California Communities Against Toxics v. EPA

Facts

The Wehrum Memo declares that the plain language of §112 of the Clean Air Act § 7412, compels the conclusion that a source of toxic emissions classified as 'major' can reclassify to an 'area source,' and thereby ease its regulatory burden, at any time after it limits its potential to emit to below the major source threshold. The Wehrum Memo states that it supersedes a prior 1995 EPA memorandum. The 1995 memo interpreted §112 to mean that once D classifies a source as major, that source can never reclassify to area source status, even if it limits its potential to emit below the major source threshold. The State of California and a group of environmental organizations whose citizens and members (Ps), breathe the air in the vicinity of regulated sources. Ps sued claiming that the courts can and should review the Wehrum Memo because it is final agency action and prudentially ripe. D and a group of industry organizations have joined as Intervenor. Ps argues the Wehrum Memo is a legislative rule, and it is therefore procedurally defective under the Administrative Procedure Act (APA) § 551 because D failed to provide notice and comment before issuing it. Ds claim the Court lacks jurisdiction over the Wehrum Memo because it is not final agency action and that it is not prudentially ripe. Ds contend that even if the Memo is final and ripe the court must deny the petitions because it is an interpretive rule and is thus procedurally sound, and its interpretation of § 112 is correct.

Congress enacted the CAA, 42 U.S.C. § 7401 et seq., to 'protect and enhance the quality of the Nation's air resources . . . . ' The Act distinguishes between 'major' and 'area' sources. A major source means any source within a listed category that 'emits or has the potential to emit considering controls, in the aggregate, 10 tons per year or more of any [listed hazardous air pollutant] or 25 tons per year or more of any combination of [listed hazardous air pollutants].' Area source means 'any stationary source of [hazardous air pollutants] that is not a major source.' For major sources, the Act requires D to establish stringent emissions caps that result in 'the maximum degree of reduction in emissions . . . (including a prohibition on such emissions, where achievable).' D refers to these emissions limitations as 'Maximum Achievable Control Technology' (MACT) standards which must be 'no less stringent than the emission control that is achieved in practice by the best controlled similar source.' For area sources, D need not set emissions caps at all, save under limited circumstances. If D chooses to cap emissions for an area source, it may set emissions limits based on 'Generally Available Control Technology' (GACT) standards, which are far more lenient than their MACT counterparts. Congress enacted Title V of the CAA, 42 U.S.C. § 7661 et seq., which makes it unlawful for a source subject to regulations under the Act - including GACT or MACT standards under § 112 - to operate without a permit. Title V requires a source to submit a permit application and compliance plan to a state permitting authority. A source must certify its compliance annually and submit to inspection, monitoring, and reporting requirements. Title V provides a detailed administrative process that dictates exactly when and how regulated sources and regulatory beneficiaries may seek D's review of a state permitting authority's action, and, ultimately, judicial review of D's action. Section 7661d specifies: (1) that 'no objection shall be subject to judicial review until the Administrator takes final action to issue or deny a permit under this subsection,' and (2) that the Administrator's denial of a petition to object 'shall be subject to judicial review under section 7607.' Section 7607 contains the Act's umbrella judicial review provision, which confers jurisdiction in the appropriate circuit for regionally applicable final action of the Administrator and in this Court for final action of the Administrator that is 'nationally applicable.' In 1995, D issued a memorandum to 'clarify when a major source of [hazardous air pollutants] can become an area source' under § 112. On January 25, 2018, D announced it was reversing course. Wehrum issued a four-page memo to the agency's Regional Air Division Directors; it announced that D would no longer interpret § 112 in accordance with the 1995 Memo. The Wehrum Memo holds that Congress placed no 'temporal limitations' on when a major source is eligible to reclassify as an area source. The Wehrum Memo declares that when a source previously classified as major limits its potential to emit to below the major source threshold, it 'will no longer be subject either to the major source MACT or other major source requirements that were applicable to it as a major source under CAA section 112.'

Issues

Rule of Law

Holding and Decision

Legal Analysis

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