1 ORAL ARGUMENT NOT YET SCHEDULED UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

____________ ___________________________ ) NATIONAL ASSOCIATION OF CLEAN WATER AGENCIES, ) ) ) Petitioner ) No. 11-1131 ) (consolidated with Nos. v. ) 11-1167 and 11-1185) ) ENVIRONMENTAL PROTECTION AGENCY and LISA PEREZ JACKSON, ADMINISTRATOR, ENVIRONMENTAL PROTECTION AGENCY ) ) ) ) ) Respondents )

____________ ___________________________ ) EMERGENCY JOINT MOTION FOR STAY OF THE SEWAGE SLUDGE INCINERATION RULE Pursuant to Fed. R. App. P. 18 and Ci rcuit Rule 18, the National Association of Clean Water Agencies (“NACWA”) and Hatfield Township Municipal Authority (“Hatfield Township”) (together , “Movants”) hereby move this Court for an order staying the effectiveness and implementation of the U.S. Environmental Protection Agency (“EPA” or “Age ncy”) action entitled “Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Sewage Sludge Incineration Unit s,” 76 Fed. Reg. 15372 (Mar. 21, 2011) USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 1 of 362 (the “SSI Rule”). 1 As discussed in Section I be low, Movants respectfully request that the Court expedite review of this Motion. In the SSI Rule, EPA illegally promul gated numerous stringent emission limitations, operating conditions and othe r requirements under § 129 of the Clean Air Act (“CAA”), 42 U.S.C. § 7429, appli cable to sewage sludge incinerators (“SSIs”). The regulated SSIs are ow ned and operated by an estimated 118 municipalities and public clea n water agencies across th e nation. As discussed below, the SSI Rule is demonstrably unlawful and, if allowed to remain in effect, will result in concrete a nd irreparable harm to th e communities who rely upon incineration without concomitant benefits to other parties or to the environment. NACWA and Hatfield Township are pe titioners in Nos. 11-1131 and 11- 1167, respectively; Movants ha ve filed for leave to inte rvene in No. 11-1185. Per Fed. R. App. P. 18(a)(2)(C) and Circuit Rule 18(a)(2), Movant s have coordinated by telephone regarding this motion with counsel for all parties in these consolidated cases. Couns el for EPA and for Sierra Club (petitioner in No. 11- 1185) have indicated that th ey oppose this motion.

1 On September 7, 2011, Movants filed a Joint Motion to Exceed the Page Limit for this Motion for Stay (ECF #1328130 ) . As of the time of filing this Motion for Stay, the Joint Motion to Exceed the Page Limit was still pending. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 2 of 363 STANDARD FOR GRANTING A STAY Per Circuit Rule 18(a), the Court weighs four factors in considering motions to stay an agency rule on review: (1 ) Has the petitioner made a strong showing that it is likely to prevail on the merits of its appeal? (2) Has the petitioner shown that without such relief, it will be irrepa rably harmed? (3) Would the issuance of a stay substantially harm other parties inte rested in the proceedings? (4) Where lies the public interest? See Virginia Petroleum Jobbers Ass’n v. FPC , 259 F.2d 921, 925 (D.C. Cir. 1958). These f actors are considered togeth er and balanced against one another, such that a “stay may be granted with either a high probability of success and some injury, or vice versa. ” Cuomo v. NRC , 772 F.2d 972, 974 (D.C. Cir. 1985). In this case, each of these factors weighs heav ily in favor of staying the SSI Rule.
ARGUMENT EPA’s promulgation of the SSI Rule is an extreme example of Agency obduracy and regulatory corner-cutting with imminently harmful results for the communities who rely upon incineration as the only practical solution for managing the sewage sludge that their wa stewater treatment facilities generate every day. By setting emission standa rds under § 129 of the CAA, EPA has circumvented the statutory mandate to regulate SSIs under § 112(d) and thereby upset the flexible regulatory framework that Congress expressly reserved for USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 3 of 364 publicly owned treatment works (“POTW”) under the CAA and the Federal Water Pollution Control Act (“CWA”). Pressed for time during the rulemaki ng, EPA also subverted the CAA mandate to collect data from the requisite minimum number of SSIs. Then, when the Agency ran out of time to finalize the SSI Rule under the schedule set by the U.S. District Court for the District of Columbia, EPA ignored data and other information submitted during the comment period that would have changed the outcome of the standards, and failed to give weight to information submitted by commenters showing that the standards woul d not be achievable even for some of the best performing SSIs.

I. EXPEDITED REVIEW OF THIS MOTION IS WARRANTED Pursuant to Circuit Rule 27(f), any party may request e xpedited action on a motion on the ground that, to avoid irrepara ble harm, relief is needed in less time than would ordinarily be required for the Court to consider a response. Although there is no specific date by which Court action is necessary in this instance, expedited consideration of this Motion fo r Stay is warranted to minimize the imminent and irreversible harm resulting from the SSI Rule to the over 100 communities who rely on incineration to manage the sewage sludge generated by their POTWs, as set forth more fully in Section IV below and in the attached declarations submitted by four POTWs. M ovants are not seeking to expedite the USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 4 of 365 schedule for any responses to this Motion for Stay and any replies thereto, but instead are respectfully requesting that the Court expedite its own consideration of this Motion when briefing on the motion has concluded.

II. MOVANTS HAVE EXHAUSTED THEIR ADMINISTRATIVE REMEDIES WITH EPA. Movants have previously sought relief from EPA by submitting a Petition for Reconsideration and Stay (“Petition” ) (Ex. 1) on May 24, 2011. NACWA submitted the Petition requesting an imme diate stay of the SSI Rule pending reconsideration of the SSI Rule and prom ulgation of replacement regulations. After receiving no response, on June 27, 2011 NACWA submitted a supplement to the Petition (Ex. 2) reiterating the need for an immediate stay and providing information on regulatory developments fu rther illustrating the immediate impact that the SSI Rule is having on NACWA’s members. After obtaining two extensions of time to act , EPA still has not formally announced a decision on the petition. However, on August 31, 2011 EPA’ s counsel verbally informed Movants that the Agency will not reconsider the decision to regulate SSIs under § 129 of the CAA and will not grant the request for an administrative stay. Therefore, EPA has not afforded the relief requested. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 5 of 366 III. MOVANTS ARE LIKELY TO PREVAIL ON THE MERITS OF THEIR CHALLENGES TO THE SSI RULE. The SSI Rule is substantively and procedurally unlawful in multiple respects.
A. EPA’s Interpretation that SSIs Must be Regulated Under § 129 of the CAA Is Contrary to the Te xt of the CAA and Arbi trary and Capricious. EPA’s foundational claim that SSIs are subject to regulation under § 129 of the CAA fails both steps of analysis un der Chevron U.S.A. Inc. v. Natural Res. Def. Council , 467 U.S. 837 (1984). The plain language of CAA § 112(e)(5) requires EPA to establish national emissi on standards for hazardous air pollutants (“NESHAP”) for POTWs under CAA § 112. Because regulation of sources under § 112(d) and § 129 is mutually exclusive, 2 EPA lacks authority to regulate SSIs under CAA § 129. As discussed belo w, Congress placed SSIs under § 112 to ensure maximum flexibility in the regul ation of hazardous pollutants from these sources. EPA’s decision to regulate SSIs under § 129 using the more stringent requirements applicable to “solid waste incineration units” upsets this Congressional vision of providing the fl exibility local governments need to choose the best sewage sludge management method for their circumstances.

2 CAA § 129(h)(2) provides that: “no so lid waste incineration units subject to performance standards under [§§ 129 and 111] shall be subject to standards under [§ 112(d)].” Thus, § 129(h) makes re gulation of sources under § 129 or § 112 Footnote continued on next page USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 6 of 367 1. SSIs Are an Essential and Insepa rable Part of the Treatment Works and Congress Directed that They Be Regulated under § 112(d) of the CAA. In analyzing the interplay between §§ 112(e)(5) and 129, courts are “guided not by ‘a single sentence or member of a sentence, but [must] look[ ] to the provisions of the whole law, and to its object and policy.’” John Hancock Mut. Life Ins. Co. v. Harris Trust & Sav. Bank , 510 U.S. 86, 94-95 (1993) (quoting Pilot Life Ins. Co. v. Dedeaux , 481 U.S. 41, 51 (1987)). Section 112(e)(5) of the CAA

states: The Administrator shall promulgate st andards pursuant to subsection (d) of this section [112] applicable to public ly owned treatments works (as defined in title II of the Federal Water Po llution Control Act [33 U.S.C.A. § 1281 et seq .]) not later than 5 years after November 15, 1990. 42 U.S.C. § 7412(e)(5). The definition of “t reatment works” contained in Title II of the CWA is extraordinarily broad and includes SSIs. It defines treatment works

as: any devices and systems used in the storage, treatment, recycling, and reclamation of municipal sewage or i ndustrial wastes of a liquid nature to implement [section 201 of the Act], or ne cessary to recycle or reuse water at the most economical cost over the us eful life of the works, including intercepting sewers, outfall sewers, se wage collection systems, pumping, power, and other equipment, and their appurtenances; extensions, improvements, remodeling, additions, and alterations thereof; elements essential to provide a reliable recycl ed supply such as standby treatment Footnote continued from previous page mutually exclusive. EPA has consistent ly recognized that sources regulated under § 112 cannot also be regulated under § 129. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 7 of 368 units and clear well facilities; and any works , including site acquisition of the land that will be an integral part of the treatment process (including land used for the storage of tr eated wastewater in land treatment systems prior to land application) or is used for ultimate disposal of residues resulting from such treatment

. 33 U.S.C. § 1292(2)(A) (emphasis added). This definition clearly encompasses th e areas of a POTW used to manage sewage sludge resulting from the treatment of wastewater, including the SSIs that are “used for ultimate disposal of resi dues resulting from” the sewage treatment process. Congress’ use of this well- understood term from th e CWA has no other meaning in Congress’ instruction for EP A to establish the emission standards under § 112. Likewise, EPA’s regulatory definition of “treatment works” at 40 C.F.R. § 35.905 further reinforces the expansive meaning of the term under the CWA and just as clearly encompasses SSIs: Any devices and systems for the storage, treatment , recycling, and reclamation of municipal sewage, domestic sewage, or liquid industrial wastes used to implement section 201 of th e Act, or necessary to recycle or reuse water at the most economical cost over the useful life of the works. These include intercepting sewers, outfall sewers, sewage collection systems, individual systems, pumping, power, and other equipment and their appurtenances; extensions, improve ment, remodeling, additions, and alterations thereof; elements essential to provide a reliable recycled supply such as standby treatment units and clear well facilities; and any works , including site acquisition of the land th at will be an integral part of the treatment process or is used for ultim ate disposal of residues resulting from such treatment (including land for co mposting sludge, temporary storage of such compost, and land used for the st orage of treated waste water in land USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 8 of 369 treatment systems before land application); or any other method or system for preventing, abating, reducing , storing, treating , separating, or disposing of municipal waste or industrial waste , including waste in combined storm water and sanitary sewer systems. Id. (emphasis added). The § 112(e)(5) scheme placing SSIs u nder § 112 is consistent with the Congressional vision – expressed in § 405 of the CWA – for flexibility in regulating POTWs and their SSIs. See CWA § 405(e) (“[t]he determination of the manner of disposal or use of sludge is a local determination”). Section 405 of the CWA plays the primary role in regulating the use and disposal of sewage sludge generated at POTWs. EPA implements § 405 through comprehensive standards in 40 C.F.R. Part 503 that have been in place since the early 1990s, including riskbased standards regulating hazardous air pollutants from SSIs. When Congress decided to supplement that CWA program by using a technology-based approach under the CAA, it invoked the CWA to defi ne the POTW source category that EPA was to regulate under § 112. The le gislative history of § 112 shows that Congress was fully aware that emissions from POTWs were covered by the CWA and that Congress intended to supplement th at authority using § 112. For example, the Senate Report stated that [t]he Administrator is specifically directed to include publicly owned treatment works (as defined in the Cl ean Water Act) a nd [certain RCRA facilities] among the categories of major sources pursuant to this subsection. ... The Agency has also indicated th at air emission standards for POTWs USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 9 of 3610 may be promulgated under the Clean Wate r Act. There is no standard of protection of either human health or the environment from releases to air under that Act. It is more likely that appropriate standards would survive a legal test, if established pursuant to these new authorities of § 112 of the Clean Air Act. Sen. Rep. No. 100-231, Committee on En vironment and Public Works, 1990 CAA Legislative History, at 9436, 9668. There is no hint that Congress intended EPA to regulate an SSI differently from the rest of the POTW, much less through different authority under CAA § 129.
EPA’s own regulatory pronouncements a nd actions make clear the Agency’s understanding (prior to EPA’s departure in the SSI Rule) that SSIs are part of the POTW for purposes of the CWA and the CAA. First , EPA has long viewed SSIs as included within the CWA “treat ment works” definition through its implementation of the CWA Title II c onstruction grant program. EPA has consistently and repeatedly provided fe deral funding to build and upgrade SSIs through its Title II grant fund, under wh ich funding is specifically limited to “treatment works” as defined above. Ex amples include: (1) 10 SSIs owned by the Hampton Roads Sanitation District in so utheast Virginia (N. LeBlanc Decl. ¶ 4 [Ex. 3]), (2) seven SSIs owned by the No rtheast Ohio Regional Sewer District (“NEORSD”) (NEORSD Decl. ¶ 4 [Ex. 4]), and (3) one SSI owned by the City of Cedar Rapids, Iowa (P. Ball Decl. ¶ 4 [Ex. 5] ). Indeed, it may we ll be the case that many or all of the approximately 230 SSIs nationwide were constructed or USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 10 of 3611 upgraded with EPA’s Title II construction gr ants. This would have been contrary to the CWA – and EPA would have illegally approved the use of many millions of dollars in federal funds – if the Agency did not consider SSIs to be part of the “treatment works.”

Second , in numerous prior pronouncements over many years EPA has stated unequivocally that SSIs are part of the PO TW. For example, EP A has consistently held that sewage sludge mana gement, including incineration, is an inherent part of POTW operations for which CWA Title II funding was made available, and this position is also reflected in the Part 503 pr ogram. EPA has stated in the context of the Part 503 program that: “Treatment wo rks treating domestic sewage, as noted above, include facilities dedicated to the di sposal of sewage sludge (i.e., surface disposal sites and incinerators ).” 58 Fed. Reg. 9248 , 9359 (Feb. 19, 1993) (App. A) (emphasis added); see also 40 C.F.R. § 122.2 (treatment is expressly defined to include sewage sludge treatment systems).

Third , EPA has previously classified SSIs as Congress intended under CAA § 112, by identifying SSIs as an area source category under CAA § 112. In 1992, when EPA issued the initial list of majo r and area source categories under § 112, the Agency examined th e categorization of SSIs under the CAA. See 57 Fed. Reg. 31576 (July 16, 1992) (App. B) . That initial list of source categories included SSIs as a § 112 source category. In the related Federal Register notice, EPA expressly USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 11 of 3612 states that “the Agency does not consider sewage sludge incineration units to be covered under § 129 so it has authority to list and set standards for these units under § 112.” See also 58 Fed. Reg. 9248, 9262, 9276- 77 (Feb. 19, 1993) (noting that SSIs are regulated under § 112 of the CAA) (App. C). In 1999, EPA promulgated a NESHAP under § 112 for POTW treatment plants. See 64 Fed. Reg. 57572 (Oct. 26, 1999). Significantly, although the definition of “POTW treatment plant” is appropriately focused on the wastewater treatment part of a POTW, th e definition of POTW in th at rule is much broader and encompasses everything that is eligib le to receive grant assistance under Title II of the CWA. See 40 C.F.R. § 63.1595. Although EPA’s rulemaking preamble inexplicably stated that EPA then belie ved that SSIs were subject to regulation under CAA § 129, EPA nowhere elaborated on the rationale for this change from its prior approach or justified this ne w interpretation of the statute. See 62 Fed. Reg. 1868 (Jan. 14, 1997). In fact, shortly after EPA promulgated the POTW NESHAP, EPA reversed its position and expressly stated that SSIs would be regulated under § 112 instead of § 129. See Unified Agenda 65 Fed. Reg. 23460 (Apr. 24, 2000) (App. D). Then, in Febr uary 2002, EPA acted on this by revising its list of source categories under § 112 to delete SSIs, not because they were not covered by § 112, but because there were no major sources in that category. See 67 Fed. Reg. 6521 (Feb. 12, 2002) (App. E). EPA then added SSIs to the list of USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 12 of 3613 area ( i.e. , non-major) source categories under §§ 112(c) and 112(k) of the CAA.
See 67 Fed. Reg. 43112 (Jun. 26, 2002) (App. F); 67 Fe d. Reg. 70427 (Nov. 22, 2002) (App. G). These actions are entirely consistent with EPA’s earlier view that SSIs are subject to regulation under § 112 of the CAA; and they are inconsistent with EPA’s new view in the SSI Rule that SSIs are subject to regulation under § 129 – for example, there is no major s ource/area source distinction for sources subject to § 129, so basing these listing and delisting decisions on this distinction is incongruous with the Agency’s current vi ew that SSIs are subject to § 129.

2. SSIs Are Not “Solid Waste Incin eration Units” and Therefore Cannot Be Regulated Under § 129 of the CAA. Notwithstanding the clear language of § 112(e)(5) and evidence that Congress intends SSIs to be regulated as part of POTWs, EPA’s preamble to the SSI Rule responded to commenters’ arguments in conclusory fashion, stating that it “has taken the position in its regulati on of POTW under the Clean Air Act that § 112(e)(5) does not apply to SSI units and for this reason did not regulate them in its POTW § 112(d) emission standards. ” 75 Fed. Reg. 63264 (Oct. 14, 2000). EPA nowhere justifies how it reaches the conclusion that SSIs are not covered by the expansive CWA definition of “treat ment works” incorporated into CAA § 112(e)(5), how its position is reasonable in light of the integral role SSIs play in the management of sewage sludge, or how SSIs could have been built and USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 13 of 3614 improved using CWA Title II funds if they are not part of the CWA definition of “treatment works.” The reason for these failures is apparent: There is no justification for EPA’s position. The plain meaning of Congress’ invocation in § 112(e)(5) of the CWA definition of POTW, coupled with EP A’s many regulatory pronouncements and actions, makes EPA’s current position on §§ 112 (e)(5) and 129 clearly contrary to the text of the CAA and arbitrary and capricious. Section 112(e)(5) specifically compels regulation of POTWs under § 112 (d), and nothing in the language of § 129 suggests that SSIs are not to be treated as part of the POTW to be regulated under § 112. The legislative history of § 129 is also silent as to SSIs. SSIs also cannot be regulated under § 12 9 because they do not fit within the definition of “solid waste incineration unit” under § 129(g) (1). Per § 129(a)(1)(A) and (b)(1), EPA must set emission standa rds “for each category of solid waste incineration units.” Section 129(b) commands EPA to establish emission guidelines for existing solid waste incinera tion units. Thus, the definition of solid waste incineration unit serves a gate-keepi ng function – if the unit at issue is a solid waste incineration unit, then it is subject to standards under § 129. Section 129(g)(1) defines the term solid waste inci neration unit as “a distinct operating unit of any facility which combusts any so lid waste material from commercial or industrial establishments or the general public (including single and multiple USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 14 of 3615 residences, hotels, and motels).” 3 By contrast, sewage sludge is generated in the POTW from the treatment of wastewater afte r several stages of filtering, chemical and physical treatment, and dewatering. Thus, the sewage sludge combusted in SSIs is generated within the POTW itself, a local government-owned facility, and so is not a solid waste material collected “from commercial and industrial establishments or the general public” as defined under § 129(g)(1). EPA has itself long acknowledged that sewage sludge is generated in the POTW and also concluded that these sludges are not solid waste. See, e.g. , 55 Fed. Reg. 46354, 46364 (Nov. 2, 1990) (sludge s generated in the POTW are covered under the domestic sewage exclusion) (App. H). 4 Instead of addressing these central i ssues of statutory interpretation on the merits, EPA incorrectly clai ms that this Court’s deci sion in Natural Res. Def. Council v. EPA , 489 F.3d 1250 (D.C. Cir. 2007) (“NRDC ”), “precludes” EPA from regulating SSIs under § 112 and that promulgation of the SSI Rule is

3 The section goes on to crea te exceptions for certain type s of units used for metals recovery, energy production and dispos al of wood and yard wastes. 4 NACWA also contends in its separate ch allenge to EPA’s rule that defines NonHazardous Secondary Materials That Are Solid Waste, 76 Fed. Reg. 15456 (Mar. 21, 2011) (“NHSM”), that sewage sludge is excluded from “solid waste” under the RCRA domestic sewage exclusion (42 U.S .C. § 6903(27)), and thus SSIs cannot be solid waste incineration units for this r eason as well. However, the reasons that SSIs do not fall under § 129 as set forth in this motion are independent of EPA’s NHSM rule. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 15 of 3616 necessary in order “to comply with the Clean Air Act and the court decision in NRDC v. EPA.” 76 Fed. Reg. 15383. Based on this view that NRDC is controlling, EPA discounts all of its ear lier pronouncements regarding regulation of SSIs under § 112 as nullified by the NRDC decision. Id. However, EPA’s reliance on the NRDC case is clearly erroneous. The
NRDC decision invalidated EPA’s attempt to carve out new exceptions from the definition of “solid waste incineration units” based on energy recovery and other criteria that have nothing to do with SSIs . Thus, the decision has no bearing on the proper regulation of SSIs. The panel in th at case did not address or rule on the proper application of § 112(e)(5), nor did it address or rule on the regulation of POTWs or SSIs or the issue of whether SSIs must be regulated as part of POTWs under § 112(d). 5 NRDC cannot “preclude” EPA from performing its fundamental obligation to interpret and apply th e CAA properly in regulating SSIs. Even if EPA had independently deci ded that SSIs can be covered by the general definition of a solid waste incine ration unit, instead of justifying the SSI

5 EPA’s preamble accurate ly claims that the NRDC decision rejected EPA’s claim of discretion to “create” additional ex emptions from regulation under § 129, beyond those already contained in § 129(g). See 76 Fed. Reg. 15383. But this argument is not at all pertinent to EPA’s obligation to honor the scheme created by Congress for SSIs under § 112(e)(5). Indeed, if anything in the spirit of the NRDC decision is important here, it is this C ourt’s admonition to EPA to apply the CAA as written. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 16 of 3617 Rule on an incorrect reading of NRDC , such an interpretation is not supportable for the reasons discussed above. Further, it is axiomatic that the specific direction of Congress contained in § 112(e)(5) is c ontrolling over the general provisions of § 129 dealing with solid waste incinerati on. “However inclusive may be the general language of a statute, it will not be held to apply to a matter specifically dealt with in another part of the same en actment.” Fourco Glass Co. v. Transmirra Prods. Corp. , 353 U.S. 222, 228 (1957). CAA § 112(e)(5) unambiguously directs EPA to set emission standards for SSIs under CAA § 112(d), and this sec tion does not contain language permitting EPA discretion to regulate SSIs under § 129. Although Congress under § 112(d)(1) allows EPA to promulgate differing standards for major and area sources at POTWs and for differing cate gories and subcategories of sources at POTWs, the Agency does not have aut hority to set standards under § 129 for POTWs or parts of POTWs, including SSIs. Indeed, EPA has previously held the very same interpretation of the proper wa y to regulate SSI. EPA can change its mind on policy issues if the Agency develops a reasoned analysis to support the change, Motor Vehicle Mfrs. Ass’n v. State Farm Mut. , 463 U.S. 29 (1983); however, it cannot act contrary to a stat utory directive that compels a singular outcome, as the CAA does here. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 17 of 3618 However, even if Congress had le ft some room in § 112(e)(5) for interpretation on the issue, EPA’s current position fails under Chevron ’s “step two” analysis. EPA’s position that it is compelled to regulate SSIs under § 129 is not an expression of the Agency’s inte rpretation of the CAA, but rather an (incorrect) reading of this Court’s decision in NRDC . Therefore, EPA’s position is not entitled to any administra tive deference under Chevron . EPA’s rationale for using § 129 is grounded in and so ta inted by its incorrect reading of NRDC that the Agency has essentially abdicated its role in interpreting the C AA. The Agency’s reading of the NRDC decision does not bring to bear any special technical expertise, Agency political account ability or Congressi onally delegated policymaking that justify judi cial deference under Chevron

. Finally, for the several reasons di scussed above, EPA’s position is so fundamentally at odds with the inclusiv e definition of “treatment works” under Title II of the CWA and EPA’s consistent interpretation of the term as including SSIs that it cannot be a permissible reading of the use of the same term within the context of § 112(e)(5).

B. The SSI Rule Emission Standards are Based Upon Data from an Impermissibly Small Number of Sources, and EPA Failed to Use Representative Data to Set the Standards. Assuming arguendo that SSIs may be regulated under CAA § 129, the standards EPA has created are unlawful beca use (1) the database EPA used to set USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 18 of 3619 the maximum achievable control tec hnology (“MACT”) floors does not contain data from the statutorily mandated number of SSIs, and (2) EPA failed to consider and use available data showing the i nherent variability of sewage sludge combusted in the best performing SSIs.

1. EPA’s SSI Database Is Inadequate. In performing MACT floor calculations, § 129(a)(2) provides that the floor for existing sources cannot be less stringen t than “the average emission limitation achieved by the best perform ing 12 percent of units in the category.” Unlike the MACT floor calculation provision in § 112(d), § 129(a)(2) does not permit the Agency to use a smaller number of sources in the calculation where data from the best performing 12 percent are not available. The SSI Rule contains two subcategories of sources – fluidized bed incinerators (“FBIs”) and multiple hearth incinerators (“MHIs”) – based on the design of the incinerator technology. Be cause EPA identified 60 existing FBIs and 144 existing MHIs, § 129(a)(2) requires the Agency to derive the floor based on data from eight FBIs and 18 MHIs. See “Revised MACT Floor Analysis for the Sewage Sludge Incinerato r Source Category,” EPA Do cket No. EPA-HQ-OAR2009-0559-01571 (Jan. 2011) (“Revised MACT Floor Memo”) at 6 (App. I). Instead, EPA set the MACT floor standards for FBIs based on data from as few as four (6.7 percent) and no more than six (10 percent) of the 60 FBIs identified by USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 19 of 3620 EPA. EPA set the floors for MHIs based on data from less than 4 percent of the 144 units in that subcategory. 6 By EPA’s own admission, § 129 does not permit the Agency to stop short of collecting sufficient emissions informati on from the required number of SSIs. As EPA acknowledges: While Congress adopted identical la nguage describing the MACT floor calculation in section 129(a)(2) as it did in section 112(d)(3), the latter section includes a provision stating that the floor for existing sources cannot be less stringent than “the average emission limitation achieved by the best performing 12 percent of the existing sources (for which the Administrator has emissions information)[.]” Secti on 129, however, simply states that the existing source floor cannot be less st ringent than the average emission limitation achieved by the best performi ng 12 percent of the existing sources in the category. Therefore, while EPA believes Congress intended for the MACT floor calculation under each se ction of the Act to be the same, this difference in the text of the two provisions requires us to establish the MACT floor for section 129 source categories based on the best performing 12 percent of sources in the category. Because EPA does not have that data at this time, the statistical technique described below is the only manner in which we can es tablish the existing source floor on that basis. See Revised MACT Floor Memo at 8 (empha sis added). Statistical manipulations of an undersized database do not meet the mandate of § 129(a)(2) to base the emission standards on 12 percent of “units” in the category.

6 EPA’s SSI count also appears erroneous . Commenters pointed out that a 2009 survey counted 234 active SSIs. EPA did not confirm its initial inventory of SSIs. The consequence of undercounting 30 SSI s means that EPA’s MACT floor database is an additional four SSIs short of the statutory minimum. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 20 of 3621 Furthermore, this is not a case wher e EPA tried and failed to collect the requisite data. From the out set, EPA consciously decided not to obtain data from the required minimum number of SSIs. By limiting its information collection to only nine of the roughly 118 POTWs with SSIs , EPA circumvented the Paperwork Reduction Act, 44 U.S.C. § 3501, and Offi ce of Management and Budget review and thereby gained several weeks under its District Cour t scheduling order. See P. Tsirigotis Decl. ¶ 43, Ex. 6 to Enclos ure A of NACWA Petition (Ex. 1). By cutting corners, EPA guaranteed that it woul d not collect adequate emissions data from the requisite number of SSIs. Even after collecting additional data from state agencies (after proposal), EPA had data fr om only six FBIs and some of those units were not tested for all of the CAA § 129 po llutants. The MHI database also lacked data from 12 percent of the MHI units fo r seven of the nine pollutants to be regulated. Thus, even assuming the improba ble – that all of the data EPA collected came from the top performing 12 percent of units within the subcategory – EPA’s database still falls far short of genera ting the minimum emissions information necessary to set the MACT floors.

2. EPA Failed to Use Other Ava ilable Data Demonstrating Significant Variability in Emission Characteristics Among POTWs and Within a POTW Over Time. EPA’s rush through rulemaking also re sulted in the Agency disregarding data provided by NACWA and other commenters that w ould have helped fill some USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 21 of 3622 of these data gaps if the Agency had take n the time to evaluate the data and made reasonable requests for sup porting information. EPA had data – particularly data show ing the concentration of metals and other pollutants in sludge combusted in SSIs for all POTWs under the Part 503 regulations – available to it prior to pu blishing the proposed SSI rule. Because these data show the high variability of emissions of these pollutants from SSIs, commenters urged EPA to use the data to determine the emi ssion rates achieved by the best performing sources under the full range of operating c onditions. However, perhaps pressed for time under the District Court’s scheduling order, EPA ignored these data and ended up re lying on the original 17 stack tests from the nine informational collection request POTWs. As emphasized in the comments, these data do not represent the emission profiles of the large population of SSIs – or even the profiles of the tested units themselv es over time – because they do not account for geographic variability in sludge ch aracteristics among POTWs nor do they account for seasonal and daily variability of sludge characteristics within a POTW. EPA explained its refusal to use th e data in its files and submitted by commenters by claiming that it “did not receive adequate sampling data from the best performing sources” and, thus, concluded that “there is not enough information to determine whether it would be appropriate to incorporate variability in sludge feed into the rule.” 76 Fed. Reg. 15391. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 22 of 3623 This claim is patently untrue and high lights the Agency’s refusal to abide by the CAA’s substantive mandates and rule making procedures. EPA had available to it years of sludge metals concentrati on data from all of the POTWs it contends are the best performing sources, from as re cently as late 2010 and dating back to the early 1990s. Under the Part 503 regula tions, all POTWs are required to collect and submit these data directly to EPA or to the state permitting authorities in some states that have assumed primacy for th e Part 503 program. There is no indication in the preamble or the rulemaking docket th at EPA tried to retrieve these data from its files or contacted a single commenter to obtain new copies of the data. 7
As with the Part 503 data, EPA also re fused to consider stack test data submitted by commenters who provided test results demonstrating that the proposed emission limits were not supporte d by sound data. EPA did not use these data simply because commenters did not in clude a complete stack test report in their comment submission. Id. at 15387. Again, there is nothing in the record to suggest that EPA tried to obtain the back up report information so EPA could verify the data that was submitted. Moreover, some of the nine POTWs targeted by

7 NACWA’s Petition (Ex. 1) requested that EPA revisit its failure to consider the Part 503 and other data. NACWA incl uded with its Petition a summary and analysis of monthly Part 503 data from Ja nuary 2005 to as late as December 2010 from 25 POTWs using SSIs, including 15 POTWs operating SSIs that EPA considers to be among the best performing units. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 23 of 3624 EPA’s information collection request submitt ed their stack test results using EPA’s electronic reporting system, and thus never submitted their stack test reports. Yet EPA relies upon these test data – and only these test data – wi thout independently reviewing the test reports to verify the accu racy of the information submitted. It is clearly arbitrary for the Agency to use only the data it wants and to disregard contrasting information by selectively a pplying more stringent data validation requirements.

EPA’s failure to use the Part 503 data and test da ta submitted by commenters is a violation not only of the database requirements established by § 129 for making MACT floor determina tions, as acknowledged by EPA, but also of the fundamental requirement underlying § 129 for rational decisionmaking. See CAA § 307(d)(9), 42 U.S.C. § 7607(d)(9); Cement Kiln Recycling Coal. v. EPA , 255 F.3d 855, 861-62 (D.C. Cir. 2001). See generally NRDC v. EPA , 194 F.3d 130, 136 (D.C. Cir. 1999).

IV. ABSENT A STAY, THE SSI RU LE WILL CAUSE SUBSTANTIAL AND IRREPARABLE HARM TO THE MUNICIPALITIES WHO RELY UPON INCINERATION AS AN ESSENTIAL PUBLIC SERVICE. A stay is necessary to ensure a complete correction of the legal defects in the SSI rulemaking and to avoid the potentia l for irreversible impacts to the environment and on the municipalities that rely upon sewage sl udge incineration. USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 24 of 3625 First , there is a substantial risk that the SSI Rule will result in significant environmental harm. Becaus e several of the emission limitations in the SSI Rule are so stringent, and EPA has so far failed to account for the inherent variability of sludge characteristics, some municipalitie s – even those that operate SSIs EPA deemed to be among the “best performers” – predict that no viable control technologies exist that will allow them to operate in compliance with the rule. See N. LeBlanc Decl. ¶¶ 5-6 (NOx control technologies never demonstrated for SSIs) (Ex. 3); P. Ball Decl. ¶ 7 ( no reliable method for contro lling mercury) (Ex. 5); R. Lyons Decl. ¶ 6 (activated carbon absorption not shown to work on SSIs) (Ex. 6). Municipalities also predict that they do not have the physical space and other necessary facilities to retrofit their SSIs to comply with the new standards. See N. LeBlanc Decl. ¶ 7 (Ex. 3); P. Ball Decl. ¶ 7 (Ex. 5). Municipalities are already being forced to make immediate commitments either to go down the uncertain path of retrofitting their SSIs or abandon incineration and start the conversion to la ndfilling. For example, New York State regulators set June 30, 2011 as the date by which POTWs were to certify whether they will retrofit their SSIs to comply wi th the SSI Rule or commit to permanently shut down their SSIs by March 21, 2012 . See Supplement to Petition (Ex. 2); R. Lyons Decl. ¶ 9 (Ex. 6). The Commonw ealth of Virginia is likewise moving quickly to implement the SSI Rule, which is forcing the Hampton Roads Sanitation USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 25 of 3626 District to make a decision on shutting down four of its SSIs. See N. LeBlanc Decl. ¶ 8 (loss of these SSIs “will potentially result in greater landfilling burdens and increased costs” and also increase po llution from truck tailpipe emissions and from landfill emissions) (Ex. 3). Making such significant changes to sludge management at a POTW takes many months to implement, so the point of no return is now for these local governments. There is no prospect of a ruling on the merits in these cases before these and ma ny other POTWs are forced to make that decision. The SSI Rule is also having an immedi ate chilling effect on environmentally beneficial projects. For example, Alba ny predicts that the SSI Rule will cause it and other POTWs to avoid undertaking en ergy recovery and other beneficial projects because the projects may trigge r expensive and possibly unachievable regulation. See R. Lyons Decl. ¶¶ 5-7 (Ex. 6). The City of Cedar Rapids is evaluating replacing its flood damaged olde r MHI with a new FBI, but the timing of the effective date of the SSI Rule may postpone or eliminate such an environmentally beneficial upgrade. See P. Ball Decl. ¶ 5. The environmental impacts of sw itching away from incineration are practically irreversible and are magnified precisely because landfilling is not an environmentally or economically attractiv e option for those communities who rely on incineration. Communities that are for ced to switch are extremely unlikely to USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 26 of 3627 switch back if EPA later promulgates a de fensible SSI rule beca use they will have eliminated their incineration systems a nd invested millions in new treatment equipment, sludge storage, and truck loading facilities. See N. LeBlanc Decl. ¶ 9 (capital costs of $200 million and net pr esent value of total costs equals $546 million) (Ex. 3). EPA never gave weight to the enviro nmental impacts that would cascade from municipalities being forced to switch to landfilling. However, these impacts would be serious and many of them permanen t. Increased diesel exhaust emissions from literally thousands of new truck trips tr avelling, in some cases, more than 260 miles round trip to the nearest landfill will greatly exceed emissions from incineration. See NEORSD Decl. ¶ 12 (Ex. 4); P. Ball Decl. ¶ 8 (170 miles round trip to nearest landfill) (Ex. 5). Emi ssions from trucks and landfills are far more difficult and costly to monitor and contro l. Landfilling sludge increases methane emissions (a powerful greenhouse gas) from the decomposition of organic materials, which does not occur during in cineration. Landfilling also increases energy impacts due to increased consumption of fossil fuel for trucking, and other impacts to communities due to additional traffic congestion. Due to the combined effect of increased emissions from trucking and from landfill emissions, NEORSD estimates that the “carbon footprint” re sulting from the SSI Rule forcing a switch to landfilling would be more than 35,000 metric tons CO2 equivalent greater than USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 27 of 3628 their current energy recovery project . See NEORSD Decl. ¶¶ 12-13 (Ex. 4). Absent a stay, communities that are forced into landfilling woul d be irretrievably committed to less environmentally beneficial sewage sludge management options.

Second , absent a stay, EPA’s interpretati on of its standard-setting authority under the CAA will operate to cause additional irrepara ble and unjustifiable harm to municipalities who have no practical altern ative to incineration. Ironically, this harm will occur even if this Court ultimately agrees that the SSI Rule is legally flawed. When EPA publishe d the SSI Rule, it also published another set of CAA § 129 standards for commercial and indus trial solid waste incineration units (“CISWI”). See 76 Fed. Reg. 15704. In the pr eamble to the CISWI rule, EPA responded to comments on the so-calle d “MACT-on-MACT” issue – that is, whether EPA may lawfully include in newly promulgated MACT floor calculations the emission levels that incine rators were forced to achieve by virtue of unlawful predecessor MACT standards that this Court had remanded to EPA. In the CISWI preamble, EPA contended that it must use the MACT-on-MACT approach by virtue of the litera l language of CAA § 129. Id. at 15721-22. Although Movants contend that EPA’s le gal position is erroneous, that position nonetheless sets the stage for a potentially profound and irreversible impact on POTWs with SSIs

. If the SSI Rule is not stay ed, inevitably some POTWs will install new control technologies and equipmen t in an effort to comply with the SSI USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 28 of 3629 Rule. The effect will be to lower emissions to some degree and, thereby, to lower emission rates of SSIs selected as the be st performing units and used to set the future MACT floor. If ultimately the Cour t vacates and remands the SSI Rule back to EPA, then, according to EPA’s interpreta tion of § 129, the performance of these SSIs that installed new controls during the litigation will be part of the MACT floor database when it comes time to re-e stablish the MACT standards. The fact that these controls were a dded solely due to the previ ous unlawful standards is apparently irrelevant in the Agency’s view of § 129. To illustrate the magnitude of this harm , it is possible that new and modified units that were forced to install controls immediately upon startup in order to meet illegal new source standards could become the fa ctual predicate for setting the floors for existing sources in a future SSI rulemaki ng. There is an obvious irreversible impact arisin g from the ratcheting down of future MACT standards by virtue of a prior unlawful rulemaking. A stay avoids this harm by postponing the compliance date and thereby removing the i mmediate need to install new controls required by an illegal rule.

Third , and finally, a large number of municipalities will suffer significant economic harm unless a stay is granted, and there is no prospect of compensatory relief for the costs these communities an d their rate payers are incurring. Retrofitting SSIs with the necessary add-on c ontrol equipment is a costly and timeUSCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 29 of 3630 consuming process. Even by EPA’s own estimation, dozens of municipalities will be forced to start spending public funds and committing other scarce public resources to planning, engineering and procurement of additional building space, add-on control devices and other equipment in order to try to meet the present emission standards. New sources must comply with the SSI Rule upon startup. Existing sources may be subject to the rule as early as September 2013, depending upon when states adopt regulations implementing the rule . Depending upon how much an existing unit has spent in upgrading or improving its SSI prior to the effective date of the rule, the existing unit may be subject to the new source standards should it need to make additional improvements or change s in operation to the unit after the effective date. Municipalitie s, as governmental entities, face the added challenge of longer-term financial planning require ments and uncertain financing options as state and local budgets and jobs are cut in the current economic environment. See R. Lyons Decl. ¶ 9 (ramifications “ can be devastating”) (Ex. 6). Many municipalities have already been forced to incur irretrievable costs for planning and procurement activities in order to identify compliance gaps, to locate capital project funding sources, to acquire th e necessary engineering services and equipment, and to complete the majo r infrastructure and control equipment installations required for many SSIs. Thes e impacts have already started occurring USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 30 of 3631 and will increase in magnit ude without a stay. See NEORSD Decl. ¶ 15 (Ex. 4); R. Lyons Decl. ¶ 9 (Ex. 6).

V. A STAY WILL NOT H ARM ANY OTHER PARTY. There is no foreseeable prospect that others will be harmed by staying the SSI Rule. Emissions reducing regulations are already in place under the Part 503 program – and will continue to remain in place – that control emissions from SSIs in order to protect public health. Since 1993, SSIs have been subject to a comprehensive regulatory program for reducing the potential environmental ri sks of sewage sludge pursuant to CWA § 405 and EPA’s implementing regulations set forth in 40 C.F.R. Part 503. Section 405(d) of the CWA required EPA to esta blish numeric limits and management practices that protect public health and th e environment from the adverse effects of toxic pollutants in sewage sludge. S ection 405(e) prohibits any person from disposing of sewage sludge from a POTW or other treatment works treating domestic sewage through any use or dispos al practice for which regulations have been established pursuant to § 405, ex cept in compliance with the Part 503 regulations. In the Part 503 regulations, EPA has identified the pollutants in sewage sludge that may adversely affect public hea lth or the environment and has specified the management practices for the utilization and disposal of sewage sludge that are USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 31 of 3632 protective of public health and the enviro nment. For SSIs the Part 503 regulations require, among other things:

(1) risk-based emission limits for emissions of arsenic, cadmium, chromium, lead and nickel; (2) compliance with the CAA NESHAP for mercury and beryllium; (3) operational technology-based emission lim its for total hydrocarbons or an alternative emission limit for carbon monoxide; and (4) numerous management practices a nd monitoring, recordkeeping and reporting requirements. See 40 C.F.R. Part 503, Subpart E. The Part 503 emission limits and management practices were promulgated by EPA base d on studies of the potential risks to human health and the environment which could be posed by the incineration of sewage sludge. The regulation of SSIs und er the Part 503 regulations is through risk-based standards that were develope d by EPA to protect human health and the environment from any reasonably anticipated adverse effects from pollutants that may be present in sewage sludge. As a result, SSIs can clearly demonstrate that the emissions from their operations are not adversely impacting human health and the environment by demonstrating complian ce with the Part 503 requirements. Additionally, since 1975, EPA ha s imposed, pursuant to the CAA, NESHAPs for mercury and beryllium emissi ons that apply to certain SSIs. See 40 C.F.R. Part 61, Subparts E and C. Th e mercury NESHAP, wh ich applies to any source that incinerates sludges from wastew ater treatment plants, imposes emission USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 32 of 3633 limits for mercury, as well as stack testi ng, sampling and monitoring requirements. The beryllium NESHAP, which applies to any incinerator that processes beryllium-containing waste, imposes em ission limits for beryllium, as well as sampling requirements. These NESHAPs are expressly incorporated into the Part 503 requirements applicable to SSIs. Thus, emissions from SSIs are alrea dy regulated by other congressionallymandated, comprehensive regulations th at, in EPA’s view, are adequately protective of human health and the envi ronment. These regulations would be unaffected by stay of the SSI Rule. Theref ore, staying the SSI Rule during this litigation will not result in any harm to p ublic health or the environment. Although the emission standards in the SSI Rule are significantly more stringent than many of the Part 503 st andards, the SSI Rule standards are technology-based standards th at (are supposed to) reflect the emission performance achieved by the best performing units in each category or subcategory. EPA does

not base the SSI Rule on any finding or de monstration that additional control of emissions from SSI is necessary to protect public health. Nor could it, given that the Part 503 regulations already ensure such protection. Finally, EPA cannot seriously contend th at it (or any other party) would be harmed by a stay of demonstrably unlawful regulations that impose costly and, in some cases, unachievable requirements on municipalities which the Agency has no USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 33 of 3634 authority to regulate as it wishes under the CAA. To continue implementing the SSI Rule during this Court’s review woul d amount to administrative fiat, upsetting the more flexible regulatory scheme th at Congress mandated for SSIs under the
CWA.

VI. A STAY WILL ADVANCE THE PUBLIC INTEREST. A stay will serve the public intere st for at least two reasons. First , a stay will allow this appeal to proceed while maintaining the regulatory and economic status quo ante – i.e., the conditions existing prior to EPA’s adoption of unlawful requirements in the SSI Rule. See, e.g. , Cobell v. Kempthorne , 455 F.3d 301, 314 (D.C. Cir. 2006). The public interest is best served by preserving the viability of the essential public services that these POTWs provide and preventing wasteful use of taxpayer resources for less envir onmentally beneficial sewage sludge management alternatives.

Second , granting relief from immediate impl ementation of the rule will help preserve meaningful judicial review and ensure the Court’s power to fashion an appropriate remedy to unlawful agency action. A stay is “not simply ‘[a]n historic procedure for preserving rights during th e pendency of an appeal,’ but also a means of ensuring that appellate courts can responsibly fulfill their role in the judicial process.” Nken v. Holder , 129 S. Ct. 1749, 1757 (2009). USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 34 of 3635 CONCLUSION For the foregoing reasons, Movants respect fully request that the Court stay the effectiveness and implementation of th e SSI Rule until final resolution of their petitions for review befo re this Court.
Dated: September 9, 2011

Of counsel: Nathan Gardner-Andrews General Counsel N ATIONAL A SSOCIATION OF C LEAN W ATER A GENCIES 1816 Jefferson Place, NW Washington, DC 20036-2505 (202) 833-3692 ngardner-andrews@nacwa.org Respectfully submitted, /s/ Jeffrey A. Knight . Jeffrey A. Knight P ILLSBURY W INTHROP S HAW P ITTMAN LLP 2300 N Street, NW Washington, DC 20037-1128 (202) 663-9152 jeffrey.knight@pi llsburylaw.com USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 35 of 36CERTIFICATE OF SERVICE I hereby certify that on this 9th da y of September 2011 copies of the foregoing Emergency Joint Motion for Stay of the Sewage Sludge Incineration Rule were served electronically thr ough the Court’s CM/ECF system on all registered counsel. /s/ Jeffrey A. Knight . P ILLSBURY W INTHROP S HAW P ITTMAN LLP 2300 N Street, NW Washington, DC 20037-1128 (202) 663-9152 jeffrey.knight@pi llsburylaw.com USCA Case #11-1131 Document #1328708 Filed: 09/09/2011 Page 36 of 36