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Aug. 2 — The Environmental Protection Agency is moving ahead with a new exception to its policy that regional EPA offices “uniformly apply” all policies, procedures and criteria under the Clean Air Act, a decision that is likely to trigger industry lawsuits.
The agency, in a final rule scheduled for publication Aug. 3, is establishing what it describes as a “narrow procedural exception” that will allow regional offices to implement locally or regionally applicable court decisions without affecting national policy. The exception will ensure that only decisions issued by the U.S. Supreme Court and the U.S. Court of Appeals for the District of Columbia Circuit will be applied uniformly across the country, the agency said.
A 2015 proposed version of the rule (RIN:2060-AS53) drew criticism from a number of industry organizations, which expressed concern that businesses could be placed at a competitive disadvantage based on their location if the EPA allowed for the Clean Air Act to be applied differently in one region than in the rest of the country. Associations representing the oil and gas, power and chemical industries used their comments on the proposal to highlight potential legal challenges that could be brought if the agency moved ahead with amending its regional consistency regulations.
The Class of '85 Regulatory Response Group, which represents about 30 companies involved in the power sector, alleged that such an exception would violate language in Section 301(a)(2) of the Clean Air Act that requires the EPA to “assure fairness and uniformity” in policies for implementing and enforcing the statute. That association counts Xcel Energy Inc., Alliant Energy Corp. and Westar Energy among its members.
The EPA spent much of the final rule addressing the industry arguments, offering a preview of the agency's legal defense of the new exception.
The approach advocated by the industry groups to maintain regional consistency would effectively grant every federal appeals court in the U.S. “unlimited nationwide jurisdiction” over the Clean Air Act, the EPA said.
“Rather than being merely persuasive, a decision in one circuit thus would become binding precedent in other circuits,” the EPA said. “Such a result is inconsistent with the court system established by Congress and years of case law.”
The agency cited Section 307(b) of the Clean Air Act, which gives the D.C. Circuit exclusive jurisdiction over lawsuits challenging nationally applicable regulations, as well as state or regionally applicable decisions that have been deemed to have nationwide scope or effect. The Supreme Court has jurisdiction over any appeals to those D.C. Circuit rulings.
The EPA also directly addressed industry arguments that an exception would violate the Clean Air Act language requiring the agency to “assure fairness and uniformity.” There is nothing in Section 301(a)(2) of the Clean Air Act that suggests such standardization requires the “exact duplication” of all policies and criteria by all EPA regional offices, the agency said.
That language “does not specifically discuss whether the fairness and uniformity objectives must be applied to all court decisions,” the EPA said. “Instead, the provision requires the EPA to establish procedures that apply to its regional office officials and employees, but it does not address whether or how the EPA should address judicial decisions in those procedures.”
The EPA's regional consistency rulemaking is the result of a 2014 D.C. Circuit ruling that vacated a policy memorandum known as the Summit Directive, which instructed EPA regional officials to implement Title V operating permit requirements in a different manner in states under jurisdiction of the U.S. Court of Appeals for the Sixth Circuit than in all other states. The court ruled that policy violated the regional consistency regulations ( Nat'l Envt'l Dev. Ass'n's Clean Air Project v. EPA , 752 F.3d 999, 2014 BL 150327, 78 ERC 1943 (D.C. Cir. 2014)).
In that decision, the D.C. Circuit said the agency could address its ruling by revising its regional consistency regulations. However, the panel that ruled the Summit Directive to be illegal “sidestepped” the issue of whether such an exception would conflict with Section 301(a)(2) of the Clean Air Act, according to Crowell & Moring LLP attorneys Kirsten Nathanson and David Chung.
Nathanson and Chung, in an article published by the American Bar Association, said the D.C. Circuit may be asked to weigh in on that issue once the EPA issued its final rule.
The EPA's final rule will go into effect Sept. 2. A 60-day period for filing legal challenges to the rule in the D.C. Circuit will open Aug. 3 and close Oct. 3.
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The EPA's final rule to amend its regional consistency regulations is available at http://src.bna.com/hmY .
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