

that states “submit to the Administrator a list, together with a

summary of the available information, identifying those air

quality control regions, or portions thereof,” that either satisfy

the NAAQS (‘attainment’), failed to satisfy the NAAQS (‘‘non-

attainment’) or could not be classified because of a lack of

information. Nonattainment was defined as “an area which is

calculated by air quaity modeling ... to exceed any national

ambient air quality standard...."” Section 171,42 U.S.C. § 7501."

Each state was required to submit to the EPA alist of those air

quality control regions or AQCRs that failed to comply with

NAAQS; the EPA was then to promulgate the list within sixty

days of receipt “with such modifications as he [the Adminis-

trator] deems necessary.” 42 U.S.C. § 7407(d)(2). For those

areas listed as nonattainment, Congress provided that the

' In 1979, the EPA revised the federal chemical! oxidant NAAQS and relaxed the

standard from 0.08 part per million (“ppm’"’) to 0.12 ppm and changed the chemicai

designation of the standard from photochemical oxidants to ozone. 40 C.F.R. § 50.9

(1984).

A-53

SIPs were to provide for incremental emission reductions from

existing sources in the nonattainment area. 42 U.S.C. §

7502(b)(3). The reductions in pollutants could be achieved

through “reasonably available control technology,” id., and

through permits restricting the construction and operation of

new sources Of pollutants in the nonattainment area. 42 U.S.C.

§§ 7502(b)(6) and 7503.

In line with these regulations, Illinois in 1978 submitted to

the EPA, anc the EPA promulgated, a list of nonattainment

areas. This list included, among others, Cook, Lake, Du Page,

Kane, Will, and McHenry Counties. Indiana also submitted its

list to the EPA of nonattainment areas that included Porter and

Lake Counties in Indiana. Porter and Lake County, indiana are

located along the southern short of Lake Michigan adjoining

the illinois border. Cook and Lake Counties, Illinois are located

on the western shore of Lake Michigan just northwest of Lake

and Porter Counties, Indiana, while Du Page and Kane

Counties are located southwest of Lake County and immedi-

ately west of Cook County, Illinois. The County of Will is

located south of Cook County while McHenry County is

located north of Kane and Du Page Counties.

On January 27, 1983, the State of Illinois requested that

the EPA redesignate Kane and Du Page Courties from

nonattainment to attainment status. To support its request,

Illinois noted that the ozone monitors located within those

counties had registered no violations of the NAAQS for a

three-year period. In its proposed ruling, the EPA denied the

redesignation request reasoning that Kane and Du Page

Counties were part of the Chicago urban area and contributed

to the ozone problem in the Chicago urban area because of

the prevailing southwest winds during the summer months.

A-54

“However, U.S. EPA has determined that the high

population densities in DuPage and eastern Kane

Counties are associated with relatively high densi-

ties of area and mobile source volatile organic

compound emissions. Because the prevailing winds

during the ozone season are from south through

west, ozone precursors emissions from DuPage

and Kane Counties can contribute significantly to

ozone NAAQS exceedances which continue to be

observed in the Chicago area. U.S. EPA, therefore,

proposes to reject the Illinois proposal to redesig-

nate Kane and DuPage Counties to attainment for

ozone. These counties wil! continue to be desig-

nated nonattainment until sufficient data is avaiiable

to warrant a change. These counties must continue

to be considered as part of the Chicago urbanized

ozone nonattainment area for the purpose of the

1982 SIP.”

48 Fed.Reg. 46082, 46084 (1983). After lilinois submitted

comments on the proposed ruling, the EPA, on June 12, 1984,

issued its final ruling and denied the state's request that Kane

and Du Page Counties be redesignated to an ozone attain-

ment status.

A-55

The majority holds that the EPA’s action in denying Kane

and Du Page Counties’ request for redesignation from non-

attainment to attainment is arbitrary and capricious as the EPA

has failed to set forth a consistent theory in approving the

boundaries for the nonattainment areas. Essentially, the

majority argues that the EPA has been less than consistent in

its decision of whether the nonattainment boundaries should

be determined on a county or on an urban wide area basis.

Specifically, the majority observes that in 1978 the EPA

approved a list submitted by Illinois designating the counties

in the Chicago area as nonattainment. The majority next notes

that the reason Du Page and Kane Counties were denied

redesignation to attainment status was that monitors down-

wind from these counties in the Chicago urban area have

been registering ozone violations. The majority concludes

that if the EPA considers the county to be the area unit for

defining attainment/nonattainment status and these counties

are to be held responsible for ozone measured downwind and

outside the county boundaries, the EPA should clarify the

standards as to when the county is to be held accountable for

ozone outside its borders.? On the other hand, the majority

observes that the EPA may have considered the entire urban

Chicago area as one nonattainment area (as ali the counties

within the urban area were listed as nonattainment), but that

this designation is inconsistent with the EPA’s approval of

Illinois’ list of nonattainment areas defined on a county basis.

Thus the majority concludes that if the EPA has changed its

policy as to how it defines the attainment/nonattainment area

“it must explain how and why; if it has not it must articulate an

2 Presently, the guidelines indicate that the status of whether an area is considered

attainment or nonattainment is determined by monitors located within the designated

nonattainment area. See Guidelines for the Interpretation of Ozone Air Quality

Standards (EPA 450/4-79003)

A-56

explanation that will account for both the earlier and the most

recent actions it has taken.”

After reviewing the various statements and rulings issued

by the EPA since 1978—the year that the states were to submit

a list of those areas it considered to be in nonattainment—the

record is-clear that the EPA has consistently followed the

same policy in assessing a redesignation request from

counties located in the Chicago urban area: that any county in

the Chicago urban area contributing to the Chicago urban

area's ozone problem will remain in nonattainment status until

the Chicago urban area problem of ozone is adequately

controlled and thus reaches attainment status. In denying

Kane and Du Page Counties’ request for redesignation, the

EPA stated:

“Kane and DuPage counties are part of the Chicago

urbanized area and are therefore to be considered

nonattainment until the greater Chicago area and its

downwind peak impact areas are designated as

attainment. This is consistent with EPA's designa-

tion policy for ozone as outlined in the January 3,

1978 memorandum from David G. Hawkins, Assis-

tant Administrator for Air and Waste Management

entitled ‘Attainment/Nonattainment Status Designa-

tions’...."

49 Fed.Reg. 24128, 24130 (1984) (emphasis added). The

Hawkins’ memo discusses the appropriate size of the attain-

ment/nonattainment areas.

“Priority should be given to those 105 urban areas

with populations greater than 200,000. These areas

are to be considered nonattainment for oxidants

unless monitored data supports attainment... If a

as iailliieaieieaeaeeaallll

A-57

state fails to designate any of these areas or submits

unacceptable designations, the Regional Office

should make the required designations. The Region-

al Office requires that the designated areas be of

sufficient size to include most of the significant

hydrocarbon sources.”

See Memorandum from David Hawkins to Regional Adminis-

trators of USEPA, January 3, 1978 (reprinted in Appeliee’s

Appendix at A-39) (emphasis added). Thus, for the past seven

years, as far back as 1978, ithas been the EPA’s position that

the entire urban area should be designated as nonattainment,

including in this area the significant sources of hydrocarbon

precursors. This position is also reflected in the comments

that the EPA made when it promulgated the list of nonattain-

ment areas that the states submitted to the EPA: “There are

105 urban areas in the United States with populations greater

than 200,000. These major urban areas ... are where the

oxidant problem is most severe.” 43 Fed.Reg. 8962-63 (1978)

(emphasis added). Further, in 1978, Porter County, Indiana, a

part of the Chicago urban area, requested that it be classified

as in attainment with the NAAQS; the EPA, however, denied

this request noting “[t]he nonattainment designation of Porter

County was based on the fact that portions of Porter County

are part of the Chicago-northwest Indiana urbanized area.” 43

Fed.Reg. 45997 (1978) (emphasis added). Finally, in its pro-

posed ruling, denying redesignation of Kane and Du Page

Counties, the EPA observes that:

“DuPage and eastern Kane Counties are associated

with relatively high densities of area and mobil

source volatile organic compound emissions. Be-

cause the prevailing winds during the ozone season

are from south through west, ozone precursors

emissions from DuPage and Kane Counties can

contribute significantly to ozone NAAQS exceed-

ances which continue to be observed in the

Chicago area.... These counties must continue to be

considered as part of the Chicago urbanized ozone

nonattainment area...”

48 Fed.Reg. 46084 (1984) (emphasis added). Thus, since 1978

the EPA has been concerned that the entire Chicago urban

area be considered one nonattainment area for purposes of

determining whether the NAAQS has been satisfied. This

areawide designation is consistent with the EPA’s attempt to

control the ozone problem. Ozone is an area wide, multi-

chemical phenomenon that depends upon the transforma-

tions of VOC or hydrocarbon precursors under varying

meteorological conditions. State of Texas v. Environmental

Protection Agency, 449 F.2d 289, 293 n. 1 (5th Cir. 1974), cert.

denied, 427 U.S. 905, 96 S.Ct. 3191, 49 LEd.2d 1199 (1976).°

Since science to date has been unable to make exact

predictions concerning the transportation of ozone, the desig-

nation of an area sufficient in size to contro! the ozone

problem is well within the discretion and expertise of the EPA.

See Citizens Against Refinery’s Effects v. Environmental

Protection Agency, 643 F.2d 183, 186 (4th cir. 1981).

The majority notes that the EPA may have been incon-

sistent in the theory it applies to determine the appropriate

nonattainment area as the State originally submitted, and the

EPA approved, a list of nonattainment areas based upon the

counties boundaries. As the majority concedes, at the time the

state submitted its original list to the EPA all counties in the

Chicago urban area were listed as nonattainment, and thus

the EPA approval of this list does not demonstrate in and of

* VOC or hydrocarbon precursors are those emissions from smokestack industries

and automobiles that when mixed with oxygen and sunlight under the right

meteorological conditions help to create ozone. State of Texas, 499 F 2d at293n 1

A-59

itself that the EPA approved the nonattainment status of this

area on a county basis. | would agree with the majority that

remand for clarification of the grounds upon which the EPA

evaluates a redesignation request would be proper if the

approved state list was the only evidence in the administrative

record in this case as to the previous action taken by the EPA

in approving nonattainment areas. However, as discussed

earlier in this dissent, the reports and comments issued by the

EPA since 1978 demonstrate that the EPA considered the

urban area, sufficient in size to contain the major sources of

the VOC precursors, to be the proper size for determining the

boundaries of the nonattainment/attainment zone. See 43

Fed.Reg. 8962 (1978); 43 Fed. Reg. 45997 (1978); Memo from

David Hawkins to Regional Administrators of USEPA, (Jan-

uary 3, 1978) (Appellee’s Appendix at A-39). Thus, it is clear

that the EPA never intended to consider the attainment/non-

attainment status of the Chicago urban area on a county basis,

but rather the EPA considered the entire Chicago urban area

as one nonattainment zone.

The majority also notes that the EPA's theory that the

entire Chicago urban area is to be considered as one

nonattainment zone is inconsistent with several EPA state-

ments that sources of the ozone pollution must be included

within the nonattainment area. See Majority opinion at 12

citing 48 Fed.Reg. 46084 and 49 Fed.Reg. 24130. To support

this position the majority argues that peak ozone concentra-

tions may be miles downwind from the source, yet under the

urbanized area theory these areas would not be included

within the nonattainment zone since these areas may not be

considered, under the urban area theory, to be part of the

nonattainment area because of their rural setting. For

example, the majority argues that tor the EPA to be truly

consistent in its theory that sources of the ozone are to be

included within the nonattainment zone, the counties in

<a

a. oh Peele. _

A-60

southeast Wisconsin must be considered as part of the

Chicago urban area for nonattainment purposes since the

Chicago area contributes or is a source of ozone in southeast

Wisconsin; yet, the EPA does not consider southeastern

Wisconsin a part of the Chicago urban area nonattainment

zone.* The majority's analysis completely misses the point.

The EPA, as demonstrated in David Hawkins’ memo in 1978

that suggests the appropriate size for the nonattainment area,

was primarily concerned with coritrolling ozone in urban

areas.® See also 43 Fed.Reg. 8962 (1978); 43 Fed.Reg. 45997

(1978). In order to reach its goal of attaining compliance with

the NAAQS, the EPA suggested that the urban area nonattain-

ment zone include the sources of the ozone (i.e. VOC

precursors). The EPA clearly did not intend that rural areas

(those with less than a population of 200,000) be considered

as part of one massive nonattainment designation simply

because ozone from large metropolitan areas may be blown

into or effect the rural areas;® rather, the EPA was concerned

with controlling ozone in the urban area and the best method

to reach this goal was to include the sources of the ozone

affecting the urban area's air quality within a single non-

attainment zone. See Western Oil & Gas Assoc. v. EPA, 767

F.2d 603 (9th Cir. 1985).’

* It should be noted that we have no knowledge to date of the EPA approving single

nonattainment areas across state boundary lines.

5 As noted by Mr. Hawkins, “{[P]riority should be given to those 105 urban areas with

populations greater than 200,000.”

6 See Hawkins Memo, supra, noting that the approved designation zone for rural areas

could be based upon county boundaries.

’ See also Memo from David Hawkins, Assistant Administrator for Air and Waste

Management, January 3, 1978 (Appeliee’s Appendix at A-39) (Priority should be

given to those 105 urban areas with populations greater than 200,000. These areas

are to be considered nonattainment for oxidants unless monitored data supports

attainment ... the Regional Office should require that the designated area be of

sufficient size to include most of the significant hydrocarbon sources.”) (oxidant is a

A-61

Further, the fact that the EPA previously approved of the

redesignation request of Will and McHenry Counties Illinois

from nonattainment to attainment status fails to reach that

quantum of legal reasoning to convince me that the EPA has

acted arbitrarily and capriciously in denying Kane and Du

Page Counties’ request for redesignation. In rejecting lilinois

argument that Kane and Du Page Counties should be

approved for redesignation simply because Will and McHenry

Counties were previously approved for redesignation on the

basis that ozone monitored within those counties were within

the NAAQS, the EPA noted:

“The main reason EPA concurred with Illinois’

redesignation request for McHenry and Will Coun-

ties was that these areas contained essentially none

of the Chicago urbanized area or adjacent fringed

areas of development. EPA was aware of the signifi-

cant VOC emissions for Will County. It was deter-

mined that these emissions were dominated by

stationary source emissions. These emissions have

been and willcontinue to be significantly reduced as

a result of Illinois RACT Regulations.” 49 Fed.Reg.

24128, 24130 (1980).

The population of both Will and McHenry Counties was

less than 200,000 during the period the EPA approved their

redesignation to attainment status.? Thus, the EPA decision

technical term for ozone); Memo from Helms, Chief Control Programs Operations

Branch, March 5, 1984 (In general, nonattainment areas should be large enough to

include both the areas where the monitored violations occur and the areas where the

sources Causing these violations are located. The urbanized area should be the

minimum size for ozone.... As you know, this reflects EPA’s policy since the first

Section 107 designations were made on March 3, 1978 (43 F.R. 8962-9059)").

® See Chart of Populations of Urbanized Areas: 1970 and 1960 (Appeliee’s Appendix

at A-485) (listing the populations of Will and McHenry Counties as less than 200,000

people)

en

A-62

to approve the redesignation of Wi!! and McHenry Counties

was consistent with its policy that counties with a population

of less than 200,000 people were not considered to be part of

the urban nonattainment area as defined in the 1970 census.?

In contrast, both Kane and Du Page Counties’ populations are

greater than 200,000 people, and both are sources of ozone

precursors that contribute to the ozone in the Chicago urban

area. Thus, the fact that the EPA had previously approved the

redesignation of Will and Kane Counties does not mean that

the EPA has not acted consistently in applying its policy that

those counties within the urban area of Chicago would be

considered as part of one nonattainment area.

* Memo from David Hawkins, Assistant Administrator for Air and Waste Management,

January 3, 1978 (Appellee’s Appendix at 39) (Noting that for those areas whose

population does not exceed 200,000 the “county should be designated as a minimum

{for purposes for designating a nonattainment zone] unless the county is excep-

tionally large and the extent of the violations is minimal.”) Letter from Darryi Tyler,

Director Control Programs Development Division, March 2, 1984, (Noting that for

ozone the area of nonattainment must include the urbanized area “as defined by the

U.S. Bureau of Census” and other fringe areas with significant volatile organic

compound sources).

In its brief, the EPA admits that if anything it may have made a mistake in

redesignating Will County because the businesses within that county do contain a

large number of stationary VOC sources. The EPA notes, however, that in re-

designating Will County it acted in a consistent manner with its policy that those areas

not considered to be part of the urban area could have the attainment/nonattainment

boundaries defined by their county borders. Moreover, the EPA believed that it had

the authority to redesignate Will County as nonattainment if Illinois failed to

promulgate and enforce the VOC controls. See 43 Fed.Reg. 40412. However, our

court has since held that once an area is redesignated, the EPA may not unilaterally

change the designation. Bethlehem Steel Corp. v. EPA, 723 F.2d 1303 (7th Cir. 1983).

Finally, the sources of VOCs in Wil! County are stationary and thus easier to control

through implementation of various SIP and RACT programs. However, because of the

large population iocated in Du Page and Kane Counties, a large source of VOCs is

vehicular traffic, which makes it more difficult to control the source problem

4

A-63

The scope of our review under the “arbitrary and capri-

cious’ standard is limted and we are not to substitute our

judgment for that of the agency. Where the agency’s decision

is not as precise as it may be, we are obliged to uphold the

decision “if the agency’s path may reasonably be discerned.”

Motor Vehicle Mfrs. Assn., 463 U.S. at 43, 103 S.Ct. at 2867. The

majority argues that the record reveals the EPA has not

consistently applied the same theory as to what it believes to

be the proper boundaries of a nonattainment area. However,

the EPA's path may reasonably and very easily be discerned in

this case as a review of the administrative record reveals that

since the attainment/nonattainment designation was intro-

duced in 1978, the EPA considered the entire urban area,

inciuding those areas that are sources of the ozone in the

urban areas, to be one zone for purposes of establishing that

area's attainment/nonattainment status. Thus, if we are to

follow the proper standard of review in assessing the decision

of a federal agency, | am unable to agree with the majority's

limited remand to clarify and further explain the theory the EPA

followed in assessing the proper boundaries of the nonattain-

ment areas. | respectfully dissent.

i — a—c<SXESEEOOOO

j

APPENDIX D

THE CLEAN AIR ACT’

TITLE I—AIR POLLUTION PREVENTION AND CONTROL

ons a AN Aa lea a ar a

PART A—AIR QUALITY AND EMISSION LIMITATIONS

FINDINGS AND PURPOSES

SEC. 101. (a) The Congress finds—

(1) that the predominant part of the Nation’s popula-

tion is located in its rapidly expanding metropolitan and

other urban areas, which generally cross the boundary

lines of local jurisdictions and often extend into two or

more States;

(2) that the growth in the amount and complexity of

air pollution brought about by urbanization, industrial

deviopment, and the increasing use of motor vehicles,

has resulted in mounting dangers to the public health and

welfare, including injury to agricultural crops and live-

stock, damage to and the deterioration of property, and

hazards to air and ground transportation;

(3) that the prevention and control of air poliution at

its source is the primary responsibility of States and local

governments; and

' Clean Air Act (42 U.S.C. 1857 et seq.) includes the Clean Air Act of 1963—P.L.

88-206. and amendments made by the Motor Vehicle Air Pollution Control Act—P.L.

89-272 (October 20, 1965), the Clean Air Act Amendments of 1966—P.L. 89-675

(October 15, 1966), the Air Quality Act of 1967—P.i. 90-148 (November 21, 1967), the

Clean Air Amendments of 1970—P.L. 91-604 (December 31, 1970), the Compre-

hensive Health Manpower Training Act of 1971—P.L. 92-157 (November 18, 1971),

the Energy Supply and Environmental Coordination Act of 1974—P.L 93-319 (June

22, 1974), Clean Air Act Amendments of 1977—P.L. 95-95 (August 7, 1977), and Safe

Drinking Water Act of 1977—P.L. 95-190 (November 16, 1977).

(b)

A-65

(4) that Federal financial assistance and leadership

is essential for the development of cooperative Federal,

State, regional, and local programs to prevent and

control air pollution.

The purposes of this title are—

(1) to protect and enhance the quality of the Nation’s

air resources so as to promote the public health and

welfare and the productive capacity of its population;

(2) to initiate and accelerate a national research and

development program to achieve the prevention and

control of air pollution;

(3) to provide technical and financial! assistance to

State and local governments in connection with the

development and execution of their air pollution preven-

tion and control programs; and

(4) to encourage and assist the development and

operation of regional air pollution control programs.

AIR QUALITY CONTROL REGIONS

SEC. 107.(a) Each State shall have the primary respon-

sibility for assuring air quality within the entire geographic

area comprising such State by submitting an implementation

plan for such State which will specify the manner in which

national primary and secondary ambient air quality standards

will be achieved and maintained within each air quality control

region in such State.

(b) For purposes of developing and carrying out imple-

mentation plans under section 110—

(1) an air quality control region designated under

this section before the date of enactment of the Clean Air

A-66

Amendments of 1970, or a region designated after such

date under subsection (c), shall be an air quality control

region; and

(2) the portion of such State which is not part of any

such designated region shall be an air quality control

region, but such portion may be suhdivided by the State

into two or more air quality control regions with the

approval! of the Administrator.

(c) The Administrator shall, within 90 days after the date

of enactment of the Clean Air Amendments of 1970, after

consultation with appropriate State and local authorities,

designate as an air quality control region any interstate area or

major intrastate area which he deems necessary or appro-

priate for the attainment and maintenance of ambient air

quality standards. The Administrator shall immediately notify

the Governors of the affected States of any designation made

under this subsection.

(d)(1) For the purpose of transportation control planning,

part D (relating to nonattainment), part C (relating to prevention

of significant deterioration of air quality), and for other

purposes, each State, within one hundred and twenty days

after the date of enactment of the Clean Air Act Amendments of

1977, shall submit to the Administrator a list, together with a

summary of the available information, identifying those air

quality control regions, or portions thereof, established pur-

suant to this

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