SETTLEMENT AGREEMENT

WHEREAS, the Portland Cement Association and other entities petitioned

for administrative reconsideration of the U.S. Environmental Protection Agency's

("EPA's") National Emissions Standards foN Hazardous AiN Pollutants From the

Portland Cement Manufacturing Industry, 75 Fed. Reg. 54970 (Sept. 9, 2010)

("NESHAP Rule"); and Standards of Performance for Portland Cement Plants, 75

Fed. Reg. 54970 (Sept. 9, 2010) ("NSPS Rule");

WHEREAS, on May 17, 2011, EPA granted in part and denied in part the

petitions for administrative reconsideration. See National Emission Standards for

Hazardous Air Pollutants From the Portland Cement Manufacturing

Indust~y...Denial in Past and Grant in PaNt of Petitions to Reconsider, 76 Fed.

Reg. 28,318 (May 17, 2011);

WHEREAS, the Portland Cement Association, Ash Grove Cement Co.,

CEMEX, Inc., Eagle Materials Inc., Holcim (US) Inc., Lafarge North America

Inc., Lafarge Midwest, Inc., and Lafarge Building Materials Inc., Riverside

Cement Company and TXI Operations, LP, and Lehigh Cement Company

(collectively, "PCA") also petitioned for judicial review of the NESHAP Rule, the

NSPS Rule, and the partial denial of reconsideration, in the U.S. Court of Appeals

for the District of Columbia Circuit. See Portland Cement Assn v. EPA, No. 10-

Page 1 of 11
1358 and consolidated cases (D.C. Cir.); Portland Cement Assn v. EPA, No. 10-

1359 and consolidated cases (D.C. Cir.) (collectively, the "Existing Litigation");

WHEREAS, on December 9, 2011, the U.S. Court of Appeals for the

District of Columbia Circuit issued an opinion in the Existing Litigation, which,

among other things, remanded to EPA for further consideration EPA's denial of

PCA's administrative petition to reconsider the NESHAP Rule;

WHEREAS, the deadline for filing petitions for rehearing or rehearing en

Banc is currently April 23, 2012;

WHEREAS, Holcim (US) Inc. petitioned for administrative reconsideration

of the particulate matter ("PM") standard in the NESHAP Rule and submitted new

data on PM emissions from cement kilns as measured using a continuous

emissions monitor. See Petition for Reconsideration and Stay Submitted by

Holcim (US) Inc. (Nov. 15, 2011);

WHEREAS, EPA has not yet proposed any amendments to the NESHAP

Rule and/or NSPS Rule based on: (i) the partial grant of the petitions for

administrative reconsideration; (ii) the remand from the D.C. Circuit; or (iii)

Holcim (US) Inc.'s petition for reconsideration;

WHEREAS, PCA and EPA (collectively, the "Parties") wish to enter this

Settlement Agreement ("Agreement") to avoid further litigation and to preserve

judicial resources;

Page 2 of 11
NOW THEREFORE, PCA and EPA, intending to be bound by this

Agreement, hereby stipulate and agree as follows:

By June 15, 2012, the EPA Administrator shall sign for publication in

the Federal Register a notice of proposed rulemaking (the "Notice") that at least

addresses (a) the issues upon which EPA granted reconsideration as identified in

76 Fed. Reg. 28,318, 28,325-26 (May 17, 2011); (b) the remand from the D.C.

Circuit on December 9, 2011; and (c) the Holcim (US) Inc. petition for

administrative reconsideration of the PM standard in the NESHAP Rule.

2. EPA further agrees that, in the Notice referenced in Paragraph 1 of

this Agreement, EPA will either (a) propose to reset the compliance timeframe for

existing sources subject to the portland cement NESHAP to at least September 9,

2015, if EPA determines that such an action is supported by the administrative

record at the time of proposal, or (b) in the event EPA does not propose a

compliance date extension to at least September 9, 2015 for existing sources,

solicit comment in the Notice on whether the existing source compliance deadlines

should be extended and make clear that the final rule may include such an

extension if justified.

3. By December 20, 2012, the EPA Administrator shall sign for

publication in the Federal Register a final action on the Notice referenced in

Paragraphs 1 and 2 of this Agreement, including (a) the issues upon which EPA

Page3of11
granted reconsideration on May 17, 2011; (b) the remand from the D.C. Circuit on

December 9, 2011; (c) the Holcim (US) Inc. petition for administrative

reconsideration of the PM standard in the NESHAP Rule; and (d) EPA's final

decision on whether to extend the compliance deadlines for existing sources.

4. By no later than the deadline for filing a petition for rehearing and

rehearing en Banc, the Parties agree to file a joint motion to hold the case in

abeyance pending completion of the actions identified in Paragraphs 1 through 3 of

this Agreement and subject to the termination provision of Paragraph 7.

5. If the above-referenced motion is granted by the Court on or before 5

p.m. on the deadline for filing a petition for rehearing and rehearing en Banc, PCA

agrees not to file any petitions for rehearing and rehearing en Banc except as

otherwise provided in this Agreement. If the motion is not granted by 5 p.m. on

the deadline for filing a petition for rehearing and rehearing en Banc, the Parties

recognize that PCA may file its petition for rehearing and rehearing en Banc. If

PCA files a petition for rehearing or rehearing en Banc, EPA may at its election

withdraw from this Agreement, and upon compliance with the notice provisions in

Paragraph 14 shall not be obligated to comply with any portion of this Agreement.

If EPA so elects, this Agreement is deemed terminated, and PCA shall be free to

withdraw any motion to hold the case in abeyance (if not yet granted), or to move

to lift the abeyance (if the motion has already been granted).

Page 4 of 11
6. Except as provided in Paragraph 7, if EPA complies with Paragraphs

through 3 of this Agreement, then the Parties will terminate the Existing

Litigation promptly after the final action required by Paragraph 3 is published in

the Federal Register. Specifically: (a) if the case remains in abeyance and no

petition for rehearing and rehearing en Banc is on file, the Parties shall jointly

move to terminate the abeyance, inform the Court that neither PCA nor EPA will

be seeking rehearing or rehearing en Banc, and ask the Court to issue the mandate;

(b) if the case remains in abeyance and a petition for rehearing or rehearing en

banc is on file, the Parties shall jointly move to terminate the abeyance, inform the

Court that PCA is withdrawing the petition for rehearing and rehearing en Banc,

and ask the Court to issue the mandate.

7. If EPA does not comply with any requirement of Paragraphs 1

through 3, or if the Notice required by Paragraph 1 does not propose to extend the

existing source compliance deadline to at least September 9, 2015, PCA may at its

election, move to terminate the abeyance and file, if not already filed and held in

abeyance, a petition for rehearing and rehearing en Banc. The Parties agree that

this Paragraph 7 constitutes PCA's sole remedy if EPA does not comply with any

requirement of Paragraphs 1 through 3 of this Agreement, and that contempt of

court is not an available remedy under this Agreement.

Page 5 of 11
8. The commitments by EPA in this Agreement are subject to the

availability of appropriated funds. No provision of this Agreement shall be

interpreted as or constitute a commitment or requirement that EPA obligate or pay

funds in contravention of the Anti-Deficiency Act, 31 U.S.C. § 1341, or any other

applicable federal statute.

9. Nothing in this Agreement shall be construed to limit or modify any

discretion EPA may have to alter, amend, or revise regulations promulgated

pursuant to this Agreement, from time to time, or to promulgate superseding

regulations.

10. Nothing in this Agreement shall be construed to limit or modify the

discretion accorded EPA by the Clean Air Act or by general principles of

administrative law, in taking the actions which are the subject of this Agreement.

EPA's obligation to perform the actions specified in Paragraphs 1 through 3 of this

Agreement, by the dates specified in those Paragraphs, does not constitute a

limitation or modification of EPA's discretion within the meaning of this

Paragraph.

11. The Parties agree and acknowledge that before this Agreement can be

finalized, EPA must provide notice in the Federal Register and an opportunity for

comment pursuant to Clean Air Act § 113 (g), 42 U.S.C. § 7413(g). EPA will

expeditiously prepare such notice and forward it to the Office of Federal Register

Page 6 of 11
within 15 days of execution of this Agreement by the Parties. Nothing in this

Paragraph should delay or defer the Parties' joint motion to hold the case in

abeyance, pursuant to Paragraph 4 of this Agreement. After this Agreement has

undergone an opportunity for notice and comment, the Administrator and/or the

Attorney General, as appropriate, shall promptly consider any such written

comments in determining whether to withdraw or withhold consent to this

Agreement, in accordance with section 113 (g) of the Clean Air Act. If the federal

government elects to withdraw or withhold consent to this Agreement, PCA shall

have the right to withdraw from this Agreement and file a request to lift the

abeyance requested by the Parties.

12. This Agreement may be modified by written stipulation signed by the

Parties.

13. Nothing in this Agreement shall be construed to limit any right that

PCA may have to seek review of any final action issued pursuant to Paragraph 3 of

this Agreement; nor shall this Agreement be construed to limit PCA from initiating

a claim under section 304(a) of the Clean Air Act to allege a failure of EPA to

perform nondiscretionary duty as set forth in the Act.

14. Any notices required or provided for by this Agreement shall be in

writing, effective upon receipt, and sent to the following:

For PCA: Andrew T. O'Hare

Vice President, Regulatory Affairs

Page 7 of 11
Portland Cement Association

500 New Jersey Avenue, 7th Floor

Washington, DC 20001

Office: (202) 408-9494

Fax: (202) 408-0877

e-mail: aohare@cement.org

For EPA: Steven Silverman, Attorney

Office of General Counsel

U.S. Environmental protection Agency

1200 Pennsylvania Ave., NW

Washington D.C. 20009

Office: (202) 564-5523

email: Silverman.Steven@epamail.epa.gov

Daniel Dertke, Trial Attorney

Environmental Defense Section

Environment and Natural Resources Division

P.O. Box 7611

Washington D.C. 20044

Attn: DJ # 90-5-2-3-18959

Office: (202) 514-0994

email: daniel.dertke@usdoj.gov

or such other person as either Party may subsequently identify in writing to the

other Party.

15. The undersigned representatives of each Party certify that they are

fully authorized by the Party they represent to consent to this Agreement and its

terms.

IGN IA S. MORENO ~

Ass sta t Attorney G 1

En iro me N tural eso r ivision

i

DATE:

DANIEL R. DERTKE

.Page 8 of 11


DATE: Y 1 ______ 

 6 / ( 

Beth S. Ginsberg 

Jason T. Morgan 

Stoel Rives LLP 

600 University Street, Suite 3600 

Seattle, WA 98101 

(206) 624-0900 

On behalf of Petitioner 

Ash Grove Cement Company 

i*iuc 

Ashley C. Parrish 

Cynthia A.M. Stroman 

KING & SPALDING LLP 

1700 Pennsylvania Avenue, N.W. 

Washington, D.C. 20006 

Telephone: (202) 737-0500 

Facsimile: (202) 626-3737 

Email: aparrish@kslaw.com 

On behalf of Petitioners 

Riverside Cement Company and 

TXI Operations, LP 

DATE: 

Chet M. Thompson 

CR0 WELL & MORING LLP 

1001 Pennsylvania Ave., N.W. 

Washington, DC 20004 

Telephone: (202) 624-2500 

Facsimile: (202) 628-5116 

On behalf of Petitioner 

CEMEX, Inc. 

Page 10 of 11