Petition for Writ of Certiorari — Appalachian Power Co. v. Environmental Protection Agency

No.

( )

ae

Supreme Court, U.S,

FILED

00 638 OCT 20 2000

OFFICE OF THE CLERK

In the Supreme Court of the United States

THE STATES OF OHIO AND INDIANA, Petitioners,

UNITED STATES ENVIRONMENTAL PROTECTION

AGENCY, et al., Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the District of Columbia Circuit

PETITION FOR A WRIT OF CERTIORARI

KAREN M. FREEMAN-WILSON

Attorney General of Indiana

STEVEN D. GRIFFIN

Deputy Attorney General

402 West Washington St.

Indianapolis, Indiana 46204

- (317) 232-6226

BETTY D. MONTGOMERY

Attorney General of Ohio

EDWARD B. FOLEY*

State Solicitor

*Counsel of Record

FRANK J. REED, JR.

BRYAN F. ZIMA

ELISE PORTER

Assistant Attorneys General

30 E. Broad St., 17th Floor

Columbus, Ohio 43215

(614) 466-8980

QUESTION PRESENTED

Under the Clean Air Act, a State must prohibit emissions

from within the State that “contribute significantly” to

another State’s failure to meet an air quality standard.

This case involves the application of this statutory

requirement to a situation where emissions in several

upwind States contribute to air pollution in downwind

States.

The question presented is whether, in this situation, U.S.

EPA may define each State’s “significant contribution” in

terms of the relative costs of reducing that State’s

emissions, without regard to the amount of actual

emissions that each State sends downwind.

PARTIES TO THE PROCEEDING

1. Petitioners Ohio and Indiana were petitioners

in the court of appeals along with:

In No. 98-1497, State of Michigan,

Michigan Department of Environmental Quality,

and State of West Virginia, Division of

Environmental Protection.

In No. 98-1596, Commonwealth of Virginia.

In No. 98-1615, State of Alabama, ex re/

Bill Pryor, Attorney General.

In No. 98-1619, State of North Carolina.

In No. 98-1621, State of South Carolina.

In No. 98-1499, United Mine Workers of

America.

In No. 98-1500, Appalachian Power

Company, et al., consisting of:

Appalachian Power Company;

Baltimore Gas and Electric Company (now

referred to as Constellation Power

Source Generation, Inc.);

Carolina Power & Light Company;

Central and South West Services, Inc.;

Central Power and Light Company;

Public Service Company of Oklahoma;

Southwestern Electric Power

Company;

West Texas Utilities Company;

Central Illinois Light Company;

Central Illinois Public Service Company;

CliNergy;

Columbus Southern Power Company;

Commonwealth Edison Company;

Consumers Energy Company;

Dayton Power and Light Company, The;

Detroit Edison Company, The;

Duke Energy Company;

Florida Power Corporation;

Illinois Power Company;

Indiana Michigan Power Company;

Jacksonville Electric Authority;

Kentucky Power Company;

Kentucky Utilities Company;

Louisville Gas and Electric Company;

Minnesota Power Company;

Monongahela Power Company d/b/a

Allegheny Power System, Inc.;

Northern Indiana Public Service Company;

Oglethorpe Power Corporation;

Ohio Power Company;

Ohio Valley Electric Corporation;

Oklahoma Gas & Electric Company;

Otter Trail Power Company;

PacifiCorp Electric Operations;

Plains Electric Generation & Transmission

Cooperative, Inc.;

Potomac Edison Company, The,

d/b/a Allegheny Power System, Inc.;

Potomac Electric Power Company;

Public Service Company of New Mexico:

Salt River Project;

South Carolina Electric & Gas Company;

Southern Company;

Alabama Power Company;

Georgia Power Company;

Gulf Power Company;

Mississippi Power Company;

Savannah Electric and Power

Company;

Tampa Electric Power Company;

Tucson Electric Company;

Union Electric Company;

Virginia Power;

West Penn Power Company

d/b/a Allegheny Power System, Inc.;

Edison Electric Institute;

National Rural Electric Cooperative

Association; and

American Public Power Association.

In No. 98-1500, Duquesne Light Company.

In No. 98-1501, Midwest Ozone Group.

In No. 98-1502, West Virginia Chamber of

Commerce.

In No. 98-1504, National Mining

Association.

In No. 98-1518, West Virginia

Manufacturers Association.

In No. 98-1556, City of Springfield,

Missouri, through the Board of Utilities, d/b/a City

Utilities of Springfield, Missouri.

In No. 98-1567, Kansas City Power & Light

Company;

St. Joseph Light & Power Company;

The Empire District Electric Company;

Utilicorp United, Inc.;

City of Independence, Missouri; and

Associated Electric Cooperative, Inc.

In No. 98-1573, Indianapolis Power & Light

Company.

In No. 98-1585, The Alabama Forestry

Association, Inc., by and through its section, The

Alabama Pulp and Paper Counsel.

In No. 98-1590, Dairyland Power

Cooperative. ,

In No. 98-1598, South Carolina Public

Service Authority d/b/a Santee Cooper.

In No. 98-1601, American Municipal

Power-Ohio.

In No. 98-1602, Fort James Operating

Company;

Gilman Paper Company;

Rayonier Inc.;

Savannah Electric & Power

Company;

Southeast Paper Manufacturing

Company; and

International Paper Company.

In No. 98-1608, PP&L, Inc.

In No. 98-1609, Council of Industrial Boiler

Owners.

In No. 98-1611, Network for Workable Air

Policies.

In No. 98-1616, Georgia Coalition for Sound

Environmental Policy, Inc.

In No. 98-1618, Interstate Natural Gas

Association of America.

In No. 99-1070, Appalachian Power

Company, et al.

In No. 99-1093, Wisconsin Paper Council;

Madison Gas and Electric Company;

Northern States Power Company;

Wisconsin Public Service

Corporation: and

Wisconsin Manufacturers & Commerce.

2. The single respondent in the court of

appeals was the United States Environmental Protection

Agency.

ee The following parties intervened in the

court of appeals:

State of Wisconsin;

Virginia Manufacturing Association;

Detroit Public Lighting;

GPU Generation, Inc.;

American Gas Association;

Michigan Manufacturing Association;

State of New York;

State of Connecticut;

State of Maine;

State of Maryland;

State of New Hampshire;

Commonwealth of Massachusetts;

Commonwealth of Pennsylvania;

State of Rhode Island;

State of Vermont;

New England Council;

Natural Resources Defense Council;

Province of Ontario, Canada;

Environmental Law and Policy Center of

the Midwest;

Clean Air Task Force;

Consolidated Edison Co. of New York, Inc.;

Natural Gas Supply Association;

Associated Industries of Massachusetts;

New Jersey State Chamber of Commerce;

Pennsylvania Power & Light;

American Lung Association of Metropolitan

Chicago;

Appalachian Power Company, et al;

Dairyland Power Cooperative;

South Carolina Public Service Authority

d/b/a Santee Cooper;

Grand Haven Board of Light and Power;

Holland Board of Public Works;

Lansing Board of Water and Light;

Marquette Board of Light and Power;

Michigan South Central Power Agency;

City of Wyandotte Department of Municipal

Service;

Interstate Natural Gas Association of

America;

Network for Workable Air Policies;

Business Council of Alabama;

KeySpan Generation LLC;

Niagara Mohawk Power Corporation;

PECO Energy Company;

Public Service Electric and Gas Company;

Rochester Gas & Electric Corporation;

PG & E Generating;

Sempra Energy;

Atlantic City Electric Company;

Delmara Power & Light Company;

Appalachian Mountain Club;

Citizens Action Coalition of Indiana, Inc.;

Clean Air Council;

Environmental Defense Fund;

Group Against Smog and Pollution;

Hoosier Environmental Council:

Illinois Environmental Council:

Izaak Walton League of America;

Legal Environmental Assistance

Foundation;

Michigan Environmental Council;

National Environmental Trust;

Natural Resources Council of Maine:

New York Public Interest Research Group;

Ohio Citizen Action;

Ohio Environmental Council:

U.S. Public Interest Research Group;

Wisconsin’s Environmental Decade

Institute;

Norman W. Sterling, Minister of the

Environment, Province of Ontario;

Charles A. Harnick, Attorney General of

Province of Ontario; and

Christopher Carl Haromy.

4. The following parties appeared as amici

curiae in the court of appeals:

Government of Canada

South Carolina Chamber of Commerce:

North Carolina Citizens for Business and

Industry;

Toledo Metropolitan Area Council of

Governments;

Environmental Management Association of

South Carolina; and

South Carolina Manufacturers Alliance.

TABLE OF CONTENTS

Page

Table of Authorities................. es ees iephinabaniaidakenaies ii

ETE ACE PRIN TERR TTR OT 1

i ee ON ORR SE TE ICD SRN EOE |e RR PORT 1

Statutory Provisions Involved.............cccccccccecssescccececeeceeees 2

IC ihcadianalciiaisscelitiinitieaetitaal lc ic aaa 3

Reasons for Granting the Petition ..............cccccccccccccecceesees 7

I. The Question for Review is One

of Great National Importance.................... 7

II. The Specific Language of the Act

Supports a Federalism-Sensitive

SRE HII SEN IG 2 eRe a 9

Ill. A Federalism-Sensitive Interpretation

of the Act is Consistent with the Proper

Resolution of the Question Pending in

American Trucking Associations

PRcMEI IID Giithtbdiainhdiinsddienunatskasbndsadagmncadoucninds 14

IV. The Question Here Requires This

8 SE a TED 16

PUN iictatta i cei 18

ii

TABLE OF AUTHORITIES

Cases Page

American Trucking Associations v. U.S. EPA,

195 F.3d 4 (D.C. Cir. 2000),

cert. granted, No. 99-1257

CRY ls HED Aiisiahinkabiceesiiecsuicpiabinasiedaniii 8, 14, 15, 16, 17

Appalachian Power Co. et al. v. U.S. Environmental

Protection Agency,

PN: WIT Aciontsiinnicianecisiassisciabiidanip tdceininsipumakalcsenieeauiaetitannade 1

Train v. Natural Resources Defense Council,

EE Rs BSED niakcckchaciseanenddenstadannipctdiasalanmiions 8

Union Electric Company v. Environmental

Protection Agency,

EF Es a cicithaskcwndbitiasdncnsaccadnauaacatnineaiaanelonanie 8

Constitution, statutes and regulations

es ais SANs THEE abcess dvbreh ticeabeabaioanideidalcndcutes us ckacse atiencis 16

ee rats Or I Pics necietiwicinchicitelaiid tate eek eee 1

Clean Air Act, 42 U.S.C. § 7401, et seq. .......esceeseeeseeeeteeees 2

Section 109,

ee ake We Si iitceniiniustiidhatnnthittesadddattaitiisinuhiinn 14, 15

Section 110,

ee Ae Paaicataidiastadenasaninubaibebiniancendaasaaniadins 15

Section 110(a)(2)D)(iX(1),

42 U.S.C. § 7410 (a2) D)i)(1).....0. passim

Section 110(k)(5),

he Wa ii dncnitsceciittnsnhdctecnsdensiianauade 2,4,11

Section 307(b),

Ge SR ae PE Ailonincsscnsnienenneacsinitnndobieuebusitans 16

ill

63 Fed. Reg. 57356 (lodged with the Court

by petitioners in No. 00-445) ......cccecccccccccseccess 4,5,6,11

Miscellaneous

John Rawls, A Theory of Justice (1971)..................... 15

R. Stern et al., Supreme Court Practice

BARRE E EES alee A 17

Air Quality Modeling Technical Support

Document for the Nox SIP Call, U.S. EPA,

Office of Air and Radiation, September 23, 1998,

reproduced in Joint Appendix of Industry

Petitioners before the Court of Appeals,

Te A aichismidladiniigsci 4

Assessment of the Contribution of Emissions from

Northern OTAG States on Elevated Ozone

Concentrations, prepared for the Southeast

Michigan Council of Governments, reproduced

in Joint Appendix of Industry Petitioners

before the Court of Appeals, Vol. 5, 2021 ................. 12

PETITION FOR A WRIT OF CERTIORARI

The States of Ohio and Indiana respectfully

petition for a writ of certiorari to review the judgment of

the United States Court of Appeals for the District of

Columbia Circuit in this case.

In a separate petition, filed on September 20, 2000,

various industry parties seek review of the same

judgment, Appalachian Power Co., et al. v. US.

Environmental Protection Agency, No. 00-445, and we

anticipate that another petition will be filed

simultaneously with this one, on behalf of several other

States, including Michigan.

OPINIONS BELOW

The opinion of the court of appeals is reported at

213 F.3d 663, and is printed in the Appendix to the

Petition in No. 00-445 (hereinafter “No. 00-445 App.”)

JURISDICTION

The decision of the court of appeals was entered on

March 3, 2000. A rehearing petition was denied on June

22, 2000. The jurisdiction of this Court is invoked under

28 U.S.C. § 1254(1). Upon motion of the State of

Michigan, on behalf of itself, Ohio, Indiana, and several

other petitioning States, this Court granted the

petitioning States an extension until October 20, 2000,

within which to file their petitions for a writ of certiorari.

|

2

STATUTORY PROVISIONS INVOLVED

The relevant sections of the Clean Air Act, 42

U.S.C. § 7401, et seg., namely Section 110(a)(2)D) and

110(/k\5), 42 U.S.C. § 7410(aX2”(D) and § 7410(k)(5),

respectively, provide:

§$7410(a)(2). Each implementation plan submitted by a

State under this Act shail be adopted by the State after

reasonable notice and public hearing. Each such plan

shall— ~

Ps * Bs

(D) contain adequate provisions—

(i) prohibiting, consistent with the

provisions of this title, any source or other

type of emissions activity within the State

from emitting any air pollutant in amounts

which will—

(I) contribute significantly to

nonattainment in, or interfere with

maintenance by, any other State

with respect to any such national

primary or secondary ambient air

quality standard,....

$7410(k)(5). Calls for plan revisions. Whenever the

Administrator finds that the applicable implementation

plan for any area is substantially inadequate to attain or

maintain the relevant national ambient air quality

standard, to mitigate adequately the interstate pollutant

transport described in section 176A or section 184 [42

USCS § 7506a or 7511c], or to otherwise comply with any

requirement of this Act, the Administrator shall require

the State to revise the plan as necessary to correct such

inadequacies ....

3

The EPA rule at issue in this case has been lodged

with the Court by Petitioners in No. 00-445.

STATEMENT

This petition, like the others filed seeking review

of the same judgment, concerns the problem of pollution

migrating downwind from midwestern, southeastern and

northeastern States to other, primarily northeastern,

States. The United States Environmental Protection

Agency (EPA) has issued a rule requiring 22 States and

the District of Columbia (“23 States”)! to revise their

plans to reduce emissions of nitrogen oxides (NOx),

because of the effect that they have downwind on the level

of ozone in the air.? Eight of these 23 States, including

Ohio and Indiana, sought review of this EPA rule in the

court of appeals on the ground that EPA’s method for

determining how much each State should reduce its NOx

emissions was premised on an incorrect interpretation of

the Clean Air Act.

The relevant provision of the Act requires that

each State prohibit emissions within the State that

“contribute significantly” to another State’s failure to

meet an air quality standard adopted by EPA. 42 U.S.C. §

7410(a)(2D\i)). The Act further authorizes EPA to

require States to submit plans “necessary” to achieve an

| The court of appeals vacated the EPA rule as to three of the

23 States, Wisconsin, Missouri, and Georgia. The remaining

nineteen states, plus the District of Columbia, are Alabama,

Connecticut, Delaware, Illinois, Indiana, Kentucky,

Massachusetts, Maryland, Michigan, North Carolina, New

Jersey, New York, Ohio, Pennsylvania, Rhode Island, South

Carolina, Tennessee, Virginia, and West Virginia.

2 Nitrogen oxides combine with another pollutant, volatile

organic compounds, in the presence of sunlight to form ground

level ozone, or “smog.” This ground level ozone pollution differs

from the problem of the ozone hole in the upper atmosphere.

4

adequate mitigation of this pollution. Jd. § 7410(k\5).

EPA, however, interpreted these provisions to permit,

when several States combine to cause _ pollution

downwind, a definition of each State’s “significant

contribution” in terms of a single standard of how

expensive it would be to reduce these emissions, without

regard to the actual level of emissions sent downwind by

each State.

To be specific, in promulgating its NOx rule, EPA

stated that, before considering cost-effectiveness, it first

considered several “air quality” factors. 63 Fed. Reg. at

57376 (lodged with the Court by petitioners in No. 00-

445). In doing so, the EPA modeled the amount of

emissions flowing downwind from the upwind States.

This modeling showed that some upwind States have

much less effect on downwind pollution than other

upwind States, in both the amounts of NOx pollutants

they contribute and the frequency with which such

pollutants are contributed.*

3 One factor that EPA analyzed was the number of “parts” of

ozone in a billion “parts” of air that an upwind State

contributed to a downwind State as a result of the downwind

flow of nitrogen oxides, an ingredient of ozone. The EPA

standard for ozone is 125 parts of ozone in a billion parts of air.

(Abbreviated as “125 ppb”). Analyzing four particular multi-

day “episodes” when ozone pollution was particularly bad in the

Eastern half of the United States, EPA generated statistics

concerning the amounts of ozone (in parts per billion) that a

given upwind State contributed to a downwind State and how

often an upwind State contributed to a downwind State’s failure

to meet the EPA standard. For example, EPA found that

Pennsylvania contributes at least 10 parts per billion of ozone

to New York City during 91 percent of the times that New York

City fails to meet the 125 ppb standard. In contrast, Indiana,

under one analysis, contributed only 5 or more parts per billion

of ozone and, under another analysis, contributed only 2 or

more ppb of ozone, to only 4 percent of New York City’s failures

to- meet the 125 ppb national standard. Air Quality Modeling

Technical Support Document for the NOx SIP Call, U.S. EPA,

—J____

Using these data, EPA identified 23 States that

contribute emissions to the failure of one or more

downwind States to meet the national ozone standard.

EPA found downwind emission from these 23 States to be

in amounts “large and/or frequent enough to be of

concern.” Id. at 57381, 57390-57398. In fact, as the court

of appeals itself stated (213 F.3d at 675), EPA used a

“very low threshold” to include a State in its group of

twenty-three contributors.

For the critical steps of determining each State’s

“significant contribution” to, and “necessary mitigation”

of, downwind pollution, however, EPA chose a factor other

than air quality. EPA instead considered the cost-

effectiveness of pollution control measures’ and

Office of Air and Radiation, September 23, 1998 (“the TSD”), at

p. C-13, C-14. Joint Appendix of Industry Petitioners before the

Court of Appeals, Vol. 3, at 1048, 1156, 1157.

Another statistic that EPA generated was the

percentage that upwind States contributed to the total amount

of ozone above the 125 ppb standard during the four episodes.

Using the New York City example again, Indiana contributes 1

percent to the total above 125 ppb, Ohio contributes 4 percent of

the total above 125 ppb and Pennsylvania contributes 18

percent of the total above 125 ppb. By comparison, local

sources contribute 55 percent of the total above 125 ppb (and,

by definition of the statistic, 100 percent of the amount of ozone

leading up to the 125 ppb standard). See 63 Fed. Reg. at

57,391-2.

4 The threshold was a “magnitude” of contribution of 2 parts per

billion of ozone considered in conjunction with “frequency” of

contribution and “relative amount” of the contribution. For

example, North Carolina was included in the group of States

significantly contributing to New York City’s ozone problem

because it contributed 2 parts per billion of ozone to 2 percent of

the times that New York City failed to meet the 125 parts per

billion standard, and because it contributed 3 percent of the

total amount of ozone in New York City that exceeded the EPA

standard. See 63 Fed. Reg. at 57,392-3.

6

determined that, for each of these 23 States, its

“significant contribution” te downwind pollution was the

amount of emissions it could reduce by “highly cost-

effective control measures.” Specifically, regardless of the

relative contributions of each of the 23 States, each State

was required to make reductions in NOx emissions that

could be accomplished for an average cost of $2000 per

ton or less. See 63 Fed. Reg. at 57,377.

In the court of appeals, Ohio and Indiana (among

many others) challenged EPA’s’ methodology as

inconsistent with the Act. The court, however, held

otherwise.

The majority of the court of appeals found that

“the fundamental dispute is over the clarity of the phrase

‘contribute significantly.” 213 F.3d at 677. The court

stated that the term “significant” is not a one-dimensional

term that limits EPA’s consideration to health factors, but

a term that allows consideration of cost-effectiveness as

well. Further, the lower court stated that an agency was

not barred from considering costs absent a “clear

congressional intent to preclude consideration of cost.”

Finding that Section 110(a)(2)(D)(i)(1) of the Clean Air Act

did not prohibit consideration of costs, the majority

concluded that EPA could consider costs. 213 F.3d at 677,

679.

Addressing the implications of its decision, the

majority recognized the fact that “where two states differ

considerably in the amount of their respective NOx

contributions to downwind nonattainment, under the

EPA rule even the small contributors must make

reductions equivalent to those achievable by highly cost-

effective measures.” Jd. at 679. Even more to the point, a

State with a relatively small level of actual emissions

flowing downwind, and whose emissions are relatively

inexpensive to mitigate, will be required by the EPA rule

to bear a disproportionately high share of the clean-up

7

cost. Acknowledging this point, the majority observed:

“(T]he ultimate line of ‘significance, whether measured in

volume of NOx emitted or arriving in nonattainment

areas, would vary from state to state depending on

variations in cutback costs.” Id. at 675. The majority,

however, dismissed this objection by stating, when it

upheld EPA’s line-drawing on the basis of cost

differential, that its decision “logically entailled|]

upholding this consequence.” Id.

In his dissent, Judge Sentelle found that the EPA

impermissibly substituted its own notions of cost

effectiveness in place of the mandated Section

110(aX2D)\iX1) determination of “significant contri-

butions.” He noted that EPA did not apply the factors

most logically relevant to identifying a_ significant

contribution, and he found no basis for using cost

effectiveness as the pivotal factor in applying the

“significant contribution” mandate. Id. at 695-97

(Sentelle, J., dissenting).

Petitioners filed a joint petition for rehearing and

rehearing en banc with the court of appeals. On June 22,

2000, the court denied both requests, with Judge Sentelle,

voting in favor of the petition’s requests.

REASONS FOR GRANTING THE PETITION

I. The Question for Review is One of Great

National Importance.

The problem of air pollution in a downwind State,

caused in part by emissions in upwind States, is an issue

of obvious significance to the _Nation as a _ whole.

Interpreting correctly how the Clean Air Act apportions

responsibility among upwind States for their share of

downwind pollution is, consequently, a legal issue of

pressing national concern, warranting review by this

8

Court. This issue of statutory interpretation, moreover,

has yet to be addressed by this Court.

Ours is a federalist system, and the structure of

the Clean Air Act is predicated on this premise. In both

Train v. Natural Resources Defense Council, 421 U.S. 60

(1975), and Union Electric Company v. Environmental

Protection Agency, 427 U.S. 246 (1976), this Court has

recognized the critical role to be played by the individual

States in the implementation of the Clean Air Act, and

the relative roles of the States and the U.S. EPA under

the Act is also implicated by the issues under

consideration in the two American Trucking cases

scheduled for oral argument before this Court on

November 7, Nos. 99-1257 and 99-1426. (In particular,

the so-called “Subpart 2” issues in No. 99-1257 affect the

authority of States to implement ozone reduction as

intended by Congress.) This case now even more squarely

implicates the appropriate share of responsibility each

State bears for redressing the portion of the national air-

pollution problem that its local activities have caused.

We do not deny that emissions that migrate

downwind and cause pollution in other States create a

problem that spills over state boundaries and requires a

federal solution. But the question in this case is whether

Congress, in enacting the Clean Air Act and its

amendments, intended that the federal solution to this

problem be one that ignores the significance of State

boundaries.

EPA has interpreted the Act to permit it to

identify contributing upwind States using a nominal

threshold, and then to require each State in the upwind

group to reduce its emissions according to a single “cost-

effective” standard that does not bear a relationship to

how much each State actually contributed to the

downwind pollution in the first place. But this solution,

whatever its other virtues, disrespects federalism and

———

§

thus is contrary to the basic structure of the Clean Air Act

itself. Rather than defining the required solution for a

State in terms of the contribution to the air quality

problem that originates from within the State’s borders,

EPA has defined the solution in terms of its own notions

of cost-effectiveness and economic fairness. This

approach, however, exceeds the scope of the agency's

authority. Instead, EPA must adopt an interpretation of

the Act that, first, apportions the responsibility for

reducing emissions among the upwind States in

accordance with each State’s actual share of these

emissions and, then, permits each State to adopt the most

cost-effective means of achieving this reduction within

that State.

Interpreting the Act to require this kind of

federalism-sensitive solution has no detrimental effect on

air quality in any State. Consistent with the Act, EPA

has the authority to insist on an appropriate level of

pollution reduction to be achieved in a downwind State

and, further, to require the upwind States to curtail their

emissions so as to achieve the necessary reduction of

pollution in the downwind State. The only issue here is

how this burden on the several upwind States will be

allocated among these States. In accordance with basic

principles of federalism, as well as the specific language of

the relevant provision of the Clean Air Act, this burden

should be apportioned among the upwind States

according to how much emissions each State actually

contributed to the problem downwind.

Il. The Specific Language of the Act Supports a

Federalism-Sensitive Interpretation.

The relevant provision of the Act states simply

that each State shall prohibit “any source or other type of

emissions activity within the State from emitting any air

pollutant in amounts which will . . . contribute

significantly to nonattainment in . . . any other State with

10

respect to any [national air-quality standard].” 42 U.S.C.

§ 7410(aX2(D)\iX1). This language, which specifically

refers to emissions in amounts that “contribute

significantly” to pollution downwind, speaks of these

“significant contributions” in terms of actual levels of

emissions. Thus, the primary factor in defining a State’s

“significant contribution” to a downwind problem should

be the actual pollution that the State sent downwind.

It is true, as the court of appeals noted, that the

term “significant” is inherently open-ended and _ is

susceptible of an interpretation that would consider costs

of reduction as one of several factors in measuring

“contributions” that require a regulatory response. But, it

must also be emphasized, the adjective “significant” as

modifying the noun “contribution” can also be easily

defined to mean measurable and non-minimal effects in a

downwind State. This definition of significance would

confine the term to physical considerations, in keeping

with the focus of the statutory language on actual

emissions in a particular State and the air-quality effect

they produce downwind.

This point shows, not that a correct interpretation

of “significant contribution” may be had by plain meaning

analysis of these two words alone, but instead that the

meaning should be settled by reference to the overall

structure and purpose of the Clean Air Act. Guided by

this broader inquiry, our argument is that a correct

interpretation of the Act may not ignore the importance of

State boundaries in the way that the EPA did. While the

national priority must be to adequately mitigate the

problem of interstate transport of pollution, this solution

may be obtained in a way that allocates responsibility in

accordance with each State’s share of actual contribution

to the problem, and the whole structure or purpose of the

Act itself expects this kind of proportional solution.

11

The Act also specifically provides that, if a State’s

plan for redressing its “significant contribution” to a

downwind problem is inadequate, then EPA may require

the State to revise its plan “as necessary to correct such

inadequacies.” 42 U.S.C. § 7410(k)\(5). This provision

reasonably may be construed to permit cost-effectiveness

to be a factor in selecting among methods to achieve the

“necessary” reduction in the upwind emission levels that

have caused the “significant contribution” to the

downwind problem. Even so, a reasonable construction of

the statute as a whole still requires that cost-effectiveness

be a subordinate factor to the initial determination of how

much each State must reduce its actual emissions levels

in order to avoid “contributling] significantly” to the

downwind pollution.

EPA’s contrary approach leads to_ several

anomalous and unreasonable results. First, EPA’s choice

of how costs should relate to defining “significance” of a

State’s contribution is arbitrary and not tethered to the

Act itself. As even the majority of the court of appeals

recognized:

[The EPA] neither rests that [$2,000-per-

ton] benchmark on anything in_ the

language or function of § 110(a(2)(D)GXD,

nor otherwise explains why the resulting

cut-off point represents the right degree of

“cost-effectiveness” (i.e., why “highly cost-

effective” should be at that “height”).

Accordingly, we must read the EPA as

having understood that its selection of the

cut-off point was essentially unbounded.

213 F.3d at 680. EPA’s statement that the reductions are

not “overkill” because collectively the reductions are not

more than necessary to ameliorate downwind

nonattainment, 63 Fed. Reg. 57,379, 57,403, 57,440, does

12

nothing to address the arbitrary, unbounded nature of the

determination on a State-by-State basis.

EPA’s use of the cost-effectiveness standard leads

to marginally-contributing States being faced with huge

pollution control costs for marginal air-quality benefits.

For example, EPA determined that both Indiana and

Pennsylvania contributed to New York’s failure to meet

the national standard that air should not contain more

than 125 “parts” of ozone per billion “parts” of air. Under

EPA’s cost-effectiveness standard, each State must install

$2000-per-ton pollution control measures. Yet, when the

amount of ozone pollution above the national standard is

analyzed, Indiana contributes only 1 percent of the

amount and Pennsylvania contributes 18 percent of the

amount. Id. at 57,391-2.

Another study shows that if Indiana imposes no

additional controls, it will contribute an average of 2.1

parts of ozone to a billion parts of air in New York City in

2007, the year that EPA looked to as the target year for

ozone reductions to occur under its NOx rule. If, however,

Indiana imposes all of the controls required by EPA, the

modeling predicts Indiana’s contribution to New York

City will average 1.7 parts per billion of ozone.

Assessment of the Contribution of Emissions from

Northern OTAG States on Elevated Ozone Concentrations,

prepared for the Southeast Michigan Council of

Governments, reproduced in Joint Appendix of Industry

Petitioners before the Court of Appeals, Vol. 5, at 2021,

2036a.5 Under the same study, Pennsylvania will

contribute an average of 21.38 parts per billion of ozone

before the $2000-per-ton controls and an average of 18.86

parts per billion after. Id.

5 EPA never performed any State-by-State modeling that shows

the contributions of upwind states after its rule is implemented.

13

Two points result from this comparison. First,

installation of controls in Indiana yields a nominal

projected 0.4 parts-per-billion reduction in ozone in New

York City compared to a projected 2.52 parts-per-billion

reduction of ozone as a result of installation of controls in

Pennsylvania. Controls in Pennsylvania would therefore

have a more than six-fold greater effect on New York City

than the same controls in Indiana according to this study.

Second, because Pennsylvania would have _ installed

“highly cost-effective controls,” EPA would consider

Pennsylvania’s after-control level of 18.86 parts per

billion of ozone to be an insignificant contribution. This is

in comparison to a pre-control level of 2.1 parts per billion

in Indiana that is considered by EPA a significant

contribution. Thus, a relatively large contribution of

ozone is considered insignificant under EPA’s standard,

while a nominal contribution of ozone is considered

significant.®

There is an even broader point. Under EPA’s

approach, an upwind State that contributes a relatively

large amount of pollutants downwind, but whose

pollution happens to be particularly expensive to clean

up, may escape having to bear a proportionate share of

the clean-up costs. In other words, although it caused

more of the problem, this State may be asked to sacrifice

comparatively less to achieve the solution. EPA might

argue that from a policy perspective it makes sense to

adopt a single overall clean-up method, without regard to

State boundaries or who caused the problem. But this

6 Of course, Indiana has an effect on other downwind non-

attainment areas besides New York. But, under the correct

interpretation of the statute, Indiana’s responsibility for NOx

reductions should be based on the actual amounts of

contributions to the ozone problems in New York or another

State, not on an amount calculated by a cost-effectiveness

standard disconnected from the actual contribution.

14

policy approach is not what the Act contemplates.

Instead, the Act is structured to require each State and

its industries to bear their share of the clean-up costs, in

proportion to the extent that they actually contributed to

the problem in the first place. While each State may

reduce its own emissions as inexpensively as possible, no

State may evade its share of responsibility simply because

it is cheaper to reduce overall emissions elsewhere. As

long as the downwind problem is to be solved—as the Act

requires—then it was an appropriate judgment for

Congress to make that each State will contribute to the

solution in proportion to its contribution to the problem.

Whatever its preferred policy approach, EPA is not

entitled to overrule this congressional judgment.

Ill. A Federalism-Sensitive Interpretation of the

Act is Consistent with the Proper Resolution

of the Question Pending in American

Trucking Associations v. Browner.

In American Trucking Associations v. U.S. EPA,

195 F. 3d 4 (D.C. Cir. 2000), cert. granted, No. 99-1257

(May 22, 2000) and No. 99-1426 (May 30, 2000) (ATA), the

State of Ohio, like many other parties, is urging the Court

to adopt an interpretation of the Act that permits EPA to

consider costs, as well as benefits, when setting an air-

quality standard. Specifically, in ATA, we argue that, at

least with respect to “non-threshold” pollutants (for which

there is no health-related reason for a permissible level

above zero), consideration of costs, as well as benefits, is

necessary to enable EPA to articulate an intelligible basis

for choosing a particular level of permissible emissions as

the controlling national standard. As we observe in our

briefs in that case, the language of the Act (Section 109

specifically) is susceptible to this reasonable, common-

sense interpretation, which has the added virtue of

avoiding a constitutional challenge to the Act on “non-

delegation” (and perhaps also due process) grounds.

i ha ee Nt A a ts

"

i

a

R

15

The federalism-sensitive interpretation of the Act

that we propose here is consistent with the interpretation

of the Act we advance in ATA. In both cases, we argue

that considerations of cost-effectiveness should be a

secondary factor, subordinate to primary considerations

identified in Act, namely health-related factors under

Section 109 and air-quality factors under Section 110.

When EPA sets a national air-quality standard under

Section 109, public health should be the primary

consideration (in keeping with the overall purpose of the

Act), but costs should be a_ permissible secondary

consideration insofar as considering health benefits alone

is necessarily indeterminate and untenable. Likewise,

when EPA determines how much each State must reduce

its emissions that “contribute significantly” to downwind

pollution, the primary factor should be the actual amount

of emissions that each State sends downwind, with cost-

effectiveness a secondary consideration, to determine how

each State will achieve the reduction necessary to rectify

its share of the problem.’

This construction of the Act should not be difficult

to understand or implement. The idea of one factor

having a priority over another (subordinate) factor in a

decision-making process is well-established. Cf. John

Rawls, A Theory of Justice (1971) (arguing that liberty

should have a priority over utility). Here, we argue that,

properly construed in light of the Act’s basic structure and

purpose, Section 110 should be construed to require EPA,

first, to identify (to the extent feasible) the measurable

effect that each State has on downwind pollution, and

then require each State to reduce it emissions in

proportion to its share of the overall measurable effects.

After making this calculation, EPA then may consider

cost-effectiveness in requiring each State to adopt the

7 We wish to make clear that we do not argue that costs cannot

be considered at all when EPA assesses the adequacy of a

State’s plan for reducing NOx emissions.

16

most efficient means of pollution reduction within its

borders. This two-step decision-making process is neither

unintelligible nor unreasonable in light of the overall

structure and purpose of the Act. Rather, it is EPA’s

interpretation, which permits States with large downwind

emissions to avoid a proportional share of the clean-up

costs, that is unreasonable given the inherent federalist

premises of the Clean Air Act.

IV. The Question Here Requires This Court’s

Review.

The novel question of statutory construction that

this case presents is of a magnitude and scope as to

require this Court’s review. Moreover, the case finds a

number of States lined up on either side of the issue, as

some States benefit from one interpretation while other

States from another. This kind of dispute among several

States is a category of case in which the Framers

anticipated that this Court would exercise jurisdiction.

(It only adds to the case that an agency of the United

States is also directly involved in this dispute among the

several States. )

The Constitution, in Article III, specifies that this

Court has original jurisdiction in those cases where a

State is a party. While this original jurisdiction is non-

exclusive and, here, the court of appeals clearly had

jurisdiction to review EPA action under 42 U.S.C.

§7607(b), the character of this case and the analogy of

original jurisdiction indicate that it is an appropriate case

for the exercise of certiorari jurisdiction. In particular,

the specific problem of interstate transport of pollution, as

well as the fact that States are opposed to one another

8 Because of the relationship between the question of statutory

interpretation in this case and the issues in ATA, the Court

may wish to defer consideration of this petition as well as the

others in this case until it has issued its decision in ATA.

17

concerning the allocation of responsibility for solving this

problem, distinguishes this case from many questions

arising under the Clean Air Act. While other issues

under this Act may be left to the court of appeals, this one

deserves the plenary review of this Court.

Indeed, throughout the Nation's history, disputes

among the States concerning borders and _ natural

resources have been a primary category of case in which

this Court has exercised its original jurisdiction. See R.

Stern et al., Supreme Court Practice 462 (7th ed. 1993).

The dispute in this case—concerning the flow of air

pollution downwind from some States to another—is a

modern-day version of the border and natural-resource

disputes for which this Court's original jurisdiction was

designed. When this point is added to the fact that the

question presented here is a general and novel one of

statutory interpretation, rather than being simply the

application of settled precedents to a particular fact

pattern, it is evident that this case is especially deserving

of this Court's review.®

® It would be consistent with this point if the Court determines

that the question in this case would benefit, at least initially,

from further consideration by the court of appeals in light of the

interpretation of the Clean Air Act that this Court renders in

ATA, and on this basis vacate and remand the court of appeals’

decision.

18

CONCLUSION

For the reasons stated above, the petition for a

writ of certiorari should be granted.

KAREN M. FREEMAN-WILSON

Attorney General of Indiana

STEVEN D. GRIFFIN

Deputy Attorney General

402 West Washington St.

Indianapolis, Indiana 46204

(317) 232-6226

October 2000

Respectfully submitted.

BETTY D. MONTGOMERY

Attorney General of Ohio

EDWARD B. FOLEY*

State Solicitor

*Counsel of Record

FRANK J. REED, JR.

BRYAN F. ZIMA

ELISE PORTER

Assistant Attorneys General

30 E. Broad St., 17th Floor

Columbus, Ohio 43215

(614) 466-8980