IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

) AMERICAN PETROLEUM INSTITUTE, ) )

Petitioner, ) )

v. ) Docket Nos. 94-1273, ) 94-1274, and 94-1276 U.S. ENVIRONMENTAL PROTECTION ) AGENCY and CAROL M. BROWNER, ) (consolidated cases) Administrator, U.S. Environmental ) Protection Agency ) ) Respondents. ) )

SETTLEMENT AGREEMENT BETWEEN THE INSTITUTE OF MAKERS OF EXPLOSIVES AND THE U.S. ENVIRONMENTAL PROTECTION AGENCY IN NO. 94-1276

This Set tlement Agreement is made this __th day of March, 1996, between the Unite d States Environmental Protection Agency (“EPA”) and the Institute of Makers of Explosive s (“IME”).

WHEREAS
, EPA issued a final rule entitled List of Regulated Substances a nd Thresholds for Accidental Release Prevention (59 Fed. Reg. 447), pursuant to section 112 (r) of the Clean Air Act, as amended, 42 U.S.C. § 7412 (r) (referred to hereafter as “CAA section 112(r)”);

WHEREAS
, IME filed a Petition fo r Review in the above-styled docket objecting to the inclusion of Division 1.1 explosives in the list of regulated substances;

WHEREA S
, EPA and IME desire to resolve this matter without resorting to furthe r litigation;

WHEREAS
, “Other Law”, as defined in Paragraph 2 below, requires nearly all facilities at which explosives are manufactured or stored to develop emergency response plans;

WHEREAS
, Other Law requires, for most facilities, that the owner or operator provide local emergency responders with copies of Material Safety Data Sheets (“MSDSs”), or lists of materials for which there are MSDSs (“Current MSDS Requirements”);- 2 -

WHEREAS
, fo r most facilities not subject to Current MSDS Requirements, Other Law requires that the owner or operator of such facilities advise local law enforcement, the fir e depa rtment, and the local emergency response committees regarding the type, quantity, an d location of Division 1.1 explosives on site;

WHEREAS
, IME acknowledges that the failure of a facility to undertake the actions set forth in Sections 3(a)-(c) below would be inconsistent with IME’s suggested safety practices;
NOW, THEREFORE , EPA and IME agree as follows:

1. Except as otherwise provided i n this Settlement Agreement, all terms herein shall be define d in accordance with the CAA and regulations promulgated under the authority of the CAA.

2. For pur

poses of this Settlement Agreement, “Other Law” shall mean obligations arisi ng under federal, state, and local laws and regulations other than CAA section 112 (r), and its implementing regulations.

3. IME member companies, at facilities that they own or control, shall:

a. Post at all normal access route s a sign which states “Danger. Never Fight E xplosive Fires. Explosives are stored on this site. Cal l (Emergency Phone Number.)";

b. Whe never a Division 1.1 commercial explosives storage or manufacturing location is established at a temporary job site, immediatel y notify Local Emergency Planning Committees and other local authorities, such as fire dep artments and local law enforcement agencies, of the type, quantity, and location of any Division 1.1 explosive at that new site;

c. At new or existing Division 1.1 commercial explosiv e storage or manufacturing locations (not including an y temporary job site) that are not already required by Othe r Law to prepare emergency response plans, and that hav e 50 00 pounds or more of Division 1.1 explosives on site a t any one time, prepare emergency response plans for suc h sites, notify Local Emergency Planning Committees an d other local authorities, such as fire depart ments and local law enforcem ent agencies, of the type, quantity, and location of Division 1.1 explosives at the s ite, and provide such plans to local emergency responders. Such facilities also shal l- 3 - res pond to reasonable requests for information about th e type, quantity, and location of a ny Division 1.1 explosive on site that may be made by those local authorities.

d. IME member comp anies shall inform their customers of the contents of this Settlement Agreement, including the actions to be taken pursuant to section 3(a)-(c) above.

4. Consistent with its Charter, By-Laws, long-standing pr actice, and Other Law, IME wi ll respond to reasonable requests from law enforcement agencies and emergency responders for information concerning the safe storage, distribution, and use of explosives.

5. IME will distribute to other non-IME commercial explosives manufacturers
, dist ributors and users of which it has knowledge, a letter informing such manufacturers
, distributors and users of the contents of this Settlement Agreement, including the actions to be taken pursuant to section 3(a)-(c) above.

6. The obli gations set forth in this Agreement shall not substitute for, or supersede, any obligation on the same subject matter that is imposed by Other Law.

7. EPA intends to conduct notice-and comment rulem aking in accordance with CAA section 307 (d) proposing that 40 C.F.R., section 68.130 be amended to remove Division 1. 1 explosives from the list of regulated substances under CAA sect ion 112(r) ( i.e. , “de-list” Division 1.1 explosives).

8. EPA will use its best efforts to sign a notice of proposed rulemaking on the issue described in Paragraph 7 , no later than nine (9) months after the “Approval Date,” as defined in Paragraph 11 of this Settlement Agreement. After considering any public comments received, EPA will us e its best efforts to sign a notice of final rulemaking on the issues described i n Paragraph 7, no later than eighteen (18) months after the Approval Date.

9. The parties may extend the dates set forth in Paragraph 8 , or otherwise modify this Settlement Agreement by written stipulation, executed by counsel for the parties.

10. The parties agree and acknowledge that final appr oval of this proposed Settlement Agreemen t is subject to the requirements of CAA section 113(g), 42 U.S.C. § 7413(g). Tha t subsection provides that notice of this prop osed agreement be given to the public, that the public shall have at l east thirty (30) days to make any comments, and that the Administrator or th e Attorney General, as appropriate, must consider those comments in deciding whether to consent to this Settlement Agreement.

11. The Administrator shall cause notice of this Settlement Agreement requestin g public comment t

hereon to be forwarded to the Federal Register for publication within 15 days- 4 -

of execution of this Settlement Agree ment by the parties. Within 30 days after the close of such public comme nt period, and after review of any public comments, the Administrator or th e Attorney General, or their delegees, as appropriate, shall determine whether to consent to thi s Settl ement Agreement. Unless such consent is withheld, the parties shall promptly thereafte r move the Court, based on this Settlement Agreement, to stay further pro ceedings before the Court until the Settlement Agreement is implemented as provided in Paragra phs 7 and 8, or until further motion to the Court. For purposes of this Settlement Agreement, the date the parties file th e finally-approved Settlement Agreement shall constitute the “Approval Date.”

12. Nothing in this Settlement Agreement shall be construed to limit or modify th e discretion accorded to the Administrator by the CAA or by general principles of administrative law. Nothing in this Settlemen t Agreement shall be construed to require EPA to obligate or pay funds or in any other way to take action in violation of the Anti-Deficiency Act or any othe r applicable appropriations law.

13. Nothing in this Settlement Agreement shall be c onstrued to limit or modify EPA’s disc retion to alter, amend, or revise the regulations identified in Paragraph 7 from time-to-time or to promulgate superseding regulations.

14. Nothing in this Settlement Agreement shall be construed to limit or modify th e applicability of CA A section 112(r)(1), 42 U.S.C. § 7412(r)(1), to any stationary source, as that term is defined in CAA section 112(r)(2).

15. In the even t that EPA takes final agency action de-listing explosives within th e time frames specified in Paragraph 8, IME and EPA shall promptly stipulate to the dismissal, with prejudice, of IME’s petition in Case No. 94-1276 in accordance with Rule 4 2 of the Federal Rules of Appella te Procedure. In addition, IME will not exercise whatever rights it may have to seek review of that final action pursuant to CAA section 307, or otherwise.

16. In the event EPA fails to perform its obligati ons under this Settlement Agreement, IME’s so le remedy (except as provided in Paragraph 17) shall be the right to reactivate thi s litigation. IME agrees to give EPA thirty (30) days’ notice prio r to exercising its rights under this Paragraph, unless sua sponte action by the Court effectively precludes such notice from being given.

17. If EPA’s final action under Paragraph 8 does not amend 40 C.F.R. part 68 to delist explosive s, IME may exercise whatever rights it may have to seek review of that final actio n pursuant to CAA section 307, or otherwise.

18. Except as expressly provided in this Settlement Agreement, none of the partie s waives or relinquishes any legal rights, claims, or defenses it may have. Each party will bear its

o w n costs and attorneys’ fees, including but not limited to any costs of monitoring compliance- 5 -

with t his Settlement Agreement and participating in the rulemaking contemplated by thi s Settlement Agreement.- 6 -

19. The undersigned representatives of each party certify tha t they are fully authorized by the party or parties they represent to bin d the respective parties to the terms of this Settlement Agreement, subject to the provisions of Paragraphs 11 and 12.

For the United States Environmental Protection Agency and Carol M. Browner , Administrator:

Date: ROBIN L. JUNI Environmental Defense Section Environmental and Natural Resources Division United States Department of Justice 10th Street & Pennsylvania Avenue, N.W. Washington, DC 20530 (202) 514-3676

Date: JONATHAN C. AVERBACK Office of General Counsel (2344) Environmental Protection Agency 401 M Street, S.W. Washington, DC 20460 (202) 260-7718

For the Institute of Makers of Explosives:

Date: JENNIFER M. PORTER Andrews & Kurth L.L.P. 1701 Pennsylvania Avenue, NW, Suite 200 Washington, DC 20006 (202) 662-2718- 7 - Date:

J. CHRISTOPHER RONAY President Institute of Makers of Explosives 1120 19th Street, N.W., Suite 310 (202) 429-9280