number thirteen guest house sixty three et al tell your state resources industry association petitioner versus environmental protection agency and you know mccarthy administrator u s environmental protection agency mr mercer petitioner treasurer state resource case is not about the e p a s exercise of its technical expertise and the discretion of this court typically gives that exercise this case is about the failure of e follow its own rules guidelines and policy statements and by virtue of failure of doing so in two different stages of this case it's committed an arbitrary and capricious act that demands reversal by this court if we look specifically to the two stages of this case the first stage was the determination that a portion of yellowstone county which is largely in billings montana is now been designated as a non  purposes of a new problem gated rule for s o two that rule in two thousand and ten led to the not attainment decision e p a did not follow the recommendation of the state of montana and the state of montana had indicated that it was skeptical concerned about the quality of data that would form the basis for the opinion e p a in a variety of ways did not balance that data and did not follow its policy statements  guidelines in reaching the team a decision that it included a policy statements and guidelines the policy statements and was that we want to refer the court to start with the quaff which is the quality management plan that's required in forty c a four per fifty a subsection eight to one and that's a far it's got a five part component test it says all monitored organizations in this case state of montana must develop a quality system that is described in approved in quality management plans and quality assurance project plans to ensure that monitoring results do the following a meet a well defined need use promoted very  hundred six it dealt with the former standard for esso to give an explanation for that didn't name do we require more than that certainly not at the time of the original designation there were concerns voiced about whether that data was this is the version just a few thousand in it so for instance when they're talking about operational criteria on page one fifty eight says the reason for not meeting the criteria must be investigated mitigated or justified  and the burden is even higher with respect to the critical period table and so in excerpts of record two ninety five in that joint appendix there is this chart which sets forth nine because there are just ten columns there those you've got critical criteria in columns numbered six and seven you have operational criteria that are and k columns two three four and five this data was not assessed by u p a even though that's demanded by this shows that in those critical criteria columns six and seven there were failures on the first three days where they found where their ranges that exceed the new the new parts per billion standard for which is an operational criteria there's failure on every one of the days in question except the first day and there are other failures that are represented here as well so when we look at that data and say your own handbook says that this quality assurance data needed to be considered and needed to either be in the he said the critical criteria designation needs to be excluded in the keys of the operational criteria with when and when did you all raise that this point about coopted seven discrete instances of quality assurance telling e p a that you didn't consider it the proper time when you were making a rule is my right or wrong you were correct your honor good because if that's not always that's good too ninety five is that it's a difference here doesn't it well they have the primary obligation to ensure that that the that that they're utilizing a team of decision is accurate and is of an adequate quality they didn't do any of that here and so for that reason it it this rule needs to be act works is you're you're always going to be relying in part on old data right i mean a new standard is announced the state has a year to designate what other date is the state  use at least in that period of time if it's not all day then there's the retroactivity your given your honour's is grounded in the authority in this case is this recourse decision lancer after this court's decision in national data that was collected under previous standards right what's wrong with that we complied with the previous standard they now are taking our compliance under the previous standard and they're applying it and creating a not attain zone which is to area will make a statute and it retroactive at the time of it's me the regulation effective at the time of his probation they didn't do that in this section of clean air act and so the fact that data that show compliance is now and the party didn't have the benefit of being able to know that it needed to have a different standard or otherwise it was going to be in a not a team of cage is it to determine entertainment zone as long as there isn't a retroactive effect to the detriment changes or something like that so i'm trying to figure out your implications here with it so it could be used to the extent to didn't have a right retroactive effect that would be negative would it would be for some  negativism tests that land graft uses is it i mean negative going forward as in you don't get you're subject to a new regulatory scheme is pretty commonplace we have a lot of cases relying on old data to impose back of the previous argument do you have an example of a case where e p a rely on failures in data maybe critical data or critical operational data technical failures to say we can't we can't use that data throw it away completely without even though the weight of the evidence would have been reliable if you many examples where they behaved the way you think they and should behave in this mississippi commission that we talked about it in our notice the supplemental forty gets it that's that's a case where this court said it first of all did not utilize compliance data for the decision and this court went on to say it must be collected things that are a collective compliance data or was that the private data you're talking about that hadn't been subject to quality assurance includes all areas contributing to don attainment so to the extent there are areas of monroe county that are contributing to non attainment in wayne county and the detroit michigan area that too has to be included within the boundar they can designate an area unclassifiable or they can designate an area team the definition of not a team and includes any area contributing to not a team but there's nothing in the law that tells you where that not a where that boundary needs to be drawn just that monroe county has to be not a team in it some point in time but it doesn't tell us where the the boundary is needs to be drawn does it is very thorough and for that i would state say the statutory scheme dictates that gnation the theory that we're confident law as not the case the area nonna team and the boundaries of that area must include those contributing to the they're uncertain as to trickle or adjacent area if there's an insufficient basis for making the designation for the non attainment area then their property classification under one hundred seventy is one classify i know what would you have the same position if they from monroe county and that way that it will happen you know what is contributing a lot more to monroe county but the the boundaries because they define the sources that have to reduce emissions in order to satisfy attainment if you leave out those you don't have include everything if if if a little width is coming over from one plant but it's really contributing substantially to another county surely you wouldn't say that oh no because some whiffs come over now and then that has to be in this area and this is certainly not a situation where about and i don't i'm trying to test your analysis here it's not that everything that potentially contributes in any amount has to be with him the attainment area doesn't that's correct and i state has determined that sure whether the money ro plant is a significant source or a less than significant source for your county and they want to look at what is done in another county your position is they're paralyzed they can't move until  they can designate what is clearly a non ataman area undisputed by you until they actually figure out everything that's outside and put it in it's own place at least they have to follow their own methodology for determining if the source is a contributing a significant contributing source here the methodology they determined was to evaluate the total emissions and divided by the distance to the monitor this is what i hear what i see is the problem sooner you can address problem the judge williams has raised they haven't finished deciding that on the other hand it doesn't need to be part of the same area with and that's that you have a finale the issue is finally finally drawn the boundary but it doesn't need to include the grow the monroe power plant if it's going to be part of another nineteen area to address judge williams finality issue we have an opportunity to designate the entire area unclassifiable because there's an insufficient basis to draw boundaries that include all contributing sources the one hundred eighteen thousand tons that monroe emitted when divided by the distance from the southwest high school there right near this high school monetary growth and you've got monroe sort of down here and that between the two of them is an area called allen park which is actually in attainment coming over from county isn't bothering the air in between the meteorology which is one of the elements that's to be considered in determining the non ataman area indicates that the emissions from monroe county with its very high stacks moves towards the detroit river up the river and impacts the south west high school monitor even though the impact on the allen county monitor is still in the chain disillusioned like here's why sure which area even is supposed to look like is that sort of gerrymandered around the allen park counties so we're skipping over one county altogether and we're going to have two counties separated by another county that are a single not ataman area no the monroe is adjacent to the wayne county area the boundary between the wayne county non a area and monroe does not have any independent area one park not between the two of them it is not they share a jurisdictional boundary so the air emissions according to the meteorology in the modeling that we provided in our petition for reconsideration indicates that those emissions do in fact head up the detroit river and significantly impact the southwest high school monitor and then we i'm sorry you don't i was just to conclude unless you have i really wanted to back up and talk about standing what i'm trying to figure out is how would he us feel the impact the regulatory impact on u s steel be changed if monarch county were advantage problem no the the implications for the reasonably available control measures is that you reduce emissions to the extent necessary to bring the area into attainments according to the monitor data right now it's clear that the monroe power plants emission reductions have already satisfied the non payment problem because the detroit area is currently in a team and for the us of two standard because of the way the michigan state implementation plan is structure you start with the larger sources and gradually move to smaller and smaller sources until you solve the problem well if you start with the largest source here it's monroe well that i'm going to start with just one u s steel is also a very large source and would be regulated i think right you're not you're not telling us that if mineral plant were in u s steel wouldn't be regulated of all it would be within the realm of the statutory scheme for all of what you mission w they don't have to be not a payment area to be regulated by machine cracked that's correct but the ability to regulate different i'm trying to figure out why they couldn't all be in the exact same place the non in team an area defines who is required to reduce emissions the fact that the state power plant be brought in as a source of the solution where you have a issue we will certainly be commenting on the state implementation plan with regards to its impact on the u s steel corporation facilities and to the extent we they have that authority we would encourage the state to consider the voluntary emission reductions necessary to address munro's issue but and can come up with eight to reasons a determination for the contributing sources to the wayne county not a tuner problem thank you thank you court my name's amanda berman i'm here representing the united states e t a table with me is mike threat from u b s office of general counsel before delving into the jurisdiction on merits issues presented here today i'd like to put these challenges in a little bit of challenge only two of those twenty nine designations and the non attainment status of one of those areas is not really contested here rather the challenge is really to the non designation of a neighboring county i think this reflects something important about this rule that it addressed areas that from e p a s perspective were relatively easy calls where the monitoring data available to the agency clearly showed that those areas exceeded that this standard during the two thousand and nine to two thousand and eleven period i'm not saying to williams what i'm all i'm trying to say is that as a backdrop you know from e p a s perspective i want the court to know that these are areas where we think the monitoring gate is very clear and i'll go into the record specific areas issues that show that petition treasurer state tries to undermine the and your own regulatory rules are handbooks talk about critical criteria you know if it if you violate the critical criteria that's very consequential and you should rely on the data and my understanding now of that operates when i said so but i think that means we have to look at the arguments that were actually made and when they were made here in their comments on a rule just a treasure state made the same sort of very eneral allegations of operational fire failures problematic data that it made in its opening brief here and he did respond to those in its response to comments it's only in the reconsideration petition that this sort of laundry list of alleged discrepancy between the monitoring regulations and the handbook and the operation data along with other information and made a weight of evidence determination e p a has always used this weight of the evidence approach with even when they are violations of critical criteria well i i have to crow with the idea that there's necessarily violations of critical criteria here the chart they pointed you to is some kind of back up into your hands of a question first and then that i'm happy to hear that you know about and is there an instance in which there have been violations of critical criteria but nonetheless the weight of the evidence total evidence intended use of that had amongst other data to make them into a non ataman decision or over and we have to accept your there was no violation of critical criteria for you and i don't think you have to accept that there was absolutely no violation of critical criteria what he saying here is that it's always final follow this idea that what we're looking for is overall compliance and i mean in the middle where is an example where there was critical hard tyria violations in the weight of the evidence  identify a case where some something was called a critical criteria violation but i think this is a bit of a red herring because this chart that they've pointed you to is something that was given to the agency after it's not even part of the reconsideration petition it was discrepancies you know one that they pointed to a couple times is the fact that performance tracks on the monitor in question were on one or two of occasions not performed every fourteen days as they're supposed to do that but every twenty one days now he explained in response that in fact in many instances those checks were performed more frequently than required but in any event on the one time they identify where there's a twenty one day window there are the criteria measured on either side in the two checks on either side so that the monitor was working fine during that period these performance checks the point is to make sure that the monitor is functioning e p a has no reason to doubt that it was functioning during that period so it you know and i would encourage the court to really look at its pages three one through the next four or five pages very specifically response to those assertions but again those were raised in comments on the rule without sort of specificity critical criteria sorry for any of these critical criteria i'm not really a approach e p a s regulations they're monitoring regulations i mean they run many many pages in the federal register they're very comprehensive and for good reason but he has always taken the approach that one missed check and one discrepancy is not reason to toss out the data i mean the e p a would never have enough data to make any decision if it had to do that but i'd like to return to the arguments that treasury state actually made it both in its comments in its opening brief here which are broader arguments first that the nine hundred ninety seven quality assurance plan is just too old second that the monitor wasn't designed for this particular standard third that the fact that it was recalibrated in two thousand and ten shows that it's not up to the task of generating data for this particular and that's before that and fourth we were just discussing this laundry list of discrepancies but regarding those first three things while e p a agrees that the monitor that montana quality assurance plan was due we're due for a revision and in fact it has now been revised that's not a mandatory requirement and plans to lapse into disapproval if a state doesn't mean you meet that every five year guidance and e p a is regulations don't work higher than a monitor be specifically designed for a particular knack set it up or to a particular level the regulatory requirement that's applicable here is that the monitor has to produce adequate quality data that's in forty c f r part fifty eight appendix a section two point one b the coburn road monitor meets that relatively low bar it's audited regularly as e p a explain responding to comments at levels that are low enough to show that it's up to the task for of recording data for a seventy five parts per billion standard and the fact that it was recalibrated in two thousand and ten doesn't undermine the village idiot data recorded before that if i tune my view between pieces during a concert that doesn't mean that the sound i was creating before was horribly off key i'm just trying to ensure the continued quality of the sound i'm creating now if we have a presumption to the contrary for emissions monitors that would create perverse incentive for states that might want to have a particularly year of data like the twenty times over grow data taken off the books and the facts don't warrant that presumption here rather the monitor was audited before and after th ensure that it was able to measure the data at this standard so collectively we don't think treasury states arguments amount to any more of the sum of their parts which is zero they've not only failed to identify any legal flaw in the data from the monitor they fail to articulate any real substantive issue with that data at all except that the twenty ten data was too high and so should be discarded as outlying but this state certified that data montana certified that data for e and so this sort of cherry picking we think is just not a rational approach to the designations process and certainly not an approach that we think you should be compelled to take i would like to finally on the montana side just address the record retroactivity issue that this court ask facts is not retroactivity rather as this court's explain for example the national petrochemicals and refiners association case the question is whether new sanctions are being applied imposed on old conduct old conduct isn't being sanctioned here we're just using data reposing the data isn't sound like they're put on probation now based on what happened before now all right all right we'll look back at what you did lots of bad air and so now you're going to have to change your conduct and you're go have to be subject to all these new regulatory burdens based on what you did three years ago and so why isn't that retroactivity this isn't more affecting your benefits prospectively were actually  they describe it in subjection to regulatory burdens that other folks are not based on past conduct well i think if that's fresh march a video that would always be true in regard to this sort of designations process is the data you're particular overlay that they didn't have notice about three years the consequences of any given time three years of data can be used to impose regulatory burdens on us so sure there are at least of a notice of that that you know they do have notice it's not a newly created regime it's just an adjustment of the standard and we're using the data that we have which necessarily is going to create a new standard to some degree suppose you know  about use of three years of data i knew i mean you yourself have said there are severe consequences to these containment decisions so severe consequences attach and so why isn't that some it feels at least a little bit different to me and heavy regulatory burden that ever have sufficient effect to trigger retroactivity concerns could it ever i mean possibly but i think we have to look at what is being sanctioned here it's not  because in fact you need then more than one year to get one year of data certification doesn't happen until may of the following year so e p a would have to wait for an entire new or the state would have to wait for an entire new calendar year of data for that date to be to be certified so you couldn't meet the scheme that congress has set out here and i think right now took this approach that you can't use any data that predates well i think that i think i'm trying to make a different point and that is simply with respect to have breadth of the time period that you're looking back in time when that was brand new that hadn't happened before and no notice was given and pretty significant regulatory burdens follow from reliance on that data do you have to have one time have proposed rule proposed this change of the nats everyone had an opportunity to comment on that and challenge it and then moving after that it went through the proposal process for their particular destination so i think everybody had adequate notice here i magine that there were only a few potential sources i know there are others in the area but it was us steel and potentially monroe power right and they said so now we have to carry the regulatory burden alone we alone must change our operations to get this air level into attainment and if you had included among rogue plant we'd share the burden would be fifty percent or some percent and some allocation why isn't that the difference between one hundred remind the court that under its recent decision and this was a manufacturing base this burden of showing each of these elements is very much on petitioners but i don't think they've met the burden here because you know it's still a double speculation or land right now  because not only is it speculative that the state's going to impose any particular burdens on u s steel but it's doubly speculative that the state's going to do that and not impose any burdens on them and wrote well i think i think the use of the word speculative is way overused and standing arguments and seems to be used anytime we think we don't have certainty and we have to make predictions and i don't think that's what speculative means and standing cases i mean you've been doing this for some time you're an expert in this area what are the chances that u steel is going to be subject to regulatory burdens once they're within the ataman area and is that different from the chances that monroe power's going to be in it you know i honestly can't answer those questions but i'm not the state regulator it's not them is the the statutory requirement is that they submit a plan that gets the state to attain it the so and that's the basis on which he has to approve or disapprove a plan so i think that's the critical question and have you ever approved a plan in which the state only regulated sorry michigan is saying is consistent with my u p a saw in that it's it's really the u s steel plant which is two kilometers from the violating monitor as very significant emissions you know we do believe that you know there is if we want to turn to the merits here i mean i think long very solid ground when it says i know we're talking about the end whether they have an injury here yes a very injured by this designation well as i said i you know we don't have to use the word speculative but the requirement is that the injury has to be not even moving past injury point across ation here it's really this is a unique case that we really do have this disconnect between the conduct complained of and that's the phrase from the swanson manufacturing case and here the conduct complained of is the non designation problem also because the logical we think the only logical redress here if the court agreed with them on the merits would be to remain anti e p a to consider you know the designation for monroe county and nobody disputes that wayne county is not a team and i don't see nearby area and it's answering that question specifically for a certain area here it would be for the monroe area so i don't think its expansion is the right way i think that but again the critical point from our perspective is that wayne county still going to be in on attainment and the burdens area these folks will face burke you know wouldn't really dispute that i think the idea that they're going to have lesser burns if we go back and designate when the ro county is not a team and i think that is speculation that you would consider that if they were in the same area  maybe some sharing of the burdens presumably but given a default rule as counties county lines them the chance that they would end if you went back to the drawing table and chances are that they would be two separate not ataman areas anyhow have wayne county not ataman area and monroe county not ataman area right next to each other and everybody back in the office just generally refers to that big old area not ataman area but when you're testing going forward to see if they come into a sort of green colored dots right by that now monroe county as you see is well below that in the the planting question is the da in the row county so i mean i think you know the big conclusion collective one of has you know have these counties collectively brought fifteen minutes at the monitoring site in wayne county but you know it's we can't answer these questions now because we just don't have the necessary information and the state has gone through the those very ambiguous statutory terms you know it's fifty four kilometers away from the violating mine or a missile so be gluten from the mississippi commission case correct me if i'm wrong i thought there you define nearby as neighboring counties in a metropolitan honor that's what you're looking for it but what all we're saying here is that it's reasonable for e p a to say look we've got some sources really close to the violating monitor including us do it with very significant emissions yes we have another source that's fifty four kilometers away that does have seen if it emission but we explain that explain why i don't want more and i don't think there's any record any evidence on the record that supports that assertion that the wind is traveling in the sort of l shaped pattern that's neatly of meeting the allen park and other non violating monitor as it goes of the river i ten of our reply which means a duty to examine key assumptions part of its affirmative burden and therefore must justify the sanction even if no one objects to it during the public comment period that's from appalachian power one thirty five f thirty seven ninety one also would like to go back to questions the about the quaff and the significance of the kuapa joint appendix one seventy five sets forth the montana quote that was in place the time we need to start with the language on one sixty five of the it should be traceable to a primary standard and then the objective which is set for the next page six point two two and then back to language that you and i talked about church group with two point one b the government wants to talk about how the needs to be adequate quality but the key language that they are leaving out is provided death of adequate quality for the intended monitoring objectives and so these monitor gestures on one sixty five and one sixty six very clear all that is shall mandatory language shall be traceable to a primary standard and then the specifics here and the fact that they were collecting data throughout all of two thousand and nine and through august of two thousand and ten that was casting against used i just don't see why that should be the case well i think the best evidence of the significance is that the state in fact did begin to collect a different level of data based upon the new standard in august and ten so they realized that they needed to change what they were monitoring in order for it to be meaningful and to be adequate quality and yet we got all this data from before august of two thousand and ten that's being measured at the old standard and and the record suggests that least come as we made that that date is jeopardized as a result and finally i would like to refer the court also to page seventeen of the brief where we noted that data collection for the aggregate them are very significant because we're in in the margin of error the major source of s o two as is reflected in the record at said that it was would be fault and so in that larger context all these factors meteorological data that we refer to is in the record at joint appendix six sixty one to six seventy it's in fact easy presentation to t t is the owner of the mineral power plant and in their presentation they are trying to explain why in two thousand and nine when the us steel plant was shut down due to economic concerns there were still violations of the monitor and the conclusion that d t e zone engineer came to was that the media a logical of quinces of their emissions had in parts of the southwest high school monitor i think there's a slippery slope problem here if we accept e p a s interpretation of one zero seven d they can presumably devise a set a boundary around a single source and wait until later for the rest of the sources to be brought into the nonpayment designation they're not really they're not restricted by jurisdictional boundaries in fact in this case on the record the wayne county boundary is not a jurisdictional based boundary they use roadways to determine the boundary around the non ataman area so if you if you allow e p a to set it set in the area around a determination of the area contributing to wayne county in monroe is not a separate designation it's part of the non a team and foundry for wayne county so in even if we take a proposition that e p a has the authority to separate the designation in a later time period that also imposes of burden on those that are within the initial designation arce i home well the e p a if they're allowed to separate those designations by a matter of years which is what they're asking this court to bless means that the obligations for u steel will be in stone in the senate and required well before they complete any analysis on the monroe power plant and by doing so u s steel will be required to reduce emissions to compensate for the emissions for the that we visited an amended annually based on progress and everything circumstance it does have opportunities for it to be reevaluated periodically but now within the five year period now within no thank you very much the case