IN THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMIA CIRCUIT

)

)

)

)

)

)

)

AGENCY, ) U.S. ENVIRONMNTAL PROTECTION )

)

)

)

Petitioner,

AMRICAN PUBLIC GAS

ASSOCIATION,

v.

No. 09-1331

Respondent.

SETTLEMENT AGREEMENT

WHREAS the American Public Gas Association in No. 09-1331 (referred

to as "Petitioner") filed in the Court of Appeals for the D.C. Circuit a petition for

review captioned above that challenges the regulation titled "Mandatory Reporting

of Greenhouse Gases," 74 Fed. Reg. 56,260 (Oct. 30,2009) ("GHG Reporting

Rule"), which was promulgated under the Clean Air Act by the Environmental

Protection Agency ("EP A");

WHREAS No. 09-1331 has been consolidated with other petitions

challenging the GHG Reporting Rule, with No. 09-1325 designated as the lead

petition;

WHREAS EP A intends to undertake a rulemaking to make certain

amendments to portions of the GHG Reporting Rule that may resolve the concerns

raised by Petitioners in their petition for review;

WHREAS the EP A and American Public Gas Association (collectively the

"Parties") wish to implement this Settlement Agreement ("Agreement") to avoid

- i -
protracted and costly litigation and to preserve judicial resources;

NOW, THEREFORE, the Parties, intending to be bound by this Agreement,

hereby stipulate and agree as follows:

1. Promptly after execution of this Agreement, the Parties wil notify the

Court that they have reached a settlement, subject to required notice provisions

described in paragraph 7 below, and wil request that No. 09-1331 be severed from

lead No. 09-1325 and the other consolidated cases and be held in abeyance

pending finalization and completion of the terms of their settlement, with EP A to

file status reports on 120-day intervals.

2. EP A shall as expeditiously as practicable publish a notice of proposed

rulemaking on the issue of whether the GHG Reporting Rule should be amended

by the inclusion of proposed amendments ofthe same substance as set forth in

Attachment A to this Agreement.

3. If and when EP A promulgates in final form an amendment to the

GHG Reporting Rule that includes a change that is substantially the same

substance as set forth in Attachment A to this Agreement, then Petitioner shall

promptly file a stipulation of dismissal with prejudice of No. 09-1331 in

accordance with Rule 42 of the Federal Rules of Appellate Procedure, with each

part to bear its own costs and attorneys' fees. In addition, Petitioner shall not

challenge the validity of the portion of the final rule adopting such amendments of

substantially the same substance as set forth in Attachment A in any court or

administrative proceeding, and the right to raise such challenge is waived,

provided that Petitioner reserves any rights it may have to challenge in any court

- 2 -
or administrative proceeding any portion of such final rule that is not of "

substantially the same substance as set forth in Attachment A to this Agreement.

4. If and when EP A promulgates in final form an amendment to the

GHG Reporting Rule that includes a change that is substantially the same

substance as set forth in Attachment A to this Agreement, Petitioner's pending

administrative petition for reconsideration of the GHG Reporting Rule shall be

deemed withdrawn.

5. For purposes of this Agreement, EPA and Petitioner recognize that

the publication of new or modified regulations in the proposed or final rule that

address other matters or provisions than that set forth in Attachment A or that in

the proposed or final rule are otherwise substantially more detailed, extensive and

comprehensive than that set forth in Attachment A would not on that basis alone

cause the final changes referenced in paragraphs 2, 3 and 4 above not to be the

same substance or substantially the same substance as set forth in Attachment A.

6. IfEPA does not take action in accordance withthe terms of this

agreement then Petitioner's sole remedy under this Agreement regarding the rules

under review in these cases shall be the right to request that the Court lift the stay

of proceedings and establish a schedule for briefing and oral argument.

7. EP A and Petitioner agree and acknowledge that before this

Agreement is final, EP A must provide notice in the Federal Register and an

opportunity for comment pursuant to Clean Air Act section 113(g), 42 V.S.C. §

7413(g). EPA shall submit said notice of this Agreement to the Federal Register

for publication as expeditiously as possible. After this Agreement has undergone

- 3 -
an opportunity for notice and comment, the Administrator andlor the Attorney

General, as appropriate, shall promptly consider any such written comments in

determining whether to withdraw or withhold her consent to the Agreement, in

accordance with section 113(g) of the Clean Air Act. This Agreement shall

become final on the date that EP A provides written notice of such finality to

Petitioner.

8. Nothing in the terms of this Agreement shall be construed to limit or

modify the discretion accorded EP A by the Clean Air Act or by general principles

of administrative law.

9. Any obligations ofEPA to obligate or expend funds under this

Agreement are subject to the availability of appropriations in accordance with the

Anti-Deficiency Act, 31 U.S.C. § 1341. This Settlement Agreement shall not be

construed to require the United States to obligate or pay funds in contravention of

said Anti-Deficiency Act, 31 V.S.C. § 1341.

10. Except as provided in this Settlement Agreement, none of the parties

hereto waives or relinquishes any legal rights, claims or defenses it may have.

II

II

II

II

II

II

- 4 -
11. The undersigned representatives of each party certify that they are

fully authorized by the party that they represent to bind that respective party to the

terms of this Agreement.

IGNACIA S. MORENO

Assistant Attorney General

Environment and Nat. Resources Div.

DAVID J. KALAN

V.S. Department of Justice

Environmental Defense Section

PO Box 23986

Washington D.C. 20026-3986

(202) 514-0997

JOSHUA L. MENTER

WILLIAM THOMAS MILLER

Miler, Balis & O'Neil, PC

1015 15th Street, NW

Washington, DC 20005

Counsel for vnited States

Environmental Protection Agency

Counsel for

American Public Gas Association

Dated: Dated:

- 5 -
ATTACHMENT A

(B) Ml Local natural gas distribution companies that deliver 460,000 thousand

standard cubic feet or more of natural gas per year.

40 C.F.R. 98.2(a)(4)(iii)(B)