morning morning may please the court my name is brant knew all i would like to reserve fifteen minutes of my time for a bottle got it under the threat of sanctions included suspending federal highway funding the joaquin valley air pollution control district removed the agricultural exemption from the district on asar rules at e p a suggestion on emphasize that at e p a suggestion e p a then approved those exemption for rules and lifted the sanctions because many new and expanding large confined animal facilities were operating and citing in the san joaquin valley the association of irritated residents brought three citizen suits to enforce the district and s our rules because those facilities were not obtaining permits they were not installing pollution control technology and they were not insuring no net increase in emissions through the purchase of offsets air prevailed in summary judgment in the very first of those cases to go to liability terminations the vendor him case immediately after the van dam case the e p a claimed it made a mistake exempted minors forces from the offsets requirement because the district sought and e p a approved reductions from those sources that are real permanent quantifiable the forcible and third the court should not defer to the opinions of the california attorney general and the california air resources board so my first point e p a has no authority under section one ten case six to amend the civil congress created this scheme some call it cooperative federalism where e p a establishes the air quality standards the states have the primary responsibility as well the sole responsibility of developing the plans and the rules and the regulations to achieve the standards e p a sets e p a s role under section one ten k is to review that which the states submit congress that's limited role to that of a regulatory backstop under section one ten k e p a has two areas of authority it can approve or disapprove that which the revision to fix the inadequacy here e p a wanted to amend the cip itself and it did so it promulgated forty c f r section fifty two point two forty five correct an action i want to size the term action as appropriate now the term action and the term appropriate referred to as authority within section one ten k so the actions that e p a is permitted to take our approval zz disapprovals and what are called sept calls those instances where e p a demands a supervision that i described so section one ten case six should be read within the overall meeting of section one ten k so that the actions that he p is allowed to correct are those which congress gave authority for e p a to do it's a fundamental principle your honor of separation of powers agencies derive their authority from an affirmative grant of power they do not operate with plenary authority subject only to congressional restriction let me see if you're making address this argument when the soup is approved let's assume that the california statute was perfectly clear so we don't have to worry about interpretation and it pretty clearly says we're go exempt what i'm going to call small farms joinder stand i mean the miners who are says are you suggesting that the e p a at that point had they known about that at the understood it should have then said no no no no we won't approve that we don't want to have any exemptions at all are you saying that are you just saying that it's a different situation that the e p a assumed that there were no exemptions that the e p a here didn't assume that there was no exemptions e p a knew that at the time the district adopted those and us our rules that there was a blanket exemption for agricultural equipment e p a knew that the air district knew that e p a suggested to the air district you know what you better take out everything not withstanding the fact that there is the state law in there right now the motivation for that clearly based on evidence of the record was that e p a was trying to assist the district avoid sanctions ok so the defendant then says they say what they say and the e p a are we saying assumed that it meant no exemptions well then the the district anis our rules came into e p a and while e p a was considering those exemption for the rules california legislature passed a senate bill seven hundred after that senate bill seven hundred became law at no time did the district submit anything to e p a to say hey you know what things have changed a little bit here we want you to to consider this offsets provision or the one half exemption that never happened e p a went ahead and approved the district and it's our rules in two thousand and four after seven hundred became law without any submission by the district in fact the district didn't submit any further revision to those district on this our rules until two thousand and eight that submission happened after the ban and decision they started working on their revisions in two thousand and six but both the district and e p a received notices of ten to sue err was required to give them notice of their intent to sue they  knew what the cases where they were filed their matters of public record but at no time did the district attempt to change these rules until two thousand and eight and i i would direct  the court to the say fair decision it's a fair decisions rather instructive because in the situation with idaho law and banning field burning consistently idaho law banned or allowed for field burning and held that federal law controls in consistence a law going back to the one ten k six point is that allowing the p a to take this action would drastically alter this model of cooperate federalism e p a isn't supposed to have authority to amend the sense in imagine a situation where e p a told texas a texas you know those affirmative defenses we approved in the sept twenty years ago you know we made a mistake we're going to go back in time and take them out in this situation e p a is collaborating with the state and that example i'm giving you texas would undoubtedly say no way are you messing with that you do not have authority to change are simple we're the ones who get to tell you what's in the sip and you get to decide whether it meets the minimal requirements of the act or not are there other cases that that interpret seventy four ten k six the way you would urge us to read it no court has recognized the e p a has the discretion and claimed that there was a gap and they needed to fill it under chevron step two and courts have consistently said no you know you know what congress polk directly to this point and we want to constrain e p a authority we do not want to have authority because i'll be the first to admit i don't deal with the statute every day but you know just reading it whenever the administrators actions are proving disapproving or promulgating any plan is deemed to be in error the administrator may revise such action is appropriate that seems pretty broad to me i respectfully disagree because the actions that e p a has been given to take are extremely limited congress did not give  and then it says they can revise it is appropriate it seems to be pretty i don't know pretty healthy grant of discretion well congress didn't say they could revise the plans as appropriate congress said they could revise their actions approving the it said that the agency can revise its actions so could you excuse me this is just right or could you just give us that in what you were in your view the classic example of what this sections  which is something that was submitted e p a to regulate pesticides and e p a it later became known that e p a inadvertently amid a a document that made the pesticide element of forcible e p a would say you know what we made a mistake of proving that what we should have done is we should have disapproved it because that document was not submitted to us so then e p a would change the action from an approval to disapproval the change in that action would give california up to eighteen months of time to submit a correction under section one ten k and then e p a if california did not correct the  authority to impose sanctions so what congress is trying to do here judge order is as an regulatory backstop e p a decides whether it meets the requirements or not and if it doesn't then the state has to correct it or face sanctions that's how it is supposed to work your hypothetical e p a inadvertently failed to ban the x y z chemical and you're saying when they discover the mistake they have to allow x y z for another eighteen months while they go through this process rather than corrected by saying what we meant we should have included we should have had the state should have had x y z in there  that's correct and that's what happened early in the saga of this situation when california has laws exempted agricultural sources from any pollution controls e p a said ok you've got eighteen months to fix it my second point is that assuming the e p a has the authority it acted arbitrary and capricious like the plain meaning of the offsets provision says that the district has no authority to require offsets if the reductions do not meet the criteria for real permanent quantifiable and enforceable reductions now the court should interpret the meaning of state law and does not refer or do you d s interpretation and the safe air case the ninth circuit interpreted state law in reaching its decision and the texas vs e p a case which we cited in our briefing the fifth circuit did not defer to state law it interpreted state law so looking about the court i mean the court yet the fist circuit court oyo why would the e p a be arbitrary and in relying on the opinion of the attorney  well going to the attorney general's point the court should interpret the law now in relying on the attorney general's opinion well i grant you were not bound by the attorney general's writing but he agents as the agencies trying to do it do its thing why is it arbitrary for it to rely on an opinion of the california attorney general in what california law permits or doesn't it reasons why the jets overman first the plain meaning of the statute says that there are four criteria to satisfy real permanent quantifiable enforceable the record here demonstrates that those criteria have been satisfied the district adopted and submitted multiple rules affecting agricultural sources sent them to e p a the district sought credit for those reductions in its attainment plans e p a approved all of the rules and all of the attainment plans  thus finding that the reductions were real permanent quantifiable and enforceable even in the context of confined animal facilities my client directly questioned whether those reductions were valid reductions and e p a rejected its arguments that said no we're going to approve this rule and we're going to give credit to the team of plans for massive v o c reductions those criteria have been satisfied so that's the first reason why it's offsets all of a sudden when that letter came in you can imagine what what what happened people when run into the attorney general said we need another letter and that's what happened the second letter in two thousand and thirteen offers a conclusive and factual opinion that is directly contradicted by the evidence i just described in the record as a matter of fact there's no evidence that says that reductions are not real permanent on a viable in a forcible the california supreme court in the yamaha case articulated a standard for judicial review situations where agencies are interpreted in law in a non rulemaking context so that's what the attorney general is doing and that's what the california air resources board were doing in their letters they were interpret in law in a non rulemaking context and in that context california supreme court applied a standard of review that's very similar to skidmore deference that standard review applies deference on a spectrum depending on various factors one of the factors is whether the agency is interpreting its own regulations or a statute there's more deference if it's interpreted his own whether there was careful consideration by senior agency officials whether the agency has consistently maintained that interpretation whether the agency's interpretation occurred contemporaneously with the enactment of the legislation so applying those factors here to the attorney general's letter the letter came in two thousand and twelve two thousand and thirteen well over five years after the van dam decision ten years after senate bill seven hundred it was not articulated contemporaneously with that legislation well afterwards and it was not even an official decision of the attorney general of california attorney general's opinions received specific numbers and they're published on the attorney general's website there are found on lexis when you search for those attorney general opinions these opinions were not official attorney general pinions do not reflect under yamaha consideration by senior agency officials so applying yamaha the court should give very little deference to these attorney general opinions applying yamaha to the air resources board letter the two thousand and eight or sources board letter again it came out two thousand and eight right after the van dam decision which was in two thousand and seven it interprets senate bill seven hundred not carbs own regulations again less deference because it's not inter own regulations also not contemporaneous with s b seven hundred an act that came out five years after s b seven hundred became law in two thousand and three and there's no evidence that that letter was considered by the actual decision makers at air resources board the board members the appointed board members so applying yamaha to these letters the court should apply very little deference to these letters and that's the second reason why if you acted ar because it ignored the plain language of the statute it then went to these agency letters that created an interpretation that has no rational connection to what that statute says i see you're down past ten minutes and i know you wanted reserve sometimes you're welcome to use it now or or unless the court has any other questions i'll reserve the balance thank you to thank you ok we received a letter from the responding to me i gather you folks have decided how you're going to divvy up your time is that right ok your honor is e p a made a mistake and corrected it back action was appropriate and was recently based on interpretations of state law by the state attorney general judge silberman you observed section one ten case six of the clean air act gives e p a broad authority to revise its actions actions are approvals but revisions need not be lawfully reasonably and in keeping with the goals of the act this correction fell within those bounds e p a it limited the scope of its approval to correspond to californians ability to actually implement keeping with the goal of reducing air pollution but this is not a case where e p a is imposing its own policy preferences on the state or writing its own implementation rolls concerned about is that when california is required to do something by the setup but california actually have the authority to implement those measures under state law there suggests that the statutory structure requires e p a to issue air corrections only in the forms that e p a could act under one ten k three or k four but the statutory structure does not make that cla section one ten k six is a separate section it is a distinct form and it governs actions not only in k three and q four but also a problem of plans which are not in section one ten k a didn't have the inherent authority to correct its mistakes more than merely typographical mistakes so section one ten case six was actually added to give e t a more authority and that's in petitioners excerpts of record  correction that was retroactive that argument has been waived regardless e p a recently interpreted its authority under section one ten k six to allow it to correct its errors from the time of the error on words a s error determinations were also reasonable california had not provided necessary assurances that it could fully implemented because of conflicts between the and state la a has an independent obligation to make sure that these necessary assurances have been provided e p a failed to recognize the conflicts and its approval was in error the standard of review here is deferential and your overview e p a a ninth circuit case this court to for is to e p a s determinations regarding necessary assurances based on state law regardless a didn't interpret state law on its own here but reasonably relied on interpretations by the state attorney general and the interpretations that air urged e p a to seek in the first place once those interpretations came out it was clear that there were indeed conflicts between state law on the set up and those conflicts centered on two provisions in state law the offset provision and the one half exemption and there is no dispute about what the one half exemption means as to the offset provision and it is ambiguous technical and obscure and e p a reasonably incorporated the state attorney general's opinion from her two thousand and thirteen letter and interpret ing law provision it is true as air points out that the two thousand and twelve letter as e p a has acknowledged as difficult to reconcile with a two thousand and thirteen letter but the two thousand and thirteen letter was specifically addressed to the problem regarding the conflicts between the state's authority to regulate minor agricultural sources under us the seven hundred and the determination as the state attorney general explained savings clauses serve a narrow and technical purpose as the seven hundred changed the definition of agricultural sources and the savings clauses serve to sa rules that pertain to sources that were not considered agricultural under previous law but are considered agricultural under s b seven hundred control district i have just a couple of points that i want to focus this court's attention on the smarting first of all i want to emphasize that this case from a practical real world perspective is really much ado about nothing because any decision from this court will neither benefit nor harm air quality in the san joaquin valley e p a s error correction rule only pertains to a limited six year window of time between june two thousand and four and june two thousand and ten as demonstrated in the record in two thousand and six the district amended its and s r rules yet again to conform with the permit ing and offset exemptions in s b seven hundred what would happen is that now at this present time as far as right redress ability of injuries is concerned vacating e p a s error correction rule will serve no practical purpose the most that can happen is that if the district could somehow go back in time and retroactively issue permits for the two thousand and four to two thousand and ten time period it would essentially be an idle act because those facilities would be entitled to then turn around and mediately surrender their permits they're after and the same is also true for offset credits even if hypothetically a miner acts or so could somehow afford to purchase offset credits without going bankrupt the current offset exemption means that the miner acts forces would be required to read bank those credits and so from an air quality perspective the status quo would essentially be maintained from this point going forward there would be no benefit for air quality i also want to address just very briefly  petitioners arguments on pages sixteen to seventeen of their reply brief and alluded to here that where they state that e p a failed to adequately examine the lack of authority under state law for the districts the middle and that the state somehow failed to demonstrate adequate authority under state law for there for the districts rules petitioners argument somehow imply that adequate authority the adequate authority requirement under state law required by section one ten a to be of the clean air act can somehow be forfeited by a stoppel of course it's a well established principle of law that a stop will cannot be invoked against a government agency acting in its public capacity at least not in the absence of some type of affirmative misconduct and resulting injury none of which has occurred here it's important to recognize that california state law has never allowed for the type of permitting and offsets for the type of minor acts forces at issue here either before or since the state's adoption of s b seven hundred and the fact that e p a failed to recognize that limitation when it approved the rules didn't have the effect of creating adequate state authority out of thin air it was quite plainly an air the air that is at issue here and if section one ten k six is to have any meaning at all it is to enable e p a to correct this error finally i just want to address one additional point that petitioners brought up concerning their interpretation of section ten k six i want to point out that it allows for error corrections as appropriate without any further submission from the state and petitioners arguments if it's to be believed would essentially read out this last portion of the statute that no for this mission is required from the state to enable e p a to exercise its air correction authority you have no for the questions i would like to defer to my co coun unusual circumstances and it fits right in the very core of the air era correction power under case six e p a era correction here was appropriate first because it exactly addressed the problem which was a mismatch between the state's ip and the district's power under state law as interpreted by the attorney general and as it appears on the face of the california statute and it was appropriate second because none of the other options that are open to e p a it is partial or limited or full disapproval of the soup or conditional approval none of those would have achieved that pinpoint result of aligning the sip with state law and e p a explained why those other options were not appropriate including the fact that  full disapproval of the sippy would have harmed the environment obviously not something that he would want to do so the court here doesn't have to in order to affirm to embrace any broader view of e p a s discretion on the case six and you can leave for another day the question whether e p a can choose to use error correction if some other remedy under section k subsection k is reasonably available injury remember what's at issue here what's at issue here is a narrow category of mine a source's we're not even talking about all minus sources we're talking only about those that amiss emit less than half of the level of pollutants that  threshold for major sources and in an area like the valley that is a very very low threshold and so e p a concluded in its two thousand and ten action and it concluded again in september two thousand and fourteen the final for the district submitted in a twenty eight j level last week that the exemption of these minor sources and i quote here was consistent with federal n s o requirements and would not interfere with attainment or maintenance of or on offsets for these few minor sources and that's a finding the de hasn't challenge in its papers and it means that the minus source is at issue here are relevant to equities and it's designed to protect as members if the petition to believe otherwise it should have argument there really is no need for section one ten k six they have presented such a narrow interpretation it's hard to fathom any situation where e p a could ever use the section  if you look at section one ten k of the clean air act it lists the examples of what d p a can do when it deals with a plant with a plan they can approve it partially approve it they can disapprove it partially disapprove it they can give what they call a conditional approval the next one on the list as they can do the simple call where they tell the state rewrite the plan the cards because it's defective and then one of the other elements they can do is they can make corrections  definition a correction really is an amendment to the set it can't be anything else it's it's going back retroactively and fixing an error that was made in the plan and then one ten six as the court has pointed out gives a lot of discretion in e p a on how to deal with these types of situations a lot of these arguments that you can only use a sip revision or a sip coffee have been already rejected by at least one court that's the alabama environmental counsel case were petitioners raise the same argument they claimed you can't use this error correction to amend a sip you can only do a sip call and the court rejected that obscure thing that somebody dreamed up it's in the code and it's been used by e p a on numerous occasions to go back and retroactively correct errors so i would hate to see  section like that just basically get written out of the act as to authority the clean air act says the state presents assurance of adequate authority we're getting in a situation here where the petitioners are saying well you have to disregard with the states saying disregard what the attorney general says even though the state provides an assurance of authority you also have to disregard what the p a says if they follow the attorney general's opinion they are violating the tenant that they're basically abusing their discretion i think that puts e p a in an impossible situation the b c ca appeals group case basically says that it says the state gives assurances e p a should follow that it should not have to get into this exercise that we're getting in here today where we're going to nit pick and analyze every word of the state's assurance in that state attorney general's opinion to do that we might as well not have the section in the clean air act that says the state gives assurances if the state gives assurances and no one has to give it any deference or back to back to you that you thank you  thank you your honor with respect to the p a s argument miss pot made the point that air made an argument and center in its reply brief and said that it was an argument about e p a s authority under one tent k six so i'm disagree that we've raised a new argument in our reply brief we brief section one ten k and their opening and we responded to the relevant answer in arguments miss bought and mr j for air coalition team both made arguments about deference for when a state provides necessary assurances you heard that phrase a few times when when the side came up and argued necessary surance is is something that happens when the state submits a plan d p a for review under section one ten a to e of the act a status supposed to show that it has authority to implement the sip it's supposed to show that it has adequate resources and personnel to implement the sip and it's supposed to provide assur again when i was speaking earlier no but he questioned what e p a was doing at that time the district did not submit anything about s b seven hundred trying to limit what it was doing with offsets or with this one half exemption there was no question about necessary surance is in fact the action e p a is taking now is not sane it's not an action under one ten a two e it's not a claim that the state did not provide necessary s state that's supposed to provide assurances e p a isn't supposed to go around and hunt and peck and look in a state law to find whether the state has authority it's not supposed to investigate whether a state has resources and personnel the state supposed to provide that and in this case the state did not provide that the state was trying to avoid sanctions and e p a was participating in that effort to help make that is valid or williams williamson's point about subsequent events more of the supercede subsequent actions taken that is superceded the she is correct that the state ultimately submitted revisions to the district on this our rules and that the sip ultimately changed our position is that the sip changed on october seventeenth two thousand and fourteen when e p a took final action to approve these two exemptions we're talking about into the seven so there would be a ten year window when the district and us  rules controlled as a matter of federal law is immediately as you and i asked her suppose we were to rule in your favor what would that would that practically mean what happens is that in this ten year window or misspell atory said six year window either ten year window or six year window that means the exemption free rules apply and they trump inconsistent state law that is under ok and it was a fairness we can't go back in time in i mean what would it what can we do what would be the effect now it's twenty fifteen if a new source filed a permit application that source would have to comply with the revised rules that say which are in existence now which are in existence our case wouldn't have any effect one way or the other and this would not have perspective effect of course the meaning of the seven would would be interpreted by courts going forward if there's any challenges but i think your question is about the retroactive effect what would happen during that six year window during the six year window under say fair the exemption for a district and as our rules would control and agricultural sources would have to obtain offsets and obtain permits notwithstanding centerville seven hundred does that mean you with limitations considerations taken care of you would then be able to sue people because they didn't comply during this this ten year window inconsistent state law it granted summary judgment to air that said this ag source has to get offsets and get a permit to foster given that we have cases like this so you have a successful lawsuit but the couper can't issue an injunction going forward it was unnecessary so what is the what is the court will do to the small farm that it has  violated during this period of time a fine require them to buy credits of it what is the court going to do that's going to help the environment the court would require the facility to install control technology to reduce emissions so that benefits the environment because there's less air pollution entering their base and it would require the source to buy more reductions from another source so that there is an actual net decrease in the air base and given that given that addition so there would be a benefit to the environment going forward judge garbus your question is what would happen going forward well the sip now says that that the district is not of authority to require offsets unless reductions are real permanent quantifiable and in forcible that trigger an event has already happened so someone could file a lawsuit against a new source going forward and say under the sip now this condition has been satisfied you have an obligation to obtain offsets so either way going forward we're going backwards agricultural sources have to get offsets because they just are going to it's our rules require it and they trump  consistent state law and going forward this the sip says they're required if the conditions are satisfied as i explained earlier those conditions have been satisfied he has approved reductions as real permanent quantifiable and enforceable the district's off them it's about improving air quality and going to the standing points that the foster farms makes it argues that there's no benefit there quality what offsets do is a matter of california federal law is ensure that there's no net increase in emissions when new and expanding sources add air pollution they are basin they take air pollution from somewhere else so there's no net increase with  there is an allowance so more emissions and up in the aggregate in the air basin because the ag sources are exempt from offsetting their emissions that's the causation that's the harm t for foster farms made the argument that e p a has found that there is no interference with attainment and he referenced a twenty eight j letter his argument about that about e p a s finding came in a twenty eight j letter filed yesterday afternoon and it's a new argument that argument was not made at all and the answer in briefs about e p a finding that there would be no interference with attainment and linking that finding causation i want to point out about this that that the finding that that that rule is referring to actually attainment because the district's plans did not claim credit for those emissions reductions just like i was talking about how they sought credit for me p h p approved credit well the district didn't claim credit so e p a said look just because these are being taken out that doesn't interfere with the ataman demonstration e p a did not find and i want to emphasize this e p a did not find that an exemption for ag sources would not allow an increase in air