From: Kent A. Mason [mailto:kamason@davis-harman.com] 

Sent: Thursday, September 15, 2011 2:33 PM 

To: Cela, Phyllis J.;

Cc: 'Lynn Dudley'; dhowland@abcstaff.org; james.harshaw@GM.COM; 'Bella Sanevich'; 'Young, Mark D' 

Subject: Agency exemptive authority 

Thanks once again for an excellent meeting on August 30th. We found it very helpful and 

constructive. Our action item was to get back to you with authority for your ability to exempt 

ERISA plans from some or all of the business conduct standards that were intended to protect 

plans. 

 

The following cases illustrate that agencies have the inherent power to create exemptions where 

application of a requirement would not serve the purpose of the requirement. We believe these 

cases support the proposition that the CFTC/SEC have inherent power to exempt swap dealers 

(when they act as swap counterparties to certain special entities) from the requirement that SDs 

must have a reasonable basis to believe the SE has a "qualified representative." An exemption 

would be in order because applying this requirement would hurt, not protect, many special 

entities, including ERISA plans. ERISA plans are represented by fiduciaries that by law must 

be: (1) prudent experts and (2) independent of the SDs under ERISA. In effect, the CFTC and 

SEC have adequate authority to adopt a waiver or safe harbor that would allow an ERISA plan to 

say to its swap dealer counterparty -- "We have told you we are represented by an ERISAregulated fiduciary and you have no need to learn, we have no need to tell, and you have no need 

to ask, for any more information." 

 

In addition to the summaries provided below, we have attached copies of the cases for your 

reference. Note that we included the Alabama Power case, although it was decided against the 

agency, because it contains some instructive language on inherent exemptive authority (see 

bolded language) that has been cited by subsequent cases and its facts are distinguishable from 

our situation. 

 

State of Ohio v. EPA,997 F.2d 1520 (D.C. Cir. 1993)

 

Facts: Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) 

requires periodic review of Superfund sites at which "any hazardous substances" remain. EPA 

promulgated regulation requiring periodic review only of sites where hazardous substances 

remained at levels presenting some possibility of harm, thus exempting the sites at which de 

minimis amounts of hazardous substances remained. States challenged EPA's de minimis 

exemptions as being contrary to statute. 

 

Holding: EPA's exemption was valid. 

 

Rationale/key quotes: Court found that Congress had not set out its requirement for periodic 

review in rigid terms -- the statute's reference to "any hazardous substances" could easily be 

referring to "even one" hazardous substance as opposed to "any amount of any hazardous 
substance." Even if States were correct that statute's reference to "any hazardous substances" 

was unambiguous, "the literal meaning of a statute need not be followed where the precise 

terms lead to absurd or futile results, or where failure to allow a de minimis exemption is 

contrary to the primary legislative goal." States' literal reading would lead to such absurd or 

futile results: every Superfund site would be subject to five-year review because EPA cannot 

detect whether "true" zero has been obtained with respect to a particular hazardous substance. 

EPA's regulation, on the other hand, avoided this "mammoth monitoring burden" while serving 

the "health-protective purpose of the statute." Court concluded that to endorse the States' reading 

over the EPA's would be "to adjudge Congress incompetent to fashion a rational legislative 

design.” 

Environmental Defense Fund, Inc. v. EPA, 82 F.3d 451 (D.C. Cir. 1996)

Facts: Clean Air Act (CAA) prohibits any department, agency, or instrumentality of the federal 

government from engaging in "any activity" not in conformity with a state implementation plan 

(SIP) providing for the implementation, maintenance, and enforcement of national ambient air 

quality standards. CAA also directs the EPA to "promulgate criteria and procedures for 

determining conformity" under the statute. EPA promulgated regulations that required only 

"major" federal government activities to conform with SIPs, thereby exempting certain 

categories of government activities that produced trivial or no emissions increases. 

Environmentalist associations contended that EPA's de minimis exemptions were in conflict 

with the statutory conformity requirement for "any" federal government activity. EPA argued 

that statute could be read to require conformity of "any activity" that is likely to interfere with the 

attainment goals in a SIP -- i.e. major federal actions producing significant levels of emissions.

Holding: EPA's exemption was valid.

Rationale/key quotes: Court explained that it did not think that "Congress had taken a position 

so rigid that it will not admit of a de minimis exemption." EPA's interpretation of the "any 

activity" language as applying only to major federal activities (i.e. activities that could threaten a 

state's attainment goals in its SIP) was reasonable. The de minimis categories of federal action 

exempted by the EPA, by definition, could not threaten a state's attainment of goals in its SIP.

Brodsky v. U.S. Nuclear Regulatory Com'n, 2011 WL 797497 (S.D.N.Y March 4, 2011)

Facts: Atomic Energy Act requires United States Nuclear Regulatory Commission (NRC) to 

establish rules and regulations governing the operation of nuclear power plants. The statute does 

not prescribe how the NRC is to fashion such rules, but rather reposes broad discretion in the 

agency. NRC promulgated regulations creating a fire protection program and allowing for 

exemptions from the program upon application of an interested party or the NRC's own 

initiative. Exemptions would be granted where “the exemptions are authorized by law, will not 

present an undue risk to public health or safety, and are consistent with the common defense and 

security,” and where “special circumstances” are present -- for example, where application of the 

program's requirements would not serve the underlying purpose of the program or is not 

necessary to achieve the underlying purpose of the program. Pursuant to its regulations, NRC 

granted an exemption to the owner of a nuclear power plant from a fire protection program 

requirement that electrical cables be able to withstand fire for at least one hour. Citizens' group 
alleged that NRC lacked authority to create or issue exemptions to the NRC's fire protection 

program because the statute does not expressly authorize exemptions. NRC argued that 

legislative mandate to promulgate rules governing nuclear power plants also conferred authority 

to grant exemptions to the rules promulgated.

Holding: NRC's decision to issue exemption for nuclear power plant was valid.

Rationale/key quotes: Court distinguished case from Alabama Power (summarized below). 

Whereas EPA in Alabama Power had created a blanket exemption that was contrary to the 

express language in its governing statute, NRC had created a case-specific exemption from 

regulations that Congress had authorized it to promulgate. Court concluded that "the argument 

that the NRC is authorized to promulgate rules but does not have the ability to modify those rules 

on a case by case determination defies common sense. The NRC's authority to establish rules 

and regulations must go hand in hand with the agency's ability to grant exemptions on a 

case by case basis to those very same rules."

Alabama Power Co. v. Costle, 636 F.2d 323 (D.C. Cir. 1979)

Facts: Clean Air Act provides for exemption from air quality review for source modifications or 

expansions emitting less than 50 tons of air pollutants per year. Environmental Protection 

Agency (EPA) promulgated regulation that exempted new sources as well as modifications from 

best-available-control-technology review in addition to air quality review. Petitioners (Sierra 

Club and Environmental Defense Fund) contended that the statute did not allow for an 

Administratively-created exemption, and that even if statutorily permissible, the action was 

arbitrary and capricious. EPA characterized its exemption as an "expansion" of the statutory 

exemption that was justified because application to such sources of the full review and permit 

process would not be cost-effective and would strain the agency's resources to the limits. 

Holding: EPA's exemption was invalid. 

Rationale/key quotes: D.C. Circuit recognizes that "[u]nless Congress has been extraordinarily 

rigid, there is likely a basis for an implication of a de minimis authority to provide exemption 

when the burdens of regulation yield a gain of trivial or no value." EPA could not assert implicit 

de minimis authority to create a categorical exemption precisely because "Congress ha[d] been 

extraordinarily rigid" through setting forth a narrow statutory exemption; EPA's categorical 

exemption was contrary to the "explicit statutory design." Moreover, EPA had not shown that 

the burdens of regulation would yield a gain of trivial or no value. Because the conditions for 

exercising inherent de minimis exemptive authority were not met, EPA could not create a 

categorical exemption.

In explaining its holding, Court also said: "We noted at the outset that we are not concerned 

here with the 'equitable' discretion of agencies to afford case-by-case treatment taking into 

account circumstances peculiar to individual parties in the application of a general rule to 

particular cases, or even in appropriate cases to grant dispensation from the rule's 

operation. The need for such flexibility in appropriate cases is generally recognized, and 

enhances the effective operation of the administrative process, though Congress may, of 
course, restrain the agency by mandating standards from which no variance is permitted. In this 

case, however, we are presented with an attempt by an agency to promulgate a blanket 

exemption from statutory requirements."

Conclusion

In the case of ERISA plans, we believe that we fit squarely within the reasoning of the courts in 

Alabama Power and Brodsky. First, Congress was not "extraordinarily rigid" with respect 

to the business conduct standards. Where Congress explicitly delegates rulemaking to an agency 

instead of setting forth a clear self-executing rule, it is impossible to say that Congress has been 

"extraordinarily rigid." On the contrary, as in Brodsky, the explicit delegation of rulemaking 

authority logically confers exemptive authority. Second, we are not asking for a "blanket 

exemption." On the contrary, we are only asking for an exemption where another set of laws 

ensures that the purpose of the statute is completely fulfilled. Third, not only would application 

of the counterparty rule to ERISA plans yield no benefit (since ERISA provides comprehensive 

protections for plans), such application would actually harm plans in a material way.

Kent A. Mason 

Davis & Harman LLP

The Willard

1455 Pennsylvania Avenue, NW, Suite 1200

Washington, DC 20004

Main: 202-347-2230 Direct: 202-662-2288

Fax: 202-393-3310 kamason@davis-harman.com

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Date/Time of Request: Friday, September 2, 2011 19:33 Central

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Citation Text: 636 F.2d 323

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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

United States Court of Appeals,

District of Columbia Circuit.

ALABAMA POWER COMPANY, et al., Petitioners,FN*

FN* Consolidated with the following cases 

(identified by this Circuit's case number and petitioner), in all of which the Environmental Protection Agency is the respondent: No. 78-1008, 

American Petroleum Institute, et al.; No. 

78-1525, Part II, Environmental Defense Fund, 

Inc.; No. 78-1590, Part II, Hampton Roads 

Energy Company; No. 79-1591, Alabama Power 

Company, et al.; No. 78-1592, Alabama Power 

Company, et al.; No. 78-1595, American Petroleum Institute, et al.; No. 78-1596, American Petroleum Institute, et al.; No. 78-1610, Part II, The 

Montana Power Company, et al.; No. 78-1752, 

District of Columbia, a municipal corporation; 

No. 78-1801, National Coal Association; No. 

78-1802, National Coal Association; No. 

78-1805, Mining and Reclamation Council of 

America, Inc.; No. 78-1806, Mining and Reclamation Council of America, Inc.; No. 78-1807, 

The Montana Power Company, Pacific Power and 

Light Company, Portland General Electric 

Company, Puget Sound Power and Light Company, and Washington Water Power Company; 

No. 78-1810, Part II, The Pittston Company; No. 

78-1811, American Iron and Steel Institute; No. 

78-1815, Part II, American Paper Institute and the 

National Forest Products Association; No. 

78-1816, Ashland-Warren, Inc.; No. 78-1817, 

Ashland-Warren, Inc.; No. 78-1818, Manufacturing Chemists Association, Chemical Products 

Corporation, Dow Chemical Company, FMC 

Corporation, Monsanto Company, PPG Industries, Inc., Rohm and Haas Company, Stauffer 

Chemical Corporation, Union Carbide Corporation, and Allied Chemical Corporation; No. 

78-1819, Part II, Manufacturing Chemists Association, Chemical Products Corporation, Dow 

Chemical Company, FMC Corporation, Monsanto Company, PPG Industries, Inc., Rohm and 

Haas Company, Stauffer Chemical Company, 

Union Carbide Corporation, and Allied Chemical 

Corporation; No. 78-1821, Asarco Incorporated; 

No. 78-1822, American Mining Congress, United 

States Steel Corporation, Buttes Resources 

Company, Cyrus Mines Corporation, Energy 

Fuels Corporation, Freeport Exploration Company, ITT Resources, Inc., Johnsmanville Sales 

Corporation, The Montana Coal Council, Thermal Energy Inc., and Wyoming Mineral Corporation; No. 78-1823, Westmoreland Coal Company and Westmoreland Resources, Inc.; No. 

78-1824, Westmoreland Coal Company and 

Westmoreland Resources, Inc.; No. 78-1825, 

State of Texas; No. 78-1827, Mitchell Energy 

Co., a corporation; No. 78-1828, Cheyenne Refining Co., a corporation; No. 78-1829, Gary 

Western Co.; No. 78-1830, LA Jet, Inc., a corporation; No. 78-1832, Sierra Club; No. 78-1833, 

Reynolds Metals Company, Inc.; No. 78-1834, 

Colorado Interstate Gas Company, Tennessee 

Gas Pipeline Company, a division of Tenneco, 

Inc., and Natural Gas Pipeline Company of 

America; No. 78-1836, GATX Terminals Corporation, General American Transportation 

Corporation, and GATX Corporation; No. 

78-1837, Occidental Oil Shale, Inc. and Ashland 

Colorado, Inc.; No. 78-1838, Part II, Kroppers 

Company, Inc.; and No. 78-1839), Part II, USM 

Corporation.

v.

Douglas M. COSTLE, as Administrator, Environmental 

Protection Agency, et al., Respondents,*

Sierra Club, et al., Intervenors.*

No. 78-1006.

Argued April 20, 1979.

Decided Dec. 14, 1979.

As Amended April 21, 1980.

Petitions were filed seeking review of Environmental 

Protection Agency's final regulations embracing prevention of significant deterioration of air quality in “clean air 

areas,” which PSD regulations implemented Clean Air Act 

Amendments of 1977. Preliminary issues were decided by 

initial per curiam opinion, 196 U.S.App.D.C. 161, 606 

F.2d 1068. Subsequently, a three-part opinion was issued. 

In an opinion for the Court, Leventhal, Circuit Judge, held, 

among other things, that: (1) it was error to define “poten-
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

tial to emit” by discounting beneficial effect of air pollution control equipment designed into a facility; (2) EPA 

may exempt de minimis situations; and (3) authority other 

than PSD permit requirements permit resolution of problem of interstate pollution. In an opinion for the Court, 

Robinson, Circuit Judge held, among other things, that: (1) 

statutory method for establishing baseline concentrations 

was controlling; (2) modeling regulations would not be 

overturned; and (3) tall-stack policy, for purpose of PSD 

program, applies to nonbaseline emissions of nongrandfathered stacks. In an opinion for the Court, Wilkey, Circuit Judge, held, among other things, that: (1) NSPS definition of “source” applies to PSD provisions; (2) a “bubble 

concept” may be applied in determining a covered “increase”; and (3) visible emission standards may be considered by PSD permitting authority in applying BACT.

Affirmed in part and remanded in part.

Opinion by Circuit Judge Leventhal

West Headnotes

[1] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

In enacting provision of Clean Air Act Amendments 

of 1977 subjecting major emitting facilities to preconstruction review and permit requirements Congress' intention was to identify facilities which, due to their size, are 

financially able to bear the substantial regulatory costs 

imposed by the “PSD”, i. e., prevention of significant 

deterioration provisions, and which facilities, as a group, 

are primarily responsible for emission of the deleterious 

pollutants that befoul our nation's air. Clean Air Act, §§ 

165, 169, 169(1), 42 U.S.C.A. §§ 7475, 7479, 7479(1).

[2] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

In subjecting major emitting facilities to preconstruction review and permit requirements of Clean Air Act 

Amendments of 1977 the purpose of Congress was to 

require preconstruction review and a permit before major 

amounts of emissions were released into the air, and when 

determining a facility's potential to emit air pollutants, the 

Environmental Protection Agency must look to the facility's “design capacity,” a concept which not only includes a 

facility's maximum productive capacity but also takes into 

account the anticipated function of the air pollution control 

equipment designed into the facility. Clean Air Act, §§ 

165, 169, 169(1), 42 U.S.C.A. §§ 7475, 7479, 7479(1).

[3] Statutes 361 219(1)

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k213 Extrinsic Aids to Construction

361k219 Executive Construction

361k219(1) k. In General. Most Cited 

Cases

In general a court defers to the interpretations of a new 

statute by the agency that is charged with putting it into 

effect, meshing the wheels, and that presumably has some 

awareness of the approaches of legislators particularly 

concerned with the legislation.

[4] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

In implementing the “PSD” provisions of Clean Air 

Act Amendments of 1977 the Environmental Protection 

Agency erred in defining the “potential to emit” language 
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

in definition of a “major emitting facility” by discounting 

the beneficial effects of air pollution control equipment 

designed into a facility. Clean Air Act, §§ 165, 169, 

169(1), 42 U.S.C.A. §§ 7475, 7479, 7479(1).

[5] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

The Clean Air Act Amendments of 1977 do not give 

the Environmental Protection Agency a free hand to grant 

broad exemptions. Clean Air Act, §§ 101 et seq., 165(b), 

42 U.S.C.A. §§ 7401 et seq., 7475(b).

[6] Environmental Law 149E 292

149E Environmental Law

149EVI Air Pollution

149Ek289 Administrative Agencies and Proceedings

149Ek292 k. Notice and Comment. Most Cited 

Cases

(Formerly 199k25.6(8) Health and Environment)

Whether planned down time must, or may, be included 

in calculating the “potential to emit” threshold tonnage 

triggering preconstruction review and permit requirements 

of the “PSD” provisions of Clean Air Act Amendments of 

1977 is a matter for the notice and comment proceedings 

on proposed Environmental Protection Agency regulations 

addressing the point. Clean Air Act, §§ 165, 169, 169(1), 

42 U.S.C.A. §§ 7475, 7479, 7479(1).

[7] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Environmental Protection Agency's exemption allowing sources and modifications emitting under 50 tons 

per year of air pollutants to forego best available control 

technology and air quality assessment, i. e., expanding the 

statutory exemption from air quality review for modifications or expansions emitting less than 50 tons of pollutants 

per year, fell beyond the Agency's exemption authority 

under the PSD provisions of Clean Air Act Amendments 

of 1977. Clean Air Act, §§ 165, 165(b), 42 U.S.C.A. §§ 

7475, 7475(b).

[8] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

The exemption of modification or expansion of existing facilities from the air quality review provisions necessary to obtain approval of construction of a major 

emitting facility under PSD provisions of Clean Air Act 

Amendments of 1977 applies to major emitting facilities in 

class II areas which existed on August 7, 1977 and which 

became subject to permit requirements because of expansion or modification that, after application of best available

control technology, results in a net increase of less than 50 

tons a year in emission so long as they do not contribute to 

ambient air quality levels in excess of national secondary 

ambient air quality standards for sulphur dioxide and particulate matter. Clean Air Act, §§ 165, 165(b), 42 U.S.C.A. 

§§ 7475, 7475(b).

[9] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

Although Environmental Protection Agency regulations establishing March 19, 1978 as effective date of 

preconstruction review and permit requirements of PSD 

part of Clean Air Act Amendments of 1977 supplanted 

effective date specified in the Act, i. e., August 7, 1977, 

and although same statutory date, subject to change by 

Agency rule, was specified for exception for expansion or 

modification of existing facilities whose emissions would 

be less than 50 tons per year, absent rule making changing 
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

the latter effective date the Court of Appeals was constrained to apply literal terms of the statute. Clean Air Act, 

§§ 165, 165(a, b), 42 U.S.C.A. §§ 7475, 7475(a, b).

[10] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Protection Agency erred in construing 

phrase “whose allowable emissions,” as used in exception 

to air quality review necessary for preconstruction approval of a major emitting facility under PSD part of Clean 

Air Act Amendments of 1977 for an expansion or modification of an existing facility whose allowable emissions 

will be less than 50 tons per year, as referring to emissions 

from the major emitting facility, with agency applying 

exception to an existing major emitting facility that becomes subject to permit requirements due to an expansion 

or modification where allowable emissions from entire 

facility have been reducted, after best available control 

technology, to less than 50 tons per year. Clean Air Act, § 

165(b), 42 U.S.C.A. § 7475(b).

[11] Environmental Law 149E 698

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek694 Determination, Judgment, and Relief

149Ek698 k. Remand to Administrative Agency. 

Most Cited Cases

(Formerly 199k25.15(9), 199k25.15(6) Health and 

Environment)

Although since “major emitting facilities” subject to 

permit requirements of PSD part of Clean Air Act 

Amendments of 1977 are only those sources which after 

controls emit or have potential to emit at least 100 tons 

annually, standard doctrine taught that proper course for 

reviewing court was to remand to agency for further consideration on concluding that agency erred in defining 

“potential to emit” by discounting beneficial effects of air 

pollution control equipment, notwithstanding that dispute 

over Agency's 50 tons per year exemption had, in effect, 

become academic. Clean Air Act, § 165(a), 42 U.S.C.A. § 

7475(a).

[12] Administrative Law and Procedure 15A 303.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak303.1 k. In General. Most Cited Cases

(Formerly 15Ak303)

Administrative Law and Procedure 15A 749

15A Administrative Law and Procedure

15AV Judicial Review of Administrative Decisions

15AV(D) Scope of Review in General

15Ak749 k. Presumptions. Most Cited Cases

Certain limited grounds for the creation of exemptions 

are inherent in the administrative process and their unavailability under a statutory scheme should not be presumed, save in the face of the most unambiguous demonstration of congressional intent to foreclose them; however, there exists no general administrative power to create 

exemptions to statutory requirement based on the agency's 

perception of costs and benefits.

[13] Administrative Law and Procedure 15A 324

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak324 k. Discretion. Most Cited Cases

Constitutional Law 92 2407

92 Constitutional Law

92XX Separation of Powers

92XX(B) Legislative Powers and Functions

92XX(B)4 Delegation of Powers

92k2405 To Executive, in General

92k2407 k. Standards for Guidance. Most 

Cited Cases

(Formerly 92k62(2), 15Ak209)

Agencies have “equitable” discretion to afford 

case-by-case treatment, taking into account circumstances 

peculiar to individual parties in application of a general 

rule to particular cases, or even in appropriate cases to 
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

grant dispensation from the rule's operation; however, 

Congress may restrain the agency by mandating standards 

from which no variance is permitted.

[14] Statutes 361 235

361 Statutes

361VI Construction and Operation

361VI(B) Particular Classes of Statutes

361k235 k. Liberal or Strict Construction as 

Affected by Nature of Act in General. Most Cited Cases

Categorical exemptions from the clear commands of a 

regulatory statute, though sometimes permitted, are not 

favored.

[15] Administrative Law and Procedure 15A 303.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak303.1 k. In General. Most Cited Cases

(Formerly 15Ak303)

Broad principle that frowns on categorical administrative exemptions from command of a regulatory statute is 

strict, but is not absolute, and consideration of administrative necessity may be a basis for finding implied authority 

for an administrative approach not explicitly provided in 

the statute.

[16] Administrative Law and Procedure 15A 303.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak303.1 k. In General. Most Cited Cases

(Formerly 15Ak303)

The same consideration of administrative need to adjust to available resources underlying an administrative 

approach not explicitly provided for in the regulatory statute applies where the constraint is imposed not by a 

shortage of funds but, rather, by a shortage of time, or of 

the technical personnel needed to administer a program.

[17] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

To extent that Environmental Protection Agency, in 

granting a general exemption from preconstruction review 

and permit requirements of the PSD provisions of Clean 

Air Act Amendments of 1977 for stationary sources emitting less than 50 tons per year of any air pollutant relied on 

substitution of its own analysis of policy considerations for 

those enunciated by Congress, its action was to be rejected 

as trenching on the congressional function. Clean Air Act, 

§ 165(a), 42 U.S.C.A. § 7475(a).

[18] Administrative Law and Procedure 15A 389

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak389 k. Duty to Make. Most Cited Cases

Where an agency seeks approval of a prospective 

exemption of certain categories from the statutory command based on the agency's prediction of the difficulties of 

undertaking regulations, the agency's burden of justification is especially heavy as such is a different case from 

where the agency seeks relief from a charge which, after a 

good-faith effort, it has found it cannot perform.

[19] Administrative Law and Procedure 15A 385.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak385 Power to Make

15Ak385.1 k. In General. Most Cited Cases

(Formerly 15Ak385)

Before a court sanctions an agency's prospective exemption of certain categories from a statutory command 

based on prediction of difficulties of undertaking regulation a court is to carefully study the governing statute to 

ascertain whether it authorizes approaches that deviate 
Page 6

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

from the legislative mandate in response to concerns about 

feasibility.

[20] Administrative Law and Procedure 15A 389

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak389 k. Duty to Make. Most Cited Cases

Under doctrine of necessity, an agency may defer 

regulation in individual instances until the aggregation of 

those instances surpasses a reasonable threshold, and 

agency's burden of justification for such approach is substantially less than that required when the agency seeks to 

exempt rather than defer regulation.

[21] Administrative Law and Procedure 15A 303.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak303.1 k. In General. Most Cited Cases

(Formerly 15Ak303)

Categorical exemptions from scope of a regulatory 

statute may be permissible as an exercise of agency power, 

inherent in most statutory schemes, to overlook circumstances that in context may fairly be considered de minimis 

as the law does not concern itself with trifling matters.

[22] Administrative Law and Procedure 15A 305

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak305 k. Statutory Basis and Limitation. 

Most Cited Cases

Agency ability to exempt de minimis situation from a 

statutory command is not an ability to depart from the 

regulatory statute, but, rather, a tool to be used in implementing the legislative design.

[23] Statutes 361 184

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k180 Intention of Legislature

361k184 k. Policy and Purpose of Act. Most 

Cited Cases

Statutes 361 189

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k187 Meaning of Language

361k189 k. Literal and Grammatical Interpretation. Most Cited Cases

Notwithstanding the “plain meaning” of a statute, a 

court must look beyond the words to the purpose of the act 

where its literal terms lead to absurd or futile results.

[24] Administrative Law and Procedure 15A 303.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(A) In General

15Ak303 Powers in General

15Ak303.1 k. In General. Most Cited Cases

(Formerly 15Ak303)

Determination of when matters are truly de minimis 

will turn on the assessment of particular circumstances, 

and the agency bears the burden of making the required 

showing.

[25] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Protection Agency may exempt de 

minimis situations from statutory commands of the Clean 

Air Act. Clean Air Act, §§ 101 et seq., 165, 42 U.S.C.A. §§ 

7401 et seq., 7475.
Page 7

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

[26] Administrative Law and Procedure 15A 389

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak389 k. Duty to Make. Most Cited Cases

Although difference between what an agency must 

regulate and what it may exempt as de minimis is one of 

degree, the difference is an important one as unless Congress has been extraordinarily rigid there is likely basis for

an implication of de minimis authority to provide exemption when the burdens of regulation yield gain of trivial or 

no value while such implied authority is not available 

where the regulatory function provides benefits, in the 

sense of furthering the regulatory objective, but the agency 

concludes that the acknowledged benefits are exceeded by 

the costs and for such a situation any implied authority to 

make cost-benefit decisions must be based not on general 

doctrine but on a fair reading of the specific statute, its 

aims and legislative history.

[27] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

In provision of Clean Air Act Amendments of 1977 

exempting from air quality review provisions of the PSD 

preconstruction permit requirements any modifications or 

expansions of existing facilities involving increase of 

pollutants to less than 50 tons a year Congress has permitted a narrow exemption which provides no basis for 

Environmental Protection Agency to exercise a “revisory 

power” to exclude new sources as well as modifications or 

to extend the exemption to best available control technology review in addition to air quality review. Clean Air 

Act, § 165(a), (a)(4), (b), 42 U.S.C.A. § 7475(a), (a)(4), 

(b).

[28] Environmental Law 149E 276

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek276 k. In General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Fact that emission of mercury is not within the group 

of sources covered by national emission standards for 

hazardous air pollutants does not mean that mercury is not 

a pollutant subject to regulations under PSD provisions of 

Clean Air Act Amendments of 1977. Clean Air Act, §§ 101 

et seq., 165, 42 U.S.C.A. §§ 7401 et seq., 7475.

[29] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Apart from its limited de minimis exemption authority 

in applying the PSD part of Clean Air Act Amendments of 

1977 the Environmental Protection Agency has flexibility 

to consider costs and benefits in deciding what is “best 

available control terminology” for any situation. Clean Air 

Act, § 165(a)(4), 42 U.S.C.A. § 7475(a)(4).

[30] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Any administratively created 50-ton exemption from 

preconstruction review and permit requirements of PSD 

provisions of Clean Air Act Amendments of 1977 must 

take into account the fact that exemption authority is narrow in reach and tightly bounded by the need to show that 

the situation is genuinely de minimis or one of administrative necessity. Clean Air Act, § 165, 42 U.S.C.A. § 

7475.

[31] Environmental Law 149E 258

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards
Page 8

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

149Ek258 k. In General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Environmental Protection Agency has authority under 

the PSD part of Clean Air Act Amendments of 1977 to 

prevent or to correct a violation of the increments, but the 

agency is without authority to dictate to the states their 

policy for management of the consumption of allowable 

increments. Clean Air Act, §§ 161, 163(a), 42 U.S.C.A. §§ 

7471, 7473(a).

[32] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Although principal mechanism for monitoring the 

consumption of allowable increments in pollution concentrations in clean air areas is the preconstruction review 

and permit process required for new or modified major 

emitting facilities, as specified in section 165 of Clean Air 

Act Amendments of 1977, such section does not provide 

the exclusive mechanism for protection of the increments, 

as Administrator of Environmental Protection Agency has 

authority beyond such section to prevent or remedy a violation of the threshold specified in the Act. Clean Air Act, 

§§ 161, 163, 165, 42 U.S.C.A. §§ 7471, 7473, 7475.

[33] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

General rule-making authority granted Administrator 

of Environmental Protection Agency under section 301 of 

Clean Air Act Amendments of 1977 to prescribe such 

regulations as are necessary to carry out its functions under 

“this Act” includes authority to promulgate regulations for 

state implementation plans under the “PSD provisions” in 

addition to promulgating regulations relating to 

pre-construction permitting process. Clean Air Act, §§ 

161, 301, 42 U.S.C.A. §§ 7471, 7601.

[34] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Although waiver provisions of Clean Air Act 

Amendments of 1977 could conceivably allow permissible 

pollution increments in clean air areas to be exceeded, 

waiver only has vitality and recognition in that facilities 

granted special consideration thereunder are, in effect, 

treated as facilities operating in compliance with the Act, 

but the totality of facilities in compliance, as a group, may 

be subject to measures necessary to cope with a condition 

of pollutants exceeding the PSD maximum. Clean Air Act, 

§§ 163, 165, 168, 169, 42 U.S.C.A. §§ 7473, 7475, 7478, 

7479.

[35] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Although legislative history underlying PSD part of 

Clean Air Act Amendments of 1977 gave no indication 

that prior regulatory approach, which was limited to preconstruction review, was being altered, such was no indication that enforcement measures under the amendment 

were limited to preconstruction review as Congress did not 

in each case compare amendments with reach of prior 

regulations and although Act is patterned in many respects 

on preexisting regulatory approach it contains many differences. Clean Air Act, §§ 101 et seq., 165, 42 U.S.C.A. 
Page 9

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

§§ 7401 et seq., 7475.

[36] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Environmental Protection Agency regulation stating 

that the state implementation plans under PSD provisions 

of Clean Air Act Amendments of 1977 must make provisions to ensure that violation of the increments of maximum allowable concentrations do not occur and if they 

have occurred to ensure that steps will be taken to correct 

them is interpretive in nature and, as such, exempt from 

notice and comment requirements of Administrative Procedure Act and rule-making provisions of Clean Air Act. 5 

U.S.C.A. § 553(b)(A); Clean Air Act, §§ 161, 163, 301, 

307(d), 42 U.S.C.A. §§ 7471, 7473, 7601, 7607(d).

[37] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

In implementing the PSD provisions of Clean Air Act 

Amendments of 1977 the Environmental Protection 

Agency has authority to require inclusion in state plans of 

provision for the correction of any violation of allowable 

increments or maximum allowable concentrations, and 

may require, in appropriate instances, the relatively severe 

corrective of a rollback in operations or the application of 

retrofit air pollution control technology. Clean Air Act, §§ 

161, 163, 42 U.S.C.A. §§ 7471, 7473.

[38] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Under PSD part of Clean Air Act Amendments of 

1977, it is permissible for Environmental Protection 

Agency to promulgate guidelines to help the states manage 

the allocation of available increments in pollutants in clean 

air areas; however, the Agency may not prescribe the 

manner in which states will manage their allowed internal 

growth. Clean Air Act, §§ 161, 163, 42 U.S.C.A. §§ 7471, 

7473.

[39] Constitutional Law 92 2488

92 Constitutional Law

92XX Separation of Powers

92XX(C) Judicial Powers and Functions

92XX(C)2 Encroachment on Legislature

92k2485 Inquiry Into Legislative Judgment

92k2488 k. Policy. Most Cited Cases

(Formerly 92k70.3(3))

Constitutional Law 92 2621

92 Constitutional Law

92XX Separation of Powers

92XX(D) Executive Powers and Functions

92k2621 k. Encroachment on Legislature. Most 

Cited Cases

(Formerly 92k70.3(3))

Where Congress, presumably after due consideration, 

has indicated by plain language a preference to pursue its 

stated goals by what an agency asserts are less than optimal 

means, neither the reviewing court nor the agency is free to 

ignore the plain meaning of the statute and substitute its 

policy judgment for that of Congress.

[40] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Phrase “constructed in any area to which this part applies,” as contained in permit and preconstruction review 

requirements of PSD part of Clean Air Act Amendments of 

1977, limits PSD review requirements to major emitting 

facilities to be constructed in certain locations and does not 
Page 10

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

authorize extension of permit requirements to all sources, 

wherever located, if emissions therefrom would have an 

impact on a clean air area; permit requirement may not be 

extended to major facilities located in nonattainment areas 

in one state although they may have an adverse impact on 

clean air areas in a neighboring state. Clean Air Act, §§ 

101(b)(1), 160(4), 161, 165, 42 U.S.C.A. §§ 7401(b)(1), 

7470(4), 7471, 7475.

[41] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

Although PSD permit requirement of Clean Air Act 

Amendments is based on location rather than impact on a 

clean air area, provisions other than the permit section are 

available to fulfill the congressional objective of a need to 

cope with the problem of interstate pollution. Clean Air 

Act, §§ 110(a)(2)(E)(i), 114, 126(a-c), 161, 165, 169A, 42 

U.S.C.A. §§ 7410(a)(2)(E)(i), 7414, 7426(a-c), 7471, 

7475, 7491.

[42] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Phrase “measures required to be included” in a state 

implementation plan, as provided for in Clean Air Act 

Amendments of 1977, clearly incorporate at least absolute 

emission limitation for each pollutant for which increment 

limitations have been set under PSD provisions, the monitoring and modeling requirements of PSD part and “such 

other measures as may be necessary, as determined under 

regulations promulgated” under PSD provisions, thereby 

authorizing EPA to prevent the industry of one state from 

interfering with the PSD program of another. Clean Air 

Act, §§ 110(a)(2)(E)(i), 161, 163, 165(e), 166, 42 U.S.C.A. 

§§ 7410(a)(2)(E)(i), 7471, 7473, 7475(e), 7476.

[43] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

Provision of Clean Air Act Amendments of 1977 

governing abatement of interstate pollution is a vehicle for 

abating substantial interstate air pollution independent of 

permit requirements of the PSD part. Clean Air Act, §§ 

126, 165, 42 U.S.C.A. §§ 7426, 7475.

[44] Environmental Law 149E 261

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek261 k. Contents of Implementation Plans. 

Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Both provision of Clean Air Act Amendments of 1977 

requiring a state implementation plan to prohibit stationary 

sources within the state from emitting pollutants which 

interfere with implementation plan of any other state under 

the PSD provisions and provision governing abatement 

notwithstanding any permit gives Environmental Protection Agency power to require that state implementation 

plans contain provisions sufficient to address the problem 

of interstate air pollution, including authority to require 

that SIPs include notice provisions designed to trigger the 

mechanisms required by the former. Clean Air Act, §§ 

110(a)(2)(E)(i), 126(a, c), 42 U.S.C.A. §§ 

7410(a)(2)(E)(i), 7426(a, c).

[45] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Record-keeping provision of Clean Air Act Amendments of 1977 authorizes Environmental Protection 

Agency to require any facility to provide notice of an interstate impact on air quality, be it or some other source the 

cause of the impact, and provides an additional tool for 
Page 11

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

combating effect on a clean air area of one state by a pollution source located in another state. Clean Air Act, § 114, 

42 U.S.C.A. § 7414.

[46] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Provision of PSD part of Clean Air Act Amendments 

of 1977 that each state implementation plan contain emissions limitations “and such other measures as may be necessary, as determined under regulations promulgated 

under this part,” to prevent significant deterioration of air 

quality in clean air areas grants to EPA the power to 

promulgate rules requiring that SIPs adequately address 

the problem of abatement of substantial interstate air pollution and, hence, the administrator may promulgate rules 

to require inclusion of such provisions in the SIP of the 

state whose clean air is affected, of the state which is the 

source of the adverse impact, or of both. Clean Air Act, § 

161, 42 U.S.C.A. § 7471.

[47] Administrative Law and Procedure 15A 385.1

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak385 Power to Make

15Ak385.1 k. In General. Most Cited Cases

(Formerly 15Ak385)

Where congressional objective is clear but statutory 

measures addressed thereto are modest, a determination 

that supplemental measures are necessary for purpose of 

triggering rule-making authority is within an agency's 

authority even though generally the statute relies on 

measures specified by Congress rather than a contemplation of broad agency rule-making discretion.

[48] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Permit requirements applicable to new construction of 

major emitting facilities under PSD provisions of Clean 

Air Act Amendments of 1977 do not apply to sources in 

nonattainment areas that impact on the air quality of federal lands and Indian reservations, although other measures 

under the Act are available to combat the problem. Clean 

Air Act, §§ 161, 165, 165(d)(2), 169A, 42 U.S.C.A. §§ 

7471, 7475, 7475(d)(2), 7491.

[49] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

In view of other statutory tools available to combat 

interstate air pollution, specifically, effect on one state's 

clean air areas of pollution emanating from a source in 

another state, there is no predicate for judicial “gloss” on 

preconstruction requirements provision of PSD portions of 

Clean Air Act Amendments of 1977 to support EPA 

rule-making authority to apply permit requirements to 

major emitting facilities located in nonattainment areas in 

one state that impact adversely on clean air areas within a 

neighboring state. Clean Air Act, § 165, 42 U.S.C.A. § 

7475.

[50] Environmental Law 149E 278

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek278 k. Fugitive Emissions. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Phrase “fugitive emissions” for purpose of Clean Air 

Act Amendments of 1977 are emissions from a facility that 

escape from other than a point source and principal among 

which is “fugitive dust,” a term referring to fugitive emissions by particulate matter; although such are the general 

parameters of subject terms, EPA has latitude to provide 
Page 12

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

reasonable, though more specific, definitions along similar 

lines, so long as they comport with congressional intent. 

Clean Air Act, § 302(j), 42 U.S.C.A. § 7602(j).

[51] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Provisions of PSD part of Clean Air Act Amendments 

of 1977 detailing the preconstruction review and permit 

requirements for each new or modified “major emitting 

facility” apply with equal force to fugitive emissions and 

emissions from industrial point sources. Clean Air Act, § 

165, 42 U.S.C.A. § 7475.

[52] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 278

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek278 k. Fugitive Emissions. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

A major emitting facility is subject to preconstruction 

requirements of PSD part of Clean Air Act Amendments of 

1977 for each pollutant it emits irrespective of the manner 

in which it is emitted; however, a source emitting large 

quantities of fugitive emissions may remain outside the 

definition of “major emitting facility” and thus may not be 

subject to the preconstruction requirements. Clean Air Act, 

§ 165, 42 U.S.C.A. § 7475.

[53] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

Definition of “major emitting facility” in general definition provisions of Clean Air Act Amendments of 1977 

is not totally supplanted for the PSD part by definition of 

“major emitting facility” in PSD provisions, as general 

definition specifically attaches a rule-making requirement 

for inclusion of fugitive emissions in the threshold 100-ton 

per year calculation and under the PSD part the calculation 

of the threshold emission levels may include fugitive 

emissions only as determined by rule, thereby giving 

agency flexibility to provide industry-by-industry consideration and appropriate tailoring of coverage. Clean Air 

Act, §§ 169(1), 302(j), 42 U.S.C.A. §§ 7479(1), 7602(j).

[54] Environmental Law 149E 278

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek278 k. Fugitive Emissions. Most Cited 

Cases

(Formerly 199k25.6(7) Health and Environment)

Environmental Law 149E 695

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek694 Determination, Judgment, and Relief

149Ek695 k. In General. Most Cited Cases

(Formerly 199k25.15(12), 199k25.15(6) Health and 

Environment)

Environmental Protection Agency regulation including partial exemption from statutory PSD permit requirements for major emitting facilities of fugitive dust was 

required to be vacated as based on an erroneous premise, 

namely, that Clean Air Act Amendments of 1977 of their 

own force subject major sources of fugitive emissions to 

PSD preconstruction review and permit requirements; 

objective of partially exempting fugitive dust emitted by 

major emitting facilities from permit requirements was to 

be had by way of appropriate rule making. Clean Air Act, 

§§ 111, 165, 169(1), 302(j), 42 U.S.C.A. §§ 7411, 7475, 
Page 13

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

7479(1), 7602(j).

[55] Environmental Law 149E 268

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek268 k. Stationary Sources in General. 

Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 276

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek276 k. In General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Under Clean Air Act Amendments of 1977, including 

PSD part, the Environmental Protection Agency has discretion to define the pollutant termed “particulate matter”

to exclude particles of a size or composition determined 

not to present substantial public health or welfare concerns 

and although the excluded particulates would remain “air 

pollutants” within meaning of the Act, they could be 

dropped from list of air pollutants the emission of which 

might endanger public health and thereby would not be 

subject to NAAQS but nonetheless might be included in 

the list, required under the amendments, of stationary 

sources that contribute to pollution. Clean Air Act, §§ 

108(a)(1), (a)(2), 109, 111(b)(1)(A), 302(g), 42 U.S.C.A. 

§§ 7408(a)(1), (a)(2), 7409, 7411(b)(1)(A), 7602(g).

[56] Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Under Clean Air Act Amendments of 1977, a stationary source may significantly contribute to air pollution by 

emission of “particulate matter” even though quantities 

emitted fall below tonnage threshold that would qualify 

such source as a major emitting facility for purpose of 

preconstruction permit and review requirements of PSD 

part, and due to difference in focus of the listing requirements a performance standard might be developed governing “excluded particulates” although no NAAQS had 

been promulgated but once a standard of performance was 

promulgated for “excluded particulates” they would become “subject to regulation” within meaning of provision 

requiring BACT prior to PSD permit approval. Clean Air 

Act, §§ 108, 111(a)(1)(C), (b)(1)(A), (d)(1), 165(a)(3, 4), 

42 U.S.C.A. §§ 7408, 7411(a)(1)(C), (b)(1)(A), (d)(1), 

7475(a)(3, 4).

[57] Environmental Law 149E 278

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek278 k. Fugitive Emissions. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency has authority by 

rule making to incorporate fugitive emissions, including 

fugitive dust, in the calculation of tonnage threshold required to qualify a stationary source as major emitting 

facility for purpose of preconstruction permit requirements 

of the PSD parts of Clean Air Act Amendments of 1977. 

Clean Air Act, §§ 165, 302(j), 42 U.S.C.A. §§ 7475, 

7602(j).

[58] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Requirement of PSD part of Clean Air Act Amendments of 1977 that preconstruction review in connection 

with construction of a major emitting facility “shall” be 

preceded by an analysis for each pollutant subject to regulation which will be emitted from the facility is mandatory, subject only to authority of the agency to exempt de 

minimis situations; there must be an analysis and it must be 

for each pollutant regulated under the Act. Clean Air Act, § 

165(a)(2), (e)(1), 42 U.S.C.A. § 7475(a)(2), (e)(1).
Page 14

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

[59] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Although an analysis for each pollutant regulated 

under Clean Air Act Amendments of 1977 must be conducted in preconstruction review of a new major emitting 

facility the Act does not require monitoring as the method 

of analysis; EPA may use its discretion in its choice of 

methodology, either monitoring or modeling, which discretion is subject to statutory requirements as to monitoring. Clean Air Act, § 165(a)(2), (e)(1, 2), 42 U.S.C.A. § 

7475(a)(2), (e)(1, 2).

[60] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

The monitoring required under PSD part of Clean Air 

Act Amendments of 1977 in connection with construction 

of a new major emitting facility requires monitoring to 

determine whether emissions will exceed allowable increments. Clean Air Act, § 165(e)(2), 42 U.S.C.A. § 

7475(e)(2).

[61] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Even a congressional mandate, such as a clean air 

technology-forcing requirement based on a congressional 

projection of emergency of technology for the future, is 

subject to a justified excuse from agency compliance 

where good-faith effort to comply has not been fruitful of 

results; however, such is different from exemption on basis 

of current technological infeasibility. Clean Air Act, § 101 

et seq., 42 U.S.C.A. § 7401 et seq.

[62] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Although Environmental Protection Agency, in undertaking the monitoring required by PSD parts of Clean 

Air Act of a new major emitting facility has authority to 

require methods other than monitoring to ensure that allowable increments and NAAQS are not violated and may 

choose to invoke that authority because of its perception 

that monitoring alone is inadequate, it does not have authority to dispense with monitoring as one enforcement 

mechanism as Congress has mandated the use of that 

technique. Clean Air Act, § 165(e)(2), 42 U.S.C.A. § 

7475(e)(2).

[63] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Environmental Protection Agency is to furnish meaningful guidance to the states as to circumstances appropriate for exemption from one-year monitoring requirement applicable to preconstruction review of a major 

emitting facility. Clean Air Act, § 165(e)(2), 42 U.S.C.A. § 

7475(e)(2).

[64] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)
Page 15

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

Under PSD provisions of Clean Air Act Amendments 

of 1977, the Environmental Protection Agency has latitude 

to determine whether postconstruction monitoring of a 

newly constructed major emitting facility is required, in 

light of facts and circumstances, and has latitude to respond to suggestions that guidelines be formulated outlining circumstances that require postconstruction monitoring and nature thereof. Clean Air Act, § 165(a)(7), (e), 

42 U.S.C.A. § 7475(a)(7), (e).

[65] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Authority of Administrator of Environmental Protection Agency to require monitoring by any source that in his 

judgment is necessary to carry out his responsibilities 

under Clean Air Act includes authority to require postconstruction monitoring under PSD parts of a newly constructed major emitting facility, but such monitoring is not 

compelled. Clean Air Act, §§ 114, 165(e), 42 U.S.C.A. §§ 

7414, 7475(e).

[66] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

The nationwide monitoring network authorized by 

Clean Air Act Amendments of 1977 is to be a function of 

government, not responsibility of a PSD applicant for 

permit to construct a new major emitting facility. Clean Air 

Act, § 319, 42 U.S.C.A. § 7619.

[67] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Protection Agency exceeded scope of 

its authority under PSD part of Clean Air Act Amendments 

of 1977 in departing from statutory baseline data from 

which a deterioration in air quality is calculated, i. e., time 

of first application for a permit, with agency defining 

baseline concentration in terms of actual air quality as of 

August 7, 1977, i. e., effective date of PSD provisions. 

Clean Air Act, § 169(4), 42 U.S.C.A. § 7479(4).

[68] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 280

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek280 k. Sulfur and Sulfur Dioxide. Most 

Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

The baseline concentration of pollutants under PSD 

provisions of Clean Air Act Amendments of 1977 is to 

include all emissions actually being made by major facilities on which construction was underway before January 6, 

1975, and which are in operation when the baseline determination is made, with emissions of sulphur dioxide and 

particulate matter from major facilities on which construction began after January 6, 1975, not being grandfathered into the baseline but, rather, counted against in-
Page 16

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

crements, even if such facilities are operating on the date of 

the first permit application, i. e., the measuring date in 

determining baseline concentration. Clean Air Act, § 

169(4), 42 U.S.C.A. § 7479(4).

[69] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Under the PSD provisions of Clean Air Act Amendments of 1977, baseline concentrations of pollutants and 

increments are set for regions, rather than individual facilities. Clean Air Act, § 169(4), 42 U.S.C.A. § 7479(4).

[70] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's decision, in establishing baseline concentrations under PSD part of Clean 

Air Act Amendments of 1977, not to grandfather emissions from voluntary fuel switches by facilities which, 

prior to January 6, 1975, had fuel-switching capabilities 

did not violate congressional intent. Clean Air Act, § 

169(4), 42 U.S.C.A. § 7479(4).

[71] Statutes 361 189

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k187 Meaning of Language

361k189 k. Literal and Grammatical Interpretation. Most Cited Cases

Every issue of statutory interpretation should commence with a close textual examination.

[72] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

For purpose of establishing a “baseline concentration”

under PSD part of Clean Air Act Amendments of 1977, 

there are two types of emitting sources begun prior to 

existence of any PSD program: if the source has no actual 

emissions because it has yet to commence operating, its 

hypothetical, projected emissions are included in the 

baseline while if the source is an established operation, a 

more realistic assessment of its impact on ambient air 

quality levels is possible, and thus is directed. Clean Air 

Act, § 169(4), 42 U.S.C.A. § 7479(4).

[73] Environmental Law 149E 273

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek273 k. Mobile Sources; Motor Vehicles. 

Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Environmental Protection Agency did not act improperly in treating state-ordered fuel conservation orders 

differently from federally mandated fuel switches for 

purpose of counting emissions from voluntary fuel changes 

against the increment in setting baseline concentrations 

under PSD provisions of Clean Air Act Amendments of 

1977. Clean Air Act, § 169(4), 42 U.S.C.A. § 7479(4).

[74] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Congress expected Environmental Protection Agency 

to use administrative good sense in establishing the baseline concentration and in calculating exceedances under 
Page 17

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

the PSD part of Clean Air Act Amendments of 1977; were 

measurements on an atypical day the sole method of determining actual ambient air quality as of approximate time 

of first permit application, i. e., the date for setting baseline 

concentrations, affected industries would have cause for 

complaint and potential ground for relief. Clean Air Act, § 

169(4), 42 U.S.C.A. § 7479(4).

[75] Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 280

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek280 k. Sulfur and Sulfur Dioxide. Most 

Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Under PSD provisions of Clean Air Act Amendments 

of 1977, increments setting forth the maximum allowable 

increase in pollutants are stated for particulates and sulphur 

dioxide, which increments are not source specific; all 

emissions are considered in determining whether statute's 

aim of preventing significant deterioration of air quality in 

attainment areas is being secured. Clean Air Act, § 163(b), 

42 U.S.C.A. § 7473(b).

[76] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's refusal to grandfather into baseline concentrations the emissions resulting 

from voluntary fuel switches, with Agency view being that 

switches consume the increment in applying PSD part of 

Clean Air Act Amendments of 1977, is not procedurally 

infirm as Agency carefully delineated rationale of its policy and its views of congressional intent merely differed, 

justifiably so, from that of the industry and, also, since 

such regulation was interpretive and exempt from 

rule-making requirements of the Amendments and the 

Administrative Procedure Act. 5 U.S.C.A. § 553; Clean 

Air Act, §§ 169(4), 307(d), 42 U.S.C.A. §§ 7479(4), 

7607(d).

[77] Administrative Law and Procedure 15A 394

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak392 Proceedings for Adoption

15Ak394 k. Notice and Comment, Necessity. 

Most Cited Cases

Administrative Law and Procedure 15A 400

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak392 Proceedings for Adoption

15Ak400 k. Hearing in General. Most Cited 

Cases

For purpose of notice and comment provisions of 

Administrative Procedure Act, the line between binding, 

substantive rules and mere informal announcements as to 

how an agency plans to exercise a discretionary power is 

not always bright. 5 U.S.C.A. § 553(b)(3)(A).

[78] Environmental Law 149E 292

149E Environmental Law

149EVI Air Pollution

149Ek289 Administrative Agencies and Proceedings

149Ek292 k. Notice and Comment. Most Cited 

Cases

(Formerly 199k25.6(8) Health and Environment)

Since guidelines accompanying final modeling regulations promulgated by Environmental Protection Agency 

under Clean Air Act Amendments of 1977 require that 
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

deviations from specified models be fully supported and 

documented, the models designated in the guidelines are 

thus granted sufficient weight in subsequent proceedings to 

remove the regulations from the ambit of mere policy 

statements and Administrative Procedures Act's exemption 

therefrom of notice and comment requirements applicable 

to rule making. 5 U.S.C.A. § 553(b)(3)(A); Clean Air Act, 

§§ 165(e)(3)(D), 320, 42 U.S.C.A. §§ 7475(e)(3)(d), 7620.

[79] Administrative Law and Procedure 15A 394

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak392 Proceedings for Adoption

15Ak394 k. Notice and Comment, Necessity. 

Most Cited Cases

Administrative Law and Procedure 15A 400

15A Administrative Law and Procedure

15AIV Powers and Proceedings of Administrative 

Agencies, Officers and Agents

15AIV(C) Rules and Regulations

15Ak392 Proceedings for Adoption

15Ak400 k. Hearing in General. Most Cited 

Cases

Agency's duty to respond to significant comments 

finds a statutory basis in required notice and comment 

procedures, for the opportunity to comment is meaningless 

unless the agency responds to significant points raised by 

the public. 5 U.S.C.A. § 553(b)(3)(A).

[80] Environmental Law 149E 293

149E Environmental Law

149EVI Air Pollution

149Ek289 Administrative Agencies and Proceedings

149Ek293 k. Hearing and Determination; 

Statement of Reasons. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Since Clean Air Act Amendments of 1977 explicitly 

afford interested persons the opportunity to comment with

respect to proceedings of required special modeling conference, and since submitted comments must be included 

in the docket established for promulgation and review of 

regulations pertaining to air quality modeling, any comments standing unaddressed may well leave a reviewing 

court unable to say that the agency has considered all relevant factors. 5 U.S.C.A. § 553(b)(3)(A); Clean Air Act, 

§§ 165(e)(3)(D), 320, 42 U.S.C.A. §§ 7475(e)(3)(b), 7620.

[81] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

In enacting modeling provisions of the PSD part of 

Clean Air Act Amendments of 1977 Congress recognized 

the technical difficulties in modeling emissions across 

complex terrain and expected Environmental Protection 

Agency to develop and use the most appropriate models 

for such situations. Clean Air Act, §§ 165(e)(3)(D), 320, 

42 U.S.C.A. §§ 7475(e)(3)(D), 7620.

[82] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

In authorizing use of modeling under the PSD part of 

Clean Air Act Amendments of 1977 Congress did not 

direct the use of any particulate defusion models but, rather, expected Environmental Protection Agency to develop and utilize the most accurate and feasible modeling 

techniques available. Clean Air Act, §§ 165(e)(3)(D), 320, 

42 U.S.C.A. §§ 7475(e)(3)(D), 7620.

[83] Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)
Page 19

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

Environmental Law 149E 280

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek280 k. Sulfur and Sulfur Dioxide. Most 

Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Since PSD part of Clean Air Act Amendments of 1977 

set largely inflexible increments for sulphur dioxide and 

particulates, Congress has commanded the use of conservative assumptions on weather and other data input in 

the modeling process. Clean Air Act, §§ 165(e)(3)(D), 320, 

42 U.S.C.A. §§ 7475(e)(3)(D), 7620.

[84] Environmental Law 149E 293

149E Environmental Law

149EVI Air Pollution

149Ek289 Administrative Agencies and Proceedings

149Ek293 k. Hearing and Determination; 

Statement of Reasons. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Protection Agency's first models under 

the PSD part of Clean Air Act Amendments of 1977 do not 

contravene any discernible congressional directive and 

since comments of industry spokesmen to the contrary 

raised relatively insubstantial questions of law they did not 

necessitate an agency reply. 5 U.S.C.A. § 553(b)(3)(A); 

Clean Air Act, §§ 165(e)(3)(D), 320, 42 U.S.C.A. §§ 

7475(e)(3)(D), 7620.

[85] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Of great importance in implementation of modeling 

provisions of PSD part of Clean Air Act Amendments of 

1977 is a reasoned agency response to substantial questions of fact, policy or science raised in comments on 

recommended models or in proposals to employ new 

technique, as lack of scientific certitude about modeling 

techniques increases rather than reduces need for the 

agency to critically examine all substantial questions of 

fact and science emerging from the commenting process. 5 

U.S.C.A. § 553(b)(3)(A); Clean Air Act, §§ 165(e)(3)(D), 

320, 42 U.S.C.A. §§ 7475(e)(3)(D), 7620.

[86] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Since first set of models adopted under PSD part of 

Clean Air Act Amendments of 1977 are concededly 

flawed, should scientific advances or better information 

permit a more accurate assessment of air quality, Environmental Protection Agency should move to adopt the 

more accurate procedure, although it too may not be entirely free from fault. 5 U.S.C.A. § 553(b)(3)(A); Clean Air 

Act, §§ 165(e)(3)(D), 320, 42 U.S.C.A. §§ 7475(e)(3)(D), 

7620.

[87] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(9) Health and Environment)

Environmental Protection Agency did not exceed its 

authority in interpreting stack height provision of Clean 

Air Act Amendments of 1977 as requiring emissions from 

all preexisting sources with tall stacks that were built after 

effective date of the 1970 Act and, hence, were not 

grandfathered, to be modeled as though the emissions 

proceeded from GEP (Good Engineering Practice) height 

stacks when ascertaining the emission limitations to be 

imposed on new facilities. Clean Air Act, § 123, 42 

U.S.C.A. § 7423.

[88] Statutes 361 219(1)

361 Statutes

361VI Construction and Operation
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

361VI(A) General Rules of Construction

361k213 Extrinsic Aids to Construction

361k219 Executive Construction

361k219(1) k. In General. Most Cited 

Cases

Deference to agency interpretation of regulatory statute is heightened when the interpretation is of a statute by 

its implementing agency.

[89] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(3.1), 199k25.6(3) Health and Environment)

Although it is fair to say that in enacting stack height 

provisions of Clean Air Act Amendments of 1977 Congress generally approved of judicial decisions disapproving use of tall stacks and other dispersion techniques in lieu 

of emission limitations, it is not accurate to say that Congress simply codified the holdings and dicta of those decisions. Clean Air Act, § 123, 42 U.S.C.A. § 7423.

[90] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Term “emission limitation” in stack height provision 

of Clean Air Act Amendments of 1977 includes any requirement imposed on a source by Environmental Protection Agency or a state which restricts the quantity, rate, or 

concentration of air pollutants on a continuous basis. Clean 

Air Act, §§ 123, 123(a), (a)(1), 302(k), 42 U.S.C.A. §§ 

7423, 7423(a), (a)(1), 7602(k).

[91] Statutes 361 181(2)

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k180 Intention of Legislature

361k181 In General

361k181(2) k. Effect and Consequences. 

Most Cited Cases

An absurd construction of a regulatory statute is to be 

avoided if at all possible.

[92] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Emissions from tall-stack sources that have been included in baseline definition for PSD permit requirements 

of Clean Air Act Amendments of 1977 do not consume the 

available increment as their actual emissions at time of first 

permit application are grandfathered; grandfathering does 

not conflict with exemption of stack height requirements 

for stacks in existence before December 31, 1970, as 

grandfathered emissions do not affect the “degree of 

emission limitation required” for PSD permits nor render 

the December 31, 1970 cutoff nugatory as the latter is not 

in the PSD part and statutory tall-stack policy is not confined to the nondeterioration program but applies to entire 

range of programs under Clean Air Act. Clean Air Act, §§ 

123, 123(a), 169(4), 42 U.S.C.A. §§ 7423, 7423(a), 

7479(4).

[93] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and En-
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

vironment)

Since only actual emissions of a major source operating on date of the baseline determination for a PSD 

permit and on which construction commenced prior to 

January 6, 1977 are grandfathered, additional emissions 

from such source consume the increment and, thus, if 

nonbaseline emissions from such source proceed from a 

taller than GEP stack not in existence before statutory 

December 31, 1970 cutoff they consume the increments as 

though they were emitted from GEP stacks; in short, 

tall-stack policy of Clean Air Act Amendments, for purpose of the nondeterioration PSD program, applies to 

nonbaseline emissions of nongrandfathered stacks. Clean 

Air Act, §§ 123, 123(a), 169(4), 42 U.S.C.A. §§ 7423, 

7423(a), 7479(4).

[94] Environmental Law 149E 259

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek259 k. Inventory, Emission Limits, and 

Modelling. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Although tall-stack facilities existing before date of 

Clean Air Act Amendments of 1970 are grandfathered as 

regards emission limitation requirements, i. e., their emissions are modeled at actual stack height, it is in the interests 

of all post-1970 facilities with tall stacks to demonstrate, if 

possible, that their excess height is justified by downwash 

problem, for such sources may be subjected to extensive 

regulatory measures in the event of increment exceedances 

or violation of national standards and if a source makes 

such a demonstration, its emissions will be modeled at 

actual stack height in subsequent permit proceedings. 

Clean Air Act, §§ 123, 123(a, c), 165, 42 U.S.C.A. §§ 

7423, 7423(a, c), 7475.

[95] Environmental Law 149E 254

149E Environmental Law

149EVI Air Pollution

149Ek253 Federal Regulation

149Ek254 k. In General. Most Cited Cases

(Formerly 199k25.6(4) Health and Environment)

Congress did not intend its tall-stacks policy of Clean 

Air Act Amendments of 1977 to preclude identification of 

areas with real pollution problems; since Environmental 

Protection Agency may require revision of state implementation plans whenever the increments or the national 

standards are actually being violated, such authority insures that the tall-stacks policy need not hamper attainment 

and maintenance of federally prescribed pollution standards everywhere. Clean Air Act, §§ 123, 161, 163(a), 42 

U.S.C.A. §§ 7423, 7471, 7473(a).

[96] Environmental Law 149E 695

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek694 Determination, Judgment, and Relief

149Ek695 k. In General. Most Cited Cases

(Formerly 199k25.15(12), 199k25.15(1) Health and 

Environment)

Court of Appeals would not defer ruling on Environmental Protection Agency's interpretation of stack 

height provision of Clean Air Act Amendments of 1977 

until completion of pending rule-making proceedings 

which, among other things, would define good engineering 

practice for stack height since issue before the court was 

propriety of modeling emissions from tall stacks GEP 

height when calculating emission limitations from later 

sources and Agency's final position on the question had 

been announced. Clean Air Act, § 123(a), 42 U.S.C.A. § 

7423(a).

[97] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Definition of term “source” for purpose of PSD provisions of Clean Air Act Amendments of 1977 is the same 

as that provided for new source performance standards; 

hence, EPA erred in defining “source” to include equipment, operations and combinations thereof. Clean Air Act, 

§§ 111(a)(3), 169(1), 42 U.S.C.A. §§ 7411(a)(3), 7479(1).

[98] Statutes 361 212.6
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k212 Presumptions to Aid Construction

361k212.6 k. Words Used. Most Cited Cases

Given no expression of any contrary intent in a statute 

or in legislative history regarding definition of that being 

regulated, it is assumed that the meaning of a particular 

term is to be consistent throughout the enactment, especially where the subject term prior to enactment of controversial language has assumed a particular definition 

under closely related statutory provisions.

[99] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

For purpose of the PSD regulations, components of 

the term “source” need not be interpreted so narrowly so as 

to comprehend only those sources that emit pollutants 

through industrial “point” sources, such as smokestacks 

and chimneys, as Environmental Protection Agency has 

discretion to define the term reasonably to carry out intent 

of Clean Air Act Amendments of 1977, but not to go 

beyond the clear scope of the Act. Clean Air Act, §§ 

111(a)(3), 169(1), 42 U.S.C.A. §§ 7411(a)(3), 7479(1).

[100] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

In implementing PSD provisions of Clean Air Act 

Amendments of 1977 the EPA has discretion to define 

statutory terms reasonably to carry out express purposes of 

the Act and, for instance, it is reasonable to define “facility” and “installation” broadly enough to encompass an 

entire plant. Clean Air Act, §§ 111(a)(3), 169(1), 42 

U.S.C.A. §§ 7411(a)(3), 7479(1).

[101] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Entire plants may be considered single “sources” for 

purpose of PSD provisions of Clean Air Act Amendments 

of 1977. Clean Air Act, §§ 111(a)(3), 169(1), 42 U.S.C.A. 

§§ 7411(a)(3), 7479(1).

[102] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Although an entire plant may be considered a single 

“source” for purpose of PSD review under Clean Air Act 

Amendments of 1977, the Environmental Protection 

Agency cannot treat contiguous and commonly owned 

units as a single source unless they fit within the four 

permissible statutory terms; EPA should devise regulatory 

definitions of the terms “structure,” “building,” “facility,”

and “installation” to provide for aggregation, where appropriate, of industrial activities according to considerations such as proximity and ownership. Clean Air Act, §§ 

111(a)(3), 169(1), 42 U.S.C.A. §§ 7411(a)(3), 7479(1).

[103] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's definition of 

“source” for PSD review under Clean Air Act Amend-
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

ments of 1977 should provide explicit notice as to whether 

and on what statutory authority the agency construed the 

term source, as divided into its several constituent units, to 

include unloading of vessels at marine terminals and 

“long-line” operations such as pipelines, railroads and 

transmission lines. Clean Air Act, § 169(1), 42 U.S.C.A. § 

7479(1).

[104] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

For purpose of PSD review under Clean Air Act 

Amendments of 1977, Environmental Protection Agency 

has latitude to adopt definition of the component terms of 

“source” that are different in scope from those that may be 

employed for new source performance standards and other 

clean air programs, due to differences in the purpose and 

structure of the two programs. Clean Air Act, §§ 111(a)(3), 

169(1), 42 U.S.C.A. §§ 7411(a)(3), 7479(1).

[105] Environmental Law 149E 661

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek661 k. Finality. Most Cited Cases

(Formerly 199k25.15(3.2), 199k25.15(1) Health and 

Environment)

Opportunity to petition for review of reasonableness 

of Environmental Protection Agency's contiguity and 

common ownership criteria in defining “source” for purpose of PSD requirements of Clean Air Act Amendments 

of 1977 would not be forfeited by judicial decision not to 

resolve such issueson finding that inclusion of equipment, 

operation and combination thereof was erroneous since 

regulations, as revised in light of the opinion, would constitute new “final action” and trigger once again review 

procedures of Clean Air Act. Clean Air Act, §§ 169(1), 

307(b), 42 U.S.C.A. §§ 7479(1), 7607(b).

[106] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's use of term “major stationary source” in place of statutory term “major 

emitting facility” in defining coverage of PSD parts of 

Clean Air Act Amendments of 1977 was not objectionable 

as long as the regulatory term was defined in a manner 

consistent with statutory requirements. Clean Air Act, § 

169(1), 42 U.S.C.A. § 7479(1).

[107] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's extension of PSD 

requirements to all sources with potential emissions of 250 

tons or more per year regardless of physical size or production capacity of the source, was not an unreasonable 

construction of Clean Air Act Amendments of 1977. Clean 

Air Act, § 169(1), 42 U.S.C.A. § 7479(1).

[108] Environmental Law 149E 267

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek267 k. In General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Critical factor in pollution control is not the industrial 

output of a particular source, but its pollution output. Clean 

Air Act, § 169(1), 42 U.S.C.A. § 7479(1).

[109] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

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© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

Environmental Protection Agency exceeded scope of 

its authority by limiting PSD review to those modifications 

deemed “major,” defined by agency as incorporating the 

same 100 or 250-ton per year threshold for a “major emitting facility” ; PSD review requirements apply to any 

modification of a major emitting facility and term “modification” is nowhere limited to physical changes exceeding a certain magnitude. Clean Air Act, §§ 111(a)(4), 

165(a), 169(1), (2)(C), 42 U.S.C.A. §§ 7411(a)(4), 

7475(a), 7479(1), (2)(C).

[110] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

In administering “modification” provision of PSD 

provisions of Clean Air Act Amendments of 1977 the EPA 

has discretion to exempt from review some emission increases on grounds of de minimis or administrative necessity. Clean Air Act, §§ 111(a)(4), 165(a), 169(1), 

(2)(C), 42 U.S.C.A. §§ 7411(a)(4), 7475(a), 7479(1), 

(2)(C).

[111] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

The PSD part of Clean Air Act Amendments of 1977 

is intended to “grandfather” existing industries; however, 

provisions concerning modification indicate that there is 

no perpetual immunity of existing industries from all 

standards under the PSD program, and if existing plants 

increase pollution they will generally need a permit, with 

exceptions when increases are de minimis or are offset by 

contemporaneous decreases of pollutants. Clean Air Act, 

§§ 111(a)(4), 165(a), 169(1), (2)(C), 42 U.S.C.A. §§ 

7411(a)(4), 7475(a), 7479(1), (2)(C).

[112] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Word “increases” as used in definition of “modification” for purpose of PSD permit and review process under 

Clean Air Act Amendments of 1977 is not to be construed 

as requiring an inspection at individual plant units affected 

by an operational change to determine whether any of the 

units will consequently emit more of a pollutant, as opposed to a “bubble” concept, i. e., determination of 

whether net effect of all steps involved in the change is to 

increase emission of any air pollutant. Clean Air Act, § 

111(a)(4), 42 U.S.C.A. § 7411(a)(4).

[113] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

In passing the PSD part of Clean Air Act Amendments 

of 1977, Congress wished to apply the permit process only 

where industrial changes might increase pollution in area, 

not where an existing plant changed its operation in a way 

that produced no pollution increase. Clean Air Act, §§ 

111(a)(4), 165(a), 169(1), (2)(C), 42 U.S.C.A. §§ 

7411(a)(4), 7475(a), 7479(1), (2)(C).

[114] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

In applying PSD parts of Clean Air Act Amendments 

of 1977, the EPA has properly exempted from the best 

available control technology and ambient quality review 
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© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

those “modifications” of a source that do not produce a net 

increase in any pollutant. Clean Air Act, §§ 111(a)(4), 

165(a)(3, 4), 169(1), (2)(C), 42 U.S.C.A. §§ 7411(a)(4), 

7475(a)(3, 4), 7479(1), (2)(C).

[115] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Environmental Protection Agency retains substantial 

discretion in applying the “bubble” concept, i. e., a net 

result determinative of whether there has been an increase 

in pollutants activating PSD review requirements, in that 

any offset changes claimed by industry must be substantially contemporaneous, as defined by the agency, and, 

second, offsetting changes must be within the same source, 

as defined by the agency. Clean Air Act, §§ 111(a)(4), 

169(1), (2)(C), 42 U.S.C.A. §§ 7411(a)(4), 7479(1), 

(2)(C).

[116] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency's definition of 

“statutory source” for purpose of PSD provisions of Clean 

Air Act Amendments of 1977 governs both the definition 

of “modification” and the coverage of major emitting 

facilities. Clean Air Act, § 169(1), (2)(C), 42 U.S.C.A. § 

7479(1), (2)(C).

[117] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Where there is no net increase from contemporaneous 

changes within any pollution source the PSD review requirements of Clean Air Act Amendments of 1977, 

whether procedural or substantive, cannot apply; hence, in 

applying a “bubble” concept to determine what types of 

industrial changes constitute “modifications” subject to 

PSD review requirements, the EPA could not adopt two 

different definitions of “modification,” one that looked 

only at net increases for substantive requirements and a 

second that looked at all increases, without allowing offset, 

for procedural requirements. Clean Air Act, §§ 111(a)(4), 

165(a), 169(1), (2)(C), 42 U.S.C.A. §§ 7411(a)(4), 

7475(a), 7479(1), (2)(C).

[118] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Environmental Protection Agency regulation exempting from the PSD review and best available control 

technology requirements of Clean Air Act Amendments of 

1977 each pollutant not emitted in sufficient amounts to 

qualify as a source as a major emitting facility, i. e., adoption of BACT de minimis criterion to coincide with the 100 

to 250-ton emission thresholds for major emitting facilities, is contrary to clear statutory language. Clean Air Act, 

§§ 165(a)(3, 4), 169(1, 3), 42 U.S.C.A. §§ 7475(a)(3, 4), 

7479(1, 3).

[119] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Although application of BACT requirements to emission of all pollutants from a new facility could impose 

severe administrative burden on Environmental Protection 

Agency in implementing PSD part of Clean Air Act 

Amendments of 1977 and could impose a severe economic 

burden on construction of new facilities, proper way to 
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636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 Envtl. L. Rep. 20,001

(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

resolve the difficulty is to define a de minimis standard 

rationally designed to alleviate administrative burden, not 

to extend the statutory 100 or 250-ton threshold for major 

emitting facilities to a context where it is not applicable. 

Clean Air Act, §§ 165(a)(3, 4), 169(1, 3), 42 U.S.C.A. §§ 

7475(a)(3, 4), 7479(1, 3).

[120] Environmental Law 149E 274

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek274 k. Exemptions, Extensions, Exceptions, and Variances. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

The de minimis exemption as applied to BACT requirements under PSD part of Clean Air Act Amendments 

of 1977 must be designed with specific administrative 

burdens and specific regulatory context in mind. Clean Air 

Act, §§ 165(a)(3, 4), 169(1, 3), 42 U.S.C.A. §§ 7475(a)(3, 

4), 7479(1, 3).

[121] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

The statutory 100-ton threshold for defining a major 

emitting facility does not necessarily exceed a permissible 

de minimis level for application of BACT requirements 

under PSD part of Clean Air Act Amendments of 1977, 

however, the EPA must follow a rational approach to determine what level of emission is a de minimis amount and 

may not merely adopt the statutory threshold. Clean Air 

Act, §§ 165(a)(3, 4), 169(1, 3), 42 U.S.C.A. §§ 7475(a)(3, 

4), 7479(1, 3).

[122] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

A rational approach to determining what level of the 

emission is a de minimis amount for purpose of PSD requirements under Clean Air Act Amendments of 1977, 

including best available control technology, would consider the administrative burden with respect to each statutory context: what level of emission is de minimis for 

modification and what level de minimis for application of 

BACT, with agency looking at degree of administrative 

burden posed by enforcement of various de minimis threshold levels and taking into account the facility's air pollution controls and possibly considering of statutory thresholds for new facilities. Clean Air Act, §§ 165(a)(3, 4), 

169(1, 3), 42 U.S.C.A. §§ 7475(a)(3, 4), 7479(1, 3).

[123] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

In establishing a de minimis standard for application 

of best available control technology to modifications of 

facilities subject to PSD requirements of Clean Air Act 

Amendments of 1977, a rational approach would consider 

whether the de minimis threshold should vary depending 

on the specific pollutant and the danger posed by increases 

in its emission. Clean Air Act, §§ 165(a)(3, 4), 169(1, 3), 

42 U.S.C.A. §§ 7475(a)(3, 4), 7479(1, 3).

[124] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Law 149E 276

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek276 k. In General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and En-
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© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

vironment)

Phrase “each pollutant subject to regulation” as used 

in preconstruction requirements of PSD part of Clean Air 

Act Amendments of 1977 is not limited to sulphur dioxide 

and particulates; PSD preconstruction review is not qualified by provision requiring EPA to conduct a study and 

promote regulations to prevent significant deterioration of 

air quality resulting from emissions of hydrocarbons, 

carbon monoxide, photochemical oxidants and nitrogen 

oxides, the automotive pollutants, as well as pollutants for 

which national ambient air quality standards are promulgated. Clean Air Act, §§ 165(a)(3, 4), (e)(1), 166(a), 

169(3), 42 U.S.C.A. §§ 7475(a)(3, 4), (e)(1), 7476(a), 

7479(3).

[125] Environmental Law 149E 264

149E Environmental Law

149EVI Air Pollution

149Ek257 Implementation of Federal Standards

149Ek264 k. Prevention of Significant Deterioration. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

In deciding on immediate PSD regulation of pollutants 

other than sulphur dioxide and particulates the EPA under 

Clean Air Act Amendments of 1977, acted reasonably in 

balancing feasibility in economic impact arguments 

against the goal of protecting clean air areas. Clean Air 

Act, §§ 165, 166, 42 U.S.C.A. §§ 7475, 7476.

[126] Environmental Law 149E 683

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek677 Scope of Inquiry on Review of Administrative Decision

149Ek683 k. Air Pollution. Most Cited Cases

(Formerly 199k25.15(9), 199k25.15(6) Health and 

Environment)

In determining whether Environmental Protection 

Agency acted properly in immediate PSD regulation of 

pollutants other than sulphur dioxide and particulates it 

was not the role of the reviewing court to engage in a 

technical review of policy decisions made by Congress 

where those decisions were clearly stated in Clean Air Act 

Amendments of 1977. Clean Air Act, §§ 165, 166, 42 

U.S.C.A. §§ 7475, 7476.

[127] Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(8) Health and Environment)

Under PSD part of Clean Air Act Amendments of 

1977, the EPA has authority to include a visible emissions 

standard among other emission limitations to be considered by the PSD permitting authority in applying best 

available control acknowledgment; PSD permitting authority could fairly have construed statutory term “emissions standard” as comprehending a visible emissions 

standard. Clean Air Act, §§ 165(a)(4), 169(3), 302(k), 42 

U.S.C.A. §§ 7475(a)(4), 7479(3), 7602(k).

[128] Environmental Law 149E 277

149E Environmental Law

149EVI Air Pollution

149Ek275 Particular Pollutants

149Ek277 k. Particulate Matter. Most Cited 

Cases

(Formerly 199k25.6(8) Health and Environment)

The EPA's inclusion of visible emission standards 

among others, to be used to determine compliance with 

BACT sets no single standard that all PSD permittees must 

meet under Clean Air Act Amendments of 1977 but, instead, regulations contemplate only factoring of an opacity 

standard into other BACT considerations to be applied on a 

“case-by-case basis” to emitting facilities and, as such, the 

regulation is far from oppressive or unduly expansive but 

merely defines some specificity in an area in which the 

permitting authority may exercise reasonable discretion. 

Clean Air Act, §§ 165(a)(4), 169(3), 302(k), 42 U.S.C.A. 

§§ 7475(a)(4), 7479(3), 7602(k).

[129] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)
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© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

The EPA did not exceed its authority under Clean Air 

Act Amendments of 1977 in conditioning grant of a comprehensive PSD permit for a phased construction project 

on: independent BACT review of each phase, actual

commencement of construction of each phase within 18 

months of target date specified in original application, with 

a variance only for commencement of the first phase, and 

avoidance of interruption in construction of any phase for 

longer than 18 months. Clean Air Act, §§ 165, 169(2)(A), 

42 U.S.C.A. §§ 7475, 7479(2)(A).

[130] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Under PSD part of Clean Air Act Amendments of 

1977 the EPA has authority to allow a comprehensive 

permit for construction projects that are to be completed in

phases, with phased construction projects having “mutually dependent” facilities exempt from the new PSD 

requirements if one of the facilities has commenced construction by the applicable grandfather date, i. e., August 7, 

1977. Clean Air Act, §§ 165, 169(2)(A), 42 U.S.C.A. §§ 

7475, 7479(2)(A).

[131] Environmental Law 149E 269

149E Environmental Law

149EVI Air Pollution

149Ek266 Particular Sources of Pollution

149Ek269 k. Power-Generating Facilities; Utilities. Most Cited Cases

(Formerly 199k25.6(7) Health and Environment)

Ineligibility of utility company multiboiler projects for 

grandfathering under Environmental Protection Agency's 

multiphase projects for purpose of PSD permits under 

Clean Air Act Amendments of 1977 is consistent with 

reason behind a multiphase PSD program and has not been 

shown to be arbitrary or capricious. Clean Air Act, §§ 165, 

169(2)(a), 42 U.S.C.A. §§ 7475, 7479(2)(a).

[132] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Within limits of statutory language, EPA can define 

each phase of a multiphase construction project as a separate source for PSD permit and review requirements of 

Clean Air Act Amendments of 1977, so long as each phase 

could reasonably be termed a structure, building, facility or 

installation or it could define the entire project as a single 

source, so long as it was reasonably one facility, or installation, etc., and, as the case may be, require either 

separate or single permits. Clean Air Act, §§ 111(a)(2, 3), 

165(a), 169(1), 42 U.S.C.A. §§ 7411(a)(2, 3), 7475(a), 

7479(1).

[133] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

If a particular phase of a multiphase construction 

project is deemed a separate source, the EPA has authority 

under PSD provisions of Clean Air Act Amendments of 

1977 to require for it a separate permit, but EPA also has 

statutory authority to issue a single permit covering all 

phases of project and, also, if the Agency deems the project 

to be a single source, then a single permit would be appropriate, but if it considers each phase to constitute a 

single source, it may still issue a single permit covering all 

phases, so long as the permit prerequisites are satisfied as 

to each phase. Clean Air Act, §§ 111(a)(2, 3), 165(a), 

169(1), 42 U.S.C.A. §§ 7411(a)(2, 3), 7475(a), 7479(1).

[134] Environmental Law 149E 265

149E Environmental Law

149EVI Air Pollution

149Ek265 k. Permits, Licenses, and Approvals in 

General. Most Cited Cases

(Formerly 199k25.6(5.1), 199k25.6(5) Health and Environment)

Environmental Protection Agency reasonably exer-
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cised its discretion by providing for a comprehensive PSD 

permit, under Clean Air Act Amendments of 1977, for 

related facilities of a single project on a common site and, 

also, limitations on use of comprehensive permit are also 

valid, as to require mutual dependence before multiphase 

projects, one phase of which commenced construction 

prior to 7 August 1977, are exempt from the PSD requirements is a reasonable threshold standard as Act leaves 

Agency discretion to issue separate permits for phases that 

can be deemed separate sources. Clean Air Act, §§ 165, 

169(2)(A), 42 U.S.C.A. §§ 7475, 7479(2)(A).

[135] Environmental Law 149E 291

149E Environmental Law

149EVI Air Pollution

149Ek289 Administrative Agencies and Proceedings

149Ek291 k. Regulations and Rulemaking in 

General. Most Cited Cases

(Formerly 199k25.6(8) Health and Environment)

There was no need for EPA to repropose regulations 

specifying when “construction is commenced” for purpose 

of PSD review and permit requirements of Clean Air Act 

Amendments of 1977 since the rules represented reasonable revisions to original proposal in light of comments 

received. Clean Air Act, § 169(2)(A), 42 U.S.C.A. § 

7479(2)(A).

Opinion of Circuit Judge Robinson

*342 **70 Petitions for Review of Orders of the Environmental Protection agency.Henry V. Nickel, Washington, D. C., with whom George C. Freeman, Jr., Richmond, 

Va., Michael B. Barr, Andrea S. Bear, Washington, D. C., 

were on brief, for Alabama Power Company, et al., in Nos. 

78-1006, 78-1591, 78-1592, 78-1801, 78-1802 and 

78-1832.

Michael K. Glenn, Washington, D. C., for American Paper 

Institute, et al., in Nos. 78-1815 and 78-1832.

James R. Bieke, Washington, D. C., with whom Francis M. 

Shea, Richard T. Conway, William R. Galeota and Joseph 

C. Zengerle, Washington, D. C., were on brief, for Montana Power Company, et al., in Nos. 78-1610, 78-1807 and 

78-1832.

Richard G. Wise, Asst. Corp. Counsel, Washington, D. C., 

with whom Louis P. Robbins, Acting Corp. Counsel, John 

C. Salyer, III, Asst. Corp. Counsel, Washington, D. C., 

were on brief, for District of Columbia in No. 78-1752.

Jim Mathews, Asst. Atty. Gen., State of Texas, Austin, 

Tex., with whom John L. HillFN**, Atty. Gen., David M. 

Kendall, Jr.**, First Asst. Atty. Gen., State of Texas, Austin, Tex., were on brief, for State of Texas in No. 78-1825.

FN** At the time the brief was filed.

John J. Adams, Washington, D. C., and David F. Peters, 

Richmond, Va., were on brief, for American Petroleum 

Institute, et al., in Nos. 78-1008, 78-1595, 78-1596, 

78-1801 and 78-1832.

J. Michael Hines, John D. Field, III and John R. Feore, Jr., 

Washington, D. C., were on brief, for Hampton Roads 

Energy Company in Nos. 78-1590 and 78-1832.

Alan B. Mollohan and J. Roy Spradley, Jr., Washington, D. 

C., were on brief, for Mining and Reclamation Council of 

America, Inc. in Nos. 78-1805 and 78-1832.

Jonathan B. Hill and Donald W. Markham, Washington, 

D. C., were on brief, for The Pittston Company in Nos. 

78-1810 and 78-1832.

Roger M. Golden, Washington, D. C., was on brief, for 

American Iron and Steel Institute in Nos. 78-1811 and 

78-1832.

George J. Miller, Denver, Colo. and William A. White, 

Washington, D. C., were on brief, for Westmoreland Coal 

Company, et al., in Nos. 78-1823, 78-1824 and 78-1832.

James L. Lyons, Washington, D. C., was on brief, for 

Mitchell Energy Co., et al., in Nos. 78-1827, 78-1828, 

78-1829, 78-1830 and 78-1832.

Carl W. Ulrich, William R. Duff and Henry E. Brown, 

Washington, D. C., were on brief, for Colorado Interstate 

Gas Company, et al., in Nos. 78-1832 and 78-1834.

William S. Hemsley, Jr., Washington, D. C., was on brief, 

for GATX Terminals Corporation, et al. in Nos. 78-1832 

and 78-1836.

Albert J. Beveridge, III and Charles A. Patrizia, Wash-
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ington, D. C., were on brief, for Reynolds Metals Company, Inc. in No. 78-1833.

Thomas C. Matthews, Jr., Charles C. Abeles and Donald T. 

Bucklin, Washington, D. C., were on brief, for Occidental 

Oil Shale, Inc., et al., in Nos. 78-1832 and 78-1837.

Frank H. Morison, Donald Quander and James L. White, 

Denver, Colo., were on brief, for ASARCO Inc. in Nos. 

78-1821 and 78-1832.

Robert C. Rauch, for Environmental Defense Fund in Nos. 

78-1006, 78-1008, 78-1525, Part II and 78-1610, Part II.

Peter J. Herzberg, Washington, D. C., with whom H. Anthony Ruckel, Denver, Colo., James H. Cohen and Kristine 

L. Hall, Washington, D. C., were on brief, for Sierra Club 

Legal Defense Fund, Inc. in No. 78-1006, 78-1008, 

78-1591, 78-1592, 78-1595, 78-1596, 78-1752, 78-1839, 

Part II, 78-1801, 78-1802, 78-1805, 78-1806, 78-1807, 

78-*343 **71 1810, Part II, 78-1811, 78-1815, Part II, 

78-1816, 78-1817, 78-1818, 78-1819, Part II, 78-1821, 

78-1822, 78-1823, 78-1824, 78-1825, 78-1827, 78-1828, 

78-1829, 78-1830, 78-1832, 78-1833, 78-1834, 78-1836, 

78-1837 and 78-1838, Part II.

Erica L. Dolgin, Angus Macbeth and Elizabeth Stein, 

Attys., Dept. of Justice, Washington, D. C., with whom 

Sanford Sagalkin, Acting Asst. Atty. Gen., Washington, D. 

C., was on brief, for respondent Douglas M. Costle, et al.

Peter H. Wyckoff, Atty., Environmental Protection 

Agency, Washington, D. C., a member of the bar of the 

Supreme Court of New York pro hac vice by special leave 

of Court, Jeffrey C. Smith and Lydia N. Wegman, Attys., 

Environmental Protection Agency, Washington, D. C., 

with whom Joan Z. Bernstein, General Counsel, Environmental Protection Agency, Washington, D. C., was on 

brief, for respondent Environmental Protection Agency, et 

al.

Lawrence V. Robertson, Jr. and John H. Cheatham, III, 

Washington, D. C., were on brief, for intervenor, Interstate 

Natural Gas Association of America in No. 78-1834.

James W. Moorman and Earl Salo, Attys., Dept. of Justice, 

Washington, D. C., entered appearances for respondent, 

Douglas M. Costle, et al. in Nos. 78-1006 and 78-1008.

Tom Watson, Washington, D. C., entered an appearance 

for intervenor Sierra Pacific Power Company in No. 

78-1832.

Bruce J. Terris and Philip G. Sunderland, Washington, D. 

C., entered appearances for intervenor, Environmental 

Defense Fund, et al. in No. 78-1610, Part II.

Theodore L. Garrett, Washington, D.C., for Ashland-Warren, Inc., in No. 78-1817, and Manufacturing

Chemists Assn., et al., in No. 79-1818; Patricia A. Barald, 

Washington, D.C., on brief, for Manufacturing Chemists 

Assn., in No. 78-1818.

Before LEVENTHAL,FN*** ROBINSON and WILKEY, 

Circuit Judges.

FN*** This opinion was written by Circuit Judge 

LEVENTHAL and concurrences were received 

from the other Judges prior to his death.

PER CURIAM:

Because of the great number of complex issues, the 

court's opinion appears in three parts, each written for the 

court by a member of the panel. Today's opinions supersede the per curiam opinion in this case, issued June 18, 

1979. We have entertained narrowly focused petitions for 

reconsideration, all of which are disposed of by our holdings here.

A table of contents for the three opinions appears at 

the start of Judge Leventhal's opinion.

LEVENTHAL, Circuit Judge:

This is one of three opinions issued today considering 

challenges to the validity of final regulations FN1 promulgated by the Environmental Protection Agency (EPA) on 

June 19, 1978 generally embracing the prevention of significant deterioration of air quality in the nation's “clean air 

areas.”

FN2 These “PSD” regulations interpreted and began 

the implementation of various provisions of the Clean Air 

Act Amendments of 1977.FN3 Pertinent provisions are 

gathered in title I, part C of the Clean Air Act as *344 **72

amended (hereafter sometimes referred to as the “PSD 

part” or the “PSD provisions”).

FN1. 40 C.F.R. ss 51.24, 52.21 (1978).

FN2. “Clean air areas” is the term generally used 

to refer to regions designated under sections 

107(d)(1)(D) & (E) of the Clean Air Act as having 
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ambient air quality better than the applicable national primary or secondary ambient air quality 

standard, or for which there is insufficient data to 

make a determination of the air quality. 42 U.S.C. 

ss 7407(d)(1)(D) & (E) (1978).

FN3. P.L. 95-95, 91 Stat. 685, 42 U.S.C. ss 7401 

et seq. (1978) (hereafter cited as the “1977 

Amendments”). The Clean Air Act is hereafter 

cited as “C.A.A.” or as the “Act.”

Before us are consolidated petitions for review filed in 

this court, as provided by statute, within 60 days of the date 

of promulgation.FN4 A special procedure was employed by 

the Chief Staff Counsel of the Circuit to coordinate the 

efforts of counsel and facilitate the presentation of this 

extraordinarily complex case.FN5 Significant preliminary 

issues raised by these petitions were argued on October 10, 

1978, and our ruling on those questions issued March 27, 

1979.FN6 The remaining issues raised by the petitions, 

involving primarily interpretative questions of comprehensive importance,FN7 came to be argued on April 19 and 

20, 1979.

FN4. C.A.A. s 307(b)(1), 42 U.S.C. s 7607(b)(1) 

(1978).

FN5. Chief Staff Counsel first separated out the 

preliminary issues for argument and arranged for 

them to be heard first in a separate action. Then, 

he aligned the parties according to their interests, 

divided the issues, and assigned them for presentation in written and oral argument.

FN6. Citizens To Save Spencer County v. EPA, 

195 U.S.App.D.C. 30, 600 F.2d 844 (1979)

(upholding EPA's exercise of legislative rulemaking authority to set the effective date for the 

PSD preconstruction review and permit requirements of the 1977 Amendments as March 1, 

1978, subject to minor exceptions).

FN7. In addition to the effect on the interpretation 

and implementation of the PSD provisions, several of the questions decided here are of significance for other comprehensive rulemakings 

under the 1977 Amendments, e. g., the regulations for “nonattainment areas” under part D of 

the Act, 42 U.S.C. ss 7501-08 (1978).

The judicial review provisions as well as other features of the Clean Air Act Amendments set a tone for 

expedition of the administrative process that effectuates 

the congressional purpose to protect and enhance an invaluable national resource, our clean air. Motivated by 

such concerns, after careful and complete consideration of 

the case, we issued on June 18, 1979, a per curiam opinion 

FN8 summarizing our rulings on the questions presented. 

The expedited judgment and per curiam opinion served 

two additional purposes: (1) it enabled the EPA to commence rulemaking or other proceedings necessary to 

promulgate those revisions in the PSD regulations required 

by our rulings, and to take other prudent action to effectuate congressional policies; FN9 and (2) it allowed the court 

to entertain, prior to the issuance of this opinion, narrowly 

focused petitions for reconsideration directed to the panel 

by the parties.FN10

FN8. Alabama Power Company, et al. v. Costle, 

et al., 196 U.S.App.D.C. 161, 606 F.2d 1068 

(1979).

FN9. EPA has proceeded with expedition to revise the pertinent regulation in accordance with 

the rulings of our per curiam opinion. Proposed 

revised regulations have already been published 

in the Federal Register for public comment. 40 

Fed.Reg. 51924 (Sept. 5, 1979).

FN10. The court was prompted to adopt this novel 

procedure by its appreciation of the complex and 

subtle nature of the case. Parties were encouraged 

to consolidate the presentation of petitions for 

reconsideration, a procedure successfully employed at oral argument.

Petitions for reconsideration submitted pursuant to this procedure were submitted without 

prejudice to the right of filing in the ordinary 

course full petitions for reconsideration subsequent to the issuance of this detailed opinion.

The three opinions issued today are in part an incorporation, with some enlargement of analysis, of the rulings 

in our per curiam opinion of June 18, 1979, together with 

modifications that the court has deemed appropriate in 

light of the petitions for reconsideration that have been 

filed. In view of the large number of questions raised, the 

members of the panel divided responsibility for preparation of discrete parts.
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TABLE OF CONTENTS

Opinion for the Court by Judge Leventhal Page

I. BACKGROUND OF PSD PROGRAM AND

REGULATIONS UNDER REVIEW 346

II. POTENTIAL TO EMIT 352

III. EXEMPTION OF 50 TPA CONTROLLED

SOURCES 355

IV. PROTECTION OF THE INCREMENTS361

V. APPLICATION OF PSD PERMITS 

TO

SOURCES IN NONATTAINMENT

AREAS 364

VI. FUGITIVE DUST SOURCES,

RULEMAKING, AND EXEMPTION

AUTHORITY 368

VII. MONITORING 371

Opinion for the Court by Judge Robinson

I. BASELINE DATE 374

II. BASELINE AND VOLUNTARY 

FUEL

SWITCHES 376

III. MODELING 381
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IV. STACK HEIGHT 388

Opinion for the Court by Judge Wilkey

I. SOURCE DEFINITION 394

II. MAJOR MODIFICATION/BUBBLE399

III. POLLUTANTS SUBJECT TO PSD

REGULATION AND THE “MAJOR

EMITTING FACILITY” THRESHOLD403

IV. DEFINITION OF BACT TO INCLUDE A

VISIBLE EMMISSION STANDARD407

V. “COMMENCED CONSTRUCTION” FOR

PHASED CONSTRUCTION 

PROJECTS

409

*346 **74 I. BACKGROUND OF PSD PROGRAM AND 

REGULATIONS UNDER REVIEW FN11

FN11. This description derives in substantial 

measure from the able joint statement of the case 

prepared by industry counsel.

A. Clean Air Amendments of 1970

Responding to the growing perception of air pollution 

as a serious national problem, Congress enacted the Clean 

Air Amendments of 1970,FN12 which restructured the 

Clean Air Act and established a rigorous program for the 

regulation of existing and new sources of air pollution. At 

the heart of the program were federally promulgated national ambient air quality standards (NAAQS) and 

state-adopted plans to implement those standards.

FN12. Pub.L. No. 91-604, 84 Stat. 1676.

Section 109 of the Act FN13 directed the Administrator 

of EPA to promulgate primary and secondary NAAQS 

establishing the maximum permissible concentrations of 

air pollutants. Primary standards were defined as those 

whose attainment and maintenance were necessary “to 

protect the public health,” with “an adequate margin of 

safety.” Secondary standards were to specify the level of 

air quality necessary to “protect the public welfare from 

any known or anticipated adverse effects” of a pollutant. 

Pursuant to this authority, the Administrator in 1971 

promulgated NAAQS for six pollutants, including sulfur 

dioxide and particulate matter, two pollutants of primary 

concern to this litigation.FN14

FN13. Current version at 42 U.S.C. s 7409 

(1978).

FN14. 40 C.F.R. s 50.4-.11 (1978).

The Act contemplated application of the NAAQS to 
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individual sources of pollution through state enforcement. 

Section 110 of the Act FN15 required each state to hold 

hearings on, adopt, and submit to the Administrator a State 

Implementation Plan (SIP) for each “air quality control 

region” within the state. The SIP was to provide (1) for the 

attainment of primary NAAQS “as expeditiously as practicable but . . . in no case later than three years from the 

date of approval of the plan,” and (2) for the attainment of 

the secondary standards within “a reasonable time.” Section 110 required that each plan include “emission limitations, schedules, and timetables for compliance with such 

limitations, and such other measures as may be necessary 

to insure attainment and maintenance” of the ambient air 

quality standards. Once a state plan was submitted, the 

Administrator was to approve it if it was consistent with 

the statutory requirements. If the plan was inadequate, or if 

no plan was submitted, the Administrator was required to 

propose and promulgate a plan for the state.

FN15. Current version at 42 U.S.C. s 7410 

(1978).

The provisions for the attainment and maintenance of 

NAAQS were to operate primarily through controls on 

existing sources of pollution. In addition, the Act contemplated that major new sources of pollution would be subject to controls more stringent than those needed to meet 

primary and secondary NAAQS. Section 111 of the Act 

FN16 required the Administrator to adopt technology-based 

new source performance standards (NSPS) limiting the 

emissions from any new or modified facilities in certain 

industrial categories that “contributed significantly to air 

pollution.” Section 111(e) made it unlawful for a new 

source in such a category to operate in violation of any 

applicable NSPS regardless of whether its emissions 

caused ambient standards to be exceeded. Section 110 also 

provided that state implementation plans contain a preconstruction review procedure to assure that major new 

sources would not interfere with the attainment and 

maintenance of ambient standards.

FN16. Id. at s 7411.

B. The PSD Program Prior to the 1977 Amendments

1) Genesis of PSD Program. Section 110 of the Act 

contained no explicit provision addressing potential deterioration of ambient air quality in those areas where ambient*347 **75 pollutant levels were lower than those 

mandated by primary and secondary NAAQS. EPA did not 

impose on the states any requirement to control new 

sources of pollution that posed no threat to ambient standards.

In 1972, the Sierra Club brought suit alleging that the 

Act required state plans to include measures to prevent the 

“significant deterioration” of air quality in those parts of 

the country where the ambient standards were being met. 

The District Court for the District of Columbia held that 

the Act's statement of purpose, contained in section 

101(b)(1), imposed such an obligation.

FN17 On June 12, 

1972, it issued a preliminary injunction directing the Administrator to disapprove state plans and to promulgate 

regulations where the plan failed to take the measures 

necessary to prevent such deterioration. This court affirmed. On June 11, 1973, the Supreme Court affirmed by 

an equally divided court. In response to the injunction, 

EPA disapproved all state plans in November, 1972, and in 

1973, following the Supreme Court's action, the agency 

initiated rulemaking to incorporate PSD requirements into 

each state plan.

FN17. Sierra Club v. Ruckelshaus, 344 F.Supp. 

253 (D.D.C.1972), aff'd per curiam, 4 ERC 1815 

(D.C.Cir.1972), aff'd by an equally divided court, 

sub. nom. Fri v. Sierra Club, 412 U.S. 541, 93 

S.Ct. 2770, 37 L.Ed.2d 140 (1973).

2) 1974 PSD Regulations. In December, 1974, the 

Administrator promulgated final regulations amending 

each state plan to include a PSD requirement. FN18 The new 

PSD program implemented through preconstruction reviews of new or modified sources of sulfur dioxide and 

particulate matter.FN19 “Significant deterioration” was 

defined in terms of allowable numerical increases in the 

concentration of sulfur dioxide and particulate matter in 

areas where ambient pollution levels were presumed by the 

regulations to be lower than those mandated by primary 

and secondary NAAQS.FN20 These regulated areas came to 

be referred to as “clean air areas,” although, as will become 

clear from our subsequent discussion, the term encompasses areas that in fact need not possess air quality better 

than the applicable NAAQS. These allowable increases, or 

“increments,” determined whether air quality deterioration 

associated with a new facility was permissible. Increment 

consumption, or “use,” was calculated by reference to a 

“baseline” level of air quality. Under the 1974 regulations 

this baseline was defined as the representative air quality 

during 1974 plus the projected emissions from sources that 

had received permits to construct before January 1, 1975,

but were not in operation by that date.FN21

FN18. 39 Fed.Reg. 42,510 (1974).
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FN19. 40 C.F.R. s 52.21(d)(1) (1977) (superseded). EPA stated that it could not regulate for 

PSD the other four pollutants for which NAAQS 

had been established because, among other reasons, existing analytical procedures were not 

adequate to determine the impact of individual 

sources on air quality concentrations of these 

pollutants. See 39 Fed.Reg. 42,51 1 (1974).

FN20. The regulations applied of their own force 

to all areas of the country except as provided by 

the following provision:

The provisions of this paragraph do not apply in 

those counties or other functionally equivalent 

areas that pervasively exceeded any national 

ambient air quality standards during 1974 for 

sulfur dioxide or particulate matter and then 

only with respect to such pollutants. States may 

notify the Administrator at any time of those 

areas which exceeded the national standards 

during 1974 and therefore are exempt from the 

requirements of this paragraph.

40 C.F.R. s 52.21(c)(1) (1977).

FN21. 40 C.F.R. s 52.21(d)(1)(i) (1977) (superseded).

The 1974 regulations established a program under 

which the amount of new growth allowed the size of increment would depend upon the amount of growth desired 

for the area. Areas subject to PSD regulations were divided 

into three groups. Initially, all such areas were designated 

Class II, for which increments were set permitting moderate growth. Areas could be redesignated Class I, for 

which much smaller increments applied, allowing virtually 

no growth, or Class III, for which increases in pollution 

were allowed up to the national ambient standards. Procedures *348 **76 were established for redesignations by 

the state (or, with respect to areas within their jurisdiction, 

by Federal Land Managers and Indian Governing Bodies).FN22

FN22. Id. at s 52.21(c) (superseded).

Small industrial facilities, surface mining, forestry and 

similar operations were not subject to PSD review. Rather, 

the regulations covered 19 categories of typical large industrial (or, in the case of incinerators, municipal) facilities. Each source on the list had significant process emissions of particulates or sulfur dioxide which, EPA estimated, accounted for “essentially all of (the sulfur dioxide 

and particulate matter) emitted in clean areas.”

FN23 New 

sources and modifications of existing sources on the list of 

19 were subject to preconstruction review. The term 

“modification,” which triggered preconstruction review, 

was generally defined as a change in operation or design 

that increased emissions at a source, but it was further 

defined so as to be inapplicable to certain changes, including the use of a more polluting fuel, if the source was 

designed to use the alternate fuel prior to the December, 

1974, promulgation of the PSD regulations.FN24 A PSD 

permit was required for new or modified sources on the list 

if construction was commenced after June 1, 1975.

FN23. 38 Fed.Reg. 18,989 (1973).

FN24. 40 C.F.R. s 52.01(d) (1977) (superseded).

In order to obtain a PSD permit, sources were required 

to demonstrate that their emissions would not violate the 

increments in any area encompassed by the regulations. 

Under the PSD program, after January 1, 1975, all emission increases were counted against the increments unless 

emitted from a source that had received its permit but was 

not in operation by that date.FN25 In other words, emission 

increases from new small sources, from fuel switches and 

from large sources commencing construction between 

January 1, 1975, and June 1, 1975, were not subject to PSD 

review but could consume the increment. Therefore, the 

1974 PSD regulations “would permit” unregulated sources 

of increased emissions “to „use up‟ the entire available 

deterioration increment, and in some cases exceed the 

increment. . . .”

FN26 Since major sources subject to PSD 

were required to “consider the impact” of emission increases from unregulated sources, the PSD program assured that, if the increments were exceeded, PSD permitting of major industrial sources would cease unless the area 

were “reclassified” to make a larger increment applicable 

to it.FN27

FN25. The definition of “baseline,” see 40 C.F.R. 

s 52.21(d)(2)(i) (1977) (superseded), excluded 

such emissions.

FN26. 39 Fed.Reg. 31,004 (1974).

FN27. Id. at 31,003.
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Under the PSD program, determination of a source's 

impact on the applicable increments was based upon 

“diffusion models” mathematical techniques for simulating the diffusion into the atmosphere of a new source's 

emissions under various meteorological conditions and 

operating levels.FN28 The purpose of such models is to 

predict pollutant concentrations at any point in the neighborhood of the source. While EPA recognized that diffusion modeling could not be expected to predict exactly 

actual increment consumption, the “normal variability of 

air quality data,”

FN29 in EPA's view, made it impractical to 

use monitoring data (i. e., actually measured data) to determine increment consumption. Therefore, since models 

were a more “consistent” method for calculating consumption, they were “used to keep track of available (or 

unused) *349 **77 increments as sources and emission(s) 

are increased or decreased.”

FN30

FN28. See Technical Support Document EPA 

Regulations for Preventing the Significant Deterioration of Air Quality 29-30 (1975); J.A. at 

241-42.

FN29. 39 Fed.Reg. 31,003 (1974). The concentration of pollutants in the air is not constant. 

Variable meterological conditions (wind direction, wind speed, temperature, humidity, etc.), 

source location, design and operating modes as 

well as other factors combine to create different 

pollutant concentrations at different times.

FN30. Technical Support Document, supra note 

16, at 29-30, J.A. at 241-42.

“Accounting” by modeling was an on-going process, 

and modeling techniques or assumptions might require 

adjustments in previous estimates of increment consumption. These changes would affect only future PSD applicants, however. As EPA emphasized in its Background 

Document, “significant deterioration is defined in terms of 

air quality increments rather than absolute air quality levels.” Therefore, because the PSD program did not establish “absolute air quality levels” that could not be exceeded, new sources receiving PSD permits were not 

subject to further controls to meet the increment if it were 

later discovered that the “EPA or State approved model 

was inaccurate.”

FN31

FN31. Id.

In addition to the increment impact review, sources 

under the 1974 PSD program had to apply “best available 

control technology,” defined in terms of emission limitations on sulfur dioxide and particulates. These BACT 

limitations were to be established on a case-by-case basis 

unless the source was subject to new source performance 

standards under section 111. The regulations provided that 

where an NSPS was applicable, compliance with the NSPS 

would constitute compliance with BACT.FN32

FN32. 40 C.F.R. s 52.21(d)(2)(ii) (1977) (superseded).

3) Judicial Review of 1974 Regulations. We sustained 

the 1974 PSD regulations over challenges by both industry 

and environmental groups.FN33 The Supreme Court granted 

industry petitions for certiorari to review our holding that 

EPA had authority to adopt PSD requirements under section 110 of the Act. On August 27, 1977, Congress passed 

the Clean Air Act Amendments of 1977 (1977 Amendments). The Supreme Court consequently vacated our 

decision and remanded for consideration in light of the 

1977 Amendments and of possible mootness. We, in turn, 

remanded the case to EPA for consideration of those issues.

FN33. Sierra Club v. EPA, 176 U.S.App.D.C. 

335, 540 F.2d 1114 (1976), vacated sub nom. 

Montana Power Co. v. EPA, 434 U.S. 809, 98 

S.Ct. 40, 54 L.Ed.2d 66 (1977).

C. Clean Air Act Amendments of 1977

The 1977 Amendments FN34 maintain the basic structure of regulation of stationary sources through state plans, 

but made substantial changes in the requirements governing those plans. The Amendments provide for additional 

controls on existing sources to ensure protection of the 

ambient standards and visibility. Further, they establish 

strict requirements for major new sources to be located in 

areas where the national standards have not yet been attained (“non-attainment areas”).

FN34. Pub.L.No. 95-95, 91 Stat. 685, 42 U.S.C. s 

7401 et seq. (1978).

The central focus of this case is Part C of title I (sections 160-169) added to the Clean Air Act by the 1977 

Amendments. Section 161 of the Act FN35 now provides an 

express directive that state plans include measures to pre-
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vent the significant deterioration of air quality in areas 

designated by the states under section 107(d)(1)(D) & (E) 

of the Act as having ambient air quality better than the 

applicable national primary or secondary ambient air 

quality standard, or for which there is insufficient data to 

make a determination of the air quality. An area so designated has commonly been referred to in the legislative 

history and in the literature that has developed as a “clean 

air area,” a description often contrasted with the term 

“non-attainment area,” which is defined by section 171(2) 

of the Act as an area that has been demonstrated to exceed 

an NAAQS for a given pollutant.FN36 We *350 **78 wish 

to alert the reader that the phrase “clean air areas” is a 

generalization that may be confusing when employed in 

technical usages. A so-called clean air area for a given air 

pollutant may include an area that for the same pollutant 

would be classified as a non-attainment area if sufficient 

data existed. Further, since classification of areas is pollutant-specific, the same area may be a clean air area due to 

the air quality with respect to one pollutant, yet be a 

non-attainment area with respect to another pollutant. 

Finally, the areas of the country subject to regulation under 

the PSD provisions of the Act include areas other than 

those commonly referred to as clean air areas. With these 

caveats, which will be explained in greater detail as they 

become pertinent to our discussion, we will continue to use 

the term “clean air areas” as a shorthand expression where 

we do not feel the context calls for a more technical usage.

FN35. 42 U.S.C. s 7471 (1978).

FN36. C.A.A. s 171(2), 42 U.S.C. s 7501(2) 

(1978) provides:

The term „nonattainment area‟ means, for any 

air pollutant an area which is shown by monitored data or which is calculated by air quality 

modeling (or other methods determined by the 

Administrator to be reliable) to exceed any national ambient air quality standard for such 

pollutant. Such term includes any area identified under paragraphs (A) through (C) of section 107(d)(1).

Circumstances will arise where an area that has 

been designated under section 107(d)(1)(D) or 

(E) will be demonstrated on the basis of monitoring data required of a permit applicant under 

section 165(e)(2), or on the basis of other information, to be a nonattainment area for a 

given pollutant. Until the designation of that 

area for such a pollutant is modified under 

section 107, the area will be categorized both 

under section 107 as a presumed “clean air 

area” and under section 171(2) as a “nonattainment area.” This anomaly illustrates that the 

second sentence of the definition of nonattainment area is inclusive, but not exhaustive.

Under the provisions of the 1977 Amendments, areas 

subject to PSD regulation are divided into three classes; 

FN37 increments are set for each class; FN38 new major facilities to be located in such areas must meet technology-based emission limitations reflecting BACT; FN39

these 

facilities cannot commence construction if their emissions 

would cause or contribute to a violation of the applicable 

increments in a Class I, II or III area; FN40 and demonstrations that new facility emissions would not violate the 

applicable increments are to be based on both monitoring 

and diffusion modeling.FN41 The list of 19 major sources 

which emit, or have the potential to emit, 100 tons per year 

or more of any pollutant are subject to PSD review.FN42 In 

addition, any other source having the potential to emit 250 

tons per year or more of any pollutant is also covered. As in 

the 1974 regulations, “modifications” of such major 

sources are also subject to PSD review.FN43 Section 165 of 

the Act FN44 tightens the requirement that must be included 

in state plans for the PSD preconstruction review and 

permitting of major new sources to be located in clean air 

areas. These stricter requirements include: (1) case-by-case 

determination of BACT rather than automatic application 

of NSPS; (2) requirements of air quality impact analyses 

performed in accordance with EPA regulations; (3) requirements for the protection of visibility in Class I areas 

even though Class I increments are met; and (4) provisions 

requiring public hearings in all cases instead of mere opportunity for written comment. Other changes in the 1974 

regulations effected by the 1977 Amendments include 

provision for “variances” from Class I increments if 

stringent criteria are satisfied,FN45 and modification of the 

definition of “baseline.”

FN46 Congress also structured the 

program to minimize disruption, by exempting existing 

sources from the permit requirement of section 165 until 

“modifications” of those facilities increased emissions,*351 **79 FN47 and by phasing sources under construction into the program.FN48 In addition, section 166 

directs EPA to develop within two years PSD programs for 

pollutants other than particulates and sulfur dioxide. EPA 

is not required to follow the “area classification” approach 

for these other pollutants, but implementation through a 

permit program is contemplated.
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FN37. C.A.A., s 162, 42 U.S.C. s 7472 (1978).

FN38. Id. at s 163, 42 U.S.C. s 7473 (1978).

FN39. Id. at s 165(a)(4), 42 U.S.C. s 7475(a)(4) 

(1978).

FN40. Id. at s 169(4), 42 U.S.C. s 7479 (1978).

FN41. Id.

FN42. Id. at s 169(1), 42 U.S.C. s 7479(1) (1978).

FN43. Id. at s 169(2), 42 U.S.C. s 7479(2) (1978).

FN44. Id. at s 165, 42 U.S.C. s 7475 (1978).

FN45. C.A.A. at s 165(d)(2)(D), 42 U.S.C. s 

7475(d)(2)(D) (1978).

FN46. Id. at s 169(4), 42 U.S.C. s 7479(4) (1978).

FN47. Id. at s 169(2)(C), 42 U.S.C. s 7479(2)(C) 

(1978).

FN48. Id. at s 168, 42 U.S.C. s 7478 (1978).

D. PSD Regulations Under the 1977 Amendments

Following several notices of proposed rulemaking, 

comment periods, and public hearings, EPA promulgated 

two sets of final PSD regulations on June 19, 1978. FN49

One set amended 40 C.F.R. Part 51 to provide guidance to 

the states on the development of revised state implementation plans. The other set amended 40 C.F.R. Part 52 to 

incorporate the immediately effective changes required by 

the 1977 Amendments.

FN49. 43 Fed.Reg. 26,380, 26,388 (1978).

The regulations require that each major stationary 

source and each modification covered by the regulations 

undergo a detailed preconstruction review and obtain a 

permit prior to the commencement of construction. The 

PSD review process contains a number of steps:

1) Control Technology Review. Each new major 

source must meet all applicable new source performance 

standards promulgated under section 111 of the Act, all 

emission standards for hazardous pollutants under section 

112 of the Act, and all applicable state implementation 

plan requirements.FN50 In addition, each such source must 

apply best available control technology (BACT) for sulfur 

dioxide and particulates unless emissions of that pollutant 

will be less than 50 tons per year, 1,000 pounds per day and 

100 pounds per hour, whichever is most restrictive.FN51

FN50. 40 C.F.R. ss 51.24(j)(1), 52.21(j)(1) 

(1978).

FN51. Id. at ss 51.24(j)(2), 52.21(j)(2).

2) Air Quality Review. At the time an application for a 

PSD permit is submitted, the owner or operator of the 

proposed source must demonstrate that allowable emissions from the source will not cause or contribute to a 

violation of any NAAQS or the applicable increments.FN52

Estimates of ambient concentrations that must be provided 

in order to determine compliance with these requirements 

must “be based on the applicable air quality models, data 

bases, and other requirements” specified in EPA's modeling guidelines. The models described in these guidelines 

may be modified, or other models substituted, only after 

notice and opportunity for comment by the public, and 

written approval by the Administrator.FN53

FN52. Id. at ss 51.24(1), 52.21(1).

FN53. Id. at ss 51.24(m)(1), 52.21(m)(1).

3) Monitoring Requirements. Two types of monitoring requirements are imposed on sources submitting PSD 

applications after August 7, 1978. An application must 

include a full year of continuous monitoring data for any 

pollutant emitted by the source for which there is an ambient standard. This monitoring data, along with the required modeling results, will form the basis for the permitting authority's determination of whether the proposed 

source would cause or contribute to a violation of a primary or secondary NAAQS. The second requirement is for 

post-construction monitoring, to be used as the state or 

EPA feels necessary to determine actual impact of the 

source on primary or secondary ambient standards.FN54

FN54. Id. at ss 51.24(n), 52.21(n).

4) Source Information. The PSD permit application 

must include, at a minimum, information on the location, 

design, and planned operating schedule of the proposed 

facility, a detailed construction schedule, and a description 
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of the control technology that is proposed as BACT.FN55 In 

addition, *352 **80 the applicant must provide an “analysis of impairment to visibility, soils, and vegetation” in 

the area, and an analysis of the air quality impacts of the 

expected growth associated with the proposed source. FN56

Meteorological and topographical information on the air 

quality impacts and nature and extent of any growth in the 

locale of the proposed facility since August 7, 1977, must 

also be provided if requested by EPA or the state.

FN55. Id. at ss 51.24(o), 52.21(o).

FN56. Id. at ss 51.24(p), 52.21(p).

5) Processing Applications. The regulations establish 

a complex process for handling the permit application. 

Within 30 days of receipt of the application, EPA must 

inform the applicant of any additional information required. EPA or the state must make a final determination 

on the application within one year after the application is 

complete. During that time, EPA or the state must: (a) 

make a preliminary determination whether the proposed 

source will be approved, disapproved, or approved with 

conditions; (b) give public notice of the preliminary determination, provide opportunity for comment and public 

hearing and the applicant's responses, and give the applicant and the public notice of the final determination.FN57

FN57. Id. at ss 51.24(r), 52.21(r).

The regulations also require that, even after the PSD 

review process is completed and permit issued, the state 

plan must be revised and individual source emissions reduced if the state or EPA determines that an applicable 

increment or maximum permissible concentration is being 

violated.FN58

FN58. Id. at s 51.24(a)(1)-(3).

II. POTENTIAL TO EMIT

[1] At the heart of the PSD provisions lies a definition 

that is jurisdictional in nature. We refer to the section 

169(1) definition of “major emitting facility,” which identifies sources of air pollution that are subject to the preconstruction review and permit requirements of section 

165.FN59 The definition is not pollutant-specific, but rather 

identifies sources that emit more than a threshold quantity 

of any air pollutant.FN60 Once a source has been so identified, it may become subject to section 165's substantial 

administrative burdens and stringent technological control 

requirements for each pollutant regulated under the Act, 

even though the air pollutant, emissions of which caused 

the source to be classified as a “major emitting facility,”

may not be a pollutant for which NAAQS have been 

promulgated or even one that is otherwise regulated under 

the Act. As will become apparent *353 **81 from consideration of the ramifications of this definition, Congress's 

intention was to identify facilities which, due to their size, 

are financially able to bear the substantial regulatory costs 

imposed by the PSD provisions and which, as a group, are 

primarily responsible for emission of the deleterious pollutants that befoul our nation's air. Such facilities are defined in section 169(1) as those stationary sources of air 

pollutants from among 28 listed categories which “emit, or 

have the potential to emit” 100 tons per year or more of any 

air pollutant plus any other stationary source with the 

“potential to emit” 250 tons per year or more of any air 

pollutant.

FN59. Section 169(1), 42 U.S.C. s 7479 (1978)

provides in relevant part:

The term “major emitting facility” means any 

of the following stationary sources of air pollutants which emit, or have the potential to 

emit, one hundred tons per year or more of any 

air pollutant from the following types of stationary sources: fossil-fuel fired steam electric 

plants of more than two hundred and fifty million British thermal units per hour heat input, 

coal cleaning plants (thermal dryers), kraft pulp 

mills, Portland Cement plants, primary zinc 

smelters, iron and steel mill plants, primary 

aluminum ore reduction plants, primary copper 

smelters, municipal incinerators capable of 

charging more than two hundred and fifty tons 

of refuse per day, hydrofluoric, sulfuric, and 

nitric acid plants, petroleum refineries, lime 

plants, phosphate rock processing plants, coke 

oven batteries, sulfur recovery plants, carbon 

black plants (furnace process), primary lead 

smelters, fuel conversion plants, sintering 

plants, secondary metal production facilities, 

chemical process plants, fossil-fuel boilers of 

more than two hundred and fifty million British 

thermal units per hour heat input, petroleum 

storage and transfer facilities with a capacity 

exceeding three hundred thousand barrels, taconite ore processing facilities, glass fiber 

processing plants, charcoal production facilities. Such term also includes any other source 
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with the potential to emit two hundred and fifty 

tons per year or more of any air pollutant. This 

term shall not include new or modified facilities 

which are nonprofit health or education institutions which have been exempted by the State.

FN60. Section 165 requires BACT for any pollutant regulated under the act. It should be noted 

that the s 169(1) definition of major emitting facility refers to a broader category of pollutants 

than does that of s 165. Section 169 sets as a 

threshold the emission of “any air pollutant,” and 

s 302(g) defines that extremely broadly.

[2] EPA has interpreted the phrase “potential to emit”

as referring to the measure of a source's “uncontrolled 

emissions” i. e., the projected emissions of a source when 

operating at full capacity, with the projection increased by 

hypothesizing the absence of air pollution control equipment designed into the source.FN61 Yet, the language and 

comprehensive scheme of the statute reveal that an emitting facility is “major” within the meaning of section 

169(1), only if it either (1) actually emits the specified 

annual tonnage of any air pollutant, or (2) has the potential, 

when operating at full design capacity, to emit the statutory 

amount. The purpose of Congress was to require preconstruction review and a permit before major amounts of 

emissions were released into the air. When determining a 

facility's potential to emit air pollutants, EPA must look to 

the facility's “design capacity” a concept which not only 

includes a facility's maximum productive capacity (a criterion employed by EPA) but also takes into account the 

anticipated functioning of the air pollution control equipment designed into the facility.

FN61. 40 C.F.R. ss 51.24(b)(3), 52.21(b)(3) 

(1978).

[3][4] We are cognizant that in general a court defers 

to the interpretation of a new statute by the agency that is 

charged with putting it into effect, meshing the wheels, and 

that presumably has some awareness of the approaches of 

legislators particularly concerned with the legislation. 

However, we view our analysis of congressional intent, set 

forth above, as clearly discernible from section 169(1). We 

identify the following as indicators of legislative intent. 

Looking at language, we see that the first sentence provides that a major emitting facility (in enumerated categories) must “emit, or have the potential to emit” 100 tons per 

year of any air pollutant. Plainly, the pollutants that 

sources “emit” is a reference to some measure of actual 

emissions. However, under EPA's interpretation of “potential to emit,” the actual emissions calculation called for 

by the verb “emit” would lose all significance. When potential emissions are calculated, as EPA provided, by assuming operation at full capacity, without any reduction to 

take into account the operation of the facility's air pollution 

control equipment, then potential emissions will always 

and inherently exceed actual emissions. Under our construction a meaning is given to the use of “emit” and “or,”

as applicable in those instances when for any reason, 

whether or not there is fault or accident, the “cleansing”

equipment has not been operated, or has been operated at 

variance from design.FN62

FN62. We are aware that the second sentence of 

section 169(1), which extends coverage of the 

term “major emitting facility” to “any other 

source with the potential to emit” 250 tons per 

year of any air pollutant, is not phrased in the 

disjunctive; the verb “emit” has not been included. Nevertheless, we are unpersuaded that 

Congress intended the disjunctive form of the first 

sentence to be mere surplusage. It may be that the 

“actual emissions” alternative should be read into 

the second sentence on the ground that Congress 

plainly included a parallel construction.

For a wide angle lens on intent, we turn to the fact that 

Congress was fully aware that many major new sources of 

air pollution were already required by law to install and 

operate air pollution control equipment. The “new source 

performance standards” of section 111 of the Act, as well 

as provisions of existing state implementation plans, were 

the sources of such requirements. In this context one would

require strong statutory*354 **82 evidence that Congress 

intended to approach the measurement of emissions in 

ignorance and disregard of the operation of pollution control equipment already required by law to be designed into 

a facility. All the statutory evidence points the other way.

The coverage of the 100 ton-per-annum threshold of 

the first sentence of section 169(1) extends to 28 categories 

of facilities. A look at these categories, and a further look 

at the legislative history FN63 reveal that Congress was 

concerned with large industrial enterprises major actual 

emitters of air pollution. The draftsmen were of the view 

that certain small industrial facilities within these categories might actually and potentially emit less than the threshold amount. But the submissions of the parties establish 

that no operational industrial facility that could be described as within the listed categories would have the 
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“potential to emit” less than the threshold amount if the 

operation of cleansing control equipment is totally discounted.

FN63. See notes 70 & 72, infra.

Congress was presumably also aware of the high rate 

of effectiveness with which control equipment eliminates 

pollutants from unprocessed industrial emissions. For 

example, at the time of the enactment of the PSD provisions, technology in operation was capable of eliminating 

over 99% of the particulate matter from emissions. Thus, a 

source with the potential according to EPA's “uncontrolled 

emissions” standard to emit 100 tons per annum of particulate matter would emit in actuality less than one ton per 

year. The record illustrates that the heating plant operating 

in a large high school or in a small community college 

would become “major” sources under such a test. FN64 We 

have no reason to believe that Congress intended to define 

such obviously minor sources as “major” for the purposes 

of the PSD provision.

FN64. Cong.Rec. 512812 (July 19, 1976), LHA at 

382.

[5] EPA recognized that its definition placed an intolerable burden on both the agency and minor sources of 

pollution and sought to cope with it by creating a broad 

exemption for smaller sources. As we explain in a subsequent section of this opinion,FN65 the Act does not give the 

agency a free hand authority to grant broad exemptions. 

Though the costs of compliance with section 165 requirements are substantial, they can reasonably be borne 

by facilities that actually emit, or would actually emit when 

operating at full capacity, the large tonnage thresholds 

specified in section 169(1). The numbers of sources that 

meet these criteria, as we delineate them, are reasonably in 

line with EPA's administrative capability.

FN65. See section III, infra.

EPA asserts that its view is supported by the interplay 

between the section 169(1) definition of major emitting 

facility and a partial exemption from PSD review requirements specified in section 165(b).FN66 It suffices at 

this juncture to refer to a subsequent part of the Court's 

opinion,FN67 and say that EPA's asserted conflict between 

sections 165(b) and 169(1) is premised on an erroneous 

interpretation of the application of section 165(b).

FN66. Section 165(b) creates a partial exemption 

from certain PSD review requirements for facilities that have been “modified” where the increase 

in particulate and SO 2 emissions, due to the 

modification, is less than 50 tons per year. EPA 

asserts that the proper interpretation of section 

165(b) creates a conflict with the definition of 

major emitting facility that is eliminated when the 

measure of a major emitting facility is projected 

emissions in the absence of “cleansing” control 

equipment.

FN67. See section III of Judge Wilkey's opinion 

in this case.

We mention the legislative history with some diffidence, for it is extensive, complex, and conflicting in certain instances. But our full review of the materials that 

have come to our attention reveals that the legislative history in general supports our interpretation of section 

169(1).

The critical phrase “emit, or (has) the potential to 

emit” had its origin in the Senate version of the bill that 

was to become*355 **83 the 1977 Amendments to the 

Clean Air Act.FN68 The House version used the equivalent 

phrase: “directly emits, or has the design capacity to emit.”

FN69 The Conference Committee adopted the wording of 

the Senate bill, but its Report reflects an understanding of 

the equivalence of the House and the Senate versions on 

this point. We refer to the Report's interpolation of the 

House language into the Conference Committee's paraphrase of the final provision:

FN68. S.Rep.No.94-717, 94th Cong., 2d Sess. 

221 (1976), LHA at 1691 (1976 version of bill); 

S.Rep.No.95-127, 95th Cong., 2d Sess. 219 

(1977), LHA at 2643 (1977 version of bill).

FN69. H.Rep.No.94-1175, 94th Cong., 2d Sess. 

358 (1976), LHA at 932 (1976 version of bill); 

H.Rep.No.95-194, 95th Cong., 2d Sess. 438 

(1977), LHA at 1908 (1977 version of bill).

The State plan must require permits for: (a) All 28 categories listed in the Senate bill if the source has the potential (design capacity) to emit over 100 tons per year; 

and (b) any other source with the design capacity to emit 

more than 250 tons per year of any air pollutant.

FN70
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FN70. H.Rep.No.95-564, 95th Cong., 1st Sess. 

152 (1977), LHA at 3046, U.S.Code Cong. & 

Admin.News, pp. 1077, 1533.

EPA agrees that the Conference Committee treated the 

House and Senate versions as having the same meaning but 

argues that EPA's “uncontrolled emissions” construction 

was intended. There is some support for EPA's position in 

legislative history, particularly on the Senate side,FN71 but 

the overall legislative history does not support EPA's position. The committee reports and floor debates evidence 

the understanding that only major sources of actual emissions would be covered by the PSD permit requirements 

and that some sources within the 28 industrial categories 

would be too small to satisfy the threshold tonnage specified in section 169(1).FN72 These understandings are inconsistent with EPA's “uncontrolled emissions” approach.

FN71. EPA makes the point that the term “potential emissions” had some currency within the 

agency during the course of the legislative 

process and that the term referred to emissions in 

the absence of pollution control equipment. EPA 

also points to portions of the legislative history 

where documents or postulated situations employing the “potential emissions” usage have 

been incorporated. At most, there are indications 

from these references that there may have been 

some ambiguity or confusion at times between the 

term “potential emissions” and the term “potential to emit.” But it is too great a leap to conclude 

from these few references that one phrase (“potential emissions”) describing a type of emissions, 

has the same meaning as “potential to emit,” a 

phrase used in the statute to describe a type of 

polluting source.

FN72. E. g., S.Rep.No.94-717, supra, at 23, 123 

Cong.Rec. S12809 (July 29, 1976), LHA at 381 

(remarks of Sen. McClure); S.Rep.No.95-127, 

supra, at 96-97, LHA at 2521; 123 Cong.Rec. 

S9169 (June 8, 1977), LHA at 2667 (remarks of 

Sen. Muskie); id. at S9255 (June 9, 1977) (remarks of Sen. Domenici).

[6] We remand the regulations premised on EPA's 

erroneous construction of section 169(1) for appropriate 

revision by the agency.FN73

FN73. The design capacity of a facility rarely 

contemplates uninterrupted operation 24 hours 

per day, 365 days per year. Projected down-time 

for repair and maintenance or other factors may 

reduce the hours of operation that are appropriately considered in the calculation of a facility's “potential to emit.”

The Court's per curiam opinion did not address 

the issue of whether such planned down-time 

must, or may, be included in calculating “potential to emit;” and, we do not decide it today. 

Since the issue was not briefed and argued, we 

are not in a position to define for this specific 

question the appropriate response by EPA, 

given our clarification at a more general level 

of the meaning of “potential to emit.” Industry 

has petitioned this court to comment on proposed EPA regulations addressing this point, 

and has registered with us objections to them. 

The appropriate forum for such discussion is 

the notice and comment proceeding on those 

proposed regulations. At a later date, if necessary, recourse might be had to this Court. For 

now, we indicate only that we did not have this 

issue in mind when we issued the per curiam 

opinion, and we do not decide it today.

III. GENERAL EXEMPTION FOR STATIONARY 

SOURCES EMITTING LESS THAN 50 TONS PER 

YEAR OF ANY AIR POLLUTANT

Having swept in too many facilities, in our view, by its 

interpretation of “potential *356 **84 to emit,” EPA inserted in its PSD regulations a partial exemption from the 

preconstruction review and permit requirements of section 

165 for all major emitting facilities that emit less than 

specified amounts,FN74 50 tons on a yearly basis, of any air 

pollutant. The pertinent amount is to reflect operation at 

maximum capacity and employing the air pollution controls imposed either by the applicable State Implementation Plan (SIP) or by an enforceable permit.FN75

FN74. The specified amounts were 50 tons per 

year, 1,000 pounds per day, or 100 pounds per 

hour, whichever was most restrictive. For the 

purposes of this opinion, we shorthand these 

amounts in terms of the annual figure, 50 tons per 

year.

FN75. 40 C.F.R. ss 51.24(j)(2), (k)(1)(ii); 

52.21(j)(2), (k)(1)(ii) (1978).

Petitioners Sierra Club and the Environmental De-
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fense Fund contend that the Act contains no warrant for the 

Administratively-created exemption, and that even if statutorily permissible, the action was arbitrary and capricious.

EPA does not argue that its 50 ton per year exemption 

is consistent with the statutory language of the Clean Air 

Act. Rather, EPA concedes FN76 that its exemption allowing sources and modifications under 50 tons per year to 

forego BACT and air quality assessment is an “expansion”

of the limited exemption provided in section 165(b) of the 

Act.FN77 This “expansion” is defended as reflecting EPA's 

judgment that application to such sources of the full preconstruction review and permit process would not be 

cost-effective and would strain to the limits the agency's 

resources. Characterizing its approach as “(f)ollowing 

Congress(„s) lead,” EPA concluded that the costs to industry and permitting authorities entailed in reviewing an 

estimated 2,400 PSD applications for sources emitting less 

than 50 tons would far outweigh the benefit of the “relatively insignificant” reduction in emissions that would 

result. Consequently, EPA “expanded” the exemption 

found in section 165(b) to new as well as existing sources, 

and precluded BACT review as well as air quality review. 

EPA promised periodic assessments to assure that overall 

air quality in any pertinent area did not deteriorate beyond 

the level of any increment.FN78

FN76. 43 Fed.Reg. 26393, Joint Appendix (J.A.) 

80.

FN77. Section 165(b), 42 U.S.C. s 7475(b) 

(1978), of the Act provides:

The demonstration pertaining to maximum allowable increases required under subsection 

(a)(3) (air quality review) shall not apply to 

maximum allowable increases for class II areas 

in the case of an expansion or modification of a 

major emitting facility which is in existence on 

August 7, 1977, whose allowable emissions of 

air pollutants, after compliance with subsection 

(a)(4) (BACT), will be less than fifty tons per 

year and for which the owner or operator of 

such facility demonstrates that emissions of 

particulate matter and sulfur oxides will not 

cause or contribute to ambient air quality levels 

in excess of the national secondary ambient air 

quality standard for either of such pollutants.

FN78. 43 Fed.Reg. 26392-93 (1978).

[7][8][9][10] EPA's “expansion” of the section 165(b) 

exemption falls well beyond the agency's exemption authority. Moreover, it is premised on a misconstruction of 

the meaning and motivation of the section. The court has 

given close consideration to this provision and has toiled to 

give a reasonable construction to language that is somewhat awkward and which does not easily disclose the 

function intended for it by Congress. We conclude that the

exemption is applicable to major emitting facilities in 

Class II areas which existed on August 7, 1977,FN79 and 

which become subject to the permit requirements of section 165 because *357 **85 of an expansion or modification that, after application of BACT, results in a net increase of less than 50 tons a year in the emissions from that 

facility. Those expansions or modifications that come 

within the exemption of section 165(b) are permitted to 

operate so long as they will not cause or contribute to 

ambient air quality levels in excess of the national secondary ambient air quality standard for two pollutants, 

sulfur dioxide and particulate matter. Were this exemption 

not in the statute, major emitting facilities, in order to avoid 

the permit requirements of section 165, would be encouraged to pursue their plans for industrial expansion by establishing small, independent facilities rather than by the 

more efficient expansion or modification of existing facilities. FN80

FN79. In Citizens to Save Spencer County v. 

EPA, 195 U.S.App.D.C. 30, 600 F.2d 844 (1979), 

we approved EPA regulations establishing March 

19, 1978, as the effective date of the preconstruction review and permit requirements. That 

date supplanted the effective date specified in 

section 165(a), the date of enactment of the Clean 

Air Act Amendments of 1977, August 7, 1977. 

The date specified in section 165(b) was obviously intended to mirror that of section 165(a). 

In view of this congressional intention, EPA 

would have latitude to alter by rule the effective 

date in section 165(b) to conform with the new 

effective date of the PSD provision. Absent such 

rulemaking, however, this Court is constrained to 

apply the literal terms of the statute.

FN80. In EPA's view, section 165(b) applies to a 

major emitting facility in existence on the date of 

enactment of the Clean Air Act Amendments that 

becomes subject to section 165 due to an expansion or modification where the allowable emissions from the entire facility have been reducted, 
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after BACT, to less than 50 tons per year. EPA 

has construed the curious phrase “whose allowable emissions” as referring to emissions from the 

major emitting facility. Though this construction 

may be supported by one reading of the syntax, it 

is so teratogenetic as to force us to reject it as an 

incorrect interpretation of the provision. Such a 

construction would render section 165(b) completely non-functional. The section allows a facility to operate notwithstanding the fact that it 

would exceed maximum allowable increases for 

Class II areas. But any major emitting facility in 

existence on the date of enactment would have a 

credit within the baseline concentration of at least 

50 tons per annum because on the baseline date 

that facility would certainly have been emitting 

air pollutants at a rate of 50 tons per annum. If that 

same source reduces its emissions to below 50 

tons per annum it is obviously in no danger of 

exceeding its credit. On such a reading, therefore, 

section 165(b) would be superfluous.

[11] We have concluded above that EPA erred in defining “potential to emit” by discounting the beneficial 

effects of air pollution control equipment designed into a 

facility. For practical purposes, then, the dispute over the 

50-ton exemption has become academic. Since “major 

emitting facilities” subject to section 165 are only those 

sources which after controls emit or have the potential to 

emit at least 100 tons annually, sources emitting 50 tons 

per year or less would ipso facto be excluded from the PSD 

requirements. Nevertheless, standard doctrine teaches us 

that our proper course is to remand this matter for further 

consideration by EPA.

In view of the possibility that EPA may refashion, 

rather than terminate, its exemption, we guide our remand 

by identifying the principles pertinent to an agency's authority to adopt general exemptions to statutory requirements. This discussion is appropriate because the exemption regulations under discussion reflect a misunderstanding by EPA of these principles and of regulatory exemptions based upon assessment of costs and benefits. 

These principles may have bearing on EPA's reconsideration of this exemption on remand and would appear to have 

bearing on a number of other EPA actions under review.

[12] Exemptions Born of Administrative Necessity. 

Certain limited grounds for the creation of exemptions are 

inherent in the administrative process, and their unavailability under a statutory scheme should not be presumed, 

save in the face of the most unambiguous demonstration of 

congressional intent to foreclose them. But there exists no 

general administrative power to create exemptions to statutory requirements based upon the agency's perceptions of 

costs and benefits.

[13] We noted at the outset that we are not concerned 

here with the “equitable” discretion of agencies to afford 

case-by-case treatment taking into account circumstances 

peculiar to individual parties in the application of a general 

rule to particular cases, or even in appropriate cases to 

grant dispensation from the rule's operation. The need for 

such flexibility in appropriate cases is generally recognized, and enhances the effective operation of the administrative process,FN81 though Congress may, of *358 **86

course, restrain the agency by mandating standards from 

which no variance is permitted.FN82 In this case, however, 

we are presented with an attempt by an agency to promulgate a blanket exemption from statutory requirements. 

The EPA's action reflects no choice to exercise administrative discretion based on circumstances peculiar to the 

individual case.

FN81. E. g., Allegheny-Ludlum Steel Corp. v. U. 

S., 406 U.S. 742, 755, 92 S.Ct. 1941, 1949, 32 

L.Ed.2d 453 (1972); Portland Cement Ass'n v. 

Ruckelshaus, 158 U.S.App.D.C. 308, 332, 486 

F.2d 375, 399 (1973), cert. denied, 417 U.S. 921, 

94 S.Ct. 2628, 41 L.Ed.2d 226 (1974) (“a regulatory system which allows flexibility, and a lessening of firm proscriptions in a proper case, can 

lend strength to the system as a whole”).

FN82. E. g., E. I. du Pont de Nemours & Co. v. 

Train, 430 U.S. 112, 137-39, 97 S.Ct. 965, 

979-980, 51 L.Ed.2d 204 (1977); see Weyerhaeuser Co. v. Costle, 191 U.S.App.D.C. 309, 

329-335, 590 F.2d 1011, 1031-37 (1978).

[14] Categorical exemptions from the clear commands 

of a regulatory statute, though sometimes permitted, are 

not favored. In FPC v. Texaco Inc., 417 U.S. 380, 94 S.Ct. 

2315, 41 L.Ed.2d 141 (1974), the Supreme Court held that 

the FPC had no authority to exempt rates charged by small 

producers of natural gas from regulation under the just and 

reasonable standard of the Natural Gas Act. Although it 

recognized that persuasive arguments had been made that 

the assumptions underlying natural gas regulations did not 

obtain for such producers, and that continued regulation 

might even be counterproductive, the Court declared that 

its role was not “to overturn congressional assumptions 
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embedded into the framework of regulation established by 

the Act.” Id. at 400, 94 S.Ct. at 2327-2328. Similarly, in 

NRDC v. Costle, 186 U.S.App.D.C. 147, 568 F.2d 1369 

(1977), this court held that the EPA lacked the power to 

exempt categories of point sources from the permit requirements established in section 402 of the Federal Water 

Pollution Control Act Amendments of 1972. We emphasized: “Courts may not manufacture for an agency a revisory power inconsistent with the clear intent of the relevant 

statute.” Id. at 155, 568 F.2d at 1377. In American Iron & 

Steel Institute v. EPA, 568 F.2d 284 (3rd Cir. 1977), the 

Third Circuit rejected EPA's blanket exemption of steel 

plants in the Mahoning Valley from BACT requirements. 

Id. at 306-08. While recognizing that the FWPCA permitted flexibility to accommodate diverse conditions, the 

court held that “an exemption by regulation from effluent 

limitations is not a permissible means of accommodating 

diversity.” Id. at 307 (footnote omitted; emphasis in the 

original).

[15] This broad principle that frowns upon categorical 

administrative exemptions is strict, but is not absolute. 

Considerations of administrative necessity may be a basis 

for finding implied authority for an administrative approach not explicitly provided in the statute. The relevance 

of such considerations to the regulatory process has long 

been recognized. Courts frequently uphold streamlined 

agency approaches or procedures where the conventional 

course, typically case-by-case determinations, would, as a 

practical matter, prevent the agency from carrying out the 

mission assigned to it by Congress. As the Supreme Court 

recognized in approving the adopting by the FPC of area 

rate regulation as the practical means of regulating thousands of natural gas producers:

“(C)onsiderations of feasibility and practicality are certainly germane” to the issues before us. . . . We cannot, in 

these circumstances, conclude that Congress has given 

authority inadequate to achieve with reasonable effectiveness the purpose for which it has acted.

Permian Basin Area Rate Cases, 390 U.S. 747, 777, 

88 S.Ct. 1344, 1365, 20 L.Ed.2d 312 (1968) (quoting 

Bowles v. Willingham, 321 U.S. 503, 517, 64 S.Ct. 641, 

648, 88 L.Ed. 892 (1944)).FN83

FN83. Accord. E. I. du Pont de Nemours & Co. v. 

Train, 430 U.S. 112, 132, 97 S.Ct. 965, 977, 51 

L.Ed.2d 204 (1977); Weinberger v. Hynson, 

Westcott & Dunning, Inc., 412 U.S. 609, 621-22 

93 S.Ct. 2469, 2479, 37 L.Ed.2d 207 (1973); 

United States v. Storer Broadcasting Co., 351 

U.S. 192, 202-05, 76 S.Ct. 763, 770-71, 100 L.Ed. 

1081 (1956); Environmental Defense Fund v. 

EPA, 194 U.S.App.D.C. 143, 165-66, 598 F.2d 

62, 84-85 (1978).

Another application of the underlying principle appears in *359**87Morton v. Ruiz, 415 U.S. 199, 94 S.Ct. 

1055, 39 L.Ed.2d 270 (1973). There, the controlling statute 

provided general assistance benefits under the Snyder Act 

to Indians living on or near reservations. When Congress 

did not provide enough funding to provide for both classes, 

the Bureau of Indian Affairs decided to use the limited 

funds solely for Indians living on reservations. The Court 

held that such a policy, operating as it did to curtail the 

statutory rights of those Indians living near but not on 

reservations, could not be implemented unless there was 

compliance with the procedural requirements of notice-and-comment rulemaking set forth in the Administrative Procedure Act, 5 U.S.C. s 553. But, the Court acknowledged the substantive authority of the Secretary to 

take appropriate action to cope with the administrative 

impossibility of applying the commands of the substantive 

statute. Id. at 230-31, 94 S.Ct. at 1072.

[16] The same consideration of administrative need to 

adjust to available resources would apply where the constraint was imposed not by a shortage of funds but, say, by 

a shortage of time, or of the technical personnel needed to 

administer a program.FN84

FN84. Cf. American Federation of Labor, et al. v. 

Marshall, et al., 187 U.S.App.D.C. 121, 128-29, 

570 F.2d 1030, 1037-38 (1978); NRDC v. Train, 

166 U.S.App.D.C. 312, 332, 510 F.2d 692, 712 

(1974).

A corollary principle is observed by the courts when 

practical considerations make it impossible for the agency 

to carry out its mandate. Thus, in NRDC v. Train, 166 

U.S.App.D.C. 312, 510 F.2d 692 (1974), we considered 

EPA's failure to meet certain statutory deadlines for the 

promulgation of effluent guidelines under the Federal 

Water Pollution Control Act. In ordering that the guidelines be issued no later than December 31, 1974, we did not 

accept EPA's “apprehension that it (would) not be able to 

publish the great majority of the guidelines” by the deadline. We nevertheless did recognize the possibility of a 

showing by EPA that publication of some of the guidelines 

by that date was infeasible. We perceived two “constraints” on the agency:
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First, it is possible that budgetary commitments and 

manpower demands required to complete the guidelines 

by December 31 are beyond the agency's capacity or 

would unduly jeopardize the implementation of other 

essential programs. Second, EPA may be unable to 

conduct sufficient evaluation of available control technology to determine which is the best practicable or may 

confront problems in determining the components of 

particular industrial discharges.

166 U.S.App.D.C. at 332, 510 F.2d at 712. We acknowledge the principle that an agency official required 

“to do an impossibility,” should be relieved from sanction. 

Id. at 333, 510 F.2d at 713. But we emphasized that the 

agency bore a heavy burden to demonstrate the existence 

of an impossibility:

An equity court can never exclude claims of inability to 

render absolute performance, but it must scrutinize such 

claims carefully since officials may seize on a remedy 

made available for extreme illness and promote it into 

the daily bread of convenience.

Id.

[17][18][19][20] Viewed in its most favorable light, 

EPA seeks approval of a prospective exemption of certain 

categories from a statutory command based upon the 

agency's prediction of the difficulties of undertaking regulation.FN85 The agency's burden of justification in such a 

case is especially heavy. This is not a circumstance of an 

agency seeking relief from a charge which, after a good 

faith effort, it has found it cannot perform. It is, rather, an 

agency seeking vindication of an approach contrary to the 

*360 **88 explicit statutory design on the basis of its 

estimate of its lack of capacity to handle the task delegated 

to it. Before a court sanctions such actions, it will carefully 

study the governing statute in the manner of Permian Basin, to ascertain whether the statute authorizes approaches 

that deviate from the legislative mandate in response to 

concerns about feasibility. Thus in NRDC v. Costle, supra, 

we rejected EPA's arguments that a categorical exemption 

of runoff point sources from the National Pollution Discharge Elimination System was necessary because of the 

infeasibility of developing national effluent limitations 

applicable to all runoff point sources and the impossibility 

of processing the literally millions of applications for 

discharge permits. We found in the statutory scheme a 

flexibility encompassing devices such as “general” effluent permits (similar to the area rate regulation employed in 

Permian Basin ), and this flexibility was sufficient to accomplish the regulatory purpose, thereby alleviating any 

need to exempt runoff sources entirely.FN86

FN85. Cf. WNCN Listeners Guild v. FCC, 197 

U.S.App.D.C. 319, at 327-330, 610 F.2d 838, at 

846-849 (1979) (en banc ) (rejecting FCC claim 

that implementation of Circuit's rules on format 

diversity would result in an “administrative 

nightmare”). To the extent the agency relies, in 

support of its exemption, on substitution of its 

own analysis of policy considerations for those 

enunciated by Congress, we must reject its action 

as trenching on the congressional function.

FN86. A similar administrative approach, supported by the doctrine of necessity, is the deferral 

of regulation in individual instances until the aggregation of these instances surpasses a reasonable threshold. The agency's burden of justification 

for such an approach is substantially less than that 

required when the agency seeks to exempt rather 

than defer regulation.

[21][22][23] Exemptions for De Minimis Circumstances. Categorical exemptions may also be permissible as 

an exercise of agency power, inherent in most statutory 

schemes, to overlook circumstances that in context may 

fairly be considered de minimis. It is commonplace, of 

course, that the law does not concern itself with trifling 

matters,FN87 and this principle has often found application 

in the administrative context.FN88 Courts should be reluctant to apply the literal terms of a statute to mandate 

pointless expenditures of effort. As we wrote in District of 

Columbia v. Orleans, 132 U.S.App.D.C. 139, 141, 406 

F.2d 957, 959 (1968), “(t)he „de minimis' doctrine that was 

developed to prevent trivial items from draining the time of 

the courts has room for sound application to administration 

by the Government of its regulatory programs . . .” The 

ability, which we describe here, to exempt de minimis 

situations from a statutory command is not an ability to 

depart from the statute, but rather a tool to be used in implementing the legislative design.FN89

FN87. See, e. g., Washington v. Washington State 

Commercial Passenger Fishing Vessel Ass'n, 443 

U.S. 658, 687 n. 29, 99 S.Ct. 3055, 3076 n. 29, 61 

L.Ed.2d 823 (1979) (Indian fishing rights); 

Pennsylvania v. Mimms, 434 U.S. 106, 110, 98 

S.Ct. 330, 333, 54 L.Ed.2d 331 (1977) (search 

and seizure); Ingraham v. Wright, 430 U.S. 651, 

674, 97 S.Ct. 1401, 1414, 51 L.Ed.2d 711 (1977)
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(due process liberty interest); Sniadach v. Family 

Finance Corp., 395 U.S. 337, 342, 89 S.Ct. 1820, 

1823, 23 L.Ed.2d 349 (1969) (Harlan, J., concurring).

FN88. See, e. g., FPC v. Texaco, Inc., 417 U.S. 

380, 399, 94 S.Ct. 2315, 2327, 41 L.Ed.2d 141 

(1974); Volkswagenwerk, A.G. v. FMC, 390 U.S. 

261, 276-77, 88 S.Ct. 929, 937-38, 19 L.Ed.2d 

1090 (1968); Monsanto Company v. Kennedy, 

198 U.S.App.D.C. 214, 222, 613 F.2d 947, 955 

(1979); United Glass & Ceramic Workers v. 

Marshall, 189 U.S.App.D.C. 240, 242, 584 F.2d 

398, 440 (1978); Marine Space Enclosures, Inc. v. 

FMC, 137 U.S.App.D.C. 9, 16, 420 F.2d 577, 584 

(1969).

FN89. In this respect, the principle is a cousin of 

the doctrine that, notwithstanding the “plain 

meaning” of a statute, a court must look beyond 

the words to the purpose of the act where its literal 

terms lead to “absurd or futile results.” United 

States v. American Trucking Ass'ns, 310 U.S. 

534, 543, 60 S.Ct. 1059, 1063, 84 L.Ed. 1345 

(1939); District of Columbia v. Orleans, 132 

U.S.App.D.C. 139, 141, 406 F.2d 957, 959 

(1968).

[24][25] Determination of when matters are truly de 

minimis naturally will turn on the assessment of particular 

circumstances, and the agency will bear the burden of 

making the required showing. But we think most regulatory statutes, including the Clean Air Act, permit such 

agency showings in appropriate cases.

[26][27] While the difference is one of degree, the 

difference of degree is an important one. Unless Congress 

has been extraordinarily rigid, there is likely a basis for an 

implication of de minimis authority to provide exemption 

when the burdens of *361 **89 regulation yield a gain of 

trivial or no value. That implied authority is not available 

for a situation where the regulatory function does provide 

benefits, in the sense of furthering the regulatory objectives, but the agency concludes that the acknowledged 

benefits are exceeded by the costs. For such a situation any 

implied authority to make cost-benefit decisions must be 

based not on a general doctrine but on a fair reading of the 

specific statute, its aims and legislative history. Congress, 

in section 165(b), permitted a narrow exemption for modifications, and from air quality review only; this provides

no basis for EPA to exercise a “revisory power” to exclude 

new sources as well as modifications, and to extend the 

exemption to BACT review in addition to air quality review.

[28][29][30] We do not here extend our analysis of 

exemption authority for other situations,FN90 beyond taking 

note that our ruling that there is a narrow exemption authority has not been challenged in any of the petitions for 

reconsideration, and has been invoked in other contexts by 

several of the parties.FN91 As to the context of the “50-ton 

exemption,” if this has practical importance notwithstanding our “potential to emit” ruling, EPA must take into 

account in any action following the remand that this exemption authority is narrow in reach and tightly bounded 

by the need to show that the situation is genuinely de minimis or one of administrative necessity.

FN90. For example, industry petitioners raise the 

issue that mercury is only a “trace” emission from 

electric generating plants. See Industry Petitioners' Petition for Rehearing on the Application of 

PSD Requirements to Pollutants Other than Sulfur Dioxide and Particulates at p. 15.

The court does not agree with industry petitioners that the fact that emission of mercury is

not within the group of sources covered by the 

national emissions standards for hazardous air 

pollutants (40 C.F.R. s 61.50) means that 

mercury is not a pollutant subject to regulation.

It may be that, assuming EPA considers it in the 

public interest, it would be able to craft a de 

minimis exemption regulation that would have 

the result sought by petitioners. The matter is 

not now presented to us in a manner permitting 

authorization declaration.

Apart from its limited de minimis exemption 

authority, EPA has flexibility to consider costs 

and benefits in deciding what is “best available 

control terminology” for any situation.

FN91. Respondents' Response to Industry Petitioners' Motion for Clarification and Petitions for 

Rehearing and for Reconsideration at 20 (August 

2, 1979); Sierra Club Brief in Response to Industrial Petitioners' Motion for Rehearing and 

Motion for Clarification and to the Environmental 

Protection Agency's Petition for Stay of Issuance 

of Mandate at 6-7 (August 2, 1979); Response of 
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the District of Columbia to Industry Petitioners' 

Petition for Rehearing on the Application of PSD 

Requirements to Pollutants Other Than Sulfur 

Dioxide and Particulates at 2 (August 2, 1979).

IV. PROTECTION OF THE INCREMENTS

[31] The regulations provide that once it is determined 

that a state implementation plan “is substantially inadequate to prevent significant deterioration or that an applicable increment is being violated,” then the SIP must “be 

revised to correct the inadequacy or the violation.”

FN92 We 

rule that EPA has authority under the statute to prevent or 

to correct a violation of the increments, but the agency is 

without authority to dictate to the States their policy for 

management of the consumption of allowable increments.

FN92. 40 C.F.R. s 51.24(a)(3) (1978).

[32] The PSD part of the statute, by its title and by its 

terms, is designed to prevent significant deterioration of air 

quality in the nation's “clean air areas” in general, those 

areas that have or are presumed to have air quality better 

than that specified in the applicable primary and secondary 

national ambient air quality standards (NAAQS).FN93 The 

fundamentals of the statutory approach include differentiation within the clean air areas of Class I, II, and III 

areas,FN94 and specification for each class of areas of 

maximum allowable increases (“increments”) in pollution 

concentrations for *362 **90 particulate matter and sulfur 

dioxide,FN95 with provision for the Administrator to 

promulgate allowable increments or similar limitations for 

other pollutants governed by NAAQS.FN96 These provisions set as the threshold of “significant deterioration” for 

each pollutant in each area the lower of the allowable 

increment of the applicable NAAQS,FN97 and the emphatic 

goal of the PSD provisions is to prevent those thresholds 

from being exceeded. It is evident that the principal mechanism for monitoring the consumption of allowable 

increments and for preventing significant deterioration is 

the preconstruction review and permit process required for 

new or modified major emitting facilities by the provisions 

of section 165. However, we cannot agree with industry's 

contention that section 165 provides the exclusive mechanism for protection of the increments. The Administrator has authority beyond the provisions of section 165 to 

prevent or to remedy a violation of the thresholds specified 

in the Act.

FN93. C.A.A. at s 107(d)(1)(D) & (E); 42 U.S.C. 

s 7407(d)(1)(D) & (E) (1978).

FN94. C.A.A. at ss 162, 163; 42 U.S.C. ss 7472, 

7473 (1978).

FN95. C.A.A. at s 163, 42 U.S.C. s 7473 (1978).

FN96. C.A.A. at s 166; 42 U.S.C. s 7476 (1978).

FN97. C.A.A. at s 163(b)(4); 42 U.S.C. s 

7473(b)(4) (1978).

The statutory provisions central to our conclusion are 

sections 161 and 163(a). Section 161 provides in pertinent 

part:

each applicable implementation plan shall contain 

emission limitations and such other measures as may be 

necessary, as determined under regulations promulgated 

under this part, to prevent significant deterioration of air 

quality in each (clean air area).FN98

FN98. 42 U.S.C. s 7471 (1978).

Section 163 provides in part:

each applicable implementation plan shall contain 

measures assuring that maximum allowable increases 

over baseline concentrations of, and maximum allowable concentrations of (sulfur oxides and particulates) 

shall not be exceeded.FN99

FN99. 42 U.S.C. s 7473(a) (1978).

On their face, these provisions establish the thresholds 

as limitations that are not to be exceeded and contemplate

that state implementation plans shall include such measures “as may be necessary” to ensure the observance of this 

command. The section 165 permit process alone does not 

ensure that maximum concentrations or allowable increments will not be exceeded. Significant deterioration may 

occur due to increased emissions from unregulated minor 

sources and major emitting facilities grandfathered out of 

the permit process, due to the use of different models to 

calculate increment consumption, due to the discovery 

through monitoring that limitations inadvertently have 

been exceeded, due to redesignation of an area to a more 

restrictive class, or due to allocation through administrative error of too many permits. Nothing in the plain language of the statute limits the measures in the state implementation plan to the preconstruction permit process. 

The legislative history reflects an understanding that other 
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measures might be required and are within the authority 

conveyed by the Act.

The Conference Report states that the “House provision requiring that the State Implementation Plan must 

contain measures to insure that significant deterioration, as 

defined, will be prevented was accepted.”

FN100 The House 

Report, in discussing its provision, stated: “This preconstruction review process should help minimize the need for 

enforcement or other actions under the State implementation plan requiring additional postconstruction control 

measures on the permitted plants.”

FN101 And at another 

point: “States would not be required to apply the permit 

process to smaller new sources, although the State plan 

would still be required to contain such measures as are 

necessary to prevent significant deterioration.”*363 **91

FN102 Implicit in each statement is a contemplation that 

measures under the Act include more than the 

pre-construction process.

FN100. H.Rep.No.95-564, 95th Cong., 1st Sess.

153 (1977), LHA at 3047, U.S.Code Cong. & 

Admin.News, p. 1534.

FN101. H.Rep.No.95-294, 95th Cong., 1st Sess. 

145 (1977), LHA at 1615, U.S.Code Cong. & 

Admin.News, p. 1224.

FN102. Id. at 171, LHA at 1641, U.S.Code Cong. 

& Admin.News, p. 1250.

[33][34] Industry representatives do not successfully 

counter the force of the statute and the legislative history. 

They argue that section 161 refers to incorporation into 

state plants of such other measures as may be necessary “as 

determined under regulations promulgated under this 

part,” and they assert that the only regulations mentioned 

in the PSD part are those identified as relating to the preconstruction permitting process. This argument overlooks 

the Administrator's general rulemaking authority under 

section 301 of the Act to “prescribe such regulations as are 

necessary to carry out his functions under this Act,” for a 

regulation promulgated under this general authority to 

ensure compliance with section 161 is a regulation promulgated under the PSD part. Industry petitioners also rely 

on those sections of the Act that provide for waiver provisions which, conceivably, could allow increments to be 

exceeded. The waiver has vitality and recognition in that 

facilities granted special consideration under these provisions are, in effect, treated as facilities operating in compliance with the provisions of the Act. But the totality of 

facilities in compliance, as a group, may be subject to 

measures necessary to cope with a condition of pollutants 

exceeding the PSD maximum.

[35] Finally, industry petitioners argue that the EPA 

regulations that preceded passage by Congress of the PSD 

provisions undertook to prevent significant deterioration 

through preconstruction review only. And they further 

agree, correctly, the legislative history gives no indication 

that this fundamental aspect of the prior regulatory approach was being altered. But this omission and negative 

implications do not offset the language of the Act and the 

affirmative implications of the House Report that enforcement measures were contemplated beyond preconstruction review. Though the Act is patterned in many 

respects on the pre-existing regulatory approach, there are 

many differences. Congress did not in each instance 

compare the legislation with the reach of the prior regulations, and we cannot view as controlling its failure to do so 

in this instance.

[36][37] The challenged regulation is interpretative in 

nature. FN103 It simply states the proposition that SIPs must 

make provision to ensure that violations of the increments 

of maximum allowable concentrations do not occur, and, if 

they have occurred, to ensure that steps will be taken to 

correct the violation. EPA has furnished no guidelines to 

the states in this regard; there is no requirement that specified corrective measures be employed. Industry evidences a concern that when EPA does promulgate guidelines or require specific measures, certain operating facilities will be unfairly disadvantaged. Obviously, such considerations are not ripe for review at this time. We may 

confirm that EPA has authority to require inclusion in state 

plans of provision for the correction of any violation of 

allowable increments or maximum allowable concentrations, and may even require, in appropriate instances, the 

relatively severe correctives of a rollback in operations or 

the application of retrofit air pollution control technology. 

At oral argument, EPA assured the court that any such 

measures would be employed in a reasonable fashion on 

the basis of a rule of general applicability, or by some 

reasonable attribution of responsibility for the violation. 

Any regulations promulgated will be reviewed with such 

considerations in mind.

FN103. As an interpretative rule, the challenged 

regulation was exempt from the notice and 

comment requirements of the APA and of section 

307(d) of the Clean Air Act. 5 U.S.C. s 553(b)(A) 

(1976); 42 U.S.C. s 7607(d) (1978). Thus there is 
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no merit to the contention of industry that the 

regulation was promulgated without due procedural regularity.

[38] The environmental groups have petitioned us to 

require EPA to promulgate guidelines detailing the manner 

in which *364 **92 States may permit consumption of the 

available increments. They also seek to have EPA set aside 

some portion of the available increments to ensure that 

current development does not inadvertently cause a violation of the maximum thresholds. EPA has evidenced an 

intention to promulgate guidelines to help the states manage the allocation of available increments. This is an appropriate step. But this is not to say that the agency may 

prescribe the manner in which states will manage their 

allowed internal growth. In the allocation of responsibilities made by Congress, maximum limitations have been 

set. These must be observed by the states, but assuming 

such compliance, growth-management decisions were left 

by Congress for resolution by the states.

V. SOURCES LOCATED IN NON-ATTAINMENT 

AREAS

Section 165(a) FN104 provides that a PSD permit is 

required before a major emitting facility “may be constructed in any area to which this part applies.” Industry 

petitioners contend that this language limits the application 

of the PSD review requirements to sources constructed in 

certain locations, and that those locations are the statutorily 

defined “clean air areas.”

FN105 On this premise, industry 

petitioners argue that section 165 does not apply to sources 

located in the so-called “non-attainment” areas. FN106 EPA, 

on the other hand, takes the position that the identification 

of “clean air” and “non-attainment” areas in section 107(d) 

FN107 of the Act are only a starting point for the planning 

process that will lead to revised state implementation 

plans, that these identifications do not shape the “area” to 

which the PSD review requirements apply, and that preconstruction review must precede the construction anywhere of a major emitting facility which will adversely 

affect the air quality of an area to which this part applies. 

EPA's regulations extend the permit requirements of section 165 to all sources, wherever located, if the emissions 

from the source have an impact on any clean air area.FN108

The issue, then, is whether a source becomes subject to the 

PSD review process because of its location within an area 

to which this part applies, or because of its impact upon the 

air quality of one.

FN104. 42 U.S.C. s 7475(a) (1978).

FN105. In this context, the term “clean air area”

refers to those air quality control regions in which 

the ambient air quality does not exceed the applicable NAAQS, which there is insufficient data 

to make such a determination. See C.A.A. at ss 

161, 163(b), 42 U.S.C. ss 7471, 7473(b) (1978). 

The clean air areas are identified pursuant to 

C.A.A. at s 107(d)(1)(D), (E), 42 U.S.C. s 

7407(d)(1)(D), (E) (1978).

FN106. “Non-attainment” areas are defined in 

section 171(2) as those air quality control regions 

designated, under sections 107(d)(1)(A)-(C), as 

regions that fail to meet the standards of an applicable NAAQS.

FN107. 42 U.S.C. s 7407(d) (1978).

FN108. 40 C.F.R. ss 51.24(i)(1), 52(i)(1) (1978).

EPA discovers in the purposes of the Clean Air Act 

and the 1977 Amendments an authority sufficient to justify 

its regulation applying section 165 according to impact. It 

asserts that such a reading is necessary to prevent the significant deterioration of air quality in fact. Section 160(4) 

sets forth as a purpose of Part C (PSD) “to assure that 

emissions from any source in any State” (regardless of 

whether the location of the source is designated an attainment area) “will not interfere with” any portion of the 

PSD plan for any other State. Clearly, EPA argues, the 

concern is with the air quality in clean air areas, not with 

the location of the source affecting that air quality. Finally, 

the agency contends, Section FN109 161 incorporates the 

purpose set out in Section 101(b)(1),FN110 to protect and 

enhance the quality of the nation's air resources which 

prompted this Court's holding in Sierra Club v. Ruckelshaus.FN111

FN109. 42 U.S.C. s 7471 (1978).

FN110. 42 U.S.C. s 7401(b)(1) (1978).

FN111. 344 F.Supp. 253 (D.D.C. 1972), aff'd per 

curiam, 4 ERC (D.C. Cir. 1972), aff'd by a equally 

divided court sub nom. Fri v. Sierra Club, 412 

U.S. 541, 93 S.Ct. 2770, 37 L.Ed.2d 140 (1973).

**93 *365 [39] EPA is correct that portions of the 

legislative history indicate that the purposes of the Act 

would best be served by an extension of the PSD provi-
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sions to any source, the emissions from which adversely 

affect the non-degradation scheme.FN112 But this alone does 

not present the situation we faced in Sierra Club, where 

Congress had clearly articulated a purpose but had remained silent as to the means for effectuating that purpose. 

Nor do we have here a case where two provisions of the 

Act are in irreconcilable conflict, the situation we faced in 

Citizens to Preserve Spencer County v. EPA.FN113 Rather, 

we have here an instance where the Congress, presumably 

after due consideration, has indicated by plain language a 

preference to pursue its stated goals by what EPA asserts 

are less than optimal means. In such a case, neither this 

court nor the agency is free to ignore the plain meaning of 

the statute and to substitute its policy judgment for that of 

Congress.

FN112. See, e. g., H.Rep.No.95-564, 95th Cong., 

1st Sess. 151 (1977); H.Rep.No.95-294, 95th 

Cong., 1st Sess. 9, 145, 151-52 (1977).

FN113. 195 U.S.App.D.C. 30, 600 F.2d 844 

(1979).

[40] After careful consideration of the statute and the 

legislative history, we must accept the contention of the 

industry petitioners that the phrase “constructed in any area 

to which this part applies” limits the application of Section 

165 to major emitting facilities to be constructed in certain 

locations. But, we reject the proposition that the only statutory means available to fulfill the purposes of Part C are 

the permit provisions of s 165.

The plain meaning of the inclusion in section 165 of 

the words “any area to which this part applies” is that 

Congress intended location to be the key determinant of 

the applicability of the PSD review requirements. That this 

is the correct interpretation is underscored by the inclusion 

of the same words in section 165(a)(3)(A), and by the 

precise language employed by Congress in those provisions where its concern was more source (rather than area) 

specific. FN114

FN114. See, e. g., C.A.A. at s 169A(b)(2)(a), 42 

U.S.C. s 7491(b)(2)(a) (1978); C.A.A. at s 

165(a)(7), 42 U.S.C. s 7475(a)(7) (1978); C.A.A. 

at s 165(e)(1), 42 U.S.C. s 7475(e)(1) (1978).

The legislative history supports our interpretation. The 

language of the pertinent provision, section 165(a), derives 

from the original bill reported to the Senate in 1976 by the 

Public Works Committee. That bill stated in pertinent part 

that “(n)o major emitting facility . . . may be constructed in 

any area designated under this subsection.”

FN115 That 

plainly means location in a designated (clear air) area. In 

1977, when Senator Muskie introduced the bill, FN116 he 

said, with respect to its PSD provisions, that it was “in 

every significant detail identical to last year's bill.”

FN117

When the Senate provision limited the PSD permit process 

to sources in areas “designated under this subsection,” it 

was expressly limiting that process to sources located in 

the areas subject to PSD protection. The Conference bill 

maintained the principle of the Senate version in that regard, but substituted for the Senate provisions the House 

provisions which designated the areas subject to PSD 

protection. Because of this combined approach, the conferees could not refer to areas “designated under this subsection” (or even “section”) because, unlike the Senate bill, 

the PSD provisions of the Conference bill comprised several sections (ss 160-169 of Part C). Accordingly, in order 

to make the intended reference, the language was changed 

to area “to which this part applies.” This change in language preserved location as a determinant of the applicability of section 165. Therefore, we conclude, as noted 

above,FN118 that the phrase “constructed*366 **94 in any 

area to which this part applies” limits the application of 

section 165 to major emitting facilities to be constructed in 

certain locations.

FN115. Senate Bill, S.3219, 94th Cong., 2d Sess. 

(1976).

FN116. Senate Bill, S.252, 95th Cong., 1st Sess. 

(1977).

FN117. 123 Cong.Rec. S9162 (daily ed., June 8, 

1977).

FN118. See also Remarks of Senator Hart, 122 

Cong.Rec. S12470 (daily ed., July 26, 1976); 

Remarks of Senator Muskie, 122 Cong.Rec. 

S13316 (daily ed., August 4, 1978).

EPA sought to further extend the reach of the PSD 

review provisions. But, to so extend EPA's authority is to 

ignore the fact that section 165(a) defines those major 

emitting facilities which become subject to its permit requirements and does so by virtue of location in a designated area.

EPA argued initially, and in its petition for reconsideration, that limiting the application of the permit requirements of section 165 solely to sources within clean air 
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areas may not provide an adequate solution to a particular 

pollution problem associated with those areas the problem 

of interstate pollution. In our per curiam opinion, we indicated agreement with the position advanced by EPA, 

noting that the problem of interstate pollution was indeed a 

serious concern not dealt with adequately by the permit 

requirement. It was our apprehension that Congress did not

intend such a major pollution problem to go untreated, and 

this led us to discover within the statute a basis for the 

exercise by EPA of rulemaking authority to extend the 

permit requirement of section 165 beyond its literal limitations.

[41] Our review of the petitions for reconsideration 

submitted by both the industry petitioners and EPA has led 

us to conclude that sections other than section 165 are 

available to fulfill that congressional objective of need to 

cope with the problem of interstate pollution.

[42] Section 110(a)(2)(E)(i) provides a vehicle for 

implementing the congressional objective of abating substantial interstate air pollution. That provision requires that 

an SIP shall contain “adequate provisions . . . prohibiting 

any stationary source within the State from emitting any air 

pollutant in amounts which will . . . interfere with measures 

required to be included in the applicable implementation 

plan for any other state under (the PSD part).” The phrase 

“measures required to be included” in an SIP clearly incorporates at least (1) the absolute emissions limitation for 

each pollutant for which increment limitations have been 

set under section 163 or 166, (2) the monitoring and modeling requirements of section 165(e), and (3) “such other 

measures as may be necessary, as determined under regulations promulgated under (part C),” as provided in section 

161. EPA's authority, under s 110(a)(2)(E) (i), to prevent 

interstate inference with these measures to prevent, in other 

words, the industry of one state from interfering with the 

PSD program of another is clear. And, it does not depend 

upon the permit process of section 165 for its effectiveness.

[43] So also, section 126 of the Act is a vehicle for 

abating substantial interstate air pollution independent of 

permitting. That provision allows that, upon petition by a 

state or political subdivision, the EPA may determine that a 

source in a neighboring state “emits or would emit any air 

pollutant in violation of the prohibition of section

110(a)(2)(E)(i).” If such a violation is found, the remedy 

provided by section 126(c) which remedy is applicable 

“(n)otwithstanding any permit which may have been 

granted by the State” is not denial or revocation of a permit, but a prohibition against construction or operation for 

a new source and a prohibition against continued operation 

for an existing source, unless EPA authorizes continued 

operation for up to three years while the source is being 

brought into compliance with s 110(a)(2)(E)(i).

[44] The industry petitioners acknowledged the obligation imposed upon them by sections 110 and 126 in their 

Response to EPA's Petition for Rehearing.

Even if s 126(a)(1)(A) does not mandate SIPs to require 

notice from sources in nonattainment areas, as we believe, that does not relieve such sources from the requirements of s 110(A)(2)(E)(i) that SIPs contain 

“adequate provisions” preventing any source from 

emitting pollutants in amounts which will interfere with 

the PSD measures required to be included in the SIPs of 

other States. Nor does it relieve them from the provisions 

*367 **95 of s 126(b) for enforcement of s 

110(a)(2)(E)(i). If notice similar to that otherwise provided in s 126(a) should be necessary to prevent violation of s 110(a)(2)(E)(i) by a source in a nonattainment 

area which would adversely affect air quality in a 

clean-air area of another State, we do not perceive any 

reason why such notice could not be required pursuant to 

s 110(a)(2)(E)(i) even though not required by s 126(a)(1) 

(A).FN119

FN119. Response of Industry Petitioners to 

Respondents' Petition for Rehearing at 12 (filed 

August 2, 1979).

We hold that both section 110(a)(2)(E)(i) and section 

126(c) give EPA the authority to require that SIP's contain 

provisions sufficient to address the problem of interstate 

air pollution. We find that section 126(a) gives the agency 

the authority to require that SIP's include notice provisions 

designed to trigger the mechanisms required by section 

110(a)(2)(E)(i) or section 126(c). And we find that section 

126(b) is an additional means to activate those mechanisms 

by permitting any state or political subdivision to petition 

the Administrator for a finding that “any major source 

emits or would emit any air pollutant in violation of the 

prohibition of section 110(a)(2)(E)(i).”

FN120

FN120. 42 U.S.C. s 7426(b) (1978) (emphasis 

added).

[45] To the extent that there is any gap in those notice 

provisions, section 114 is available. It provides that for the 

purpose of carrying out the provisions of the Act “the 

Administrator may require any person who owns or oper-
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ates any emission source . . . to (A) establish and maintain 

such records, (B) make such reports, (C) install, use, and 

maintain such monitoring equipment or methods, (D) 

sample such emissions . . ., and (E) provide such other 

information, as he may reasonably require . . .”

FN121 Thus, 

section 114 authorizes the Administrator to require any 

facility to provide notice of an interstate impact on air 

quality, be it or some other source the cause of the impact.

FN121. 42 U.S.C. s 7414 (1978) (emphasis added).

[46] Section 161 FN122 provides still another vehicle for 

implementing the congressional objective of abating substantial interstate air pollution. We realize that, at oral 

argument, EPA disclaimed invocation of section 161 

rulemaking authority to address this problem. However, 

that disclaimer came at a time when, in the agency's view, 

section 165, by its own terms, applied PSD review to 

sources of interstate air pollution impacting on clean air 

areas. Given such a view of section 165, the agency's disclaimer of authority under section 161 was reasonable. We 

have now held that section 165 does not, by its own terms, 

apply to sources located outside of clean air areas. In this 

light, and in view of the legislative desire to prevent interstate impacts, the authority granted to the EPA by the plain 

language of section 161 “each (SIP) shall contain emission 

limitations and such other measures as may be necessary, 

as determined under regulations promulgated under this 

part, to prevent significant deterioration of air quality (in 

clean air areas)”

FN123 grants to the Administrator the power 

to promulgate rules requiring that SIPs adequately address 

the problem. We hold that the Administrator may promulgate rules to require the inclusion of such provisions in 

the SIP of the state whose clean air area is affected, of the 

state which is the source of the adverse impact, or of both.

FN122. 42 U.S.C. s 7471 (1978).

FN123. Id. (emphasis added).

[47] This is not a case where Congress has crafted a 

specified set of measures to solve a problem, so that additional measures in agency-initiated rules can be deemed 

not “necessary.” On the contrary, this is a case where the 

congressional objective to meet the problem of substantial 

interstate pollution is clear, and the statutory measures 

addressed to it are modest. Accordingly, a determination 

that supplemental measures are “necessary,”

FN124 for the 

purpose of triggering*368 **96 rulemaking authority 

under section 161, is within the authority granted by 

Congress, even though generally the statute relies on 

measures specified by Congress rather than a contemplation of broad agency rulemaking discretion.

FN124. Even giving that term an expansive 

reading, see, e. g., Niagara Mohawk Power Corporation v. FPC, 126 U.S.App.D.C. 376, 379 F.2d 

153 (1967).

In sum, though it is clear from the legislative history 

that Congress intended to address the problem of interstate 

pollution, we are of the view that the Administrator has 

authority to administer section 110(a)(2)(E)(i) and section 

126(b) and (c) in conjunction with section 114 and section 

126(a) so as to require SIPs to address the problem. We are 

also of the view that EPA has additional authority, pursuant to rulemaking authority granted in section 161, to 

promulgate regulations requiring that SIPs include measures to abate interstate adverse impacts on clear air areas.

[48] There are provisions in the Act, such as those of 

section 165(d)(2), which evidence a solicitude for the 

maintenance of air quality in federal lands but there are 

none which justify the application of the permit requirements of section 165 to sources not located in, but impacting upon, such areas. Section 169A is available to 

protect visibility in Class I areas where visibility is an 

important characteristic, and the Administrator may 

choose to invoke the rulemaking authority granted to him 

by section 161 to address this problem. We find no basis 

for reading into section 165 an application of the PSD 

review provisions to sources in non-attainment areas that 

impact upon the air quality of federal lands and Indian 

reservations.

In conclusion, based upon our analysis of the Act, we 

vacate EPA's regulations extending the permit requirements of section 165 to all sources, wherever located, if the 

emissions from the source have an impact on any clean air 

area. FN125 We do so because they were promulgated pursuant to EPA's reading of Section 165, a reading which we 

have rejected.FN126

FN125. 40 C.F.R. ss 51.24(i)(1), 52.21(i)(1) 

(1978).

FN126. Should the Administrator determine that 

the provisions of sections 110, 126, and 114 are 

insufficient to address the problem of interstate 

pollution that impacts upon clean air areas, he 

may use his rulemaking authority under section 
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161 to promulgate new regulations. Those regulations will, of course, be subject to review.

[49] Based upon this analysis, we are no longer confident that this statute provides a predicate for the court to 

put a “gloss” on section 165 sufficient to support EPA 

rulemaking authority to apply the permit requirements of 

that section to major emitting facilities located in 

non-attainment areas in one state that impact adversely 

upon clean air areas within a neighboring state.

EPA, in a petition for reconsideration, correctly points 

out that emissions from facilities located in a 

non-attainment area within a state which impact adversely 

on the air quality of federal lands and Indian reservations 

raise similar problems of interjurisdictional pollution as are 

presented in the context of interstate pollution.

VI. REGULATION OF FUGITIVE EMISSIONS, INCLUDING FUGITIVE DUST

[50] In the general definitional section of the Act, 

section 302(j), FN127 Congress employed the term “fugitive 

emissions” to refer to one manner of emission of any air 

pollutant. As commonly understood, emissions from an 

“industrial point source” include emissions emanating 

from a stack or from a chimney. By contrast, “fugitive 

emissions,” are emissions from a facility that escape other 

than from a point source. Principal among the fugitive 

emissions is “fugitive dust,” a term referring to fugitive 

emissions by particulate matter.FN128 EPA's regulations 

encompass sources of fugitive emissions (including fugitive dust) as well as industrial point sources. A subsequent 

*369 **97 section of this opinion FN129 confirms EPA's 

authority to regulate sources of fugitive emissions and 

discusses the factors that de- limit the agency's discretion 

to define a “source” or an “emitting facility” of fugitive 

emissions.

FN127. 42 U.S.C. s 7602(j) (1978).

FN128. Though we have discerned the general 

parameters of these terms, EPA has latitude to 

provide reasonable, though more specific, definitions along similar lines, so long as they comport 

with congressional intent.

FN129. See section III of Judge Wilkey's Part of 

this opinion.

[51] EPA's regulation of fugitive emissions has been 

of special concern to the mining and forestry industries 

which contend, without serious opposition, that they are 

incapable of meeting the strict limitations on the emission 

of particulate matter set by the PSD provisions. The terms 

of section 165, which detail the preconstruction review and 

permit requirements for each new or modified “major 

emitting facility” apply with equal force to fugitive emissions and emissions from industrial point sources.FN130

EPA assumed that there is similarly no distinction to be 

made between fugitive emissions and emissions from 

industrial point sources when determining whether a 

source is a major emitting facility within section 169(1) 

FN131 and thus subject to section 165. This assumption led 

the agency to conclude that sources of fugitive dust satisfying the annual tonnage threshold specified in section 

169(1) are major emitting facilities. But, solicitude for the 

plight of the extractive and silvaculture industries motivated EPA to promulgate a partial exemption for sources 

of fugitive dust, an exemption which industry argues is 

inadequate and environmental groups contend is beyond 

agency authority.FN132

FN130. 42 U.S.C. s 7475 (1978).

FN131. 42 U.S.C. s 7479(1) (1978).

FN132. 40 C.F.R. ss 51.24(k)(5), 52.21(k)(5) 

(1978). The regulation maintains the requirement 

that such sources apply best available control 

technology (BACT) as defined by section 169(3), 

42 U.S.C. s 7479(3) (1978), but exempts them 

from the otherwise-required showing that particulate emissions from the facility will not exceed 

either the applicable national ambient air quality 

standards (NAAQS) or the allowable increments.

[52] EPA is correct that a major emitting facility is 

subject to the requirements of section 165 for each pollutant it emits irrespective of the manner in which it is 

emitted. However, a source emitting large quantities of 

fugitive emissions may remain outside the definition of 

major emitting facility and thus may not be subject to the 

requirements of section 165.

[53] The origin of this distinction lies in section 302(j) 

of the Act, which provides:

Except as otherwise expressly provided, the terms 

“major stationary source” and “major emitting facility”

mean any stationary facility or source of air pollutants 

which directly emits, or has the potential to emit, one 
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hundred tons per year or more of any air pollutant (including any major emitting facility or source of fugitive 

emissions of any such pollutant, as determined by rule 

by the Administrator).FN133

FN133. 42 U.S.C. s 7602(j) (1978).

EPA construes this provision as a general definition of 

“major emitting facility” that is totally supplanted for the 

PSD provisions by the definition of major emitting facility 

contained in section 169(1). Such is not the case. Section 

302(j) is a definition of “major emitting facility” in quantitative terms. That quantitative term is set at the threshold 

of 100 tons per year. The calculation of the 100 ton figure 

includes “fugitive emissions of any such pollutant, as determined by rule by the Administrator.” Thus, section 

302(j) specifically attaches a rulemaking requirement for 

the inclusion of fugitive emissions in the threshold calculation. The legislative history of this rulemaking provision 

is sparse, but it well may define a legislative response to 

the policy considerations presented by the regulation of 

sources where the predominant emissions are fugitive in 

origin, particularly fugitive dust. Whatever the motivation 

of the “rule” provision of 302(j), its existence is unmistakable. Even if the origin of this provision is fortuitous, 

the provision may be welcomed as serendipitous, for it 

gives EPA flexibility to provide industry-by-industry 

consideration and the appropriate tailoring of coverage.

*370 **98 We must still ask where the special rulemaking provision of section 302(j) has been supplanted by 

the definition, in section 169(1), of “major emitting facility.” We consider section 169(1) to be governed by the 

rulemaking requirement of section 302(j). Section 302(j) is 

a general definitional section defining terms “when used in 

this Act” and 302(j) begins: “Except as other expressly 

provided.”

Section 169(1) does expressly make a substantial 

modification in the 302(j) definition of “major.” The 100 

ton-per-annum threshold is expressly retained only for 

sources within 28 listed categories. For “any other source,”

the threshold is expressly raised to 250 tons per annum.

However, section 169(1) has no “express” provision 

modifying section 302(j)' s “rule” requirement as to fugitive emissions. Therefore under section 169(1) controlled 

in this respect by section 302(j), the calculation of the 

threshold quantity emissions may include fugitive emissions only as determined by rule by the Administrator.

[54] As we have noted, the regulations under review 

include a partial exemption from statutory permit requirements for major emitting facilities of fugitive dust. In 

light of our discussion in section III of this opinion, we 

have reason to doubt whether EPA possesses the statutory 

authority to promulgate the exception in this manner, but 

we need not resolve the question. The exemption rule was 

based on a premise that we have held to be erroneous 

namely, that the statute of its own momentum subjects 

major sources of fugitive emissions to PSD preconstruction review and permit requirements. In light of our interpretation of section 302(j), and in accordance with our 

discussion as to the limits of EPA general exemption authority, we vacate the exemption for sources of fugitive 

dust and remand for further consideration.

[55][56][57] The statutory scheme provides EPA with 

a mechanism for accomplishing its objectives of partially 

exempting fugitive dust emitted by major emitting facilities from the requirements of section 165 by appropriate 

rulemaking pursuant to section 111.FN134

FN134. EPA has discretion to define the pollutant 

termed “particulate matter” to exclude particulates of a size or composition determined not to 

present substantial public health or welfare concerns. Such “excluded particulates” would remain 

“air pollutants” within the meaning of the Act, 

section 302(g), but would be dropped from the list 

of pollutants compiled by the EPA Administrator 

under section 108(a)(1) a list comprised of air 

pollutants the “emissions of which, in his judgment, cause or contribute to air pollution which 

may reasonably be anticipated to endanger public 

health or welfare.” Since national ambient air 

quality standards may exist only for those pollutants lists under section 108(a)(1), “excluded 

particulates” would not be subject to NAAQS. 

See C.A.A. at ss 108(a)(1), (2), 109, 302(g), 42 

U.S.C. ss 7408(1), (2), 7409, 7602(g) (1978).

However, under section 111(b)(1)(A) the Administrator must compile a list of categories of 

stationary sources that in his judgment “(cause 

or contribute) significantly to, air pollution 

which may reasonably be anticipated to endanger public health or welfare.” This list could 

include sources of “particulate matter,” as 

newly defined, even though the great preponderance of particulates emitted by such sources 

have become “excluded particulates.” A source 
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may “significantly” contribute to air pollution 

on account of its emissions of “particulate 

matter” even though the quantities of “particulate matter” emitted fall well below the tonnage threshold that would qualify such a 

source, due to the emissions of that pollutant, as 

a major emitting facility. Section 111(d)(1) 

grants authority to the Administrator to establish standards of performance for any air pollutant emitted by a source on the list compiled 

under section 111(b)(1)(A). See also C.A.A. at 

s 111(a)(1)(C). Thus, due to the difference in 

focus of sections 108 and 111 one on pollutants 

and the other on sources a standard of performance might be developed governing “excluded particulates” though no NAAQS has 

been promulgated. Once a standard of performance has been promulgated for “excluded 

particulates,” those pollutants become “subject 

to regulation” within the meaning of section 

165(a)(4), 42 U.S.C. s 7475(a)(4) (1978), the 

provision requiring BACT prior to PSD permit 

approval.

EPA has authority by rulemaking to incorporate fugitive emissions, including fugitive dust, 

in the calculation of tonnage thresholds required to qualify a stationary source as a major 

emitting facility. See C.A.A. at s 302(j), 42 

U.S.C. s 7602(j) (1978); Section D, supra. After 

such a rulemaking, a major emitting facility of 

“excluded particulates” would become subject 

to the preconstruction review and permit requirements of section 165. The net result of the 

administrative action outlined above would be 

a requirement that such major emitting facilities apply BACT (section 165(a)(4)), but no 

need for showing required by section 165(a)(3) 

that emissions of “excluded particulates” would 

not violate NAAQS or allowable increments. 

No NAAQS would exist for “excluded particulates” and the increments applicable to “particulate matter” would not apply. See also 

C.A.A. at s 166, 42 U.S.C. s 7476 (1978)

(premising development of increments for 

“other pollutants” on the existence of NAAQS 

for such pollutants).

*371 **99 VII. MONITORING

Environmental petitioners challenge the EPA's monitoring regulations FN135 as falling short of the statutory 

mandate in several respects. The EPA argues that the Act, 

specifically the text of sections 165(a)(2) and (a)(7),FN136

grants broad discretion to the agency to formulate monitoring regulations.

FN135. 40 C.F.R. ss 51.24(n), 52.21(n) (1978).

FN136. 42 U.S.C. s 7475(a)(2) and (a)(7) (1978).

The arguably discretionary language of sections 

165(a)(2) and (a)(7) is in our view restricted by the plain 

language of section 165(e), which provides in part:

The review provided for in subsection (a) shall be preceded by an analysis in accordance with regulations of 

the Administrator, promulgated under this subsection . . . 

.

FN137

FN137. 42 U.S.C. s 7475(e) (1978) (emphasis 

added).

Subsection (e) provides unambiguously that certain 

requirements must be included in the regulations EPA is 

directed to issue respecting the analysis. Of course there 

are circumstances when statutory language mandatory in 

form is held to constitute a mere directory command to the 

agency, so that variance triggers no judicial sanction. In 

this case, however, the nature of the statutory command 

and its background in the legislative history FN138 supports 

our determination that the specification of requirements in 

section 165(e) must control agency action in this respect.

FN138. See H.Rep.No.95-564, 95th Cong., 1st 

Sess. 151-53 (1977); H.Rep.No.95-294, 95th 

Cong., 1st Sess. 8-9, 171 (1977).

A. Elements Required by Section 165(e)(1)

[58] On its face, section 165(e)(1) requires that preconstruction “review . . . shall be preceded by an analysis . 

. . for each pollutant subject to regulation under this Act 

which will be emitted” from the facility. FN139 The mandatory nature of these provisions subject only to the authority of the agency to exempt de minimis situations FN140

is clear. There must be an analysis; it must be for each 

pollutant regulated under the Act.

FN139. 42 U.S.C. s 7475(e)(1) (1978).

FN140. See section IIIB of this opinion.
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[59] The regulations under review required monitoring only for those pollutants for which a NAAQS exists. 

The Sierra Club and the Environmental Defense Fund 

argue that s 165(e)(1) mandates monitoring for all pollutants under the Act. In the per curiam opinion issued earlier 

in this case, we expressed the view that s 165 did in fact 

require preconstruction monitoring for each pollutant 

subject to regulation under the Act.FN141 Further reflection, 

prompted in part by a petition for rehearing filed by industry petitioners,FN142 has caused us to reconsider our 

rulings. We now affirm that s 165(e)(1) requires that an 

analysis be conducted, and that it be conducted for each 

pollutant regulated under the Act. But, we also find that s 

165(e)(1), standing alone, does not require monitoring as 

the method of analysis to be employed in fulfillment of its 

requirements. This conclusion is dictated by the absence of 

any reference to monitoring*372 **100 in s 165(e)(1) in 

contrast to its explicit inclusion in s 165(e) (2), which 

requires preconstruction monitoring to determine whether 

emissions will exceed maximum allowable increases or 

concentrations where such limits have been promulgated. 

Furthermore, s 165(e)(3)(D), which provides that EPA 

regulations shall specify any models to be used, opens the 

possibility that EPA might, in varying circumstances or for 

various pollutants, choose either monitoring or modeling 

as the method of analysis for s 165(e)(1).

FN141. Alabama Power Company, et al. v. Costle, 196 U.S.App.D.C. 161, 180, 606 F.2d 1068, 

1087 (1979).

FN142. Industry Petitioners' Petition for Rehearing on the Application of PSD Requirements 

to Pollutants Other Than Sulfur Dioxide and Particulates at 7-10 (Filed July 19, 1979).

EPA may use its discretion in the choice of methodology either monitoring or modeling to be employed in 

fulfilling the requirements of s 165(e)(1). That discretion is 

subject, however, to the provisions of s 165(e)(2) which 

sets forth requirements as to monitoring.

B. Elements Required by Section 165(e)(2)

EPA's regulations have required monitoring only to 

determine whether an applicable NAAQS will be exceeded. The Agency argues in justification for its restrictions on the use of monitoring that monitoring for actual air 

quality concentrations is technologically infeasible for all 

but a small number of pollutants and that current monitoring techniques are at best of questionable accuracy even 

for the relatively straightforward measurement of whether 

an applicable NAAQS has been exceeded. The environmental petitioners argue that the regulation falls short of 

the statutory command, that monitoring must be required 

to determine as well whether the applicant will cause or 

contribute to violations of allowable increments.

[60] The language of subsection 165(e)(2) is dispositive. It provides in part:

Effective one year after date of enactment of this part, 

the analysis required by this subsection shall include 

continuous air quality monitoring data gathered for 

purposes of determining whether emissions from such 

facility will exceed the maximum allowable increases or 

the maximum allowable concentration permitted under 

this part.FN143

FN143. 42 U.S.C. s 7475(e)(2) (1978) (emphasis 

added).

This is a plain requirement for inclusion of monitoring 

data, for purposes of the determination whether emissions 

will exceed allowable increments.

[61][62] We discern from the statute a technology-forcing objective. Congress intended that monitoring 

would impose a certain discipline on the use of modeling 

techniques, which would be the principal device relied 

upon for the projection of the impact on air quality of 

emissions from a regulated source. This projects that the 

employment of modeling techniques be held to earth by a 

continual process of confirmation and reassessment, a 

process that enhances confidence in modeling, as a means 

for realistic projection of air quality. This objective is 

furthered by the development of sophisticated monitoring 

techniques, and the collection of the data base that would 

result from monitoring's widespread use. Of course even a 

congressional mandate, such as a technology-forcing requirement based on a congressional projection of emergence of technology for the future, is subject to a justified 

excuse from compliance where good-faith effort to comply 

has not been fruitful of results. That is far different from 

the exemption created by EPA on the basis of current 

technological infeasibility. Though EPA has authority to 

require methods other than monitoring in its effort to ensure that allowable increments and NAAQS are not violated, and though it may choose to invoke that authority 

because of its perception that monitoring alone is inadequate to the task, it does not have authority to dispense with 

monitoring as at least one element of the overall enforcement effort where Congress has mandated the use of that 
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technique.

C. Guidelines for State Exemption Authority Under Section 165(e)(2)

[63] The monitoring requirement of subsection 

165(e)(2) includes an instruction that:

*373 **101 Such data shall be gathered over a period of 

one calendar year preceding the date of application for a 

permit under this part unless the State, in accordance 

with regulations promulgated by the Administrator, determines that a complete and adequate analysis for such 

purposes may be accomplished in a shorter period.

(Emphasis added.) The pertinent regulations have 

failed to provide concrete guidance to the cognizant State 

authorities for the exercise of the partial exemption authority granted by the provision. Instead, they have left 

such determinations to the States on a completely 

open-ended basis. We discern a congressional intention 

that EPA furnish meaningful guidance to the States as to 

the circumstances appropriate for exemption. We remand 

for further consideration.

D. Requirement for Post-Construction Monitoring

EPA has imposed no requirement for 

post-construction monitoring. The Sierra Club and the 

Environmental Defense Fund argue that this omission is 

invalid. In support of their contention, they point (1) to 

what they perceive to be the “prospective” monitoring 

requirement of section 165(a)(7); FN144 and (2) to a congressional intent, ostensibly apparent from the inclusion of 

the modeling provisions of section 165(e)(3)(D) FN145 in 

section 165, to ensure that monitoring and modeling 

augment one another in an ongoing manner.

FN144. 42 U.S.C. s 7475(a)(7) (1978).

FN145. 42 U.S.C. s 7475(e)(3)(D) (1978).

[64] This contention of environmental petitioners runs 

against the explicit language. Section 165(a)(7) FN146 does 

make reference to a requirement of post-construction 

monitoring, but grants discretion to the agency in this 

regard a discretion that has not been provided with respect 

to the pre-application monitoring requirements specified in 

subsection 165(e). Section 165(a)(7) provides as a condition of permit approval that the applicant:

FN146. 42 U.S.C. s 7475(a)(7) (1978).

agrees to conduct such monitoring as may be necessary 

to determine the effect which emissions from any such 

facility may have, or is having, on air quality in any area 

which may be affected by emissions from such 

source.FN147

FN147. Id.

The determination of the post-construction monitoring 

that “may be necessary” is not dictated by any provision in 

subsection 165(e), which pertains to pre-application monitoring requirements. EPA has latitude to make a determination under subsection 165(a)(7) in light of the facts 

and circumstances of each case. There is also latitude to 

respond to suggestions that guidelines be formulated outlining the circumstances that require post-construction 

monitoring and the nature of the monitoring requirement.

[65][66] Section 114 FN148 grants the Administrator 

broad authority to require monitoring by any source that in 

his judgment is necessary to carry out his responsibilities 

under the Act. This includes an authority to require 

post-construction monitoring, but does not compel such a 

requirement. Section 319 FN149 of the Act provides for 

development of a nationwide monitoring network, but this 

is to be a function of government, not the responsibility of 

permit applicants.

FN148. 42 U.S.C. s 7414 (1978).

FN149. 42 U.S.C. s 7619 (1978).

ROBINSON, Circuit Judge:

This opinion addresses four issues: first, whether 

EPA's action in specifying a uniform date on which baseline concentrations in attainment areas are to be ascertained comports with statutory requirements; second, 

whether increased emissions consequent upon voluntary 

changeovers from cleaner to dirtier fuels are to be included 

in the baseline; third, whether EPA provided reasoned 

responses to the modeling regulations that it proposed and 

ultimately adopted; and fourth, the legal propriety of EPA's 

regulations governing the role of stack height in determining the air pollution*374 **102 control requirements 

applicable to an emitting source.

I. BASELINE DATE

A central feature of the statutory program for the 

prevention of significant deterioration of air quality in 
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attainment areas, with respect to sulfur dioxide and particulate matter at least,FN1 is the establishment of maximum 

allowable increases, known as increments, in concentrations of pollutants. FN2 The increment concept incorporates 

the idea of a baseline from which deterioration is calculated, by models or monitors, to determine whether it is 

permissible. Congress has defined with specificity the time 

and manner in which the baseline for an attainment area is 

to be determined. The first sentence of Section 169(4), the 

part now relevant, provides:

FN1. Section 163 fixes the increments for these 

two pollutants. 91 Stat. 732, 42 U.S.C. s 7473 

(Supp. I 1977). Section 166 contemplates that 

EPA will study the four so-called “automotive”

pollutants for which national ambient air quality 

standards have been set with a view to determining whether increments for these pollutants 

should be established. 91 Stat. 739, 42 U.S.C. s 

7476 (Supp. I 1977). See generally Part III(B) 

supra of Judge Wilkey's opinion.

FN2. See s 163, 91 Stat. 732, 42 U.S.C. s 7473 

(Supp. I 1977).

The term “baseline concentration” means, with respect 

to a pollutant, the ambient concentration levels which 

exist at the time of the first application for a permit in an 

area subject to (Part C), based on air quality data available in the Environmental Protection Agency or a State 

air pollution control agency and on such monitoring data 

as the permit applicant is required to submit.FN3

FN3. 91 Stat. 741, 42 U.S.C. s 7479(4) (Supp. I 

1977).

EPA has acknowledged that the literal purport of the 

statutory definition is that the starting point FN4 for determining the baseline in a particular clean air region is the 

existing ambient pollution level in that area at the time of 

the first application for a permit by a major emitting facility. FN5 Yet, in a remarkable assertion of administrative 

power to revise what Congress has wrought, EPA's final 

regulations define baseline concentration in terms of actual 

air quality as of August 7, 1977.FN6 The Administrator 

explained this decision as follows:

FN4. The remainder of s 169(4) deals with attribution of emissions of non-operating major 

emitting facilities on which construction was 

commenced prior to January 6, 1975, and of 

major emitting facilities, whether operating or 

not, on which construction was commenced after 

January 6, 1975. These provisions will be instrumental in our resolution of the “fuel switches”

issue. See Part II infra.

FN5. “Section 169(4) of the Act generally defines 

baseline in terms of the ambient concentration 

existing at the time of the first application for a 

permit in an area.” 43 Fed.Reg. 26400 (June 19, 

1978) (explanation of final regulations).

FN6. 40 C.F.R. s 51.24(b)(11) (1978); 40 C.F.R. s 

52.21(b)(11) (1978).

(T)he regulations promulgated today recognize the severe technical and administrative problems with implementing a definition of baseline concentration that 

relates to the date of first permit application in an area. 

The administrator believes that a strict interpretation of 

the Act's language would create thousands of different 

areas each with different baseline starting points. 

Moreover, these areas would eventually overlap as more 

and more sources applied for PSD permits. The final 

regulations . . . resolve those problems by establishing a 

uniform starting date for determining the baseline concentration in all areas.FN7

FN7. 43 Fed.Reg. 26400 (June 19, 1978).

Without disavowing that rationale, EPA's counsel has 

offered, as a second justification for the selection of a 

single date for calculation of the baseline, the following 

“anomaly”:

There is no apparent reason why in one clean air area 

five „minor‟ sources constructed at the same time as five 

„minor‟ sources in another clean air area should be 

counted against the increment simply because the first 

application by a major facility for a PSD permit came at 

an *375 **103 earlier date in the first area than in the 

second.FN8

FN8. Brief for Respondents at 161. In rejecting 

this position on the merits, see notes 12-17 infra 

and accompanying text, we do not mean to imply 

that appellate counsel's carpentry can repair a 

deficient agency rationale. See, e. g., Citizens to 

Preserve Overton Park v. Volpe, 401 U.S. 402, 

419, 91 S.Ct. 814, 825, 28 L.Ed.2d 136, 155 
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(1971).

[67] Industry petitioners, the State of Texas and the 

District of Columbia FN9 urge that EPA's uniform baseline 

date be set aside and the statutory baseline date reinstated. 

We agree. EPA has no authority to overrule a clear, consistent congressional directive: FN10 “the sound principle of 

according deference to administrative practice normally 

applies only where the relevant statutory language is unclear or susceptible of differing interpretations.”

FN11

FN9. It may be some time before a major emitting 

facility seeks to operate in the District of Columbia.

FN10. Espinoza v. Farah Mfg. Co., 414 U.S. 86, 

94-95, 94 S.Ct. 334, 339, 38 L.Ed.2d 287, 295 

(1973), quoting Red Lion Broadcasting Co. v. 

FCC, 395 U.S. 367, 381, 89 S.Ct. 1794, 1802, 23 

L.Ed.2d 371, 384 (1969) ( “(c)ourts need not defer to an administrative construction of a statute 

where there are „compelling indications that it is 

wrong‟ ”); Volkswagenwert Aktiengesellschaft v. 

FMC, 390 U.S. 261, 273, 88 S.Ct. 929, 936, 19 

L.Ed.2d 1090, 1098 (1968), quoting NLRB v. 

Brown, 380 U.S. 278, 291, 85 S.Ct. 980, 988, 13 

L.Ed.2d 839, 849 (1965) (“the courts are the final 

authorities on issues of statutory construction 

(citations omitted), and „are not obliged to stand 

aside and rubber-stamp their affirmance of administrative decisions that they deem inconsistent 

with a statutory mandate or that frustrates the 

congressional policy underlying a statute‟ ”).

FN11. Shea v. Vialpando, 416 U.S. 251, 262 n.11, 

94 S.Ct. 1746, 1754 n.11, 40 L.Ed.2d 120, 130 

n.11 (1974); see Townsend v. Swank, 404 U.S. 

282, 286, 92 S.Ct. 502, 505, 30 L.Ed.2d 448, 453 

(1971).

The statutory definition of baseline concentration was 

in no sense a product of legislative inadvertence.FN12

Congress focused on how to define the baseline and fully 

understood the consequences of its chosen resolution. The 

Conference Committee explicitly acknowledged its adoption of the Senate definition of baseline,FN13 and the Senate 

report had explicitly rejected EPA's uniform date approach.FN14 Indeed, it purposely embraced the situation 

EPA's counsel considers anomalous: “Under this definition 

(of baseline) it is possible for nonmajor emitting sources to 

be constructed in the area after the date of enactment 

without having their emissions affect the ability of major 

emitters to use the increment available.”

FN15

FN12. Compare Citizens to Save Spencer County 

v. EPA, 195 U.S.App.D.C. 30, 600 F.2d 844 

(1979).

FN13. H.R.Rep.No.564, 95th Cong. 1st Sess. 153 

(1977) (conference report).

FN14. See S.Rep.No.127, 95th Cong., 1st Sess. 

98 (1977) ( “(u)nder the reported bill (unlike 

EPA's regulations), the time at which the baseline 

is established for different areas will depend upon 

the timing of the first application of a major 

emitting facility”). Congress also rejected the 

House definition of baseline, which embraced a 

fixed-date approach. See H.R. 6161, 95th Cong., 

1st Sess., s 108 (1977) (adding s 160(c)(2)(E) to 

the Clean Air Act).

FN15. S.Rep.No.127, 95th Cong., 1st Sess. 98 

(1977). EPA suggests that the Conference Committee's rejection of the Senate proposal that only 

emissions from major new sources should be 

considered in assessing consumption of the increment, see S. 252, 95th Cong., 1st Sess. s 7 

(1977) (adding s 110(g)(2) to the Clean Air Act), 

vitiated the purpose of calculating the baseline as 

of the date of the first permit application. Brief for 

Respondents at 157-161. This misapprehends the 

rationale of the Senate's baseline definition. See 

notes 16-18 infra and accompanying text. It is 

true, however, that the statement quoted in text 

possessed, prior to the above-mentioned conference decision, a broader meaning.

This differential treatment of clean air areas, keyed to 

when the first major emitting facility applies for a permit, 

is based on a sound, practical consideration. As the Senate 

explained,

(t)he purpose is to use actual air quality data to establish 

the baseline. Where sufficient actual data are not available, the State may require the applicant to perform 

whatever monitoring the State believes is necessary to 

provide that information.*376 **104 This may involve 

monitoring for 12 months or more to establish an annual 

average.FN16
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FN16. S.Rep.No.127, 95th Cong., 1st Sess. 98 

(1977).

In other words, the task of monitoring existing ambient pollution levels in attainment areas is assigned to the 

first permit applicant, who will provide the information 

essential to calculation of the baseline.FN17

FN17. See s 165(e)(1)-(2), 91 Stat. 738, 42 U.S.C. 

s 7475(e)(1)-(2) (Supp. I 1977). EPA asserts that 

its uniform date is supported by s 107(d) of the 

Act, 91 Stat. 687, 42 U.S.C. s 7407(d) (Supp. I 

1977). Brief for Respondents at 162. Section 

107(d)(1) requires each state to submit to EPA, 

within 120 days of enactment of the 1977 

amendments, a list of those portions of the state 

which, on August 7, 1977, do not meet a national 

ambient air quality standard, and a list of both 

those which meet all such standards and those 

which, for lack of sufficient information, cannot 

be classified and therefore are deemed clean air 

areas. See Citizens to Save Spencer County v. 

EPA, supra note 12, 195 U.S.App.D.C. at 83, 600 

F.2d at 897 (dissenting opinion). But the s 107 

lists submitted so far indicate that a great many 

states do not have acceptable air quality data 

showingpollution levels as of August 7, 1977. 

See, e. g., 43 Fed.Reg. 8967, 8970, 8978, 8980, 

8983, 8985, 8992, 8999, 9001, 9002, 9005, 9012, 

9017, 9019, 9025, 9027, 9029, 9035, 9037, 9041, 

9044, 9046 (Mar. 3, 1978). Thus, Congress' 

concern over the adequacy of existing information concerning ambient air quality has been 

borne out by experience.

The Administrator's recitation of the administrative 

and technical burdens obviated by a uniform date for the 

setting of the baseline simply blinks reality.FN18 A uniform 

date for calculating the baseline does not result in establishment of a uniform baseline. Ambient concentration 

levels of regulated pollutants varied considerably in different clean air areas on August 7, 1977, or any date for 

that matter, and thus baselines inevitably must differ. 

EPA's regulations requiring baseline concentration to be 

figured as of August 7, 1977, must be set aside in favor of 

the statutory directive to ascertain the baseline in each 

region as of the date of the first permit application.

FN18. See note 7 supra and accompanying text.

II. BASELINE AND VOLUNTARY FUEL SWITCHES

The first sentence of Section 169(4),FN19 as we have 

just explained, specifies that the baseline concentration 

means primarily the actual ambient pollution levels existing at the time of the first permit application by a major 

omitting facility.

FN20 This baseline is, however, subject to 

an adjustment specified in the remainder of Section 169(4):

FN19. 42 U.S.C. s 7479(4) (Supp. I 1977), quoted 

in relevant part in text supra at note 3.

FN20. See notes 10-18 supra and accompanying 

text.

Such ambient concentration levels shall take into account all projected emissions in, or which may affect, 

such area from any major emitting facility on which 

construction commenced prior to January 6, 1975, but 

which has not begun operation by the date of the baseline 

air quality concentration determination. Emissions of 

sulfur oxides and particulate matter from any major 

emitting facility on which construction commenced after 

January 6, 1975, shall not be included in the baseline and 

shall be counted against the maximum allowable increases in pollutant concentrations established under 

(Part C). FN21

FN21. 42 U.S.C. s 7479(4) (Supp. I 1977).

The significance of January 6, 1975, is that it was the 

effective date of EPA's earlier PSD regulations.FN22

FN22. See S.Rep.No.127, 95th Cong., 1st Sess. 

98 (1977).

[68] Indisputably, then, the baseline is to include all 

emissions actually being made by major facilities on which 

construction was under way before January 6, 1975, and 

which are in operation when the baseline determination is 

made. Nor is there any quarrel over the scope or import of 

the last sentence of Section 169(4): emissions of sulfur 

dioxide and particulate matter FN23 from *377 **105 major 

facilities on which construction began after January 6, 

1975, are not grandfathered into the baseline but rather 

count against the increments, even if such facilities are 

operating on the date of the first permit application. FN24

FN23. This case does not require us to explore the 

implications, if any, to be drawn from the fact that 

the last sentence of s 169(4), 42 U.S.C. s 7479(4) 

(Supp. I 1977), is limited to sulfur dioxide and 
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particulate matter while the remainder of the 

statutory definition of “baseline concentration”

speaks more broadly of pollutants. The other regulated pollutants have not yet been subjected to 

the baseline-increment method of regulation. 

Section 166 contemplates that the four pollutants 

other than sulfur dioxide and particulate matter 

for which national ambient standards have been 

set will be regulated to prevent significant deterioration. 42 U.S.C. s 7476 (Supp. I 1977). The 

methods for preventing significant deterioration 

by those pollutants, however, “need not require 

the establishment of maximum allowable increases.” 42 U.S.C. s 7476(e) (Supp. I 1977).

FN24. 43 Fed.Reg. 26383 (June 19, 1978) (to be 

codified in 40 C.F.R. s 51.24(b) (11)); 43 

Fed.Reg. 26404 (June 19, 1978) (to be codified in 

40 C.F.R. s 52.21(b) (11)).

[69] On the other hand, controversy rages over the 

meaning of the middle sentence of Section 169(4). EPA 

has persisted, over firm objection,FN25 in reading that directive according to its literal terms.FN26 In EPA's view, the 

sentence evinces a congressional design to grandfather 

projected emissions only of sources not in operation when 

the baseline is established, and then only if construction 

began prior to January 6, 1975.FN27 The State of Texas and 

members of the chemical manufacturing and utility industries have petitioned for review on this point, arguing that 

the provision in question reflects an intention to exempt 

projected emissions of any source on which construction 

commenced before January 6, 1975, even if operating at 

the time of establishment of the baseline.FN28 Issue has 

been joined on whether increased emissions resulting from 

a major facility's voluntary switch from a relatively clean 

but scarce fuel to a more abundant but dirtier fuel are to 

consume the increments or rather are to be included within 

the baseline when the facility was capable of utilizing the 

alternate, more plentiful fuel prior to January 6, 1975.FN29

FN25. Several of these complaints, submitted to 

EPA in affidavit form and appended to petitioners' brief, maintain that EPA's position penalizes 

companies that have in the past voluntarily 

burned cleaner-than-allowable fuel. The answer is 

that baseline and increments are set for regions, 

rather than individual facilities.

FN26. See generally 40 C.F.R. s 51.24(b)(11) 

(1978); 40 C.F.R. s 52.21(b)(11) (1978).

FN27. “The baseline concentration shall include 

contributions from . . . (t) he allowable emissions 

of major stationary sources and major modifications which commenced construction before 

January 6, 1975, but were not in operation by 

August 7, 1977.” 40 C.F.R. s 51.24(b)(11)(ii) 

(1978); 40 C.F.R. s 52.21(b) (11)(ii) (1978). 

August 7, 1977, it will be recalled, was EPA's 

uniform baseline date, which we have held to be 

in contravention of the statute. See Part I supra. 

The reference to August 7, 1977, is thus simply to 

the time of baseline determination.

FN28. Brief for Industry Petitioners on Fuel 

Switches at 17-22.

FN29. EPA's position is “that (voluntary fuel) 

switches . . . will consume increment.” 43 

Fed.Reg. 26397 (June 19, 1978) (explanation of 

final regulations).

EPA has held, first, that voluntary fuel switches by 

emissions sources which were designed to accommodate 

the alternate fuel prior to January 6, 1975, do not constitute 

modifications within the meaning of Section 111(a)(4),FN30

and accordingly that such changeovers are not subject to 

the review and permitting strictures imposed by Section 

165.FN31 EPA's ruling on this point has *378 **106 not 

been challenged. EPA has further resolved, as we have 

stated, that the additional emissions resulting from such 

fuel switches do, under the Act, consume the increments.FN32

FN30. 42 U.S.C. s 7411(a)(4) (Supp. I 1977).

FN31. 42 U.S.C. s 7475 (Supp. I 1977). In 

enacting the 1977 amendments, Congress neglected to subject modifications of major emitting 

facilities to the permit and best available control 

technology requirements. A so-called “technical”

amendment to s 169(2) of the Act added a new 

subparagraph C, which provided that “(t)he term 

„construction‟ when used in connection with any 

source or facility, includes the modification (as 

defined in section 111(a)) of any source or facility.” Act of Nov. 16, 1977, Pub.L.No.95-190, 91 

Stat. 1402, 42 U.S.C. s 7479(2)(C) (Supp. I 1977). 

By this amendment modifications of major facilities must meet the demands of s 165, and “modification” is defined to mean “any physical 
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change in, or change in the method of operation 

of, a stationary source which increases the 

amount of any air pollutant emitted by such 

source or which results in the emission of any air 

pollutant not previously emitted.” 42 U.S.C. s 

7411(a)(4) (Supp. I 1977).

EPA's decision to omit voluntary fuel switches 

from PSD scrutiny is based upon a belief that 

Congress did not intend that they be considered 

changes in the “method of operation.” The 

Administrator explained:

In adding Section 169(2)(C) to the Act, Congress indicated that it intended to conform the 

meaning of „modification‟ to „usage in other 

parts of the Act.‟ 123 Cong.Rec. H11955, 

11957 (November 1, 1977). At the time, regulations promulgated under Section 111 had defined „modifications' to exclude voluntary fuel 

switches when the source, „prior to the date any 

standard under this part becomes applicable to 

that source type . . . (,) was designed to accommodate that alternative use.‟ 40 C.F.R. 

60.14(e)(4) (1977). Apparently, Congress intended voluntary fuel switches to be treated 

similarly for PSD purposes.

43 Fed.Reg. 26396 (June 19, 1978).

FN32. See note 29 supra.

Texas and the industry petitioners complaining intimate that EPA's position on voluntary fuel switches is 

internally inconsistent.FN33 This argument conflates the 

different yet complementary functions of Section 165 

review and calculation of increment consumption. The 

theory of the statutory PSD program is that concentration 

on preconstruction review of major emitting facilities FN34

in clean air areas will preserve air quality in those areas 

with a minimum of economic hardship.FN35 At the same 

time, the success of the program depends heavily upon 

realistic assessments of pollution levels. As Senator Gary 

Hart put it, “(s)ulfur dioxide is sulfur dioxide and it doesn't 

matter whether it comes from 1 large major source or from 

1,000 small nonmajor sources. The effects are still the 

same.”

FN36 Moreover, the severe technical problems involved in assessing the origin of existing pollution are 

sidestepped somewhat by this approach.FN37

FN33. E. g., Brief for Industry Petitioners on Fuel 

Switches 37-42. These petitioners also urge that 

EPA's fuel-switches position is at odds with its 

avowed intent to deviate from a baseline calculated on the basis of actual emissions in those regions where a SIP relaxation was submitted to 

EPA and was still pending on August 7, 1977. 43 

Fed.Reg. 26400 (June 19, 1978). The validity of 

this approach itself is not questioned here, and we 

intimate no view either on its appropriateness or 

on petitioners' argument of inconsistency. Restraint is especially warranted because EPA could 

reconsider this issue in light of our decision 

overturning its uniform, August 7, 1977, date for 

determining the baseline. See Part I supra. Industry also points to EPA's announcement that it 

will use reasonable assumptions in ascertaining 

ambient concentration as of the baseline date. 43 

Fed.Reg. 26400 (June 19, 1978). This policy 

likewise is unchallenged, and may be revised, so 

we decline to rule on it. See generally notes 43-44 

infra and accompanying text.

FN34. “This key term (major emitting facility) 

assures that industrial plants of significant impact 

are fully covered, yet also assures that smaller 

activities are not subject to overzealous regulation.” 122 Cong.Rec. S12809 (daily ed. July 29, 

1976) (remarks of Senator McClure). See also 

123 Cong.Rec. S13710-13711 (daily ed. Aug. 4, 

1977) (remarks of Senator McClure).

FN35. 122 Cong.Rec. S12470 (daily ed. July 26, 

1976) (remarks of Senator Hart).

FN36. Id. See also 122 Cong.Rec. S13325-13326 

(daily ed. Aug. 4, 1976) (remarks of Senator 

Hart). The Hart amendment was defeated. See 

note 46 infra and accompanying text.

FN37. Id.

[70] The central submission of the protesting petitioners is that EPA's decision not to grandfather emissions 

from fuel switches by facilities capable of so changing 

prior to January 6, 1975, contravenes congressional intent 

as revealed in the second sentence of Section 169(4) and 

throughout the history of the 1977 Amendments. Approaching the issue with the considerable degree of deference due an agency's interpretation of the statute it is 

charged with administering, FN38 we sustain the administrative construction.
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FN38. United States v. Sheffield Bd. of Comm'rs, 

435 U.S. 110, 131, 98 S.Ct. 965, 979, 55 L.Ed.2d 

148, 166 (1978); United States v. Consumer Life 

Ins. Co., 430 U.S. 725, 751-752, 97 S.Ct. 1440, 

1454, 52 L.Ed.2d 4, 24 (1977); Train v. Natural 

Resources Defense Council, 421 U.S. 60, 87, 95 

S.Ct. 1470, 1485, 43 L.Ed.2d 731, 750 (1975); 

Udall v. Tallman, 380 U.S. 1, 16, 85 S.Ct. 792, 

801, 13 L.Ed.2d 616, 625 (1965).

**107 *379 [71] Every issue of statutory interpretation should commence with a close textual examination.FN39 The second sentence of Section 169(4) is in express terms limited to facilities on which construction was 

commenced prior to January 6, 1975, but which are not in 

operation when the first permit application triggers calculation of the baseline. Petitioners, however, would modify 

this provision to make it referable to any major facility on 

which construction started before that date, “even if ” the 

facility has not begun operation at the time of the baseline 

determination.FN40 To justify this surgery, they assert that 

“(c) learly it would be anomalous to assume that Congress 

intended to grandfather only those projected emissions 

from sources that commenced construction prior to January 6, 1975, but which were not in operation (by the date 

the baseline is figured), and exclude sources which were 

built and operating beforehand.”

FN41

FN39. Ernst & Ernst v. Hochfelder, 425 U.S. 185, 

197, 96 S.Ct. 1375, 1383, 47 L.Ed.2d 668, 679 

(1976), quoting Blue Chip Stamps v. Manor Drug 

Stores, 421 U.S. 723, 756, 95 S.Ct. 1917, 1935, 

44 L.Ed.2d 539, 561 (1975) (concurring opinion) 

(“(t)he starting point in every case involving 

construction of a statute is the language itself”); 

FTC v. Bunte Bros., 312 U.S. 349, 350, 61 S.Ct. 

580, 581, 85 L.Ed. 881, 883 (1941) (“(w)hile one 

may not end with the words of a disputed statute, 

one certainly begins there”); Citizens to Save 

Spencer County v. EPA, supra note 12, 195 

U.S.App.D.C. at 79 & nn. 12-14, 600 F.2d at 893 

& nn. 12-14 (dissenting opinion).

FN40. Brief for Industry Petitioners on Fuel 

Switches 18 (emphasis in original).

FN41. Id. at 20 n. 1.

[72][73] In our opinion, Section 169(4) as enacted 

draws a sensible distinction. There are two types of emitting sources begun prior to the existence of any PSD program. If the source has no actual emissions because it has 

yet to commence operating, its hypothetical, projected 

emissions are included in the baseline. If, however, the 

source is an established operation, a more realistic assessment of its impact on ambient air quality levels is 

possible, and thus is directed.FN42

FN42. Brief for Respondents at 173. EPA also 

relies on s 163(c), 91 Stat. 733, 42 U.S.C. s 

7473(c) (Supp. I 1977), to support its policy of 

counting emissions from voluntary fuel changes 

against the increment. Brief for Respondents at 

166-174. This subsection provides in relevant 

part:

(1) In the case of any State which has a plan 

approved by the Administrator for purposes of 

carrying out (Part C), the Governor of such 

State may, after notice and opportunity for 

public hearing, issue orders or promulgate rules 

providing that for purposes of determining 

compliance with the maximum allowable increases in ambient concentrations of an air 

pollutant, the following concentrations of such 

pollutant shall not be taken into account:

(A) concentrations of such pollutant attributable to the increase in emissions from stationary 

sources which have converted from the use of 

petroleum products, or natural gas, or both, by 

reason of an order which is in effect under the 

provisions of sections 2(a) and (b) of the 

Energy Supply and Environmental Coordination Act of 1974 (or any subsequent legislation 

which supersedes such provisions) over the 

emissions from such sources before the effective date of such order.

(B) the concentrations of such pollutant attributable to the increase in emissions from stationary sources which have converted from 

using natural gas by reason of a natural gas 

curtailment pursuant to a natural gas curtailment plan in effect pursuant to the Federal 

Power Act over the emissions from such 

sources before the effective date of such plan, . . 

.

(3) No action under this subsection shall take 

effect unless the Governor submits the order or 
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rule providing for such exclusion to the Administrator and the Administrator determines 

that such order or rule is in compliance with the 

provisions of this subsection.

Since Congress focused on the question of increment consumption caused by fuel conversions and declined to fashion an exemption for 

voluntary switches, so the argument goes, EPA 

could not expand the statutorily-authorized 

exemptions. While this thesis has some appeal, 

industry petitioners aptly respond that s 163(c) 

deals with fuel conversions regardless of 

whether the plant was capable of utilizing the 

alternate fuel prior to January 6, 1975. Thus 

that subsection addresses a somewhat different 

concern and application of the maxim expressio 

unius est exclusio alterius did not compel 

EPA's decision to count emissions from 

post-January 6, 1975, voluntary switches not 

involving any design changes. Reply Brief for 

Industry Petitioners on Fuel Switches at 3-6.

Texas, in a separate brief, insists that EPA's 

final regulations arbitrarily treat state-ordered 

fuel-conversion orders differently from federally-mandated fuel switches since only emissions from the latter are exempted from increment consumption. Brief for Petitioner State 

of Texas at 6-15. This contention is firmly rebutted by s 163(c). Texas maintains that stateand federally-ordered conversions are indistinguishable both are directed for sound energy 

conservation reasons. If, however, Texas has a 

justified grievance, resolution of it is committed to Congress. Congress may have been 

concerned that some state agencies might not 

consider all of the environmental consequences 

of a conversion order, as federal energy authorities are required to do. In any event, in 

light of s 163(c), EPA's failure to exclude increased emissions resulting from a 

state-ordered fuel switch is not judicially condemnable.

**108 *380 [74] Petitioners rail against this qualified 

“snapshot” approach to determination of the baseline 

concentration. They argue that if the snapshot is taken on a 

day on which industrial activity is rather dormant say, 

Sunday or a holiday, or when wind conditions are peculiarly favorable then the baseline concentration will be set 

so low that full operation of existing facilities on an average day will lead to increment exceedances.FN43 We think 

this fear is groundless. Congress expected EPA to use 

“administrative good sense” in establishing the baseline 

and calculating exceedances.FN44 Were measurements on 

an atypical day the sole method of determining actual 

ambient air quality as of the approximate time of the first 

permit application, affected industries would then have 

cause for complaint and potential ground for relief.

FN43. Reply Brief for Industry Petitioners on 

Fuel Switches at 9.

FN44. The Senate Report, after explaining that 

actual air quality data are to be utilized to establish the baseline, stated:

In calculating the baseline air quality concentration, one caveat is in order. This concerns 

background particulates levels in rural, arid and 

semiarid States. Because of the imprecision 

inherent in the total suspended particulate 

standards, background dust in such States can 

cause levels in excess of the particulates standards. Fortunately, the logical dilemma posed 

by the shortcomings of the present particulate 

standards can be overcome by administrative 

good sense until such time as modification of 

the standards are adopted.

S.Rep.No.127, 95th Cong., 1st Sess. 98 (1977). 

Though directed at a specific problem, we believe that this illustration indicates that Congress did not intend a simple measurement of 

air quality on a day with atypical conditions to 

control calculation of the baseline. Reasonable 

efforts to ascertain the actual but usual concentration levels, as of the date of the first application for a permit, are required. See also 

note 33 supra.

Petitioners understandably seek support for their projected-emissions approach in the Act's legislative history, 

for both the Senate and House bills, in different ways, 

would have excluded projected emissions from old sources 

in calculating expenditure of the increments. Both the 1976 

and 1977 Senate bills defined the increments in terms of 

maximum allowable increases in sulfur dioxide and particulate matter “resulting from the construction and operation of any new major emitting facility”; FN45 thus only 

emissions from new major sources would count against the 
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increments. In 1976, the Senate soundly defeated an 

amendment providing that emissions from all sources 

would be counted in determining increment consumption.FN46 Both the 1976 and 1977 House bills included 

within the baseline “the level of concentration determined 

for each period of exposure on the basis of plant capacity in 

existence on . . . January 1, 1975.”

FN47 As the 1976 House 

report stated, “the bill's definition of baseline level authorizes the „grandfathering‟ of . . . all existing industrial 

capacity . . . .”

FN48

FN45. S.252, 95th Cong., 1st Sess. s 7 (1977), 

(adding s 110(g)(2) to the Clean Air Act); S.3219, 

94th Cong., 2d Sess. s 6 (1976) (adding s 

110(g)(2) to the Clean Air Act).

FN46. See 122 Cong.Rec. S13325-13329 (daily 

ed. Aug. 4, 1976) (debate on the Hart amendment); 122 Cong.Rec. S13336 (daily ed. Aug. 4, 

1976) (defeat of Hart amendment).

FN47. H.R. 6161, 95th Cong., 1st Sess. s 108 

(1977) (adding s 160(c)(2)(E)(i) to the Clean Air 

Act); H.R. 10498, 94th Cong., 2d Sess. s 108 

(1976) (adding s 160(c)(2)(E)(i) to the Clean Air 

Act).

FN48. H.R.Rep.No.1175, 94th Cong., 2d Sess. 

123 (1976); see id. 131.

*381 **109 Had either the House definition of baseline concentration or the Senate approach to increment 

consumption been enacted, petitioners would be on firm 

ground in urging that emissions resulting from fuel 

switches in plants with the capacity to use the dirtier fuel 

prior to January 6, 1975, do not consume the increments. 

The Conference Committee withdrew these crucial supports, however. The Senate definition of the baseline became Section 169(4). FN49 As explained in the discussion of 

the appropriate date for determining the baseline,FN50 the 

Senate chose “to use actual air quality data to establish the 

baseline,” gathered if necessary through monitoring by the 

first permit applicant.FN51 Petitioners attempt to distinguish 

the injunction to use “actual data” from the use of “actual 

emissions,”

FN52 but this strikes us as contrary to common 

sense and, more significantly, to the clear directive of the 

first sentence of Section 169(4), which defines the baseline 

in terms of existing ambient concentration levels.FN53

FN49. H.R.Rep.No.564, 95th Cong., 1st Sess. 

153 (1977) (conference report).

FN50. See notes 16-17 supra and accompanying 

text.

FN51. S.Rep.No.127, 95th Cong., 1st Sess. 98 

(1977). See also 122 Cong.Rec. S13177 (daily ed. 

Aug. 3, 1976) (remarks of Senator Brooke) (“the 

House bill, unlike the Senate bill, defines the 

„baseline‟ to which new pollution increases may 

be added on the basis of total „design capacity‟ of 

existing sources, not actual emissions”).

FN52. Reply Brief for Industry Petitioners on 

Fuel Switches at 10.

FN53. 42 U.S.C. s 7479(4), quoted in pertinent 

part in text accompanying note 3 supra.

[75] The Conference Committee also rejected the 

Senate philosophy that only emissions from new major 

facilities should expend the increments. As the Committee 

observed, “(i)ncrements setting forth the maximum allowable increase in pollutants are stated in the statute for 

particulates and sulfur dioxide,”

FN54 and those increments 

are not source-specific; all emissions are considered in 

determining whether the statute's aim of preventing significant deterioration of the air quality in attainment areas 

is being secured. FN55

FN54. H.R.Rep.No.564, 95th Cong., 1st Sess. 

151 (1977) (conference report), U.S.Code Cong. 

& Admin.News, p. 1532.

FN55. s 163(b), 91 Stat. 732, 42 U.S.C. s 7473(b) 

(Supp. I 1977); see also notes 33-36 supra and 

accompanying text.

[76] In sum, EPA's refusal to grandfather emissions 

resulting from a voluntary fuel switch is a well-supported 

interpretation of congressional intent.FN56 We accordingly 

must uphold EPA's regulations on this score.

FN56. Petitioners also assert that EPA's position 

on voluntary fuel switches is procedurally infirm. 

They suggest that EPA failed to explain the basis 

for its action and neglected to respond to significant comments. Brief for Industry Petitioners on 

Fuel Switches at 30-37. These contentions are 

without merit. EPA carefully detailed the rationale of its fuel-switches policy; its view of con-
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gressional intent simply differed, and justifiably 

so, from those of petitioners. Moreover, since 

EPA's fuel switches regulations are interpretative, 

they are exempt from the requirements of s 4 of 

the Administrative Procedure Act. 5 U.S.C. s 553 

(1976). See Citizens to Save Spencer County v. 

EPA, supra note 12, 195 U.S.App.D.C. at 38, 600 

F.2d at 852. See also s 307(d), 91 Stat. 772, 42 

U.S.C. s 7607(d) (Supp. I 1977) (procedural requirements applicable to rules proposed more 

than 90 days after enactment of the 1977 

amendments; interpretative rules are exempted).

III. MODELING

In its initial, reluctant effort to establish a program for 

the prevention of significant clean-air deterioration, EPA 

in 1973 proposed four alternative sets of regulations.FN57

Though differing in many important respects, each set 

embraced increment-consumption measurements as the 

primary means for determining whether to grant a permit 

to a proposed new major emitting facility.FN58 Each facility 

would be required to monitor its impact on air quality 

unless the state wherein it was located were to *382 **110

determine that an adequate monitoring network already 

existed. FN59

FN57. 38 Fed.Reg. 18986 (July 16, 1973).

FN58. Id. at 18989-18990.

FN59. Id. at 18990.

By 1974, EPA had abandoned this program, mainly 

for two reasons: the absence of existing air quality data in 

attainment areas, and the inability of existing monitoring 

technology to “reliably distinguish between readings approaching the small increments.”

FN60 Instead, EPA decided to rely principally on techniques of diffusion modeling mathematical techniques for estimating the effects of 

emissions from multiple sources on air quality in the surrounding area.FN61 Where feasible, the accuracy of the 

models was to be tested by measurements of actual air 

quality.FN62

FN60. 39 Fed.Reg. 31000, 31003 (Aug. 27, 

1974).

FN61. Id.

FN62. “(C)urrent instrumentation would be 

adequate to calibrate and improve current diffusion modeling techniques . . . .” Id.

In fashioning the Clean Air Act Amendments of 1977, 

Congress basically shared EPA's mind-set concerning 

models. Although Congress considered models less than 

completely trustworthy,FN63 it believed them to be essential 

to implementation of a PSD program.FN64 Consequently, it 

directed EPA to develop regulations “specify(ing) with 

reasonable particularity each air quality model or models 

to be used under specified sets of conditions . . . .”

FN65 To 

insure that EPA-sanctioned models would not lag behind 

the state of the art, Congress instructed the agency to hold 

conferences on modeling techniques, and permit specialists and interested persons to participate and submit 

comments.FN66 The first such conference*383 **111 was 

held on December 14-15, 1977, in Washington, D.C., and 

subsequent modeling conferences must be held at least 

triennially.FN67

FN63. See, e. g., 122 Cong.Rec. H9564 (daily ed. 

Sept. 8, 1976) (remarks of Representative Milford) (“(a) wide variety of diffusion modeling 

methodology is available, each with its supporters 

and its detractors . . . (;) (i)n other words, the 

nondeterioration proposal rests fundamentally on 

mathematical procedures that require data and 

scientific knowledge which we do not have”); 122 

Cong.Rec. S13175 (daily ed. Aug. 3, 1976) (remarks of Senator Domenici) (“(a) major premise 

in the study rationale (of a proposed amendment) 

is that the current state of the art of air quality 

diffusion modeling makes the studies the committee has relied on unreliable(;) . . . even if one 

grants this contention . . . (a)ll the . . . amendment 

offers us is another study employing the same 

flawed modeling techniques”).

FN64. 123 Cong.Rec. S9269 (daily ed. June 9, 

1977) (remarks of Senator McClure) (“(w)e are 

making the best judgment we can, without 

knowing what those models are going to show, 

without knowing what the science of modeling 

will do, without knowing what effects it may have 

on specific questions”); 122 Cong.Rec. S13175 

(daily ed. Aug. 3, 1976) (remarks of Senator 

Domenici) (the bill, with its reliance on modeling, 

is “the first step in gathering knowledge on how 

our environmental values can be protected”; “real 

world feedback can . . . serve as the basis for 

making future modifications in the law”).
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FN65. s 165(e)(3)(D), 91 Stat. 739, 42 U.S.C. s 

7475(e)(3)(D) (Supp. I 1977). This provision 

goes on to say that

(a)ny model or models designated under such 

regulations may be adjusted upon a determination, after notice and opportunity for public 

hearing, by the Administrator that such adjustment is necessary to take into account 

unique terrain or a meteorological characteristic of an area potentially affected by emissions 

from a source applying for a permit required 

under this part.

Id.

FN66. (a) Not later than six months after the date 

of the enactment of the Clean Air Act Amendments of 1977, and at least every three years 

thereafter, the Administrator shall conduct a 

conference on air quality modeling. In conducting 

such conference, special attention shall be given 

to appropriate modeling necessary for carrying 

out Part C of title I (relating to prevention of significant deterioration of air quality).

(b) The conference conducted under this section shall provide for participation by the National Academy of Sciences, representatives of 

State and local air pollution control agencies, 

and appropriate Federal agencies, including the 

National Science Foundation; the National 

Oceanic and Atmospheric Administration, and 

the National Bureau of Standards.

(c) Interested persons shall be permitted to 

submit written comments and a verbatim transcript of the conference proceedings shall be 

maintained.

(d) The comments submitted and the transcript 

maintained pursuant to subsection (c) shall be 

included in the docket required to be established for purposes of promulgating or revising 

any regulation relating to air quality modeling 

under Part C of title I.

s 320, 91 Stat. 782, 42 U.S.C. s 7620 (Supp. I 

1977).

FN67. Id.

Many industry petitioners participated in the 1977 

conference and utilized the subsequent comment period. 

EPA, however, adhered essentially to its proposal to adopt 

the variety of models detailed in its “Interim Guideline on 

Air Quality Models,” which had been released in October, 

1977.FN68 The final regulations on modeling incorporate 

essentially the revised version of this document, released 

in April, 1978.FN69 On this review, industry petitioners urge 

that EPA's modeling regulations be set aside on the ground 

that the agency failed to respond meaningfully to significant criticism of the Interim Guideline, in contravention of 

Section 4 of the Administrative Procedure Act. FN70 They 

contend that their comments raised three crucial policy 

issues which EPA neglected to address.FN71

FN68. 42 Fed.Reg. 57472-57473 (Nov. 3, 1977)

(explaining proposal to employ requirements 

specified in EPA's Interim Guideline on Air 

Quality Models (Oct. 1977)).

FN69. 43 Fed.Reg. 26398-26399 (June 19, 1978)

(explaining regulations that incorporate by reference EPA's Guideline on Air Quality Models 

(Apr. 1978) (hereafter cited as “Guideline”)); 40 

C.F.R. s 51.24(m) (1978); 40 C.F.R. s 52.21(m) 

(1978).

FN70. 5 U.S.C. s 553 (1976).

FN71. Brief for Industry Petitioners on Modeling 

at 13-27.

Petitioners' first policy complaint goes not to the substance, but to an assumed exclusivity, of the models described in the guideline. The regulations require estimates 

of ambient concentrations to normally be based on the 

models specified in the 1978 guideline.FN72 If, however, a 

model designated by the guideline is inappropriate, it may 

be modified or another model substituted, FN73 but such 

changes are subject to public notice and comment procedures. FN74 Moreover, methods prescribed in an 

EPA-prepared workbook FN75 are to be used to determine 

whether substituted models are comparable to those laid 

out in the guideline.FN76 Petitioners read the regulations to 

require a demonstration that an industry-proposed model 

shares the individual technical aspects of one of the models 

approved in the guideline.FN77 They suggest that even if a 
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proposed model possesses greater predictive accuracy in 

particular circumstances than the reference model, it may 

not be employed unless it reproduces the technical shortcomings in the design of the standard model. According to 

petitioners, comments criticizing this emphasis on strict 

comparability, to the detriment of precision in estimating*384 **112 pollution concentrations, went unanswered.FN78

FN72. Air quality models. (1) The plan shall 

provide for procedures which specify that

(i) All estimates of ambient concentrations required under paragraph (1) shall be based on 

the applicable air quality models, data bases, 

and other requirements specified in the Guideline on Air Quality Models . . .

(ii) Where an air quality impact model specified 

in the Guideline on Air Quality Models is inappropriate, the model may be modified or 

another model substituted.

(iii) A substitution or modification of a model 

shall be subject to public comment procedures 

developed in accordance with paragraph (r) of 

this section.

(iv) Written approval of the Administrator must 

be obtained for any modification or substitution.

(v) Methods like those outlined in the Workbook for the Comparison of Air Quality Models 

. . . should be used to determine the comparability of air quality models. (2) The Guideline 

on Air Quality Models is incorporated by reference. . . .

40 C.F.R. s 51.24(m) (1978); see 40 C.F.R. s 

52.21(m) (1978) (same standards with respect 

to models used by source owners or operators 

to demonstrate compliance with the increments).

FN73. See note 72 supra.

FN74. See note 72 supra.

FN75. Environmental Protection Agency, 

Workbook for the Comparison of Air Quality 

Models (May, 1978).

FN76. 40 C.F.R. s 51.24(m)(1)(v) (1978); 40 

C.F.R. s 52.21(m)(2) (1978).

FN77. Brief for Industry Petitioners on Modeling 

at 14-15, 23 (quoting a comment submitted by the 

American Petroleum Institute).

FN78. Id. at 14-15, 23, 26.

EPA asserts, and we agree, that petitioners misread the 

regulations and the accompanying guideline.FN79 “(N)ot 

intended to be a compendium of modeling techniques,”

FN80 the guideline explicitly states its role:

FN79. Brief for Respondents at 214.

FN80. Guideline, supra note 69, at 1.

(t)his guide makes specific recommendations concerning (1) air quality models, (2) data bases and (3) general 

requirements for concentration estimates. . . . However, 

it may be found that (1) the recommended air quality 

model is not appropriate for a particular application, (2) 

the required data base is unavailable, or (3) a better 

model or analytical procedure is available and applicable. In such cases, alternatives indicated in this guide or 

other data, models and techniques deemed appropriate 

by the Regional Administrator may be used. Thus, even 

though specific recommendations are made, they should 

not be considered rigid requirements. The preferred 

model is that which best simulates atmospheric transport 

and dispersion in the area of interest. FN81

FN81. Guideline, supra note 69, at 1-2.

In sum, industry's criticism proceeded from a faulty 

premise and was firmly rebutted by the guideline, which 

was incorporated in the final regulations.

Since the models prescribed in the guideline are presumptively, not conclusively, appropriate, and EPA welcomes use of more accurate models, it could be argued that 

the modeling regulations are “general statements of policy” exempt under Section 4 from notice and comment 

procedures,FN82 whence comes the duty to respond to significant comments.FN83 We have heretofore noted that
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FN82. 5 U.S.C. s 553(b)(3)(A) (1976) provides 

that “(e)xcept when notice or hearing is required 

by statute,” the notice and comment requirement 

is inapplicable to “interpretative rules, general 

statements of policy, or rules of agency organization, procedure, or practice . . . .”

FN83. Home Box Office, Inc. v. FCC, 185 

U.S.App.D.C. 142, 168, 567 F.2d 9, 35 (1977); 

Automotive Parts & Accessories Ass'n v. Boyd, 

132 U.S.App.D.C. 200, 208, 407 F.2d 330, 338 

(1968).

(t)he critical distinction between a substantive rule and a 

general statement of policy is the different practical effect that these two types of pronouncements have in 

subsequent administrative proceedings. . . . When the 

agency applies the policy in a particular situation, it must

be prepared to support the policy just as if the policy 

statement had never been issued. FN84

FN84. Pacific Gas & Elec. Co. v. FPC, 164 

U.S.App.D.C. 371, 376, 506 F.2d 33, 38 (1974); 

see Texaco, Inc. v. FPC, 412 F.2d 740, 744 (3d 

Cir. 1969); Air Port Comm'n v. CAB, 300 F.2d 

185, 188 (4th Cir. 1962); Pacific Lighting Serv. 

Co. v. FPC, 518 F.2d 718, 719 (9th Cir.), cert. 

denied, 423 U.S. 1000, 96 S.Ct. 432, 46 L.Ed.2d 

376 (1975).

[77][78][79][80] As the modeling regulations illustrate, the line between binding, substantive rules and 

merely informational announcements on how the agency 

plans to exercise a discretionary power is not always 

bright. But the guideline requires that “deviations (from 

the specified models) be fully supported and documented,”

FN85 and in our view the models designated in the guideline 

are thus granted sufficient weight in subsequent proceedings to remove the regulations from the ambit of policy 

statements and the exemption therefor. In any event, it 

bears repeating that the duty to respond to significant 

comments finds a statutory basis in required notice and 

comment procedures, for “the opportunity to comment is 

meaningless unless the agency responds to significant 

points raised by the public.”

FN86 and, for the case at bar, 

Section *385 **113 320 of the Clean Air Act Amendments 

of 1977 explicitly affords interested persons that opportunity with respect to the proceedings of the special modeling conference,FN87 and submitted comments must be included in the docket established for promulgation and 

review of regulations pertaining to air quality modeling.FN88 Comments standing unaddressed thus may well 

leave a reviewing court unable to say that the agency has 

considered all relevant factors.FN89

FN85. Guideline, supra note 69, at 2.

FN86. Home Box Office, Inc. v. FCC, supra note 

80, 185 U.S.App.D.C. at 168-169, 567 F.2d at 

35-36; see Portland Cement Ass'n v. Ruckelshaus, 158 U.S.App.D.C. 308, 326-327, 486 F.2d 

375, 393-394 (1973), cert. denied, 417 U.S. 921, 

94 S.Ct. 2628, 41 L.Ed.2d 226 (1974).

FN87. 42 U.S.C. s 7620(c) (Supp. I 1977), quoted 

in note 66 supra.

FN88. 42 U.S.C. s 7620(d) (Supp. I 1977), quoted 

in note 66 supra.

FN89. See Citizens to Preserve Overton Park v. 

Volpe, supra note 8, 401 U.S. at 420, 91 S.Ct. at 

823-824, 28 L.Ed.2d at 153; Home Box Office, 

Inc. v. FCC, supra note 83, 185 U.S.App.D.C. at 

169, 567 F.2d at 36; Natural Resources Defense 

Council v. United States Nuclear Regulatory 

Comm'n, 178 U.S.App.D.C. 336, 346, 547 F.2d 

633, 646 (1976), rev'd on other grounds sub nom. 

Vermont Yankee Nuclear Power Corp. v. NRDC, 

435 U.S. 519, 98 S.Ct. 1197, 55 L.Ed.2d 460 

(1978); Greater Boston Television Corp. v. FCC, 

143 U.S.App.D.C. 383, 393, 444 F.2d 841, 851 

(1970), cert. denied, 403 U.S. 923, 91 S.Ct. 2233, 

29 L.Ed.2d 701 (1971).

[81] The second group of allegedly unrebutted but 

significant comments submitted by industry spokesmen 

charges undue conservatism in assumptions adopted in the 

guideline. Industry states that the guideline assumes 

“maximum loading, worst case meteorology, ground reflection, no travel time considerations and minimum plume 

rise,”

FN90 and that together they result in drastic overprediction of pollution concentrations. These comments were 

critical of the assumptions underlying the proposed models, not the techniques they incorporate. No objection has 

been raised against EPA's view that the models proposed, 

though flawed, reflect faithfully the present technological 

state of the art.FN91

FN90. Brief for Industry Petitioners on Modeling 

at 22 (citing comments submitted on behalf of 
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Arizona Public Service Company and American 

Petroleum Institute).

FN91. Guideline, supra note 69, at 18 (“(t)he 

models recommended in this guideline are simply 

those which are (1) representative of the 

state-of-the-art for atmospheric simulation models and (2) most readily available to air pollution 

control agencies”). Industry petitioners do point 

out that some commentators have expressed serious reservations about one of the models. Brief 

for Industry Petitioners on Modeling at 25. These 

may prove to be persuasive to EPA, however, as 

all the Guideline says about this model is that it 

may be “applicable to some complex terrain situations . . ..” Guideline, supra note 69, at 19. 

Congress recognized the technical difficulties in 

modeling emissions across complex terrain and 

expected EPA to develop and use the most appropriate models for such situations. See 123 

Cong.Rec. S13708 (daily ed. Aug. 4, 1977) 

(colloquy between Senator Muskie and Senator 

Garn).

Industry's position, we think, is overdrawn. The 

guideline first recommends use of a preliminary screening 

technique to single out, with minimum effort, those emission sources that clearly will not consume the remaining 

increment. FN92 Only if the source might threaten an increment exceedance is more sophisticated and expensive 

modeling required. The diffusion models specified are 

designed to make an accurate translation from source 

emissions to ambient air concentration levels at carefully 

selected places, called receptor sites, away from the 

sources.FN93 These models depend upon procurement and 

analysis of data concerning background pollution, 

load-emission conditions at the sources, and topographical 

and meteorological conditions in the area. FN94 The guideline does not, contrary to petitioners' intimation, require 

use of the highest of *386 **114 all estimated concentrations at any site. Rather, the “highest of second-highest 

concentrations for a field of receptors” is generally employed to predict increment consumption.FN95 This concentration is obtained by (a) estimating the short-term 

concentration at each receptor site in the field, (b) discarding the highest estimated concentration at each site, 

and (c) identifying the highest of the remaining concentration estimates from the field the result referred to as the 

“highest, second-highest” concentration.FN96 Where monitored air-quality data indicate impacts greater than predicted by models using highest, second-highest estimated 

concentrations, the measured concentration levels are 

utilized. FN97 And if the regional administrator determines 

that there is a lack of confidence in the highest, 

second-highest concentration standard because of data or 

model inadequacies, he may require use of the highest 

estimated concentrations until the necessary data are acquired or analytical techniques are improved.FN98

FN92. Guideline, supra note 69, at 2, 19-20. 

Recommended are the screening techniques 

summarized in EPA's Guidelines for Air Quality 

Maintenance Planning and Analysis, Vol. 10: 

Procedures for Evaluating Air Quality Impact of 

New Stationary Sources (Oct., 1977).

FN93. See, e. g., Sierra Club v. EPA, 176 

U.S.App.D.C. 335, 357, 540 F.2d 1114, 1136 

(1976), remanded sub nom. Montana Power Co. 

v. EPA, 434 U.S. 809, 98 S.Ct. 40, 54 L.Ed.2d 66 

(1977); Mision Indus., Inc. v. EPA, 547 F.2d 123, 

128-129 (1st Cir. 1976); Cincinnati Gas & Elec. 

Co. v. EPA, 578 F.2d 660, 661 (6th Cir. 1978), 

cert. denied, 439 U.S. 1114, 99 S.Ct. 1017, 59 

L.Ed.2d 72 (1979); W. Rodgers, Environmental 

Law 237 (1977).

FN94. Guideline, supra note 69, at 27-37.

FN95. Id. at 8.

FN96. Id.

FN97. Id. at 9.

FN98. Id. at 9-10.

EPA's resort to the highest, second-highest concentration level is not inexplicable. Models are designed to aid 

EPA in its task of protecting the statutorily-prescribed 

increments and, as the guideline states, “(t)hese maximum 

allowable increases in pollutant concentrations may be 

exceeded only once per year, except for the annual increment.”

FN99 Thus the guideline points out why the models 

embrace rather conservative assumptions not likely to hold 

true on many days: protection of the increments, the statute 

says, is a well-nigh continuous responsibility, not a casual 

goal to be assured only on typical days.

FN99. Id. at 11. See s 163(a), (b), 91 Stat. 732, 42 

U.S.C. s 7473(a), (b) (Supp. I 1977).
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Industry petitioners' remaining set of complaints does 

recognize the need to fit the models into the statutory 

scheme. They submitted comments averring that Congress 

intended to ratify the modeling analysis employed in a 

1975 report by EPA and the Federal Energy Administration FN100 assessing the impact of the PSD program on the 

electric utility industry.FN101 They point out ways in which 

the models selected in the guideline are more conservative 

than that employed in the 1975 EPA-FEA study.FN102

FN100. Environmental Protection Agency & 

Federal Energy Administration, An Analysis of 

the Impact on the Electric Utility Industry of Alternative Approaches to Significant Deterioration 

(Oct., 1975).

FN101. Brief for Industry Petitioners on Modeling at 16-21 (discussing comments submitted on 

behalf of Utility Air Regulatory Group and other 

industry interests).

FN102. They suggest that the EPA-FEA report, 

unlike the guideline, relied heavily on a limited 

mixing model for Class I impact analysis, and that 

the guideline adopts conservative assumptions 

while the earlier report was based “on the use of 

average (typical) conditions.” Brief for Industry 

Petitioners on Modeling at 16. The limited mixing 

model has been retained as a screening model. 

See Guidelines for Air Quality Maintenance 

Planning and Analysis, supra note 92, at 4-12, 

4-38 to 4-40. And the more conservative assumptions were warranted by the new statutory 

framework. See notes 90-99 supra and accompanying test.

This argument is belied by the facts. Congress itself 

changed some of the assumptions on which the EPA-FEA 

report was based. To take an obvious example, Congress 

made the increments used in both the House bill and the 

study more stringent.FN103 Congress also specified the 

conference and comment procedures in order to prod EPA 

into revising its models to reflect growing scientific sophistication.FN104 Moreover,*387 **115 industry's interpretation of the legislative history is itself one-sided. It is 

true that Congressman Broyhill indicated that the House 

receded from insistence upon the provisions of an 

amendment, which would have authorized temporary increment exceedances in Class II areas, upon assurances 

that the EPA-FEA study demonstrated that “powerplants 

up to 6,000 megawatts could be built” under the bill.FN105

But this proves nothing, for even according to petitioners' 

representative, such a plant can be built under the EPA 

regulations.FN106 Moreover, Senator McClure, an influential supporter of the Act, did remark that the bill would 

“make it impossible to build a 3,000-megowatt plant in 

southern Utah,”

FN107 yet the Senator recognized that the 

Act was not drafted in terms of either allowing or prohibiting sources of specified sizes, and that the Act's actual 

impact on particular sources could not be predicted: “(s)o 

we are taking something on faith. We are making the best 

judgment we can, without knowing what those models are 

going to show, without knowing what the science of 

modeling will do, without knowing what effects it may 

have on specific questions.”

FN108 Senator Muskie agreed 

that “the best we can do is to try to define the broad parameters”

FN109 of what the Act will do.

FN103. Petitioners' representative at the December, 1977, modeling conference acknowledged this crucial change. Transcript of Modeling 

Conference at 81 (Dec. 15, 1977) (remarks of Dr. 

Mahoney), quoted infra note 106.

FN104. See 42 U.S.C. s 7620 (Supp. I 1977), 

quoted supra note 66. See also H.R.Rep.No.564, 

95th Cong., 1st Sess. 153 (1977) (conference 

report) U.S.Code Cong. & Admin.News, p. 1533 

(“(t)he conference adopted the air quality modeling conference in the House bill and expects 

that EPA will seek the full participation of representatives of private and public interests”).

FN105. 123 Cong.Rec. H6667 (daily ed. Aug. 4, 

1977) (remarks of Representative Broyhill); see 

also H.R.Rep.No.294, 95th Cong., 1st Sess. 157 

(1977).

FN106. (W)e find that this is entirely consistent 

with the new guidelines and that when the earlier 

results are scaled to the increment level limit finally adopted by Congress, plants up to 6,000 

megowatt capacity could be built, if they adopt 

what we would call best available control technology, having very limited degradation, that is 

use of low sulfur Western coal with a scrubber. . . 

. We do find that the statement of the Congressional debate, that a 6,000 megowatt plant could 

be built is appropriate for that case.

Transcript of Modeling Conference at 81-82 
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(Dec. 15, 1977) (remarks of Dr. Mahoney).

FN107. 123 Cong.Rec. S9269 (daily ed. June 9, 

1977) (remarks of Senator McClure). This example concerned a Class I area.

FN108. Id. (remarks of Senator McClure).

FN109. Id. (remarks of Senator Muskie).

[82][83][84] We conclude that Congress did not direct 

the use of any particular diffusion models; rather, it expected EPA to develop and utilize the most accurate and 

feasible modeling techniques available. It also set largely 

inflexible increments for sulfur dioxide and particulates, 

thus commanding the use of conservative assumptions on 

weather and other data input. In short, EPA's models do not 

contravene any discernible congressional directive. 

Comments of industrial spokesmen to the contrary thus 

raised relatively insubstantial questions of law, and consequently did not necessitate an agency reply.FN110

FN110. See Home Box Office, Inc. v. FCC, supra 

note 83, 185 U.S.App.D.C. at 168-169 & n.58, 

567 F.2d at 35-36 & n.58; Portland Cement Ass'n 

v. Ruckelshaus, supra note 86, 158 U.S.App.D.C. 

at 326-327, 486 F.2d at 393-394.

[85][86] But though we today sustain EPA's modeling 

regulations, a final observation is in order. Of great importance is a reasoned agency response to substantial 

questions of fact, policy or science raised in comments on 

recommended models or in proposals to employ new 

techniques. In passing Part C of the Clean Air Act,FN111

Congress evinced its determination to preserve the clean 

air regions of the Nation. Congress did not, however, ignore other vital economic and energy considerations.FN112

Moreover, successful implementation of the balance struck 

by Congress will in large part depend on EPA's good sense 

in establishing and applying modeling guidelines. Modeling, the agency tells us, is on “the frontiers of scientific 

knowledge,”

FN113 but the lack of scientific certitude about 

modeling techniques increases rather than reduces*388

**116 the need for the agency to critically examine all 

substantial questions of fact and science emerging from the 

commenting process. EPA's guideline warns that all proposed deviations from the endorsed model must be fully 

supported,FN114 but this language should not be overemphasized, for the models presently specified in the guideline are concededly flawed. FN115 Should scientific advances or better information permit a more accurate assessment of air quality, EPA should move to adopt the 

more accurate procedure, although it too may not be entirely free from fault.FN116

FN111. 42 U.S.C. ss 7470-7491 (Supp. I 1977).

FN112. See, e. g., s 160(3), 91 Stat. 731, 42 

U.S.C. s 7470(3) (Supp. I 1977); s 163(c), 91 Stat. 

733, 42 U.S.C. s 7473(c) (Supp. I 1977).

FN113. Brief for Respondents at 206, citing 

Hercules, Inc. v. EPA, 194 U.S.App.D.C. 172, 

205, 598 F.2d 91, 123 (1978); Industrial Union 

Dep't v. Hodgson, 162 U.S.App.D.C. 331, 338, 

499 F.2d 467, 474 (1974).

FN114. Guideline, supra note 69, at 2.

FN115. In many cases, solutions to the issues 

raised must rely on further scientific developments. Some inherently must rely on case-by-case 

technical judgments by qualified scientists. EPA 

is actively working in the areas of model validation and improvement, turbulence characterization and the use of representative meteorological 

data and will provide additional guidance on these 

areas as it becomes available.

43 Fed.Reg. 26399 (June 19, 1978) (explanation of final regulations). See also Guidelines, 

supra note 69, at 4-6.

FN116. We would associate ourselves with the 

observation that “(d)ecisions which are not arbitrary and capricious in the light of existing 

knowledge may become so by the dint of scientific advances. By its use of estimations and 

sparse data, the EPA creates a continuing responsibility to develop, review and apply updated 

and more sophisticated information.” Texas v. 

EPA, 499 F.2d 289, 301 n.16 (5th Cir. 1974).

IV. STACK HEIGHT

Both ambient air quality standards and PSD increments are expressed in terms of permissible concentrations 

of pollutants at ground level.FN117 The effect of a source's 

emissions on air quality in its vicinity, as gauged by these 

fundamental criteria, will be influenced by the altitude at 

which pollutants are released. A good many industrial 

facilities subject to the Clean Air Amendments of 1970 
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FN118 tried to take advantage of this phenomenon by 

building taller-than-necessary stacks in order to achieve 

greater dispersion of their emissions and thus comply with 

national ambient standards. This strategy was also in vogue among sources required to comply with EPA's 1974 

PSD program. FN119

FN117. Industry Petitioners' Joint Statement of 

the Case at 3-4, 14-15.

FN118. Clean Air Amendments of 1970, Pub.L. 

No. 91-604, 84 Stat. 1676.

FN119. Promulgated pursuant to Sierra Club v. 

Ruckelshaus, 344 F.Supp. 253 (D.D.C.1972), 

aff'd, 4 ERC 1815 (D.C.Cir. 1972), aff'd by an 

equally divided Court sub. nom. Fri v. Sierra 

Club, 412 U.S. 541, 93 S.Ct. 2770, 37 L.Ed.2d 

140 (1973).

The Congress that enacted the Clean Air Act 

Amendments of 1977 FN120 was deeply concerned about the 

consequences to health and welfare of the use of tall stacks 

and other dispersion techniques.FN121 It addressed the 

problem forcefully, not by prohibiting tall stacks, but by 

removing all existing regulatory incentives for constructing them.FN122 Section 123(a) of the Act provides in relevant part that

FN120. Clean Air Amendments of 1977, 

Pub.L.No.95-95, 91 Stat. 685.

FN121. See, e. g., H.R.Rep.No. 564, 95th Cong., 

1st Sess. 143-144 (1977) (conference report); 

H.R.Rep.No. 294, 95th Cong., 1st Sess. 81-94 

(1977); 123 Cong.Rec. S9174-9175 (daily ed. 

June 8, 1977) (remarks of Senator Muskie). Related to the tall stacks problem, and addressed in 

similar fashion by virtue of ss 123(a)(2) and 

123(b), 91 Stat. 721, 42 U.S.C. ss 7423(a)(2), (b) 

(Supp. I 1977), is the problem of intermittent 

controls, which involve extensive operation when 

meteorological conditions will best disperse the 

emissions and curtailed operations at other times. 

See W. Rodgers, Environmental Law 259 (1977) 

( “(t)he rhythm method, to be sure, is better than 

nothing but it is born of desperation and succeeds 

by chance”).

FN122. See notes 150-156 infra and accompanying text.

(t)he degree of emission limitation required for control 

of any air pollutant under an applicable implementation 

plan under (Title I) shall not be affected in any manner 

by

(1) so much of the stack height of any source as exceeds good engineering practice (as determined under 

regulations *389 **117 promulgated by the Administrator) . . . .FN123

FN123. s 123(a), 91 Stat. 721, 42 U.S.C. s 

7423(a) (Supp. I 1977).

[87][88] Industry petitioners read Section 123 as a ban 

only on administrative consideration of stacks taller than 

warranted by good engineering practice (GEP) as an alternative to emission limitations. FN124 So, industry concedes, when a facility with a tall stack a term that really 

covers a too-tall stack seeks a permit and it must be determined whether that facility's emissions will threaten a 

violation of a national ambient standard or an increment 

exceedance, the calculation must be predicated on the false 

assumption that the stack has only GEP height.FN125 EPA 

interprets the mandate of Section 123 more broadly, declaring that it further requires emissions from all preexisting 

sources with tall stacks that were built after the effective 

date of the 1970 Act, and hence were not grandfathered, to 

be modeled as though the emissions proceeded from 

GEP-height stacks when ascertaining the emission limitations to be imposed on new facilities.FN126

FN124. Brief for Industry Petitioners on Stack 

Height at 11-12.

FN125. Id.

FN126. 42 Fed.Reg. 57460 (Nov. 3, 1977)

(“(a)ny subsequent PSD reviews will have to be 

based on a GEP stack height for the applicant as 

well as for any sources which have received PSD 

approval”); see 40 C.F.R. s 52.21(h) (1978); 40 

C.F.R. s 51.24(h) (1978) (provision appears to 

have been written so as to erroneously reach only 

grandfathered tall stacks).

Asked to resolve this dispute, “our task is to interpret 

the words of (Section 123) in light of the purposes Congress sought to serve.”

FN127 Granting EPA's view a proper 
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measure of deference,FN128 we sustain its construction.

FN127. Chapman v. Houston Welfare Rights 

Organization, 441 U.S. 600, 608, 99 S.Ct. 1905, 

1911, 60 L.Ed.2d 508, 516 (1979).

FN128. We have noted that “(t)his deference is 

heightened when, as here, the interpretation is of a 

new statute by its implementing agency.” Ethyl 

Corp. v. EPA, 176 U.S.App.D.C. 373, 403 n.64, 

541 F.2d 1, 31 n.64 (en banc), cert. denied, 426 

U.S. 941, 96 S.Ct. 2663, 49 L.Ed.2d 394 (1976), 

citing Power Reactor Devel. Co. v. International 

Union of Elec., Radio and Mach. Workers, 367 

U.S. 396, 408, 81 S.Ct. 1529, 1535, 6 L.Ed.2d 

924, 932 (1961); United States v. Zucca, 351 U.S. 

91, 96, 76 S.Ct. 671, 674, 100 L.Ed. 964, 970 

(1956); United States v. American Trucking 

Ass'n, 310 U.S. 534, 549, 60 S.Ct. 1059, 1067, 84 

L.Ed. 1345, 1354 (1940); Norwegian Nitrogen 

Prods. Co. v. United States, 288 U.S. 294, 315, 53 

S.Ct. 350, 358, 77 L.Ed. 796, 807 (1933); Natural 

Resources Defense Council v. Train, 166

U.S.App.D.C. 312, 326, 510 F.2d 692, 706 

(1975).

A. The 1970 Act and Tall Stacks

Under the Clean Air Act of 1970,FN129 EPA was required, by Section 110(a)(2) (B), to approve a state implementation plan if it determined that the plan was 

“adopted after reasonable notice and hearing,”

FN130 and if 

“it include(d) emission limitations, schedules, and timetables for compliance with such limitations, and such other 

measures as may be necessary to insure attainment and 

maintenance of (the applicable) primary or secondary 

standard, including, but not limited to, land-use and 

transportation controls . . . .”

FN131 EPA initially permitted 

state plans to authorize tall stacks and other dispersion 

techniques FN132 in lieu of emission limitations. The Fifth 

Circuit, however, ordered EPA to disapprove state plans 

endorsing this practice as inconsistent with Section 

110(a)(2)(B)„s requirement of emission limitations constant in their operation,**118 *390 FN133 and the Sixth FN134

and Ninth Circuits FN135 followed the Fifth Circuit's construction of the 1970 Act.

FN129. Pub.L.No. 91-604, 84 Stat. 1676.

FN130. 42 U.S.C. s 1857c-5(a)(2) (1976).

FN131. 42 U.S.C. s 1857c-5(a)(2)(B) (1976). 

Section 110(a)(2) of the 1977 Amendments, 91 

Stat. 693, revised this subsection by substituting 

“transportation controls, air quality maintenance 

plans, and preconstruction review of direct 

sources of air pollution as provided in subparagraph (D)” for “land use and transportation controls.” See 42 U.S.C. s 7410(a)(2)(B) (Supp. I 

1977).

FN132. See 37 Fed.Reg. 10859 (May 31, 1972), 

rev'd in relevant part, Natural Resources Defense 

Council v. EPA, 489 F.2d 390 (5th Cir. 1974), 

rev'd on other issues sub nom. Train v. Natural 

Resources Defense Council, 421 U.S. 60, 95 S.Ct. 

1470, 43 L.Ed.2d 731 (1975).

FN133. Natural Resources Defense Council v. 

EPA, supra note 132, 489 F.2d at 406-411.

FN134. Big Rivers Elec. Corp. v. EPA, 523 F.2d 

16, 20-22 (6th Cir. 1975), cert. denied, 425 U.S. 

934, 96 S.Ct. 1663, 48 L.Ed.2d 175 (1976).

FN135. Kennecott Copper Corp. v. Train, 526 

F.2d 1149, 1151-1160 (9th Cir. 1975), cert. denied, 425 U.S. 935, 96 S.Ct. 1665, 48 L.Ed.2d 176 

(1976).

B. EPA's 1976 Tall-Stack Guidelines

Informed as well as chastened by these judicial decisions, EPA in early 1976 promulgated a guideline on the 

role of tall stacks.FN136 The agency declared that “it is clear 

that Congress did not intend increased stack height and 

supplementary control systems to be used as a means of 

attaining national ambient air quality standards where 

constant emission reduction controls were available.”

FN137

On the other hand, EPA ruled, dispersion techniques were 

within the congressional intendment “when constant controls are not available.”

FN138

FN136. Environmental Protection Agency, Legal 

Interpretation and Guideline Concerning Stack 

Height Increases as a Means of Meeting Federal 

Ambient Air Quality Standards (Jan. 6, 1976).

FN137. Id. at 1.

FN138. Id.

The guideline divided emission sources into three 
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categories and imposed different technological requirements on each group: (1) sources in existence prior to the 

latest date by which state plans were to be submitted to 

EPA under the 1970 Act; (2) sources receiving permits 

after the Fifth Circuit decision but before issuance of the 

guideline; (3) sources receiving permits after release of the 

EPA notice.FN139 The guideline was clear, however, that if 

any source applied the best available control technology it 

would be credited for the full dispersive effect of its tall 

stack.FN140 Indeed, said EPA, “(s)o long as stack height is 

not used in lieu of emission reduction, the Agency encourages tall stacks as the means of further minimizing the 

effects of emissions on ground level concentrations.”

FN141

FN139. Id. at 2-4.

FN140. Id.

FN141. Id. at 4 (emphasis in original).

C. The 1977 Amendments

[89] Industry petitioners suggest, though somewhat 

halfheartedly, that the Ninety-fifth Congress “ratified the 

general thrust” of the EPA guideline when it enacted Section 123.FN142 They concede, however, that unlike the 

guideline, Section 123 requires that GEP stack height be 

assumed in calculating emission limitations for an individual source even though it applies the best available 

control technology.FN143 But, they argue, once the emission 

limitation for a source is properly set, Congress intended 

that the pollutants from that source be modeled as though 

emitted from the existing tall stack in order to reflect its 

actual impact on air quality. As already explained, FN144

EPA, in its November 3, 1977, final rules, adopted the 

contrary reading of the statute.FN145

FN142. Brief for Industry Petitioners on Stack 

Height at 10. It would be fair to say that Congress 

generally approved of the court decisions. See 

H.R.Rep.No. 294, 95th Cong., 1st Sess. 91 

(1977). It would not be accurate to say that Congress simply codified the holdings and dicta of 

those decisions in s 123.

FN143. Brief for Industry Petitioners on Stack 

Height at 11.

FN144. See note 126 supra and accompanying 

text.

FN145. See note 126 supra.

[90] The language of Section 123(a), though not necessarily reflective of a conscious resolution of the point in 

dispute, is certainly more amenable to EPA's construction.FN146 The section specifies that the degree of emission 

limitation required for control of any air pollutant “shall 

not be affected in any manner by . . . so much of the stack 

height of any source as exceeds *391 **119 good engineering practice . . . .”

FN147 The term “emission limitation”

includes any requirement imposed on a source by EPA or a 

state which restricts the quantity, rate, or concentration of 

air pollutants on a continuous basis. FN148 The interpretation urged by industry petitioners contravenes the natural 

import of these words, as it would have the degree of 

emission limitation required for a source reduced by the 

fact that neighboring, preexisting sources with tall stacks 

disperse their emissions over a broader region, thus resulting in lower concentrations in the immediate vicinity.

FN146. See cases cited supra note 39.

FN147. 42 U.S.C. s 7423(a)(1) (Supp. I 1977)

(emphasis supplied).

FN148. s 302(k), 91 Stat. 770, 42 U.S.C. s 

7602(k) (Supp. I 1977). The House report, 

H.R.Rep.No. 294, 95th Cong., 1st Sess. 92 

(1977), U.S.Code Cong. & Admin. News, p. 

1170, states that “(b)y defining the terms „emission limitation,‟ „emission standard,‟ and „standard of performance,‟ the committee has made 

clear that constant or continuous means of reducing emissions must be used to meet these requirements.”

The policy of Section 123, as gleaned from examination of its genesis and progress in Congress, is also supportive of EPA's interpretation. This provision originated 

in the House,FN149 and the 1977 House Report dealt extensively with the problem of dispersion techniques.FN150 In 

addition to disapproving tall stacks and other dispersion-dependent techniques in lieu of constant controls,FN151

the House Report detailed some independently deleterious 

effects of tall stacks. Among other things, the report noted 

that tall stacks, by increasing the transportation of pollutants, may lead to production of derivative pollutants, such 

as suspended sulfates and nitrates, which pose a greater 

health hazard than the parent compounds.FN152 Tall stacks 

also transport pollution problems to distant areas and states 

“where it is too late to control the pollution.”

FN153
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FN149. See H.R.Rep.No. 564, 95th Cong., 1st 

Sess. 143-144 (1977) (conference report).

FN150. H.R.Rep.No. 294, 95th Cong., 1st Sess. 

81-94 (1977).

FN151. Id.

FN152. Id. at 83-84. The report also suggested 

that harmful acid rain appears to be associated 

with tall stacks. Id. at 85-86.

FN153. Id. at 84-85, U.S.Code Cong. & Admin.News, p. 1162.

In the upper chamber, Senator Muskie spoke at length 

on the tall stacks problem.FN154 Contrary to petitioners' 

suggestion,FN155 EPA's 1976 guideline was not beyond 

congressional dissatisfaction. Senator Muskie expressed 

this sentiment:

FN154. 123 Cong.Rec. S9174-9175 (daily ed. 

June 8, 1977) (remarks of Senator Muskie).

FN155. See note 142 supra and accompanying 

text.

Far from prohibiting the construction of tall stacks or 

the use of intermittent controls, the guidelines provide 

that once minimal emission control requirements are 

met, polluters are encouraged to substitute unlimited 

stack height for any further control of emissions.

As the courts have held, the act prescribes how air 

quality standards must be met neither EPA nor the States 

may permit a proposed plan to meet the requirements by 

using tall stacks or other dispersion devices or techniques.

A policy of encouraging „tall stacks' will increase the 

burden of pollution. Long-range transport of pollutants 

will be exacerbated. There is no support in the Clean Air 

Act for such a policy. Certainly such a policy would be 

wholly inconsistent with the policy to prevent significant 

deterioration.FN156

FN156. 123 Cong.Rec. S9175 (daily ed. June 8, 

1977) (remarks of Senator Muskie). The Senator 

also noted that a report by “the National Academies of Science of Engineering found that dispersion measures may exacerbate the formation 

in the atmosphere of acid sulfates and nitrates 

from the sulfur and nitrogen oxides emitted from 

fuel-burning sources. These derivative pollutants 

are thought to be more toxic forms than the oxides 

of sulfur and nitrogen that are actually emitted at 

the smokestack and are measured in the vicinity 

of the source.” Id. at S9174.

*392 **120 The firm congressional resolve to remove 

all regulatory incentives for the construction of tall stacks 

bolsters EPA's reading of Section 123, for the position 

urged by industry petitioners would encourage, though to a 

lesser degree than the 1976 guideline, the use of such 

stacks and other dispersion methods. A company may well 

wish to expand by building a new facility close to an existing one, and if the older facility had a tall stack and if 

petitioners' interpretation of Section 123 were to prevail, 

the new facility would find it easier to comply with nondeterioration and national ambient standards. Additionally, 

operating permits are not irrevocable, and by use of a tall 

stack a facility would lessen pollution concentrations in its 

own air quality region and render it less likely that violations of national standards or increment exceedances 

which would necessitate further controls or possibly partial 

or complete shutdown of the facility FN157 will occur.

FN157. See Part IV of Judge Leventhal's Opinion.

[91][92][93] Industry petitioners make three points 

which, they submit, reveal the absurdity FN158 of EPA's 

interpretation of Section 123. First, they bitterly complain 

of artificial assumptions which in their view unnecessarily 

complicate administration of the federal pollution regulatory system.FN159 One might concur in petitioners' assessment, but a sufficient answer is that Congress introduced a 

number of such elements into the system. For example, the 

baseline is not only a snapshot of pollution on the date of 

the first permit application, but it must be reduced to exclude emissions from major operating facilities on which 

construction commenced after January 6, 1975, and increased to include the projected emissions of sources not 

yet in operation as of the date of the first permit application 

but on which construction began prior to January 6, 

1975.FN160 There is, indeed, a degree of artificiality in the 

modeling of tall-stack emissions as though they came from 

a GEP stack, but indisputably that is what Congress envisioned.
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FN158. Of course, an absurd construction is to be 

avoided if at all possible. E. g., United States v. 

Menasche, 348 U.S. 528, 538-539, 75 S.Ct. 513, 

520, 99 L.Ed. 615, 624 (1955); Melong v. Micronesian Claims Comm'n, 186 U.S.App.D.C. 

391, 395, 569 F.2d 630, 634 (1977); Quinn v. 

Butz, 166 U.S.App.D.C. 363, 373, 510 F.2d 743, 

753 (1975).

FN159. E. g., Brief for Industry Petitioners on 

Stack Height at 14-16; Transcript of Oral Argument 128-129 (Apr. 20, 1979).

FN160. See notes 21-43 supra and accompanying 

text. Of course, as EPA has recognized, 43 

Fed.Reg. 26400 (June 19, 1978); 42 Fed.Reg. 

57460 (Nov. 3, 1977); Brief for EPA at 186-187, 

emissions from tall-stack sources that have been 

included in the definition of baseline under s 

169(4) do not consume the available increment; 

their actual emissions as of the time of the first 

permit application are grandfathered. See Parts I, 

II supra. This consequence of the baseline definition does not conflict with s 123(a), for these 

grandfathered emissions do not affect the “degree 

of emission limitation required” for applicants for 

PSD permits. Nor does it render the December 31, 

1970, cutoff in s 123 nugatory, for s 123 is not in 

Part C (PSD), and the statutory tall-stacks policy 

is not confined to the nondeterioration program 

but rather is applicable to the entire range of 

programs developed pursuant to the Clean Air 

Act. This point was not made clear in our per curiam opinion, Alabama Power Co. v. Costle, 196 

U.S.App.D.C. 161, at 183, 606 F.2d 1068, at 1090 

(1979), as industry petitioners have pointed out in 

a petition for reconsideration. On the other hand, 

as we have explained in our discussion of the 

fuel-switches issue, see notes 19-56 supra and 

accompanying text, only the actual emissions of a 

major source operating on the date of the baseline 

determination and on which construction commenced prior to January 6, 1975, are grandfathered; additional emissions from such a source 

consume the increment. Thus, if non-baseline 

emissions from such a source proceed from a 

taller-than-GEP stack not in existence before 

December 31, 1970, they consume the increment 

as though they were emitted from a GEP stack. In 

short, s 123's tall-stacks policy, for purposes of 

the nondeterioration program, applies to 

non-baseline emissions of nongrandfathered 

stacks.

Second, petitioners point out that under Section 123(c) 

a stack height in excess of two and one-half times the 

height of the emission source may be considered a GEP 

stack only if the “owner or operator” demonstrates that 

such height is “necesary to insure that emissions from the 

stack do not result in excessive concentrations of any air 

pollutant in the immediate vicinity of the *393 **121

source as a result of atmospheric downwash, eddies and 

wakes which may be created by the source itself, nearby 

structures or nearby terrain obstacles . . . .”

FN161 Petitioners 

spot a lacuna in this statutory passage, which, they urge, 

reveals the error of EPA's construction: only the owner or 

operator of a source can demonstrate that a very tall stack 

is really GEP height. FN162 The owner of a proposed facility 

cannot show, they say, that preexisting tall stacks in the 

area in which he plans to build are necessary to avoid 

downwash, and this may preclude obtention of a permit.

FN161. s 123(c), 91 Stat. 721, 42 U.S.C. s 

7423(c) (Supp. I 1977).

FN162. Transcript of Oral Argument 128-131 

(Apr. 20, 1979).

[94] We believe petitioners exaggerate the problem. 

Tallstack facilities existing before the date of enactment of 

the Clean Air Act Amendments of 1970 are grandfathered; 

FN163 their emissions are modeled at actual stack height for 

all purposes. On the other hand, Congress felt that since the 

1970 Act “prohibited tall stacks as a final compliance 

method, . . . sources which raised their stacks or constructed tall stacks after the date of enactment should (not) 

be eligible for any credit.”

FN164 It will, however, be in the 

interest of all post-1970 facilities with tall stacks to demonstrate, if possible, that their excess height is justified by 

downwash problems, for such sources may be subjected to 

extensive regulatory measures in the event of increment 

exceedances or violation of national standards.FN165 If a 

source makes such a demonstration, its emissions will be 

modeled at actual stack height in subsequent permit proceedings.

FN163. The tall-stacks policy of s 123(a) is expressly made inapplicable “with respect to stack 

heights in existence before the date of enactment 

of the Clean Air Amendments of 1970 or dispersion techniques implemented before (that) date.”
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s 123(a), 91 Stat. 721, 42 U.S.C. s 7423(a) (Supp. 

I 1977). There is also a limited exemption for 

coal-fired electric generating facilities. See id. In 

addition, ss 113(d) and 119 permit some use of 

dispersion techniques under specified conditions. 

See s 113(d), 91 Stat. 705, 42 U.S.C. s 7413(d) 

(Supp. I 1977); s 119, 91 Stat. 712, 42 U.S.C. s 

7419 (Supp. I 1977). Moreover, with respect to 

the nondeterioration program, the actual emissions from tall stacks of major operating facilities 

on which construction commenced prior to January 6, 1975, are grandfathered into the baseline. 

See note 160 supra.

FN164. H.R.Rep.No. 294, 95th Cong., 1st Sess. 

93 (1977), U.S.Code Cong. & Admin.News, p. 

1172.

FN165. See Part IV of Judge Leventhal's Opinion.

[95] Lastly, industry petitioners observe that the artificial assumptions injected into the environmental protection program by EPA's construction of Section 123 will 

lead to underprediction of pollution levels in areas to 

which emissions from tall stacks are transported.FN166

Surely Congress did not intend its tall-stacks policy to 

preclude identification of areas with real pollution problems, the petitioners persuasively urge, but this, they say, is 

the consequence of EPA's fallacious construction of Section 123. FN167 As explained in Judge Leventhal's opinion,FN168 however, Congress afforded EPA authority to 

order revision of state implementation plans whenever the 

increments or the national standards are actually being 

violated. FN169 This residual authority ensures that the 

tall-stacks policy need not hamper attainment and maintenance of federally-prescribed pollution standards everywhere.

FN166. Reply Brief for Industry Petitioners on 

Stack Height at 6-8.

FN167. This assumes and we do not pass on the 

validity of the assumption that EPA must interpret 

s 123(a) consistently, despite the fact that the 

policy of the provision may not apply to the case 

of underprediction of pollution in areas to which 

emissions from tall stacks migrate.

FN168. See Part IV of Judge Leventhal's Opinion.

FN169. Id.

[96] In summary, EPA's reading of Section 123(a) is 

preferable as a matter of simple English to petitioners', is 

soundly supported by the legislative history, and is not 

belied by other provisions or policies of the Clean Air Act. 

Granting EPA's interpretation*394 **122 due deference, 

FN170 it must be sustained. FN171

FN170. See cases cited supra notes 38, 128.

FN171. Petitioners have urged us to defer our 

ruling on EPA's interpretation of s 123(a) until 

completion of a pending rulemaking proceeding 

designed to implement s 123, and which will define, among other things, GEP height. 44 

Fed.Reg. 2608 (Jan. 12, 1979) (proposed rules). 

That proceeding does not involve the question we 

decide today the propriety of modeling emissions 

from tall stacks at GEP height when calculating 

emission limitations for later sources. EPA's final 

position on the question under review here was 

announced in November, 1977, 42 Fed.Reg. 

58460 (Nov. 3, 1977). We perceive no merit in 

petitioners' deferral request.

WILKEY, Circuit Judge:

This part of our opinion reviews several interrelated 

regulatory provisions FN1 promulgated by the Environmental Protection Agency under the Clean Air Act, as 

amended in 1977.FN2 These provisions fall within five 

topical categories: I. EPA's definition of pollution-emitting 

“sources” subject to rules governing the Prevention of 

Significant Deterioration (PSD) FN3 of air quality (“source 

definition” issue); II. EPA's definition of the term “modification” of stationary sources for the purposes of PSD, 

and the right of industries to offset pollution-increasing 

changes against pollution-decreasing changes in a single 

source without PSD review (“major modification” and 

“bubble” issues); III. the applicability of PSD to pollutants 

other than sulfur dioxide and particulate matter, and EPA's 

100 and 250-ton per year emission threshold for each 

pollutant (pollutants subject to PSD and EPA's “major 

emitting facility” threshold); IV. EPA's inclusion of visible 

emission standards among emission limitations subject to 

best available control technology; FN4 and V. administrative conditions imposed by EPA on each stage of a multi-phase construction project for which EPA issues a 

comprehensive construction permit (the definition of 

“commerce construction” for phased projects).
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FN1. 40 C.F.R. ss 51.24, 52.21 (1978).

FN2. Pub.L.No. 88-206, 77 Stat. 392 (1963), as 

amended by Clean Air Act Amendments of 1977, 

Pub.L.No. 95-95, 91 Stat. 685 (1977) (codified at 

42 U.S.C. ss 7401-7642 (Supp. I 1977)). EPA's 

general rulemaking authority under the Act is 

provided in s 301, 42 U.S.C. s 7601 (Supp. I 

1977).

FN3. The Act's PSD provisions are set forth in 

Clean Air Act Title I, Part C, ss 160-169A, 42 

U.S.C. ss 7470-7491 (Supp. I 1977). These are the 

principal provisions at issue in this case.

FN4. See Clean Air Act s 169(3), 42 U.S.C. s 

7479(3) (Supp. I 1977) (definition of “best 

available control technology”).

I. SOURCE DEFINITION

Pollution control measures enacted under the Clean 

Air Act's PSD program apply to major pollution-emitting 

facilities,FN5 which are defined as certain types of “stationary sources” that emit or could emit 100 tons of pollutants 

per year, or “any other source” that could emit 250 tons.FN6

The terms “stationary source” and “any other source,”

however, are not specifically defined in the PSD provisions of the Act. To fill this statutory definitional breach, 

EPA as part of comprehensive Clean Air Act regulations 

promulgated for the purposes of PSD the following definition:

FN5. Clean Air Act s 165(a), 42 U.S.C. s 7475(a) 

(Supp. I 1977).

FN6. Clean Air Act s 169(1), 42 U.S.C. s 7479 

(Supp. I 1977).

“Source” means any structure, building, facility equipment, installation or operation (or combination thereof) 

which is located on one or more contiguous or adjacent 

properties and which is owned or operated by the same 

person (or by persons under common control).FN7

FN7. 40 C.F.R. ss 51.24(b)(4), 52.21(b)(4) 

(1978).

EPA also provided by regulation that:

Notwithstanding the source sizes specified in (the first 

sentence of Clean Air Act s 169(1), 42 U.S.C. s 7479(1) 

(Supp. I 1977), “major stationary source” means) any 

source which emits, or has the potential to emit, 250 tons 

per year or more of *395 **123 any air pollutant regulated under the Act. FN8

FN8. Id. s 51.24(b)(1)(ii). See id. s 

52.21(b)(1)(ii).

In this section of our opinion we consider three separate issues pertaining to the above regulatory definitions.

A. Inclusion of “Equipment,” “Operation,” and “Combination Thereof” within EPA's Definition of “Source”

We consider first whether EPA erred in defining 

“source” to include “any structure, building, facility, 

equipment, installation or operation (or combination thereof ) ....”

FN9

FN9. Id. ss 51.24(b)(4), 52.21(b)(4) (emphasis 

added).

Petitioning Industry Groups FN10 argue that by introducing the above italicized language into the regulatory 

definition of “source,” EPA has subjected a wider range of 

pollution-emitting activities to the Act's PSD requirements 

than Congress intended. Industry groups fear that EPA will 

capitalize on its expansive definition of “source” by subjecting to PSD review every type of productive enterprise 

ranging from mining and forestry to commercial trains and 

ships.FN11 There is a risk of an unlimited scope of PSD 

regulation which could follow from literal application of 

PSD to any “equipment” or “operation,” and to any 

“combination” of, for example, equipment and operations, 

that meets minimum emission standards.

FN10. We use the term “Industry Groups”

throughout this opinion to refer generally to the 

numerous industry petitioners and intervenors. 

Likewise we use the term “Environmental 

Groups” to refer to the several environmental petitioners and intervenors.

FN11. Industry Petitioners' Brief on Source Definition Issue at 10 (hereinafter cited as Industry 

Brief on Source Definition).

EPA, however, argues that Congress did not intend to 

confine PSD to a class of pollution-emitting entities so 
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narrow as the four nonitalicized terms above. EPA considers it prudent to “err on the side of inclusiveness,” in 

order to extend PSD to the range of activities it claims 

Congress intended, and in order to give notice to those who 

must apply for PSD permits.FN12

FN12. See Brief for EPA at 55-56. See also 42 

U.S.C. s 7411(a)(3) (Supp. I 1977).

We find this definitional issue to be governed by the 

definition of “source” provided in Clean Air Act section 

111(a)(3),FN13 pertaining to the Act's new source performance standards (NSPS). Section 111(a)(3) provides that 

for the purposes of NSPS “(t)he term „stationary source‟

means any building, structure, facility, or installation 

which emits or may emit any air pollutant.”

FN14 In addition, section 111(a)(2) provides that for NSPS “(t)he term 

„new source‟ means any stationary source, the construction 

or modification of which is commenced after (a specified 

time),”

FN15 thus incorporating into the term “source” the 

components of the term “stationary source.” For NSPS the 

two terms become essentially interchangeable.

FN13. 42 U.S.C. s 7411(b)-(j) (Supp. I 1977).

FN14. Id. s 7411(a)(3) (Supp. I 1977) (emphasis 

added).

FN15. Id. s 7411(a)(2).

[97] We find no support in the statute for the notion 

that Congress intended its definition of the term “source”

as used in the PSD provision of the Act to differ from that 

provided for NSPS in section 111(a)(3). Though “stationary source” is not defined expressly for PSD in the Act, it 

had at the time of the 1977 Amendments a well-established 

meaning, which included the four terms “structure,”

“building,” “facility,” and “installation,” but not “equipment,” “operation,” or “combination thereof.”

FN16

FN16. EPA's NSPS regulations in effect at the 

time of the enactment of the Clean Air Act 

Amendments of 1977, 40 C.F.R. s 60 (1977), define the term “stationary source” as “any building, 

structure, facility or installation which emits or 

may emit any air pollutant and which contain any 

one or combination of (a variety of specified 

types of facilities). Id. s 60.2(d). Similarly, EPA's 

definition of ”stationary source “ in its regulations 

for approval and promulgation of implementation 

plans, 40 C.F.R. s 52.01(a) (1977), refers to ”any 

building, structure, facility, or installation which 

emits or may emit an air pollutant for which a 

national standard is in effect.“

**124 *396 [98] Given no expression of any contrary 

intent in the Act or in the legislative history regarding these 

definitions, we must assume that the meaning of a particular term is to be consistent throughout the Act. This is 

especially true under present circumstances, where the 

subject term prior to enactment of the controversial language had assumed a particular definition under closely 

related statutory provisions.

In support of this conclusion we note that Clean Air 

Act section 169, which defines certain terms expressly for 

PSD, states in subsection (2)(C) that “(t) he term „construction‟ when used in connection with any source or 

facility, includes the modification (as defined in section 

111(a) ) of any source or facility.”

FN17 Section 111(a)(4), 

in turn, provides that the term “modification” means “any 

physical change in, or change in the method of operation 

of, a stationary source . . .” as that term is defined in section 

111(a)(3).FN18 Since several key sections of the Act apply 

PSD to the construction of new facilities,FN19 those sections 

thereby incorporate the definition of “stationary source”

used in section 111, at least with regard to source “modification.” The PSD provisions thus indirectly incorporated 

the section 111 definition of “source” concerning modifications; we find it implausible to assume that the same 

definition of source does not apply to construction as well. 

Therefore, we hold that the term “source” retains a consistent meaning in all PSD provisions of the Act and that 

the applicable definition is provided in section 111.

FN17. Clean Air Act s 169(2)(C), 42 U.S.C. s 

7479(2)(C) (Supp. I 1977) (emphasis added).

FN18. Clean Air Act s 111(a)(4), 42 U.S.C. s 

7411(a)(4) (Supp. I 1977).

FN19. See, e. g., Clean Air Act ss 165, 167, 42 

U.S.C. ss 7475, 7477 (Supp. I 1977).

[99][100] EPA contends that the words “equipment,”

“operation,” and “combination thereof” must be included 

in the definition of “source” for PSD, because the full 

range of industrial entities specifically made subject to 

PSD in section 169(1) cannot be comprehended within the 

definition of “source” provided in section 111(a)(3).FN20

We do not agree. The four terms encompass all of the types 
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of entities specified in the first sentence of section 169(1), 

as well as all entities and activities included on a longer list 

compiled by EPA from which the statutory list was drawn. 

Thus, for example, the components of the term “source”

provided in section 111(a)(3) need not be interpreted so 

narrowly as to comprehend only those sources that emit 

pollutants through industrial “point” sources (such as 

smokestacks and chimneys). EPA has discretion to define 

the terms reasonably to carry out the intent of the Act, but 

not to go clear beyond the scope of the Act, as it has done 

here. Section 169(1) clearly does mean that a plant is to be 

viewed as a source; the section lists many types of plants as 

stationary sources. But EPA has discretion to define statutory terms reasonably so as to carry out the expressed 

purposes of the Act. We view it as reasonable, for instance, 

to define “facility” and “installation” broadly enough to 

encompass an entire plant.

FN20. See Brief for EPA at 57.

In ASARCO Inc. v. Environmental Protection 

Agency, this court struck down the agency's defining 

source for NSPS as, inter alia, a combination of facilities. 

But that case allowed EPA broad discretion to define the 

statutory terms for “source,” so long as guided by a reasonable application of the statute. FN21 The agency has the 

same reasonable discretion here to refashion its regulations.

FN21. 578 F.2d 319, 324 & n.17 (D.C.Cir. 1978).

B. Extension of EPA's Definition of “Source” to Include 

Industrial Units Joined by Contiguity and Common Ownership

EPA regulations provide that the term “source” shall 

mean any industrial unit “which is located on one or more 

contiguous or adjacent properties and which is owned *397

**125 or operated by the same person (or by persons under 

common control).”

FN22

FN22. 40 C.F.R. ss 51.24(b)(4), 52.21(b)(4) 

(1978).

Industry Groups contend that Congress intended PSD 

review to apply only to “major industrial process facilities 

at specific plant sites” without grouping of such process 

facilities according to proximity or ownership, and that 

EPA's contiguity and common ownership language has 

expanded unlawfully the potential scope of PSD.FN23 In 

ASARCO, this court held that EPA had no authority to 

attach a similar provision to the definition of “source” for 

the NSPS program, as defined in section 111 of the Act. 

That definition, however, was not expanded by any other 

part of the NSPS provisions or their legislative history. For 

this reason, the court in ASARCO concluded that the definition of “stationary source” in section 111(a)(3) as “any 

building, structure, facility, or installation which emits or 

may emit any air pollutant” could not be administratively 

expanded to include an entire plant.FN24

FN23. See Industry Brief on Source Definition, 

supra note 11, at 23.

FN24. 578 F.2d at 326-27.

[101] With regard to PSD, however, Congress clearly 

envisioned that entire plants could be considered to be 

single “sources.” Clean Air Act section 169(1) expressly 

provides that for the purposes of PSD the term “major 

emitting facility” means “any of the following stationary 

sources of air pollutants . . . : fossil-fuel fired steam electric 

plants . . . , Portland Cement plants, . . . iron and steel mill 

plants.”

FN25 In fact, fourteen different types of industrial 

“plants ” are specifically cited in section 169(1) as types of 

“stationary sources” to which PSD is to apply.FN26 By the 

terms of the PSD provisions, then, the ASARCO holding 

does not prevent aggregation of individual units of a plant 

into a single source.

FN25. Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977) (emphasis added).

FN26. Id. A similar list of such industrial “plants”

and “mills” was considered by Congress in 

drawing up NSPS requirements in s 111, and was 

considered as a part of the legislative history of s 

111 by the court in ASARCO. See ASARCO Inc. 

v. EPA, 578 F.2d at 326 n.24. This list, however, 

was not incorporated into s 111 as it was in s 

169(1). Consequently, the court in ASARCO 

found the legislative history on the question of 

whether an entire plant could be considered a 

single source for NSPS “a much less reliable 

guide than the words of the statute itself,” and 

concluded from the statute that the types of industrial units used to define “source” in s 111 

could not be aggregated for the purposes of 

NSPS. ASARCO Inc. v. EPA, 578 F.2d at 326 

n.24.

[102] Because of the limited scope afforded the term 

“source” in section 111(a) (3), however, EPA cannot treat 
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contiguous and commonly owned units as a single source 

unless they fit within the four permissible statutory terms. 

To allow an entire plant or other appropriate grouping of 

industrial activity to be subject as a single unit to PSD, as 

Congress clearly intended, EPA should devise regulatory 

definitions of the terms “structure,” “building,” “facility,”

and “installation” to provide for the aggregation, where 

appropriate, of industrial activities according to considerations such as proximity and ownership. We have no doubt 

that the term installation, for instance, is susceptible in its 

common usage to a reasonable interpretation that includes 

all the types of sources specified in the first sentence of 

section 169(1), as well as those intended by Congress to be 

reached in the second sentence of section 169(1).

[103] EPA's new definitions should also provide explicit notice as to whether (and on what statutory authority) 

EPA construes the term source, as divided into its several 

constituent units, to include the unloading of vessels at 

marine terminals and “long-line” operations such as pipelines, railroads, and transmission lines. We agree with 

Industry Groups that EPA has not yet given adequate notice as to whether it considers those industrial activities to 

be subject to PSD.

[104][105] EPA has latitude to adopt definitions of the 

component terms of *398 **126 “source” that are different 

in scope from those that may be employed for NSPS and 

other clean air programs, due to differences in the purpose 

and structure of the two programs. The reasonableness of 

EPA's contiguity and common ownership criteria, in light 

of the new source definitions required, must await review 

until their application in specific circumstances.FN27

FN27. There is no danger that the limited opportunity for parties to petition for review under the 

Act will be forfeited by our decision not to resolve 

these issues here, since EPA's regulations as revised in light of this opinion will constitute new 

“final action” and trigger once again the review 

procedures of Clean Air Act s 307(b), 42 U.S.C. s 

7607 (Supp. I 1977).

C. EPA's Extension of PSD to All Sources with Potential 

Emissions of 250 Tons or More Per Year

[106] Petitioners object to EPA's definition of “major 

stationary source” to include any “source” with actual or 

potential emissions of 250 tons per year, regardless of 

physical size or production capacity of the source. FN28 The 

statute leaves some ambiguity on this issue. Under section 

169(1), the term “major emitting facility” includes twenty-eight specific types of industrial entities which can emit 

100 tons per year or more of any air pollutant.FN29 Four of 

these types of entities, however, are subject to PSD only if 

they meet additional operating capacity, or size, qualifications. FN30 The second sentence of section 169(1) then 

states that major emitting facilities include “any other 

source with the potential to emit two hundred and fifty tons 

per year or more of any air pollutant.”

FN31 EPA interprets 

the two sentences to mean that the four special entities are 

not exempt from PSD if they exceed the 250-ton threshold, 

even if they remain below the size qualifications. FN32 To 

justify this interpretation, EPA emphasizes the mandate of 

the second sentence that PSD shall apply to “any ” other 

source with the requisite potential to emit.FN33 Industry 

Groups, on the other hand, stress that PSD shall apply only 

to any “other ” source with the requisite potential to emit. 

FN34 Industry Groups assume, in essence, that each generic 

type of industrial entity specified in the first sentence, 

regardless of size, was considered exclusively by Congress 

in the first sentence and cannot be included by EPA within 

the second.

FN28. Industry Groups also object to EPA's use 

of the term “major stationary source” in place of 

the statutory term “major emitting facility.” This 

objection is without merit so long as the regulatory term is defined in a manner consistent with 

statutory requirements.

FN29. Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977).

FN30. Id.

FN31. Id. (emphasis added).

FN32. See 40 C.F.R. ss 51.24(b)(1)(ii), 

52.21(b)(1)(ii) (1978).

FN33. See Brief for EPA at 74.

FN34. See, e. g., Industry Brief on Source Definition, supra note 11, at 36-37.

[107][108] Reasonable semantic arguments can be 

made on either side of this issue, and the EPA's interpretation is not unreasonable. While it may be uneconomical 

and impractical to apply PSD to small sources that emit a 

low level of pollutants, such as those sources, withdrawn 

from PSD by the first sentence of section 169(1); it is less 
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impractical to apply PSD to small sources that emit relatively higher levels of pollutants, such as those sources 

reached by the second sentence. The critical factor in 

pollution control is not the industrial output of a particular 

source, but its pollution output. As demonstrated by offshore oil spills, a great pollution hazard can be caused by a 

relatively small source.

Finally, and most conclusively, legislative history 

shows that Congress intended the contested sources to be 

subject to PSD. The two sentence definition of “major 

emitting facility” in section 169(1) resulted from the 

adoption of both a one sentence definition originating in 

the Senate and a one sentence definition originating in the 

House. The first sentence of section 169(1), which designated the twenty-eight types of entities to which PSD 

would apply, originated*399 **127 almost verbatim in 

Senate bills passed in 1976 and 1977. FN35 The second 

sentence of section 169(1), which applies PSD to all other 

sources with potential to emit 250 tons per year or more of 

any pollutant, originated in House bills passed in 1976 and 

1977 but with the pollution-emission minimum raised 

from 100 to 250 tons per year.FN36 As noted in the applicable Conference Committee Report,FN37 the House concurred in the adoption of the Senate provision contained in 

the eventual first sentence of section 169(1) “with a requirement that . . . a major emitting facility will also include facilities which have the capacity to emit 250 tons 

per year or more (of any air pollutant)”

FN38 the language 

subsequently adopted in the second sentence. The Report 

does not suggest that those entities subject to size limitations in the definitional sentence borrowed from the Senate 

bill were to be excluded from the term “facilities,” as defined by the sentence from the House.

FN35. See S.Rep.No. 717, 94th Cong., 2d Sess. 

221 (1976); S.Rep.No. 127, 95th Cong., 1st Sess. 

219 (1977).

FN36. See H.R.Rep. No. 1175, 94th Cong., 2d 

Sess. 358 (1976); H.R.Rep.No. 294, 95th Cong., 

1st Sess. 439 (1977).

FN37. This is the Conference Committee Report 

of 1976, which explained language later adopted 

into the Clean Air Act Amendments of 1977. See 

H.R.Rep.No. 1742, 94th Cong., 2d Sess. (1976).

FN38. Id. at 46.

We conclude that the definition from the House bill 

adopted by the Conference Committee as the second sentence of section 169(1) retains its universal character, thus 

comprehending all sources that meet the sole qualification 

specified in that sentence: that they have the “potential to 

emit two hundred and fifty tons per year or more of any air 

pollutant.”

FN39 We therefore uphold EPA's extension of 

PSD to all sources with potential emissions of 250 tons or 

more per year.

FN39. Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977).

II. “MAJOR MODIFICATION” AND “BUBBLE”

We consider in this part of the opinion two questions 

relating to the applicability of the Clean Air Act's PSD 

provisions to the “modification” (as opposed to the initial 

construction) of “major emitting facilities.”

A. EPA's Regulatory Definition of “Modification”

Standards for PSD review of construction of facilities 

apply also to the “modification” of any source or facility,FN40 as defined by section 111(a) (4). That section of the 

Act defines “modification” as “any physical change in, or 

change in the method of operation of, a stationary source 

which increases the amount of any air pollutant emitted by 

such source or which results in the emission of any air 

pollutant not previously emitted.”

FN41

FN40. See Clean Air Act s 169(2)(C), 42 U.S.C. s 

7479(2)(C) (Supp. I 1977).

FN41. Clean Air Act s 111(a)(4), 42 U.S.C. s 

7411(a)(4) (Supp. I 1977).

By regulation EPA has limited PSD review to only 

those modifications deemed “major” within the following 

definition:

“Major modification” means any physical change in, 

change in the method of operation of, or addition to a 

stationary source which increases the potential emission 

rate of any air pollutant regulated under the act . . . by 

either 100 tons per year or more for any source category 

identified in (the first sentence of Clean Air Act s 

169(1)), or by 250 tons per year or more for any stationary source.FN42

FN42. 40 C.F.R. ss 51.24(b)(2), 52.21(b)(2) 

(1978) (emphasis added).
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This definition incorporates the same 100 or 250-ton 

per year threshold that Congress established for the term 

“major emitting facility.”

FN43 The regulation differs from 

the statute by exempting from PSD review any modification that does not exceed this threshold.

FN43. Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977).

**128 *400 [109] For this departure in regulation 

language, no reasonable basis can be found in the statute. 

The Act requires PSD review for any construction of a 

major emitting facility; FN44 the same PSD review requirement applies for any modification of a major emitting 

facility; FN45 and the term “modification” is nowhere limited to physical changes exceeding a certain magnitude.FN46 There is some indication in the legislative history 

to suggest that at least one Senator intended some such 

limit.FN47 But the language of the statute clearly did not 

enact such limit into law. We are constrained here to follow the clear language.

FN44. See Clean Air Act s 165(a), 42 U.S.C. s 

7475(a) (Supp. I 1977).

FN45. See Clean Air Act s 169(2)(C), 42 U.S.C. s 

7479(2)(C) (Supp. I 1977).

FN46. To exempt modest increases in pollution 

emissions, however, Congress did provide in s 

165(b) of the Act for a 50-ton per year minimum 

for certain substantive elements of PSD review of 

“modification of a major emitting facility” in 

class II clean air areas. Clean Air Act s 165(b), 42 

U.S.C. s 7475(b) (Supp. I 1977). As noted in the 

Senate report:

Section 110(g)(4)(C) exempts smaller, 

well-controlled sources which are expansions 

of existing facilities from having to demonstrate compliance with Class II increments. 

Many such sources which are small and relatively insignificant with respect to air quality 

would otherwise be brought under the requirements of section 110(g) by the “major 

emitting facility” definition of 100 tons per year 

potential emissions of any pollutant.

S.Rep.No. 127, 95th Cong., 1st Sess. 33 (1977). 

We find nothing to indicate that a substantial 

additional exemption, applicable for all clean 

air areas, was implicit in the statute's definition 

of “modification” itself.

FN47. Describing the scope of the Senate bill, 

Senator Buckley stated, “ „No significant deterioration‟ is a policy that has no effect on existing 

sources, unless a source undertakes a major expansion program. It requires the States to study 

the impact on air quality resulting from the siting 

of new major sources of pollution . . . .” 122 

Cong.Rec. 23,833 (1976). Senator Buckley was 

ranking minority member of the Subcommittee 

on Environmental Pollution at the time the bill 

was drafted, and took a leading role in its drafting 

and in explaining it on the floor of the Senate. 

When this debate took place, the statutory language did not apply PSD preconstruction review 

to source “modification.” In November 1977, the 

Senate and House passed technical amendments, 

one of which had the effect of defining “construction” to include “modifications.” It was this 

new language that had the effect of overriding 

Senator Buckley's interpretation of the meaning 

of “no significant deterioration.”

[110] EPA does have discretion, in administering the 

statute's “modification” provision, to exempt from PSD 

review some emission increases on grounds of de minimis 

or administrative necessity. The exemption in question, 

however, has not been so justified, and thus cannot stand. 

We discuss EPA's discretion to define de minimis in Part 

III below.

[111] Implementation of the statute's definition of 

“modification” will undoubtedly prove inconvenient and 

costly to affected industries; but the clear language of the 

statute unavoidably imposes these costs except for de 

minimis increases. The statutory scheme intends to 

“grandfather” existing industries; but the provisions concerning modifications indicate that this is not to constitute 

a perpetual immunity from all standards under the PSD 

program. If these plants increase pollution, they will generally need a permit. Exceptions to this rule will occur 

when the increases are de minimis, and when the increases 

are offset by contemporaneous decreases of pollutants, as 

we discuss below. These two exceptions, we believe, will 

allow for improvement of plants, technological changes, 

and replacement of depreciated capital stock, without 

imposing a completely disabling administrative and regulatory burden.
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B. EPA's Qualified Application of the “Bubble” Concept 

of PSD

An important issue under the Act arises from the 

problem of determining what types of industrial changes 

will be construed as “modifications” subject to PSD review 

requirements. Under the Act, the PSD permit and review 

process applies to construction and modification of major 

emitting facilities. As discussed in the previous section, the 

Act defines “modification” as any physical or operational 

change in a stationary source which “increases the *401

**129 amount of any air pollutant emitted by such source.”

FN48 There are two possible ways to construe the term “increases.” First, one can look at any change proposed for a 

plant, and decide whether the net effect of all the steps 

involved in that change is to increase the emission of any 

air pollutant this is commonly termed the “bubble” concept. Second, one can inspect the individual units of a 

plant, which are affected by an operational change, and 

determine whether any of the units will consequently emit 

more of a pollutant. In its regulations, EPA has adopted a 

qualified form of the “bubble” concept for defining modifications subject to PSD review.

FN48. Clean Air Act s 111(a)(4), 42 U.S.C. s 

7411(a)(4) (Supp. I 1977).

[112] Congress did not, in any pertinent part of legislative history, specify which of these two constructions 

was to be controlling; FN49 but an analysis of the implications of the two possible interpretations shows the second 

to be unreasonable and contrary to the expressed purposes 

of the PSD provisions of the Act. It is important first to 

recognize that alterations of almost any plant occur continuously; whether to replace depreciated capital goods, to 

keep pace with technological advances, or to respond to 

changing consumer demands. This dynamic aspect of 

American industry was not disputed by the parties. To 

apply the second construction of “increases,” however, 

would require PSD review for many such routine alterations of a plant; a new unit would contribute additional 

pollutants, these increases could not be set off against the 

decrease resulting from abandonment of the old unit, and 

thus the change would become a “modification” subject to 

PSD review. Not only would this result be extremely 

burdensome, it was never intended by Congress in enacting the Clean Air Act Amendments.

FN49. The definition of “modification” was incorporated into the PSD provisions by technical 

amendment, Pub.L.No. 95-190, s 14(a)(54), 91

Stat. 1393, 1402 (1977), which was not intended 

to resolve any substantive issues. See 123 

Cong.Rec. H11,957 (daily ed. 1 Nov. 1977).

The intent of the relevant portion, Part C, of the Clean 

Air Act as amended in 1977, is succinctly stated by the title 

of that part: “Prevention of Significant Deterioration of Air 

Quality” in areas that currently attain air quality standards.FN50 According to their stated purposes, the PSD 

provisions seek “to assure that any decision to permit increased air pollution in any area to which this section applies is made only after careful evaluation of all the consequences of such a decision and after adequate procedural 

opportunities for informed public participation in the decisionmaking process.”

FN51

FN50. See Clean Air Act s 160, 42 U.S.C. s 7470 

(Supp. I 1977).

FN51. Clean Air Act s 160(5), 42 U.S.C. s 

7470(5) (Supp. I 1977) (emphasis added).

[113][114] Congress wished to apply the permit 

process, then, only where industrial changes might increase pollution in an area, not where an existing plant 

changed its operations in ways that produced no pollution 

increase. It is true that Congress intended to generate 

technological improvement in pollution control, but this 

approach focused upon “rapid adoption of improvements 

in technology as new sources are built,”

FN52 not as old ones 

were changed without pollution increase. The interpretation of “modification” as requiring a net increase is thus 

consistent with the purpose of the Act; while the other 

interpretation is not. The EPA has properly exempted from 

best available control technology (BACT) and ambient air 

quality review those “modifications” of a source that do 

not produce a net increase in any pollutant.FN53 Within the 

terminology of the Act, of course, industrial changes 

meeting this standard are not “modifications” at all.

FN52. S.Rep.No. 127, 95th Cong., 1st Sess. 18 

(1977).

FN53. See 40 C.F.R. ss 51.24, 52.21 (1978).

The “bubble” regulation for PSD must be compared 

with an earlier EPA regulation, which applied the bubble 

concept to the new source performance standards of the 

*402 **130 Act,FN54 and which was struck down by this 

court in ASARCO Inc. v. Environmental Protection 
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Agency.FN55 That regulation stated that a modification of a 

source for NSPS purposes “shall not be deemed to occur if 

an existing facility undergoes a physical or operational 

change where . . . the total emission rate of any pollutant 

has not increased from all facilities within the stationary 

source . . . .”

FN56

FN54. See id. ss 60.2(h), 60.14 (1976). The Act's 

new source performance standards are set forth in 

Clean Air Act s 111, 42 U.S.C. s 7411 (Supp. I 

1977).

FN55. 578 F.2d 319 (D.C.Cir.1978).

FN56. 40 C.F.R. s 60.14(d) (1976).

The ASARCO case struck down that regulation because it expanded the definition of “source,” within which 

offsets were allowed, to include combinations of facilities, 

contrary to the statutory definition of “source.”

FN57 Here 

we start with the same premise as ASARCO, that the 

Agency may not define “source” to include a combination 

of facilities.FN58 Several factors prevent us, however, from 

drawing the same conclusion. First is a difference between 

the two regulations. The present EPA regulation allows 

offsets within a “source”; it does not, in light of our decision in this case, allow offsets within any “combination of 

facilities.” Thus it does not suffer from the defect on which 

the ASARCO decision turned. Second, ASARCO did not 

rule out the interpretation of “increases” in pollution as net 

increases. The case stated that a bubble concept would be 

contrary to the intent of the NSPS provisions, but such is 

clearly not the case with regard to the PSD provisions. 

Third, the PSD provisions express a purpose of ensuring 

that economic growth occurs in a manner consistent with 

preservation of clean air. FN59 The bubble concept is precisely suited to preserve air quality within a framework 

that allows cost-efficient, flexible planning for industrial 

expansion and improvement. Finally, it is relevant that 

EPA had its NSPS bubble concept in effect at the time 

Congress enacted the 1977 Clean Air Act Amendments. 

Though we are reluctant to assume that Congress expressly 

endorsed the specific bubble regulation, the Conference 

Committee approved the congressional policy as enacted at 

that time in existing EPA regulations. FN60 ASARCO, in 

short, dealt with a significantly different regulation and 

statutory purpose. Its holding is therefore not inconsistent 

with our decision today, upholding the bubble concept for 

the PSD regulations.

FN57. See ASARCO Inc. v. EPA, 578 F.2d at 

329.

FN58. See Part I supra.

FN59. 42 U.S.C. s 7470(3) (Supp. I 1977).

FN60. See 123 Cong.Rec. H8665 (daily ed. 4 

Aug. 1977).

[115][116] The Agency retains substantial discretion 

in applying the bubble concept. First, any offset changes 

claimed by industry must be substantially contemporaneous. The agency has discretion, within reason, to define 

which changes are substantially contemporaneous. 

Second, the offsetting changes must be within the same 

source, as defined by EPA. In light of the statutory intent to 

treat modification the same as construction,FN61 EPA's 

definition of “statutory source” for the PSD provisions will 

govern both the definition of “modification” and the coverage of section 169(1).

FN61. See Clean Air Act s 169(2)(C), 42 U.S.C. s 

7479(2)(C) (Supp. I 1977).

The Agency's regulations, however, impose on the use 

of the bubble concept an additional limitation, which is 

challenged in this case. The regulations define “major 

modification” by means of accumulated increases in potential emissions after 7 August 1977, with no offset allowed for contemporaneous emission decreases.FN62 The 

effect of this definition is to subject major changes to PSD 

review, even when they are offset by contemporaneous 

reductions. The only effect of the EPA's bubble concept 

then is to exempt the facility from certain substantive review standards when there *403 **131 are such offsetting 

changes, leaving the facility subject to all procedural PSD 

requirements.FN63 The most important procedural requirement is that a permit be issued, under section 165 of 

the Act, before construction begins. Under the Act, however, PSD procedural requirements, just like substantive 

ones, apply only to construction and modification of 

sources. We must therefore resolve the question whether 

EPA has authority to impose procedural requirements 

where there is no net increase of any pollutant from contemporaneous changes.

FN62. See 40 C.F.R. ss 51.24(b)(2), 52.21(b)(2) 

(1978).

FN63. Since we have rejected the limitation of 
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modifications to only “major” ones, this provision, when revised in accordance with our opinion, would bring many more offsetting changes 

within the PSD procedural review requirements.

[117] The Agency concedes that a literal reading of 

the Act would allow exemption from all PSD review requirements for offsetting changes. But it argues that a total 

exemption from section 165 requirements would contravene the basic purpose of the 1977 Amendments. We 

disagree.

There is no basis in the Act for establishing two different definitions of “modification,” one that looks only at 

net increases for substantive requirements, and a second 

that looks at all increases, without allowing offsets, for 

procedural requirements. If a particular set of industrial 

alterations is not a “modification” within the terms of the 

Act, then it is subject to neither procedural nor substantive 

PSD requirements.

The Act gives the EPA Administrator authority “to 

prescribe such regulations as are necessary to carry out his 

functions” under the Act.FN64 The Agency argues that the 

permit process is necessary to ensure that it receives information about industrial plans, so that it can decide 

whether proposed emission increases are in fact offset. But 

the PSD provisions set several thresholds, below which 

Agency review authority does not extend. The 100 and 

250-ton per year limit for “major emitting facilities” is one 

such threshold. The logic of the Agency's argument would 

justify permit requirements for any industrial action that 

falls below any of the thresholds. Rather than allow such 

an extension of Agency review authority, Congress has set 

clear limits outside which PSD review does not apply. If 

industries falsely claim to be below the thresholds for PSD 

applicability, there exist means to uncover and penalize 

such abuses. An extension of PSD permit requirements 

beyond the wording of the Act is therefore neither necessary nor appropriate to carry out EPA's functions under the 

Act. Such extension would seriously delay and impede 

industrial changes that Congress did not intend to regulate. 

Where there is no net increase from contemporaneous 

changes within a source, we hold that PSD review, whether 

procedural or substantive, cannot apply.

FN64. Clean Air Act s 301(a)(1), 42 U.S.C. s 

7601(a)(1) (Supp. I 1977).

III. POLLUTANTS SUBJECT TO PSD REGULATION 

AND THE “MAJOR EMITTING FACILITY” THRESHOLD

Several sections of the Clean Air Act apply PSD review and best available control technology to emissions by 

major emitting facilities of each pollutant subject to regulation under the Clean Air Act. In this part we review two 

regulations of EPA that define which pollutants are subject 

to PSD and BACT review. One regulation exempts from 

PSD and BACT each pollutant not emitted in sufficient 

amounts to qualify a source as a major emitting facility. 

The other applies PSD and BACT immediately to each 

type of pollutant regulated for any purpose under any 

provision of the Act, not limited to sulfur dioxide and 

particulates. We reverse EPA on the first regulation and 

affirm on the second.

A. Statutory and Regulatory Background

Section 165 of the Act provides in pertinent part:

(a) No major emitting facility on which construction is 

commenced after (7 August*404 **132 1977) may be 

constructed . . . unless

(3) the owner or operator of such facility demonstrates, that emissions from construction or operation 

of such facility will not cause, or contribute to, air 

pollution in excess of any (A) maximum allowable 

increase or maximum allowable concentration for any 

pollutant in any area to which (PSD) applies more than 

one time per year, . . . or (C) any other applicable

emission standard or standard of performance under 

this Act;

(4) the proposed facility is subject to the best 

available control technology for each pollutant subject 

to regulation under this Act emitted from, or which 

results from, such facility . . . .

(e)(1) The review provided for in subsection (a) shall 

be preceded by an analysis . . . of the ambient air quality 

at the proposed site . . . for each pollutant subject to 

regulation under this Act which will be emitted from 

such facility.

(3) The Administrator shall . . . promulgate regulations . . . which . . .

(B) shall require an analysis of the ambient air 

quality, climate and meteorology, terrain, soils and 

vegetation, and visibility at the site of the proposed 

major emitting facility . . . for each pollutant regulated 
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under this Act which will be emitted from . . . such 

facility . . . .FN65

FN65. Clean Air Act s 165, 42 U.S.C. s 7475 

(Supp. I 1977) (emphasis added).

Also section 169(3), for the purposes of PSD, defines 

BACT as “an emission limitation based on the maximum 

degree of reduction of each pollutant subject to regulation 

under this Act emitted from or which results from any 

major emitting facility.”

FN66

FN66. Clean Air Act s 169(3), 42 U.S.C. s 

7479(3) (Supp. I 1977) (emphasis added).

The italized language in the above sections would not 

seem readily susceptible to misinterpretation. In each instance, any source that qualifies with regard to any applicable pollutant as a “major emitting facility” under the 

statute's definition of such a source,FN67 is subject to “any . 

. . applicable emission standard” or “standard of performance” under the Act, and to pollution controls for “any 

pollutant in any (geographic) area” subject to PSD and for 

“each pollutant subject to regulation” under the Act. The 

only administrative task apparently reserved to the Agency 

in executing these provisions is to identify those emission 

standards, standards of performance, and pollutants subject 

to regulation under the Act which are thereby comprehended by the statute. The language of the Act does not 

limit the applicability of PSD only to one or several of the 

pollutants regulated under the Act, establish any special 

timetable for the regulation of particular pollutants, or set 

high thresholds for potential emissions of each pollutant 

before a major emitting facility becomes subject to PSD 

for that pollutant.

FN67. See Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977).

The first regulation states that PSD requirements, including BACT, “shall apply to a proposed source or modification only with respect to those pollutants for which the 

proposed construction would be a major stationary source 

or major modification.”

FN68 This provision exempts from 

PSD all pollutants not emitted in quantities of at least 100 

tons per year by a major emitting facility of one of the 

twenty-eight types specified in the first sentence of section 

169(1), and 250 tons per year by all other sources. FN69 The 

Agency thus adopted a BACT “de minimis” criterion to 

coincide with the 100 and *405 **133 250-ton emission 

thresholds for major emitting facilities. It did this on 

grounds that the “BACT de minimis level should be made 

consistent” with the overall PSD emission threshold.FN70

FN68. 40 C.F.R. s 51.24(i)(1) (1978). See id. s 

52.21(i)(1).

FN69. Clean Air Act s 169(1), 42 U.S.C. s 

7479(1) (Supp. I 1977).

FN70. 43 Fed.Reg. 26,380, 26,381-82 (1978).

[118] The petition of the District of Columbia challenges this regulation. We find the regulation to be contrary to clear statutory language. Section 165 states that no 

major emitting facility may be constructed unless it is 

subject to BACT “for each pollutant subject to regulation 

under this Act emitted from . . . such facility.”

FN71 The 

statute, then, does not exempt pollutants emitted at quantities of less than 100 tons per year by the twenty-eight 

types of sources specified in the first sentence of section 

169(I), or less than 250 tons per year by any other source. 

There is no statutory basis for applying the 100 and 

250-ton thresholds directly to the BACT requirement for 

all pollutants from a major emitting facility. This clear 

error of statutory interpretation by EPA is analogous to its 

exemption for non-major modifications. We strike down 

both for similar reasons.

FN71. Clean Air Act s 165(a)(4), 42 U.S.C. s 

7475(a)(4) (Supp. I 1977).

[119][120][121] We understand that the application of 

BACT requirements to the emission of all pollutants from 

a new facility, no matter how miniscule some may be, 

could impose severe administrative burdens on EPA, as 

well as severe economic burdens on the construction of 

new facilities. But the proper way to resolve this difficulty 

is to define a de minimis standard rationally designed to 

alleviate severe administrative burdens, not to extend the 

statutory 100 or 250-ton threshold to a context where 

Congress clearly did not apply it. Just as for the applicability of PSD to modifications, the de minimis exemption 

must be designed with the specific administrative burdens 

and specific regulatory context in mind. This the Agency 

has failed to do. We do not hold that 100 tons per year 

necessarily exceeds a permissible de minimis level; only 

that the Agency must follow a rational approach to determine what level of emission is a de minimis amount.

[122][123] A rational approach would consider the 
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administrative burden with respect to each statutory context: what level of emission is de minimis for modification, 

what level de minimis for application of BACT. Concerning the application of BACT, a rational approach 

would consider whether the de minimis threshold should 

vary depending on the specific pollutant and the danger 

posed by increases in its emission. The Agency should 

look at the degree of administrative burden posed by enforcement at various de minimis threshold levels. It is 

relevant that our decision requires the Agency, in its 

evaluation of emissions of facilities, to take into account 

the facility's air pollution controls. It may also be relevant, 

though it is certainly not controlling, that Congress made a 

judgment in the Act that new facilities emitting less than 

100 or 250 tons per year are not sizeable enough to warrant 

PSD review.

B. Types of Pollutants to be Regulated Under PSD

Industry Groups argue that the Act's provisions which 

apply PSD to each pollutant subject to regulation under 

this Act, require that controls be imposed immediately for 

only two types of pollutants: sulfur dioxide and particulates. The argument is made that PSD preconstruction 

review under section 165 is qualified by section 166, which 

requires EPA to conduct a study and to promulgate regulations to prevent the significant deterioration of air quality 

resulting from emissions of “hydrocarbons, carbon monoxide, photochemical oxidants, and nitrogen oxides” (the 

“automotive pollutants”), as well as “pollutants for which 

national ambient air quality standards are promulgated.”

FN72 Although there is no statutory language which so 

provides, Industry Groups contend that the effective date 

of the PSD permit and review framework in *406 **134

section 165 must be delayed in the case of each pollutant 

until studies and regulations required in section 166 have 

been set forth. Only sulfur dioxide and particulates are said 

to be exempt from this requirement, since these pollutants 

alone were covered by EPA's pre-1977 PSD regulations; 

FN73 thus the requisite studies have already been conducted 

and the applicable standards set,FN74 and any PSD review 

not premised on the studies and standards required by 

section 166 thus must be arbitrary and invalid. Industry 

Groups also argue that an undue burden will be imposed on 

affected facilities by the Agency's immediate application 

of section 165 to all pollutants subject to regulation under 

the Act. In line with their reading of the statute and in order 

to lessen the regulatory burden, Industry Groups argue that 

PSD regulation of the four “automotive pollutants” should 

be delayed for at least three years and seven months following the enactment of the 1977 Amendments, and other 

pollutants even longer.FN75

FN72. Clean Air Act s 166(a), 42 U.S.C. s 

7476(a) (Supp. I 1977).

FN73. The first set of proposed PSD regulations 

was published in 1974, see 39 Fed.Reg. 42,510, 

42,514 (1974), and later codified in 40 C.F.R. ss 

52.01(d)(5), 52.21 (1977).

FN74. Industry Groups also point out that s 

163(a) of the Act expressly requires that state 

plans contain measures assuring that maximum 

allowable increases over baseline concentrations 

not be exceeded “in the case of sulfur oxide and 

particulate matter,” and that s 163(b) establishes 

specific sulfur dioxide and particulate increments 

for class I, II, and III areas to be implemented in 

state plans. Clean Air Act s 163(a)-(b), 42 U.S.C. 

s 7473(a)-(b) (Supp. I 1977). No mention is made 

in these sections of other pollutants to be reached 

by PSD.

FN75. See Brief for Industry Petitioners on Regulation of Pollutants Other Than Sulfur Dioxide 

and Particulates at 14 (hereinafter cited as Industry Brief on Other Pollutants).

[124] These arguments, however, are contradicted by 

the plain language of section 165. Section 165, in a litany 

of repetition, provides without qualification that each of its 

major substantive provisions shall be effective after 7 

August 1977 with regard to each pollutant subject to regulation under the Act, or with regard to any “applicable 

emission standard or standard of performance under” the 

Act.FN76 As if to make the point even more clear, the definition of BACT itself in section 169 applies to each such 

pollutant. FN77 The statutory language leaves no room for 

limiting the phrase “each pollutant subject to regulation” to 

sulfur dioxide and particulates.

FN76. See Clean Air Act s 165(a)(3)-(4), (e)(1), 

42 U.S.C. s 7475(a)(3)-(4), (e)(1) (Supp. I 1977).

FN77. Clean Air Act s 169(3), 42 U.S.C. s 

7479(3) (Supp. I 1977).

[125][126] We find no implied or apparent conflict 

between sections 165 and 166; nor, as Industry Groups 

contend, must the requirements of section 165 be “subsumed” within those of section 166.FN78 As we noted in our 
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earlier per curiam opinion, section 166 has a different 

focus from section 165: “the development of maximum 

allowable increments or equivalent limitations for those 

pollutants (other than sulfur dioxide and particulate matter) 

for which NAAQSs (national ambient air quality standards) have been or will be established.”

FN79 Though 

Congress could have decided to delay the applicability of 

PSD for such pollutants until all studies and regulations 

required by section 166 have been completed, Congress 

apparently chose not to do so, and it emphasized its decision on that point in at least five statutory provisions.FN80

What legislative history there is on this point supports that 

view.FN81 Therefore we uphold this Agency regulation.FN82

FN78. See Industry Brief on Other Pollutants, 

supra note 75, at 19.

FN79. See Alabama Power Co. v. EPA, 606 F.2d 

at 1085 (D.C.Cir.1979) (per curiam).

FN80. See notes 76-77 supra.

FN81. Though the legislative history is not entirely unambiguous, we note, for example, that 

the House specifically rejected an amendment 

offered to restrict PSD coverage to sulfur oxides 

and particulates. See 122 Cong.Rec. 29,568-69 

(1976). In the Senate, the clearest statement of 

intention in late 1977 may have been made by 

Senator Muskie, the principal Senate sponsor of 

the 1977 Clean Air Act Amendments:

The committee did not extend the use of nondegradation increments to pollutants other than 

sulfur oxides or particulates. The lack of adequate information on the implications of covering other criteria pollutants precluded such a 

requirement. The committee did, however, 

agree that the best available control technology 

requirements should be applicable to all pollutants emitted from any new major emitting facility so that the maximum degree of emission 

reduction would be achieved in order to minimize potential deterioration. And the committee did authorize a study by EPA of increments applicable to other pollutants in order to 

establish a basis for future congressional action.

123 Cong.Rec. S9162, S9170 (daily ed. 8 June 

1977) (emphasis added). The final bill passed 

by the Senate after conference applied BACT to 

“each pollutant subject to regulation” under the 

Act, just as other PSD requirements were so 

applied. See Clean Air Act s 165, 42 U.S.C. s 

7475 (Supp. I 1977).

FN82. We have considered, but cannot give great 

weight to, petitioners' “feasibility” and “economic impact” argument against immediate PSD 

regulation of pollutants other than sulfur dioxide 

and particulates. See Industry Brief on Other 

Pollutants, supra note 75, at 31-37. We find that 

EPA acted reasonably in balancing these costs 

against the goal of protecting clean air areas.

Of greater interest is the detailed economic and 

scientific study presented to this court in support of Industry Groups' petitions for rehearing. 

See Impact of the Court of Appeals Decision on 

the PSD Permit Process, prepared by Environmental Research & Technology, Inc. (July 

1979), Exhibit A, Industry Petitioners' Petition 

for Rehearing on the Application of PSD Requirements to Pollutants Other Than Sulfur 

Dioxide and Particulates. It is not the role of 

this court, however, to engage in a technical 

review of policy decisions made by Congress 

where those decisions are clearly stated. We 

also note that the impact study nowhere takes 

into account the de minimis exemptions that 

EPA has authority to allow in the case of individual pollutants emitted by a major facility. 

Some of the dire effects feared by petitioners 

therefore may be relieved to some degree. 

These arguments are more appropriately presented to Congress, which (in light of the unambiguous language of the statute) apparently 

has adopted a different position.

We also are not convinced by petitioners' procedural objections. See Industry Brief on Other 

Pollutants, supra note 75, at 23-30. In light of 

the unambiguous legislative command at issue, 

we believe that the Administrator adequately 

explained the basis for his action and responded 

to significant comments raised during the 

rulemaking proceedings. See 43 Fed.Reg. 

26,380, 26,397 (1978).

*407 **135 IV. DEFINITION OF BACT TO INCLUDE 

A VISIBLE EMISSION STANDARD

[127] One of the principal substantive prerequisites to 
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obtaining a PSD permit for construction of a major emitting facility in clean air areas under the Act is utilization by 

that facility of the “best available control technology” for 

each pollutant subject to regulation under the Act to be 

emitted from that facility.FN83 In this part of the opinion we 

consider whether EPA had authority to include a visible 

emission standard among other emission limitations to be 

considered by the PSD permitting authority in applying 

BACT. For reasons stated herein, we conclude that EPA 

had such authority.

FN83. See Clean Air Act s 165(a)(4), 42 U.S.C. s 

7475(a)(4) (Supp. I 1977).

Clean Air Act section 169(3) defines BACT as:

an emission limitation based on the maximum degree of 

reduction of each pollutant subject to regulation under 

this Act emitted from . . . any major emitting facility, 

which the permitting authority . . . determines is 

achievable . . . through application of production 

processes and available methods, systems, and techniques . . . .FN84

FN84. Clean Air Act s 169(3), 42 U.S.C. s 

7479(3) (Supp. I 1977) (emphasis added).

Section 302(k) of the Act, in turn, defines “emission 

limitation” (and also “emission standard”) as:

a requirement established by the State or the (EPA) 

Administrator which limits the quantity, rate, or concentration of emissions of air pollutants on a continuous 

basis, including any requirement relating to the operation or maintenance of a source to assure continuous 

emission reduction.FN85

FN85. Clean Air Act s 302(k), 42 U.S.C. s 

7602(k) (Supp. I 1977) (emphasis added).

In its final regulations, EPA defined BACT essentially 

as in section 169(3) of the statute, except for the parenthetical inclusion *408 **136 that BACT means “an 

emission limitation (including a visible emission standard).”

FN86 The central question for review is thus whether 

a “visible emission standard” may be considered an 

“emission limitation” or “emission standard” within the 

meaning of section 302(k) and in the context of BACT.

FN86. 40 C.F.R. ss 51.24(b)(10), 52.21(b)(10) 

(1978) (emphasis added).

A petitioning Industry Group FN87 contends that EPA's 

parenthetical inclusion of a “visible emission standard” as 

a type of emission limitation expands the scope of BACT 

beyond that intended by Congress. The Group argues that 

Congress provided explicitly and exclusively for visibility 

protection of certain clean air areas in section 169A FN88 of 

the Act, and that therefore such visibility standards cannot 

be incorporated into other PSD provisions. These contentions are without merit.

FN87. This Group is the American Iron and Steel 

Institute.

FN88. Clean Air Act s 169A, 42 U.S.C. s 7491 

(Supp. I 1977).

Under the language of the statute, a visible emission 

standard to be incorporated into BACT must constitute a 

“requirement . . . which limits the quantity, rate, or concentration” of pollutant emissions.FN89 An emission standard pertaining to air opacity is one such means of measuring and limiting emissions; such a standard sets limits 

on the emission of pollutants according to their density in 

ways that are apparent to the human eye and that therefore 

affect, for example, human vision. EPA's regulation on the 

point thus does no more than amplify one ordinary and 

reasonable meaning of the statutory term “emission standard”; even without the parenthetical amplification, we 

believe that PSD permitting authorities could fairly have 

construed the term “emission standard” to comprehend a 

“visible emission standard.”

FN89. Clean Air Act s 302(k), 42 U.S.C. s 

7602(k) (Supp. I 1977) (emphasis added).

Opacity standards are not novel; they are used, for 

example, by a number of states in their attempts to control 

air pollution.FN90 Opacity standards have been upheld previously by this court under closely analogous circumstances involving the Clean Air Act's NSPS program.FN91

Congress also has expressed concern for opacity values in 

measuring air pollution under the Clean Air Act, and specifically under PSD. As noted by Senator Muskie, chief 

Senate sponsor of the Clean Air Act Amendments of 1977, 

with regard to the need for nondegradation provisions to 

protect against harmful environmental effects not anticipated by the Clean Air Act's secondary standards:
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FN90. See, e. g., Cal.Health and Safety Code s 

41701 (West); Colo.Rev.Stat. s 25-7-108, and 

Regulation No. 1A promulgated thereunder; 

Ariz.Rev.Stat. s 36-779, and Regulation R 

9-3-301 promulgated thereunder.

FN91. Portland Cement Ass'n v. Train, 513 F.2d 

506 (D.C.Cir.1975), cert. denied, 423 U.S. 1025, 

96 S.Ct. 469, 46 L.Ed.2d 399 (1976).

(I)f the (Act's) secondary standards were the only restraint on new sources in clean air regions, visibility 

which is now 100 miles or more in some areas could 

deteriorate to 12 miles. If humidity is high, visibility 

would be reduced even further. While visibility may not 

be important in dirty air areas, it has high public value in 

many clean air regions . . . .FN92

FN92. 123 Cong.Rec. S9170 (daily ed. 8 June 

1977) (emphasis added) (prepared statement on 

final version of Senate version of Amendments). 

See also 123 Cong.Rec. S9241 (daily ed. 9 June 

1977) (statements of concern for air visibility in 

national parks).

[128] Finally, we note that EPA's inclusion of visible 

emission standards (among others) to be used to determine 

compliance with BACT sets no single standard that all 

PSD permittees must meet. Instead, the regulations contemplate only the factoring of an opacity standard into 

other BACT considerations such as “energy, environmental, and economic impacts and other costs” to be applied on a “case-by-case basis” to emitting facilities. FN93

As such the regulation is far from oppressive or unduly 

*409 **137 expansive; it merely defines with some specificity an area in which the permitting authority, which in 

most cases will be a state, may exercise reasonable discretion.

FN93. Clean Air Act s 169(3), 42 U.S.C. s 

7479(3) (Supp. I 1977).

V. “COMMENCED CONSTRUCTION” FOR PHASED 

CONSTRUCTION PROJECTS

Section 165 of the Clean Air Act states that no major 

emitting facility, on which construction is commenced 

after 7 August 1977, may be constructed in any clean air 

area unless PSD permitting requirements are met. For an 

industrial project that is to be constructed in stages, as over 

a period of years, the meaning of the phrase “construction 

is commenced” may determine whether and to what extent 

PSD preconstruction review applies. EPA has developed 

the practice of issuing a single, comprehensive PSD permit 

for an entire project with special conditions pertaining to 

each phase of construction.

In this part, we review regulations of EPA that condition the granting of a comprehensive PSD permit for a 

phased construction project on: (1) independent BACT 

review of each phase of the project, (2) actual commencement of construction of each phase within eighteen 

months of the target date specified in the original application, with a variance procedure available only for the 

commencement date of the first phase of the project, and 

(3) avoidance of any interruption in the course of construction of any particular phase for longer than eighteen 

months. EPA's regulations allow a comprehensive permit 

for construction projects that are to be completed in phases, 

thus avoiding a separate permit proceeding for each phase. 

Phased construction projects with “mutually dependent”

facilities will be exempt from the new PSD requirements if 

one of the facilities has commenced construction by the 

applicable grandfather date, 7 August 1977; the regulations 

also suggest, very specifically, that power company multi-boiler construction projects are not mutually dependent 

and will not be eligible under any circumstances for such 

exemption.

The important statutory section for our evaluation of 

these regulations is Clean Air Act section 169(2)(A), 

which provides:

The term „commenced‟ as applied to construction of a 

major emitting facility means that the owner or operator 

has obtained all necessary preconstruction approvals or 

permits required by . . . air quality laws or regulations 

and either has (i) begun . . . a continuous program of 

physical on-site construction of the facility or (ii) entered 

into binding agreements or contractual obligations, 

which cannot be canceled or modified without substantial loss to the owner or operator, to undertake a program 

of construction of the facility to be completed within a 

reasonable time. FN94

FN94. Clean Air Act s 169(2)(A), 42 U.S.C. s 

7479(2)(A) (Supp. I 1977).

This section provides little guidance concerning the 

meaning of commencing construction, in the case of a 

multi-phase construction project, for which on-site construction may have begun, and contractual obligations may 

have been assumed, for only one of several phases of the 
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entire project. EPA has sought to provide guidance on this 

issue in its PSD regulations. The pertinent regulation 

reads:

Approval to construct (a major emitting facility) shall 

become invalid if construction is not commenced within 

18 months after receipt of such approval, if construction 

is discontinued for a period of 18 months or more, or if 

construction is not completed within a reasonable time. 

The Administrator may extend the 18-month period 

upon a satisfactory showing that an extension is justified. This provision does not apply to the time period 

between construction of the approved phases of a phased 

construction project; each phase must commence construction within 18 months of the projected and approved commencement date.FN95

FN95. 40 C.F.R. s 52.21(s)(2) (1978) (emphasis 

added).

The preamble to the final regulations adds the significant qualification that only **138 *410 “mutually dependent” multi-phase construction projects can escape the 

new PSD requirements by commencing construction on 

one phase prior to the applicable grandfather date.FN96 As 

an example, EPA regulations cite a power company's 

“three-boiler project” as an instance in which a second 

construction phase would be subject to renewed PSD review even if “there may be a phased construction process 

at the same general site” of all three boilers. FN97 Similarly, 

a footnote to this preamble appears to single out power 

company boilers for special treatment:

FN96. 43 Fed.Reg. 26,388, 26,396 (1978). The 

preamble states:

In general, if the phases of the major facilities 

involved are mutually dependent and one of the 

major facilities has, by an applicable grandfather date, commenced construction, then all 

other dependent facilities specifically approved 

for construction at the same time will also hold 

such status. Conversely, each independent facility must individually commence construction by the prescribed grandfather date(s).

Id. (footnote omitted).

FN97. Id.

The dependence of facilities within a source will be 

determined on an individual basis. Two or more facilities will generally be considered dependent if the construction of one would necessitate the construction of the 

other facility(ies) at the same site in order to complete a 

given project or provide a given type (not level of) service. A kraft pulp mill is an example of a source with 

dependent facilities, whereas a three-boiler power plant 

is a typical example of a source with major independent 

facilities.FN98

FN98. Id. n.6 (emphasis added).

Petitioning utility companies object to their apparent 

exclusion from EPA's special provision for grandfathering 

multi-phase projects and charge that such exclusion is 

arbitrary. These petitioners also object to EPA's refusal to 

consider granting specific exemptions from the eighteen-month commencement deadline for construction of 

all but the first phase of a multi-phase project. With regard 

to EPA's rules for phased construction aside from these 

two points, however, petitioners concede that in general 

EPA has taken a rational approach. FN99

FN99. See Reply Brief of Alabama Power 

Company, et al. on Stack Height and Commenced 

Construction at 9.

[129][130][131] We find EPA's regulations on these 

matters to be within the Agency's statutory authority. The 

conditions imposed by EPA on the granting of a multi-phase construction permit are reasonable. Finally, the 

ineligibility of utility company multi-boiler projects for 

grandfathering is consistent with the reasoning behind the 

multi-phase PSD program and has not, on this record, been 

shown to be arbitrary or capricious.

[132][133] As described in Part I, the Agency has 

considerable discretion to define the terms “source” and 

“major emitting facility.” Within the limits of the statutory 

language, EPA could define each phase of a multi-phase 

construction project as a separate source so long as each 

phase could reasonably be termed a structure, building, 

facility, or installation or it could define the entire project 

as a single source, so long as it was reasonably one facility, 

or installation, etc. If a particular phase is deemed a separate source, then EPA has statutory authority to require for 

it a separate permit. But EPA also has statutory authority to 

issue a single permit covering all phases of the project. If 

the Agency deems the project to be a single source, then a 

single permit would of course be appropriate; if it consid-
Page 95

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(Cite as: 636 F.2d 323, 204 U.S.App.D.C. 51)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

ers each phase to constitute a separate source, it may still 

issue a single permit covering all phases, so long as the 

permit prerequisites are satisfied as to each phase.

[134][135] We find that the Agency reasonably exercised its discretion by providing for a comprehensive PSD 

permit for related facilities of a single project on a common 

site. This is a wise measure to reduce regulatory burdens 

and facilitate construction. It is valid whether or not the 

whole project can be deemed a single “source” in light of 

Part I of this opinion.

*411 **139 The limitations on the use of the comprehensive permit are also valid. To require mutual dependence before multi-phase projects, one phase of which 

commenced construction prior to 7 August 1977, are exempt from the new PSD requirements is a reasonable 

threshold standard. The Act leaves EPA discretion to issue 

separate permits for phases that can be deemed separate 

sources, and the Agency's action here does not amount to 

an abuse of that discretion. The time limits for commencement of construction FN100 are reasonable, in order to 

prevent construction projects from reserving, for too long 

in the future, a disproportionate share of available pollution increments. The same rationale amply supports the 

restriction on gaps in construction progress exceeding 

eighteen months, and the refusal to grant variances except 

for the commencement date of the first phase. There is no 

need for EPA to re-propose these rules, as they represent 

reasonable revisions of the originally proposed rules in 

light of comments received.FN101

FN100. See 43 Fed.Reg. 26,388, 26,396 (1978).

FN101. See International Harvester Co. v. Ruckelshaus, 478 F.2d 615, 632 & n.51 

(D.C.Cir.1973).

Finally, utility companies object specifically to the 

statement, in the preamble to these regulations, that a 

three-boiler power plant is a typical example of a source 

with major independent facilities.FN102 Where multi-boiler 

plants can utilize shared water, cooling, and other facilities, there is certainly an economy of scale, and EPA's 

regulation will reduce the certainty of industry that future 

boiler construction will pass PSD review. But EPA balanced this interest against the danger that grandfathering 

for multiple boiler units would preempt available pollution 

increment into the future. There is support in the legislative 

history for giving this adverse treatment to construction of 

multiple boiler units; the Senate Committee Report stated 

that most contracts for construction of multiple utility 

boiler units do not meet the statutory standard for “commenced construction.”

FN103 Therefore EPA's treatment of 

utility boilers is not an abuse of discretion.

FN102. See 43 Fed.Reg. 26,388, 26,396 n.6 

(1978).

FN103. S.Rep.No. 127, 95th Cong., 1st Sess. 33 

(1977).

Opinions for the Court filed by Circuit Judges LEVENTHAL, ROBINSON and WILKEY.

C.A.D.C., 1979.

Alabama Power Co. v. Costle

636 F.2d 323, 13 ERC 1993, 204 U.S.App.D.C. 51, 10 

Envtl. L. Rep. 20,001

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Page 1

997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 62 USLW 2063, 23 Envtl. L. Rep. 21,157

(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

United States Court of Appeals,

District of Columbia Circuit.

STATE OF OHIO, et al., Petitioners,

v.

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Respondents.

Nos. 86-1096, 86-1116, 86-1117, 86-1119, 86-1120 to 

86-1123, 90-1276, 90-1277, 90-1280, 90-1285, 

90-1286, 90-1288, 90-1289, 90-1293 to 90-1295, 

90-1297, 90-1439, 90-1444, 90-1449, 90-1451 and 

90-1453.

Argued Feb. 3, 1993.

Decided July 20, 1993.

States brought action against Environmental 

Protection Agency (EPA), challenging EPA regulations promulgated under Comprehensive Environmental Response, Compensation, and Liability Act 

(CERCLA) and contained in National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP). The Court of Appeals held that: (1) NCP established proper 

cost-benefit analysis in remedy selection process; (2) 

NCP cancer risk range is adequate to protect human 

health and the environment; (3) NCP established 

proper federal/state cost sharing requirements; but (4) 

EPA failed to provide reasoned basis for its departure 

from past policy in amending NCP to expressly exclude states from exercising enforcement and remedy-selection authority under CERCLA.

Ordered accordingly.

Randolph, Circuit Judge, filed concurring opinion.

West Headnotes

[1] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) definition of legally “applicable” or “relevant 

and appropriate” environmental standards (ARARs) 

as “substantive” was reasonable and permissible construction of CERCLA; Environmental Protection 

Agency (EPA) reasonably interpreted CERCLA's 

reference to “a level or standard of control” to be 

directed at those environmental laws governing level 

or degree of cleanup required to remedy various types 

of toxic contamination. Comprehensive Environmental Response, Compensation, and Liability Act of 

1980, § 121(d)(2)(A), as amended, 42 U.S.C.A. § 

9621(d)(2)(A).

[2] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) construction of statutory term “promulgated”

was not inconsistent with Comprehensive Environmental Response, Compensation, and Liability Act 

(CERCLA); CERCLA requires that state standards be 

“promulgated * * * under a State environmental or 

facility siting law” to be considered as possible applicable or relevant and appropriate requirements, and 

NCP interprets “promulgated” to mean “standards 

[that] are of general applicability and are legally enforceable.” Comprehensive Environmental Response, 

Compensation, and Liability Act of 1980, § 

121(d)(2)(A)(ii), as amended, 42 U.S.C.A. § 

9621(d)(2)(A)(ii).

[3] Statutes 361 219(2)
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© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

361 Statutes

361VI Construction and Operation

361VI(A) General Rules of Construction

361k213 Extrinsic Aids to Construction

361k219 Executive Construction

361k219(2) k. Existence of Ambiguity. Most Cited Cases

Where congressional intent on precise question at 

issue is unclear, it is enough that agency's construction 

of statute is reasonable.

[4] Environmental Law 149E 666

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek666 k. Preservation of Error in Administrative Proceeding. Most Cited Cases

(Formerly 199k25.15(3.1) Health and Environment)

Court of Appeals would not reach merits of argument whether National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) improperly restricted meaning 

of federal applicable or relevant and appropriate requirements to those “promulgated” under federal 

environmental laws, where plaintiff states waived 

claim by failing to raise it during rule-making proceedings before Environmental Protection Agency 

(EPA).

[5] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) did not improperly fail to apply zero-level 

maximum containment level goals (MCLGs), established under Safe Drinking Water Act, as applicable or 

relevant and appropriate requirements (ARARs); Environmental Pollution Agency (EPA) has discretion to 

determine when MCLGs and ARARs are relevant and 

appropriate. Public Health Service Act, §§ 1401-1465, 

1412(b)(4, 5), as amended, 42 U.S.C.A. §§ 300f to 

300j-25, 300g-1(b)(4, 5); Comprehensive Environmental Response, Compensation, and Liability Act of 

1980, § 121(d)(2)(A), as amended, 42 U.S.C.A. § 

9621(d)(2)(A).

[6] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) established proper cost-benefit analysis in remedy selection process. Comprehensive Environmental Response, Compensation, and Liability Act of 

1980, § 121(d)(1), as amended, 42 U.S.C.A. § 

9621(d)(1).

[7] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) places reasonable emphasis on selection of 

permanent remedies as required by Comprehensive 

Environmental Response, Compensation, Liability 

Act (CERCLA); statutory language places as much 

emphasis on selection of cost-effective remedies as it 

does on selection of permanent remedies. Comprehensive Environmental Response, Compensation, and 

Liability Act of 1980, § 121(b)(1), as amended, 42 

U.S.C.A. § 9621(b)(1).

[8] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Ac-
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997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 62 USLW 2063, 23 Envtl. L. Rep. 21,157

(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

tions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) cancer risk range does not improperly fail to 

protect human health and environment without regard 

to cost; although cost cannot be used to justify selection of remedy that is not protective of human health 

and environment, it can be considered in selecting 

from options that are adequately protective. Comprehensive Environmental Response, Compensation, 

and Liability Act of 1980, § 121(b)(1), as amended, 42 

U.S.C.A. § 9621(b)(1).

[9] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

Environmental Protection Agency (EPA) properly interpreted Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) 

requirement of five-year review of certain remedial 

actions as requiring review only where hazardous 

substance is present in amount appreciable enough to 

present some possibility of harm; such interpretation 

squares with health-protective purpose of statute, and 

to go beyond that is to adjudge Congress incompetent 

to fashion rational legislative design. Comprehensive 

Environmental Response, Compensation, and Liability Act of 1980, § 121(c), as amended, 42 U.S.C.A. § 

9621(c).

[10] Environmental Law 149E 645

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek636 Administrative Decisions or Actions Reviewable in General

149Ek645 k. Hazardous Waste and Materials. Most Cited Cases

(Formerly 199k25.15(3.2) Health and Environment)

Issue whether National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) remedy selection guidance 

concerning use of engineering and institutional controls violate Comprehensive Environmental Response, Compensation, and Liability Act's (CERCLA's) remedy selection requirements was unfit for 

judicial decision because state's argument was premised on hypothetical application of nonbinding 

statement in NCP. Comprehensive Environmental 

Response, Compensation, and Liability Act of 1980, 

§§ 101-405, as amended, 42 U.S.C.A. §§ 9601-9675.

[11] Environmental Law 149E 645

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek636 Administrative Decisions or Actions Reviewable in General

149Ek645 k. Hazardous Waste and Materials. Most Cited Cases

(Formerly 199k25.15(3.2) Health and Environment)

Court of Appeals would not consider claims 

concerning National Oil and Hazardous Substances 

Pollution Contingency Plan (National Contingency

Plan or NCP) provisions concerning ground water 

restoration strategies and approaches because claims 

were premised on hypothetical applications of nonbinding statements in NCP; claims should be addressed in site-specific challenges in which reviewing 

court could consider agency's practical application of 

its statements.

[12] Environmental Law 149E 662

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek662 k. Ripeness. Most Cited Cases

(Formerly 199k25.15(3.2) Health and Environment)

Issue whether National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) improperly failed to apply 

federal water quality criteria as applicable or relevant 

and appropriate requirements was not ripe for review 

because NCP preamble merely set out general view 

that may or may not be followed in particular cases; 

claims should be disposed of in site-specific challenge 
Page 4

997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 62 USLW 2063, 23 Envtl. L. Rep. 21,157

(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

in which reviewing court could consider specific application of challenged language.

[13] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

Environmental Law 149E 454

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek450 Administrative Agencies and Proceedings

149Ek454 k. Hearing and Determination. 

Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

Environmental Protection Agency (EPA) failed to 

provide reasoned basis for its departure from past 

policy in amending National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) to expressly exclude states 

from exercising enforcement and remedy-selection 

authority under Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA); 

although CERCLA did not require grant of authority 

whenever it was sought by a state, prior versions of 

NCP provided that EPA could enter into agreements 

allowing states to exercise most of available statutory 

authority. Comprehensive Environmental Response, 

Compensation, and Liability Act of 1980, §§ 101-405, 

as amended, 42 U.S.C.A. §§ 9601-9675.

[14] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP), which requires states to fund 100% of maintenance of fund-financed remedy, properly established 

federal/state cost sharing requirements pursuant to 

Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). Comprehensive 

Environmental Response, Compensation, and Liability Act of 1980, § 104(c)(3), as amended, 42 U.S.C.A. 

§ 9604(c)(3).

[15] Environmental Law 149E 446

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek446 k. Covered Costs; Damages. 

Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

For purposes of determining costs related to remedial treatment of waste water under Comprehensive 

Environmental Response, Compensation, and Liability Act (CERCLA), National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) reasonably construed “necessary to restore” language of CERCLA as contemplating only those measures that actively clean up 

ground and surface water, although plaintiff states 

contended that CERCLA required Environmental 

Protection Agency (EPA) to operate entire water 

quality restoration remedy, including elements that 

may also function as source control measures. Comprehensive Environmental Response, Compensation, 

and Liability Act of 1980, § 104(c)(6), as amended, 42 

U.S.C.A. § 9604(c)(6).

[16] Environmental Law 149E 660

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek660 k. Prematurity. Most Cited Cases

(Formerly 199k25.15(5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan's (National Contingency Plan's or 

NCP's) definition of when remedy becomes operational and functional, for purposes of determining 

state's responsibility for operations and maintenance 

costs, is merely rebuttable presumption that remedies 

are operational and functional one year after completion and, thus, plaintiff states' challenge to such definition was premature; if Environmental Protection 
Page 5

997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 62 USLW 2063, 23 Envtl. L. Rep. 21,157

(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

Agency (EPA) refuses to grant extension at end of one 

year, that decision would be subject to challenge.

[17] Environmental Law 149E 453

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek450 Administrative Agencies and Proceedings

149Ek453 k. Notice and Comment. Most 

Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

Environmental Protection Agency (EPA) provided reasonable notice that assurances for institutional controls might be required of states where such 

controls were part of long-term response to a release, 

where EPA's proposed rule required states to provide 

assurances that they would assume responsibility for 

operation and maintenance of implemented remedial 

actions and, in that same proposed rule, EPA made it 

clear that it regarded institutional controls as integral 

part of many remedial actions.

[18] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) requirement that states provide assurances that 

institutional controls (e.g., zoning restrictions) to 

receive federal funding for hazardous waste clean ups 

was not arbitrary and capricious; to extent that institutional controls are necessary component of 

fund-financed remedial action, it is entirely appropriate for Environmental Protection Agency (EPA) to 

require assurance of integrity of such controls prior to 

spending federal funds on a cleanup. Comprehensive 

Environmental Response, Compensation, and Liability Act of 1980, §§ 101(24), 104(c)(3), as amended, 42 

U.S.C.A. §§ 9601(24), 9604(c)(3).

[19] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substance Pollution 

Contingency Plan's (National Contingency Plan's or 

NCP's) site access provisions are not arbitrary and 

capricious; NCP expressly does not condition fund 

financing on state assurance of site access but merely 

articulates Environmental Protection Agency's 

(EPA's) preference for state acquisition of site access, 

and does not constitute additional state “assurance,”

not authorized by Comprehensive Environmental 

Response, Compensation, and Liability Act (CERCLA), upon which federal funding is conditioned. 

Comprehensive Environmental Response, Compensation, and Liability Act of 1980, § 104(c)(3), as 

amended, 42 U.S.C.A. § 9604(c)(3).

[20] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

Environmental Law 149E 453

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek450 Administrative Agencies and Proceedings

149Ek453 k. Notice and Comment. Most 

Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) allows states reasonable opportunity to review 

and comment upon Environmental Pollution Agency 

(EPA) technical documents; potential conflicts between states and EPA should become apparent during 

process of remedy selection and implementation and, 

if not explicitly identified by EPA, be anticipated by 

states. Comprehensive Environmental Response, 
Page 6

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(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

Compensation, and Liability Act of 1980, § 121(f)(1), 

as amended, 42 U.S.C.A. § 9621(f)(1).

[21] Environmental Law 149E 439

149E Environmental Law

149EIX Hazardous Waste or Materials

149Ek436 Response and Cleanup; Liability

149Ek439 k. Remedial and Removal Actions in General; Cleanup Plans. Most Cited Cases

(Formerly 199k25.5(5.5) Health and Environment)

National Oil and Hazardous Substances Pollution 

Contingency Plan (National Contingency Plan or 

NCP) properly defined “on site” for purposes of exemption from obtaining permits for remedial actions; 

NCP definition allows Environmental Protection 

Agency (EPA) to respond to releases expeditiously 

and efficaciously and reflects practical aspects of 

responding to hazardous waste releases under various 

conditions. Comprehensive Environmental Response, 

Compensation, and Liability Act of 1980, § 121(e)(1), 

as amended, 42 U.S.C.A. § 9621(e)(1).

[22] Environmental Law 149E 666

149E Environmental Law

149EXIII Judicial Review or Intervention

149Ek666 k. Preservation of Error in Administrative Proceeding. Most Cited Cases

(Formerly 199k25.15(3.1) Health and Environment)

Issue whether preamble to National Oil and Hazardous Substances Pollution Contingency Plan (National Contingency Plan or NCP) in which Environmental Protection Agency (EPA) proposed to treat 

noncontiguous but reasonably related facilities as 

single “site” would not be reviewed on appeal; issue 

was not properly raised before EPA, and minimal 

reference to contiguity issue in public comment was so 

tangential to principal thrust of comment that it could 

not fairly be said to have been presented to EPA for 

resolution.

*1523 **321 Petitions for Review of Orders of the 

Environmental Protection Agency.Donald A. Brown, 

Victoria L. Peters, and Alan C. Williams argued the 

cause, for petitioners Com. of PA, Dept. of Environmental Resources, California, Colorado, Com. of KY, 

New Jersey, New Mexico Environment Dept., New 

York, and Ohio, and intervenor State of Minn. With 

them on the briefs were Beverly M. Conerton, Roderick E. Walson, Theodora Berger, Brian Hembacher, 

Charlotte Robinson, Mary Ann R. Baker, Gordon J. 

Johnson, Jack Van Kley, and Ellen B. Leidner. James 

D. Ellman, Bryon A. Thompson, Paul H. Schneider, 

Jacqueline H. Berardini, Charlotte Robinson, Mary C. 

Jacobson, and R. Brian McLaughlin also entered appearances for petitioners.

Lewis C. Green argued the cause, for petitioner Missouri Coalition for the Environment.

Edmund B. Frost, David F. Zoll, Michael W. Steinberg, and Arline M. Sheehan entered appearances, for 

petitioner Chemical Mfrs. Assn.

Randy M. Mott entered an appearance, for petitioners 

CPC Intern., and ASARCO, Inc.

Mark G. Weisshaar, David O. Ledbetter, Edward H. 

Commer, and Toni K. Allen entered appearances, for 

petitioner Edison Elec. Institute.

*1524**322 George C. Freeman, Jr.,Alfred R. Light, 

and James Kimble entered appearances, for petitioner 

American Ins. Ass'n.

Timothy A. Vandervere, Jr. and John C. Martin entered appearances, for petitioner United Technologies 

Corp.

Samuel I. Gutter and Peggy L. O'Brien entered appearances, for petitioner General Elec. Co.

Mark G. Weisshaar and Jeffrey N. Martin entered 

appearances, for petitioners American Tel. & Tel. Co., 

and Bridgestone/Firestone Inc.

Scott A. Schachter and Alice L. Mattice, Attorneys, 

Dept. of Justice, and Lawrence E. Starfield, Counsel, 

E.P.A., argued the cause, for respondents. With them 

on the briefs was Roger Clegg, Acting Asst. Atty. 

Gen. Carl Strauss, Roger J. Marzulla, Edward J. 

Shawaker, Elizabeth Ann Peterson, Richard B. Stewart, Marilyn P. Jacobsen, Raymond Ludwiszewski, 

and Earl Salo also entered appearances, for respondents.
Page 7

997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 62 USLW 2063, 23 Envtl. L. Rep. 21,157

(Cite as: 997 F.2d 1520, 302 U.S.App.D.C. 318)

© 2011 Thomson Reuters. No Claim to Orig. US Gov. Works.

Michael W. Steinberg, Hunter L. Prillaman, David F. 

Zoll, Dell E. Perelman, G. William Frick, Ellen 

Siegler, Paul E. Shorb, III, and Barton C. Green were 

on the brief, for intervenors Chemical Mfrs. Ass'n, 

American Petroleum Institute, and American Iron & 

Steel Institute.

Cynthia L. Amara was on the brief, for amicus curiae 

of the Commonwealths of Massachusetts and Virginia, and the states of Alaska, Arizona, Florida, Maine, 

Maryland, Michigan, Montana, New Hampshire, 

Rhode Island, South Carolina, and Washington.

Victoria L. Peters entered an appearance, for intervenor State of Colo.

Paul E. Shorb, III and Barton C. Green entered appearances, for intervenor American Iron & Steel Institute.

Mark G. Weisshaar and David O. Ledbetter entered 

appearances, for intervenor Edison Elec. Institute.

Michael W. Steinberg, Arline M. Sheehan, and David 

F. Zoll entered appearances, for intervenor Chemical 

Mfrs. Ass'n.

Susan M. Schmedes and Ellen Siegler entered appearances, for intervenor American Petroleum Institute.

Alan C. Williams entered an appearance, for intervenor State of Minn.

Gordon J. Johnson entered an appearance, for intervenor State of N.Y.

Before MIKVA, Chief Judge, EDWARDS and 

RANDOLPH, Circuit Judges.

Opinion PER CURIAM.

Concurring opinion filed by Circuit Judge RANDOLPH.

PER CURIAM:

These consolidated petitions present a multifarious challenge to Environmental Protection Agency 

(“EPA”) regulations promulgated under the Comprehensive Environmental Response, Compensation, 

and Liability Act of 1980 (“CERCLA”), 42 U.S.C. §§ 

9601-9675, as amended by the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), 

Pub.L. No. 99-499, 100 Stat. 1613. The regulations 

under review are portions of the National Oil and 

Hazardous Substances Pollution Contingency Plan, 40 

C.F.R. Part 300, commonly known as the “NCP.”

Glossary of Acronyms

ARAR Applicable or Relevant and Appropriate 

Requirements

CERCLA Comprehensive Environmental Response, Compensation, and Liability Act of 1980

EPA Environmental Protection Agency

FS Feasibility Study

J.D.A. Joint Deferred Appendix

MCL Maximum Contaminant Level

MCLG Maximum Contaminant Level Goal

MOCO Missouri Coalition for the Environment

NCP National Contingency Plan

NIH National Institutes of Health

OMB Office of Management and Budget

O & M Operations and Maintenance

PRP Potentially Responsible Party

RI Remedial Investigation

*1525 **323 ROD Record of Decision

SARA Superfund Amendments and Reauthorization Act of 1986

SDWA Safe Drinking Water Act

SMOA Superfund Memorandum of Agreement
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I

Before Congress created the Environmental Protection Agency (“EPA” or “the Agency”), and long 

before Congress enacted the Comprehensive Environmental Response, Compensation, and Liability Act 

of 1980 (“CERCLA”), 42 U.S.C. §§ 9601-9675, there 

was a National Contingency Plan (“NCP”). In 1968, a 

group of federal agencies developed the first NCP, 

which was a multi-agency strategy for dealing with 

environmental disasters. See Freedman, Proposed 

Amendments to the National Contingency Plan: Explanation and Analysis, 19 Envtl.L.Rep. 10,103, 

10,105-06 (1989). In 1970, Congress incorporated the 

NCP into the Federal Water Pollution Control Act, 33 

U.S.C. §§ 1251-1376, and pursuant to its directive, the 

President issued the first published NCP. Water and 

Environmental Quality Improvement Act of 1970, 

Pub.L. No. 91-224, 84 Stat. 91, § 102 (1970); 35 

Fed.Reg. 8508 (1970). The NCP, which acquired its 

current name-the National Oil and Hazardous Substances Pollution Contingency Plan, 36 Fed.Reg. 

16,215 (1971)-in 1971, was revised a number of times 

throughout the 1970s. See 37 Fed.Reg. 2808 (1972); 

38 Fed.Reg. 21,888 (1973); 45 Fed.Reg. 17,832 

(1980). By 1980, a comprehensive NCP was in place, 

although it applied only to discharges into waters 

regulated by the Clean Water Act. Id. “It did not apply 

to releases to groundwater or soil, and it did not provide authority or funding for long-term federal response to chronic hazards.” Freedman, supra, 19 

Envtl.L.Rep. at 10107.

CERCLA came next. Enacted in 1980, CERCLA 

provided “for liability, compensation, cleanup, and 

emergency response for hazardous substances released into the environment and the cleanup of inactive waste disposal sites.” Pub.L. No. 96-510, 94 Stat. 

2767, 2767. We have summarized its general scheme 

in previous decisions. See, e.g., Ohio v. United States 

Dep't of Interior, 880 F.2d 432, 438-40 (D.C.Cir.), 

reh'g denied, 897 F.2d 1151 (1989) (en banc ); Ohio v. 

EPA, 838 F.2d 1325, 1327-29 (D.C.Cir.1988).

Of particular importance to this case is the 

prominent role of the NCP under CERCLA. Section 

104(a)(1) of CERCLA authorizes the President “to 

act, consistent with the national contingency plan, to 

remove or arrange for the removal of, and provide for 

remedial action relating to such hazardous substance, 

pollutant, or contaminant at any time ..., or take any 

other response measure consistent with the national 

contingency plan which the President deems necessary to protect the public health or welfare or the environment.” 42 U.S.C. § 9604(a)(1). The NCP thus 

“provide[s] the organizational structure and procedures” for responding to hazardous waste threats. 40 

C.F.R. § 300.1. It is the means by which EPA implements CERCLA.

When Congress enacted CERCLA in 1980, it 

directed the President to revise and republish the NCP 

in light of the new law. 42 U.S.C. § 9605(a). Pursuant 

to section 115 of CERCLA, the President assigned 

EPA the responsibility of amending the NCP. See 42 

U.S.C. § 9615; Exec. Order No. 12,316, 46 Fed.Reg. 

42,237 (1981); Exec. Order No. 12,580, 52 Fed.Reg. 

2923 (1987). In 1982, EPA issued a new version of the 

NCP. 47 Fed.Reg. 31,180 (1982). EPA revised the 

NCP again in 1985. 50 Fed.Reg. 47,912 (1985). When 

Congress passed the Superfund Amendments and 

Reauthorization Act of 1986 (“SARA”), Pub.L. No. 

99-499, 100 Stat. 1613, which significantly revised the 

statute, Congress directed the President to revise the 

NCP again to reflect the changes in CERCLA. 42 

U.S.C. § 9605(b). EPA issued these revisions to the 

NCP in 1990. 55 Fed.Reg. 8666 (1990).

Petitioners, whom we shall call “the States,” include both states and private parties FN1 contending 

that EPA's changes to the *1526 **324 NCP in 1985 

and 1990 are inconsistent with the requirements of 

CERCLA. The petitions for review challenge two 

general categories of NCP provisions. One category 

involves claims that the NCP unlawfully diminishes 

the level of environmental protectiveness in the remedy selection process and cleanup provisions of 

CERCLA. (These claims are resolved in Parts II, III, 

and IV of the opinion.) The second category involves 

claims that the NCP improperly limits the States' participation in the cleanup process while increasing their 

financial burden. (These claims are resolved in Part V 

of the opinion.) The specific provisions of CERCLA 

and the NCP at issue in this case will be discussed in 

the portion of the opinion analyzing petitioners' claims 

regarding those provisions.

FN1. This case consolidates a number of petitions for review challenging the NCP. The 

petitioners before us are: State of Ohio; State 

of Colorado; Chemical Manufacturers Association; State of New York; Commonwealth 
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of Pennsylvania, Department of Environmental Resources; New Mexico Environment Department; Commonwealth of Kentucky; State of California; State of New Jersey; Missouri Coalition for the Environment; 

General Electric Company; American Telephone & Telegraph Company; Bridgestone/Firestone, Inc.; LaSalle Steel Co.; Bull 

NH Information Systems Inc.; McDonnell 

Douglas Corp.; Seagate Technology Inc.

The following parties intervened: American Iron & Steel Institute; American Petroleum Institute; Edison Electric Institute; 

State of Minnesota; Texas Instruments, 

Inc.; Borg-Warner Co.; Mobil Oil Corp.; 

Gencorp. Inc.; and Oklahoma Publishing 

Co.

The following states appeared as amici 

curiae in support of petitioners: Alaska, 

Arizona, Florida, Maine, Maryland, Massachusetts, Michigan, Montana, New 

Hampshire, Rhode Island, South Carolina, 

Texas, Virginia, and Washington.

II

The States first challenge several elements of the 

NCP definition of legally “applicable” or “relevant 

and appropriate” environmental standards, known as 

“ARARs.” CERCLA does not define ARARs, but the 

statute does require that remedial actions at Superfund

sites result in a level of cleanup or standard of control 

that at least meets the legally applicable or otherwise 

relevant and appropriate federal (or stricter state) 

requirements. 42 U.S.C. § 9621(d)(2)(A). The NCP 

defines “applicable requirements” as follows:

Applicable requirements means those cleanup 

standards, standards of control, and other substantive requirements, criteria, or limitations promulgated under federal environmental or state environmental or facility siting laws that specifically 

address a hazardous substance, pollutant, contaminant, remedial action, location, or other circumstance found at a CERCLA site. Only those state 

standards that are identified by a state in a timely 

manner and that are more stringent than federal 

requirements may be applicable.

40 C.F.R. § 300.5. “Relevant and appropriate 

requirements” are those substantive requirements that, 

while not “applicable,” nonetheless “address problems 

or situations sufficiently similar to those encountered 

at the CERCLA site that their use is well suited to the 

particular site.” Id.

A. Does the NCP definition of ARARs as “substantive” requirements violate CERCLA?

[1] The States claim that the NCP definition of 

ARARs is contrary to CERCLA because it excludes 

“procedural” requirements, such as recordkeeping and 

reporting to the government, by inserting the word 

“substantive” into the definition. The States argue that 

limiting ARARs to substantive requirements is contrary to the plain language of CERCLA because the 

statute itself does not distinguish between substantive 

and procedural requirements. They also contend that 

the definition is inconsistent with congressional intent 

because the SARA legislative history gives no indication that Congress intended for ARARs to be limited to substantive requirements. The States argue in 

the alternative that EPA's distinction between substantive and procedural requirements is irrational.

The States are correct that CERCLA does not 

explicitly draw a line between substantive and procedural requirements, but neither does the statutory 

language clearly forbid the NCP distinction. In fact, as 

the following discussion indicates, an application of 

traditional tools of statutory construction, see NLRB v. 

United Food & Commercial Workers Union, Local

23, 484 U.S. 112, 123, 108 S.Ct. 413, 416, 98 L.Ed.2d 

429 (1987); *1527**325Natural Resources Defense 

Council v. Reilly, 983 F.2d 259, 266 (D.C.Cir.1993), 

strongly suggests that CERCLA is concerned only 

with substantive environmental requirements. In any 

case, the NCP limitation of ARARs to substantive 

standards certainly represents a reasonable and permissible construction of the statute. See Chevron v. 

Natural Resources Defense Council, 467 U.S. 837, 

104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). We do not 

dwell in our analysis on the question of which of 

Chevron's two prongs best resolves this issue.

In limiting ARARs to procedural requirements, 

EPA reasonably interprets CERCLA's reference to “a 

level or standard of control” to be directed at those 

environmental laws governing “how clean is 

clean”-that is, the level or degree of cleanup required 

to remedy various types of toxic contamination. The 

CERCLA section at issue, section 121(d), is titled 
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“Degree of cleanup,” and it talks of standards that 

apply “to any hazardous substance, pollutant or contaminant,” 42 U.S.C. § 9621(d)(2)(A), not of standards that apply more generally to a site or a party 

executing a cleanup. Moreover, the only specific requirements explicitly set out in the statute are substantive standards such as Maximum Contaminant 

Levels established in the Safe Drinking Water Act and 

Federal Water Quality Criteria established in the 

Clean Water Act. Finally, contrary to the States' claim, 

the SARA Conference Report explicitly states that 

“[n]ew section 121(d) establishes the substantive

standards that remedial actions ... must meet.”

H.R.Conf.Rep. No. 962, 99th Cong., 1st Sess. (1985), 

U.S. Code Cong. & Admin. News 1986, pp. 2835, 

3339.

The States are surely correct that the procedural 

requirements of various environmental statutes are 

intended to ensure that the substantive contaminant 

levels are met. However, this does not compel EPA to 

impose these requirements under CERCLA. The 

language and structure of section 121(d) strongly 

support, if not compel, the EPA interpretation. The 

NCP represents at the very least a permissible construction of CERCLA within the dictates of Chevron.

B. Does the NCP improperly restrict the meaning of 

state ARARs to standards that are generally applicable and legally enforceable?

[2] The States also claim that the NCP construction of the statutory term “promulgated” is inconsistent with CERCLA. As noted supra p. 1526, CERCLA requires that Superfund remedial actions result 

in a level of cleanup that at least meets federal, or 

stricter state, ARARs. 42 U.S.C. § 9621(d)(2)(A). The 

statute contains an additional requirement with regard 

to state standards: they must be “promulgated ... under 

a State environmental or facility siting law” in order to 

be considered as possible ARARs. 42 U.S.C. § 

9621(d)(2)(A)(ii). CERCLA does not define “promulgated,” but the NCP interprets the term to mean 

“standards [that] are of general applicability and are 

legally enforceable.” 40 C.F.R. § 300.400(g)(4).

[3] None of the States' arguments establishes that 

EPA's definition is an impermissible construction of 

this admittedly undefined term. Under Chevron, EPA 

need not establish that the statute compels its regulation. Where congressional intent on the precise question at issue is unclear, it is enough that the Agency's 

construction is reasonable. Chevron v. Natural Resources Defense Council, 467 U.S. 837, 104 S.Ct. 

2778, 81 L.Ed.2d 694 (1984). EPA's definition of 

“promulgated” clearly meets this standard.

The States claim that the ordinary meaning of the 

term “promulgated” precludes the NCP's narrow definition. However, the dictionary definitions that the 

States cite-which include notions such as “official 

announcement” and “to make ... obligatory”-are perfectly consistent with the NCP requirements of general applicability and legal enforceability. Neither the 

absence of clear legislative history, nor the fact that 

the word sometimes has a broader meaning, demonstrates that the NCP definition is impermissible.

The States also argue that another CERCLA 

provision, allowing the President to waive ARARs 

that “the State has not consistently applied,” 42 U.S.C. 

§ 9621(d)(4)(E), indicates *1528 **326 that EPA 

carries the burden of proving inconsistent application 

by the State if it decides to waive an ARAR. The NCP 

definition of “promulgated,” the States argue, shifts 

the burden to the States to prove the general applicability of a state standard before it will be adopted as an 

ARAR. This argument is unavailing because the NCP 

definition and the cited CERCLA provision are perfectly consistent. Under the NCP definition, a standard 

must be generally applicable on its face, and if so, the 

standard is a potential ARAR. However, if such generally applicable standard is not applied consistently, 

then the standard may be waived under section 

9621(d)(4)(E).

The States' remaining arguments on this point 

merely suggest alternative reasonable interpretations 

of the statute. The States suggest different language 

that Congress might have used to indicate clearly its 

authorization of EPA's approach. However, just as the 

statute does not compel EPA's interpretation, neither 

does the absence of clear language render the Agency's approach impermissible. Furthermore, the inclusion in CERCLA of the terms “standards,” “criteria,”

and “limitations” in addition to “requirements” does 

not, as the States suggest, necessarily indicate a 

broader class of state rules than those generally applicable and legally enforceable. Finally, the States' 

attack on EPA's allegedly inconsistent uses of the term 

must be rejected. EPA's definition of “promulgate” is 

limited to the specific context of state requirements, 

and the Agency is defining an ambiguous term in-
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serted in the statute by Congress. See 40 C.F.R. § 

300.400(g)(4). EPA is not acting inconsistently by 

using the term differently from its use in other contexts.

C. Does the NCP improperly restrict the meaning of 

federal ARARs to those “promulgated” under federal 

environmental laws?

[4] The States also object to the NCP definition of 

ARARs insofar as it is limited to requirements 

“promulgated under federal ” environmental laws. 40 

C.F.R. § 300.5 (emphasis added). The States argue 

that in setting out possible ARARs, CERCLA includes 

the word “promulgated” in reference to state standards, but not federal standards. Compare 42 U.S.C. § 

9621(d)(2)(A)(i) (“any standard ... under any Federal 

environmental law”) and 42 U.S.C. § 

9621(d)(2)(A)(ii) (“any promulgated standard ... under a State environmental or facility siting law”) 

(emphasis added). Thus, argue the States, the NCP is 

contrary to CERCLA insofar as it requires that federal 

standards must be promulgated to be considered as 

possible ARARs.

We do not reach the merits of this argument because the States waived the claim by failing to raise it 

during rulemaking proceedings before the Agency. 

Linemaster Switch Corp. v. EPA, 938 F.2d 1299, 1308 

(D.C.Cir.1991); Washington Ass'n for Television & 

Children v. FCC, 712 F.2d 677, 680 (D.C.Cir.1983). 

The States argue that the court should exercise its 

discretion to consider this issue despite the States' 

failure to raise it below because the policies behind the 

waiver rule would not be frustrated if the court were to 

address the merits in this case. We disagree.

The States point to some of the purposes of the 

waiver doctrine-to allow an administrative agency to 

make a factual record and exercise its discretion or 

apply its expertise, see McKart v. United States, 395 

U.S. 185, 193-94, 89 S.Ct. 1657, 1662-63, 23 L.Ed.2d 

194 (1969)-and argue that these concerns are not implicated here because the States raise a purely legal 

challenge to the NCP. However, with the possible 

exception of developing a factual record, these concerns are relevant to an agency's legal interpretation of 

a statute which it is implementing. The notion of deference to agency interpretations of law embodied in 

Chevron is founded on just such concerns. See Chevron, 467 U.S. at 843-45, 104 S.Ct. at 2782-83.

Furthermore, the waiver doctrine is also concerned with notions of agency autonomy and judicial 

efficiency. The doctrine promotes agency autonomy 

by according the agency an opportunity to discover 

and correct its own errors before judicial review occurs. Judicial efficiency is served because issues that 

are raised before the agency might be resolved without 

the need for judicial*1529 **327 intervention. 

McKart, 395 U.S. at 195, 89 S.Ct. at 1663. The efficiency concern is especially germane to this challenge 

to the NCP, involving an extremely complex rulemaking in which a multitude of issues might be raised 

for the first time before this court in the absence of the 

waiver doctrine.

The States also point out that this court has “excused the exhaustion requirements for a particular 

issue when the agency has in fact considered the issue,” Natural Resources Defense Council v. EPA, 824 

F.2d 1146, 1151 (D.C.Cir.1987), but they offer no 

evidence that EPA actually considered an objection to 

the limitation of ARARs to “promulgated” federal 

standards. Neither the States nor any other party raised 

an objection to the use of the word “promulgated”

with respect to federal environmental standards, and 

EPA therefore had no opportunity to consider the 

issue.

Finally, the States argue that this issue presents a 

matter of great public importance worthy of allowing 

an exception to the waiver doctrine. See Foundation 

on Economic Trends v. Heckler, 756 F.2d 143, 156 

(D.C.Cir.1985). In Foundation, this court decided the 

level of environmental review required of the National 

Institutes of Health (“NIH”) before it approved the 

first deliberate release of genetically engineered, recombinant-DNA-containing organisms into the open 

environment. Although the plaintiffs had failed to 

raise their objections to the release during the period 

of NIH review, the court nonetheless upheld the district court's decision to address the claims because of 

the grave public importance of insuring appropriate 

environmental review “of a new technology with 

unknown environmental consequences.” Id.

Of course, the public health that CERCLA and the 

NCP are aimed at protecting is also an extremely 

important concern. But the choice between two alternative readings of the CERCLA provision at issue 

here is not so critical to the overall scheme. The States 

present no convincing argument that limiting ARARs 
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to promulgated federal standards will compromise 

CERCLA's health protection goals or is otherwise of 

such gravity as to warrant departure from settled 

waiver principles.

D. Does the NCP improperly fail to apply zero-level 

Maximum Contaminant Level Goals (“MCLGs”) as 

ARARs?

[5] The States challenge EPA's decision that 

Maximum Contaminant Level Goals (“MCLGs) established under the Safe Drinking Water Act 

(“SDWA”), 42 U.S.C. §§ 300f to 300j-26, do not have 

to be attained for contaminants whose MCLG has 

been set at a level of zero. 40 C.F.R. § 

300.430(e)(2)(i)(C). The States contend that EPA 

lacks authority to depart from a statutory requirement 

to achieve MCLGs, and in the alternative, that even if 

EPA possesses this authority, it has failed to provide a 

reasoned basis for its departure.

The SDWA is specifically referenced in section 

121(d)(2)(A) of CERCLA as one of the federal laws 

containing ARARs for Superfund cleanups. 42 U.S.C. 

§ 9621(d)(2)(A). The SDWA identifies two standards 

for exposure to contaminants. The first, Maximum 

Contaminant Level Goals (“MCLGs”), are generally 

unenforceable goals that reflect the level for a given 

contaminant at which “no known or anticipated adverse effects on the health of persons occur and which 

allows an adequate margin of safety.” 42 U.S.C. § 

300g-1(b)(4). Many MCLGs for carcinogens are set at 

zero. 55 Fed.Reg. 8750 (1990). The second type of 

standards, Maximum Contaminant Levels 

(“MCLs”)-the actual maximum permissible concentration levels under the SDWA-must be set as close as 

“feasible” to their corresponding MCLGs, taking into 

account available technology and cost. 42 U.S.C. § 

300g-1(b)(4)-(5).

While MCLGs are unenforceable under the 

SDWA, section 121 of CERCLA converts them into 

enforceable goals, providing:

Such remedial action shall require a level or standard of control which at least attains Maximum 

Contaminant Level Goals established under the Safe 

Drinking Water Act ... where such goals or criteria 

are relevant and appropriate under the circumstances of the release or threatened release.

*1530 **328 42 U.S.C. § 9621(d)(2)(A). Consistent with this requirement, the NCP generally requires the attainment of MCLGs. 40 C.F.R. § 

300.430(e)(2)(i)(B). When the MCLG for a contaminant has been set at a level of zero, however, the NCP 

requires only that the MCL be attained. In essence, 

EPA has made a categorical determination that 

MCLGs set at a level of zero are never “relevant and 

appropriate under the circumstances” of a release.

This determination was based on EPA's conclusion “that it is impossible to detect whether „true‟ zero 

has actually been attained.” 55 Fed.Reg. 8752 (1990). 

During rulemaking to promulgate MCLGs under the 

SDWA, EPA “emphasized that ... zero is not a measurable level in scientific terms.” 50 Fed.Reg. 46,884, 

46,896 (1985). “Due to limitations in analytical techniques, it will always be impossible to say with certainty that the substance is not present. In theory, 

RMCLs [Recommended Maximum Contaminant 

Levels] at zero will always be unachievable (or at least 

not demonstrable).” 49 Fed.Reg. 24,330, 24,347 

(1984).

The States contend that EPA's decision concerning zero-level MCLGs is inconsistent with CERCLA's 

mandate that all remedial actions attain MCLGs. This 

argument ignores the full language of the section, 

which imposes the requirement “where such goals ... 

are relevant and appropriate under the circumstances 

of the release or threatened release.” 42 U.S.C. § 

9621(d)(2)(A). This language leaves EPA with discretion to determine when MCLGs are relevant and 

appropriate. The States contend, though, that such 

discretion cannot be exercised in a categorical manner, 

but instead must be based on a case-specific determination at individual sites. Hence, there is no reason 

for EPA to make an individualized determination of 

what they have concluded can never be relevant and 

appropriate.

The States also contend that even if EPA has 

discretion to conclude that zero-level MCLGs are 

never relevant and appropriate, it has not justified the 

decision to do so in this case. But EPA articulated a 

number of justifications, see 55 Fed.Reg. 8750-52 

(1990), and we find its reliance on the fact that true 

zero levels can never be detected to provide adequate 

support for the Agency's decision. As we understand 

EPA's scientific analysis, one can never prove a true 

zero level. If the measuring device indicates zero, this 

shows only that the device is not sufficiently sensitive 
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to detect the presence of any contaminants. It does not 

show the total absence of the contaminants. In other 

words, if one asserts that zero contaminants are 

present, this can be falsified by showing the presence 

of some detectable level, but it can never be shown to 

be true. EPA chose to set MCLGs for carcinogens at 

zero under the SDWA because they “are goals which 

may or may not be practically achievable and the 

practicality of these goals should be factored into the 

MCLs,” not the MCLGs. 50 Fed.Reg. 46,896 (1985). 

In contrast, EPA concluded that “ARARs must be 

measurable and attainable since their purpose is to set 

a standard that an actual remedy will attain.” 55 

Fed.Reg. 8752 (1990).

The States do not contest EPA's scientific conclusion that zero-level MCLGs are not achievable. 

Instead, they argue that EPA could select a method of 

measurement approximating zero by setting “a goal of 

achieving the analytical detection limits for specific 

carcinogens.” Final Amended Joint Brief of Petitioning States at 68. That EPA could do this, however, 

does not mean it is required to do so. Section 121 

requires the selection of MCLs where MCLGs are 

unattainable. That is what the NCP does. That conclusion is reasonable given EPA's discretion to determine when ARARs are relevant and appropriate.

III

The next set of challenges by the States addresses 

a variety of issues concerning remedy selection: the 

role of cost-benefit analysis in remedy selection; the 

requirement that selected remedies are permanent to 

the maximum extent practicable; the use of a cancer

risk range in remedy selection; and the requirement of 

five-year review of certain remedial actions.

*1531 **329 A. Does the NCP establish an improper 

cost-benefit analysis in the remedy selection process?

[6] Section 121 of CERCLA, added by SARA, 

requires the selection of remedial actions “at a minimum which assures protection of human health and 

the environment.” 42 U.S.C. § 9621(d)(1). Although a 

different provision of section 121 requires the selection of remedial actions that are also cost-effective, 42 

U.S.C. § 9621(b)(1), the States interpret section 

121(d)(1) to prohibit EPA from considering the cost of 

a remedial action when it determines the level of 

protectiveness to be achieved by that remedial action. 

EPA is in full agreement with the States' interpretation 

of § 121(d)(1). See 55 Fed.Reg. 8726 (1990). The 

States contend, however, that two provisions in the 

NCP implicitly authorize the use of cost-benefit 

analysis, thereby permitting cost to be considered in 

determining the level of protectiveness to be achieved 

by a remedial action. In making this argument, the 

States distort the language of the NCP, which is 

carefully structured so “that protection of human 

health and the environment will not be compromised 

by other selection factors, such as cost.” Id.

The States first point to a provision in the NCP 

authorizing EPA to balance nine different criteria, 

including both protection of human health and cost, in 

selecting a remedy. 40 C.F.R. § 300.430(f)(1)(i)(A). 

But while the NCP identifies nine criteria to be used in 

selecting a remedy, all of the criteria are not given 

equal weight. Instead, they are divided into three 

classifications: threshold criteria, primary balancing 

criteria, and modifying criteria. Under this structure, 

“[o]verall protection of human health and the environment and compliance with ARARs (unless a specific ARAR is waived) are threshold requirements that 

each alternative must meet in order to be eligible for 

selection.” 40 C.F.R. § 300.430(f)(1)(i)(A). EPA explained in the preamble to the NCP that remedial 

alternatives “must be demonstrated to be protective ... 

in order to be eligible for consideration in the balancing process by which the remedy is selected.” 55 

Fed.Reg. 8726 (1990). The identification of threshold 

criteria therefore undermines the States' claim that by 

listing nine criteria, the NCP permits the level of 

protectiveness to be affected by cost.

The States also point us to the NCP's definition of 

“cost-effectiveness,” which states that “[a] remedy 

shall be cost-effective if its costs are proportional to its 

overall effectiveness.” 40 C.F.R. § 

300.430(f)(1)(ii)(D). The States contend that this 

language actually authorizes the use of cost benefit 

analysis. In making this argument, though, the States 

ignore the first sentence of the same section of the 

NCP that they are challenging. It states: “Each remedial action shall be cost-effective, provided that it 

first satisfies the threshold criteria set forth in § 

300.430(f)(1)(ii)(A) and (B).” Id.; see also 55 

Fed.Reg. 8727 (1990). Thus, consistent with the creation of threshold criteria, the NCP explicitly prohibits 

consideration of costs in the manner complained of by 

the States. FN2

FN2. The intervenors argue in support of 
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EPA that cost must be considered in determining the level of protection to be achieved. 

EPA, however, rejected their argument, see

55 Fed.Reg. 8726 (1990), and the industry 

intervenors did not seek review of that decision.

B. Does the NCP improperly fail to require the selection of permanent remedies to the maximum extent 

practicable?

[7] The States next argue that the NCP is inconsistent with section 121(b)(1)'s requirement that the 

President select remedial actions “that utilize[ ] permanent solutions ... to the maximum extent practicable.” 42 U.S.C. § 9621(b)(1). The NCP classifies 

permanence as one of the five primary balancing criteria, along with reduction of toxicity, mobility, or 

volume; short-term effectiveness; implementability; 

and cost. 40 C.F.R. § 300.430(f)(1)(i)(B). The States 

reason that because the selection of permanent remedies “is one of the overarching statutory principles of 

remedy selection under CERCLA,” Final Amended 

Joint Brief of Petitioning States at 27, the other balancing criteria, particularly cost, should play no role 

in EPA's determination whether a permanent remedy 

is to be selected. In essence, the States would like 

permanence to be treated *1532 **330 as an additional threshold criterion that must be evaluated independently of cost.

The flaw in the States' argument is in the premise 

that permanence is an overarching statutory principle. 

This premise is not supported by the statutory language. Section 121(b)(1), which the States rely upon, 

requires the President to “select a remedial action that 

is protective of human health and the environment, 

that is cost effective, and that utilizes permanent solutions and alternative treatment technologies or resource recovery technologies to the maximum extent 

practicable.” 42 U.S.C. § 9621(b)(1). The statutory 

language places as much emphasis on the selection of 

cost-effective remedies as it does on the selection of 

permanent remedies. Although the NCP elevates 

protection of human health and the environment to a 

threshold criterion, a different provision in section 121 

provides the basis for that treatment. 42 U.S.C. § 

9621(d)(1); see supra p. 1531. But there is nothing in 

section 121 to suggest that selecting permanent remedies is more important than selecting cost-effective 

remedies.

The States offer two responses. The first is a decision defining “practicable” as “ „possible to practice 

or perform‟ or „capable of being put into practice, 

done, or accomplished.‟ ” Ashton v. Pierce, 541 

F.Supp. 635, 641 (D.D.C.1982) (quoting Webster's 

Third New International Dictionary (1963)), aff'd, 716 

F.2d 56 (D.C.Cir.1983); cf. American Textile Mfrs. 

Inst. v. Donovan, 452 U.S. 490, 508-09, 101 S.Ct. 

2478, 2490-91, 69 L.Ed.2d 185 (1981). The Ashton

court had before it a statute requiring a single goal to 

be achieved to the extent practicable. A 1973 

amendment to the Lead-Based Paint Poisoning Prevention Act required the Secretary of Housing and 

Urban Development to “establish procedures to 

eliminate as far as practicable the hazards of lead paint 

poisoning with respect to any existing housing which 

may present such hazards and which is covered by an 

application for mortgage insurance or housing assistance payments under a program administered by the 

Secretary.” 42 U.S.C. § 4822. The regulations at issue 

in Ashton authorized the use of cost-benefit analysis in 

determining the appropriate remedy and the court 

found no basis for this approach in the statute. In 

contrast, section 121(b)(1) of CERCLA mandates the 

achievement of multiple goals. If EPA were to require 

the selection of permanent remedies whenever possible, it would be ignoring the statutory mandate to 

select cost-effective remedies.

The States' second response relies on comments 

made from the floor of Congress. We have frequently 

cautioned against placing much weight on such 

statements. See, e.g., Colorado v. United States Dep't 

of Interior, 880 F.2d 481, 490 (D.C.Cir.1989); International Bhd. of Elec. Workers, Local Union No. 474 

v. NLRB, 814 F.2d 697, 717 (D.C.Cir.1987); Northern 

Colorado Water Conservancy Dist. v. Federal Energy 

Regulatory Commission, 730 F.2d 1509, 1519 

(D.C.Cir.1984). That caution is certainly warranted 

here. For every set of comments supporting the States' 

position, there is another set of comments supporting 

the opposite position. See, e.g., 132 Cong.Rec. 

29,719-20 (1986) (statement of Rep. Lent); id. at 

29,743 (statement of Rep. Eckart, Chairman of Conference Committee).

The States argue in the alternative that even if 

permanence is not treated as a threshold criterion, the 

NCP should at least place special emphasis on the 

selection of permanent remedies. But the NCP does 

exactly that. It requires that “[t]he balancing [of al-
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ternative remedies] shall emphasize long-term effectiveness and reduction of toxicity, mobility, or volume 

through treatment.” 40 C.F.R. § 300.430(f)(1)(i)(E). 

In the preamble, EPA explained that “[t]hese two 

criteria are given primary consideration in the rule and 

preamble when analyzing the relative merits of the 

alternatives. These criteria will be the most important, 

decisive factors in remedy selection when the alternatives perform similarly with respect to the other 

balancing criteria.” 55 Fed.Reg. 8725 (1990). Given 

the statutory requirement to achieve a number of 

competing goals, EPA's decision concerning how 

much emphasis to place on the selection of permanent 

remedies is a reasonable one.

*1533 **331 C. Does the NCP cancer risk range 

improperly fail to protect human health and the environment without regard to cost?

[8] The States next challenge EPA's use of a 

cancer risk range between 10-6and 10-4in the NCP, 

arguing that an exposure level greater than 10-6is 

never appropriate. A 10-4risk subjects the surrounding 

population to an increased lifetime cancer risk of 1 in 

10,000. A 10-6risk subjects the surrounding population to an increased lifetime cancer risk of 1 in 

1,000,000. When EPA develops objectives for a remedial action at a site, it selects a remediation goal 

that “establish[es] acceptable exposure levels that are 

protective of human health.” 40 C.F.R. § 

300.430(e)(2)(i). EPA attempts to use health-based 

ARARs to set the goal, but if ARARs are nonexistent 

or unsuitable for use, EPA establishes the goal based 

on criteria in the NCP. 55 Fed.Reg. 8712 (1990). “For 

known or suspected carcinogens, acceptable exposure 

levels are generally concentration levels that represent 

an excess upper bound lifetime cancer risk to an individual of between 10-6

and 10-4....” 40 C.F.R. § 

300.430(e)(2)(i)(A)(2). The NCP expresses a preference for remedial actions that achieve a level of 10-6

however, the ultimate decision depends on a balancing 

of nine criteria, including cost. Id.; 55 Fed.Reg. 8718 

(1990).

The States contend that by permitting cost to play 

a role in determining the level of exposure, the cancer

risk range fails to meet the requirement in § 9621 that 

remedial actions be “protective of human health.” 42 

U.S.C. § 9621(b)(1); see also 42 U.S.C. § 9621(d)(1). 

The States' argument necessarily depends, though, on 

the notion that an exposure level greater than 10-6is 

not protective of human health. CERCLA requires the 

selection of remedial actions “that are protective of 

human health,” not as protective as conceivably 

possible. A “risk range of 10-4to 10-6represents EPA's 

opinion on what are generally acceptable levels.” 55 

Fed.Reg. 8716 (1990). Although cost cannot be used 

to justify the selection of a remedy that is not protective of human health and the environment, it can be 

considered in selecting from options that are adequately protective.

The States also argue that the actual risk range

selected is not adequately protective. EPA concluded, 

though, that all levels of exposure within the risk 

range are protective of human health. Id. EPA has 

used 10-444444444444 as an upper bound for establishing risk levels in the past, see 53 Fed.Reg. 51,394, 

51,426 (1988), and “[m]any ARARs, which Congress 

specifically intended be used as cleanup standards at 

Superfund sites, are set at risk levels less stringent 

than 10-6,” 55 Fed.Reg. 8717 (1990). The States offer 

no evidence challenging EPA's position that 10-4

represents a safe level of exposure, and in any event, 

we give EPA's findings on this point significant deference. See New York v. EPA, 852 F.2d 574, 580 

(D.C.Cir.1988), cert. denied, 489 U.S. 1065, 109 S.Ct. 

1338, 103 L.Ed.2d 809 (1989).

The States also argue that EPA failed to justify the 

use of a range, instead of a single point. But EPA 

explained its decision to use a range. While “[t]he use 

of 10-6expresses EPA's preference for remedial actions that result in risks at the more protective end of 

the risk range,” 55 Fed.Reg. 8718 (1990), the Agency 

is also required to consider other factors in selecting 

an appropriate remedy. “Factors related to exposure, 

uncertainty and technical limitations may justify 

modifications of initial cleanup levels that are based 

on the 10-6risk level.” Id. A flexible approach to developing remedial goals is justified by the multiple 

statutory mandates of CERCLA, so long as EPA 

meets the statutory requirement of protectiveness.

The States' final argument is that we should not 

defer to EPA's judgment because of OMB's role in 

developing the NCP. Executive Order No. 12,580

provides that “[a]ll revisions to the NCP, whether in 

proposed or final form, shall be subject to review and 

approval by the Director of the Office of Management 

and Budget.” 52 Fed.Reg. 2923, 2924 (1987). CERCLA, though, grants the President authority to revise 

the NCP, and OMB is part of the Executive Office. 42 
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U.S.C. §§ 9605, 9615. Perhaps for this reason, “[t]he 

States are not challenging the authority of OMB to 

review the NCP.” Final*1534 **332 Amended Joint 

Brief of Petitioning States at 38. Instead, the States 

question whether deference is appropriate. The 

preamble reveals that EPA considered a number of 

comments from OMB, as well as from other interested 

parties, such as the States. EPA then settled on a final 

rule, and it alone claimed responsibility for the contents of the NCP. 55 Fed.Reg. 8813 (1990). Our review is based on EPA's justification for changes in the 

NCP, and its response to comments from a number of 

parties. We are not reviewing, or deferring to, any 

justification offered by OMB.

D. Has EPA improperly interpreted the CERCLA 

requirement of five-year review of certain remedial 

actions?

[9] The States next challenge EPA's interpretation 

of the CERCLA requirement of five-year review of 

certain remedial actions. This claim must also be rejected. CERCLA provides for a five-year review of 

Superfund sites as follows:

If the President selects a remedial action that results 

in any hazardous substances ... remaining at the site, 

the President shall review such remedial action no 

less often than each 5 years after the initiation of 

such remedial action to assure that human health 

and the environment are being protected by the 

remedial action being implemented. In addition, if 

upon such review ... action is appropriate at such 

site ... the President shall take or require such action.

42 U.S.C. § 9621(c). EPA, exercising power delegated from the President, is also required to supply 

Congress with a list of sites subject to review, the 

results of reviews, and any actions taken in light of the 

reviews. Id.

EPA interprets this provision to require review 

only when remedial action “results in hazardous substances ... remaining at the site above levels that allow 

for unlimited use and unrestricted exposure.” 40 

C.F.R. § 300.430(f)(4)(ii). A site is not designated for 

review when the initial remedial action renders the site 

safe, under the standards prevailing at the time of the 

determination, for all purposes and for an unlimited 

period of exposure through drinking water, air, or any 

other “exposure pathway.”

The States attack this standard on two grounds. 

First, the States argue that EPA's approach violates 

clear statutory language requiring a review when “any 

hazardous substances” remain at the site. 42 U.S.C. § 

9621(c). The Agency responds that the regulation 

merely imposes a de minimis gloss on the CERCLA 

requirement in order to avoid an absurd result. EPA 

maintains that under the approach that the States 

suggest, the Agency would be required to conduct a 

review of every site, every five years, in perpetuity, 

because it is virtually impossible to prove that not a 

single molecule of hazardous material remains at a 

site. See supra p. 1530.

The States do not dispute that their suggested 

approach would require review at all sites every five 

years and impose a mammoth monitoring burden on 

EPA. Rather, the States argue that a de minimis exception is impermissible in this case under Public 

Citizen v. Young, 831 F.2d 1108 (D.C.Cir.1987), cert. 

denied, 485 U.S. 1006, 108 S.Ct. 1470, 99 L.Ed.2d 

699 (1988). In Public Citizen, this court refused to 

allow a de minimis exception to the “Delaney Clause”

in the Pure Food and Drug Act, which provided that a 

color additive will be deemed unsafe if appropriate 

tests reveal that it “induce[s] cancer in man or animal.”

Public Citizen, 831 F.2d at 1112. The States seize in 

particular on the Public Citizen court's admonition that 

the de minimis doctrine cannot “thwart a statutory 

command; it must be interpreted with a view to „implementing the legislative design.‟ ” Id. at 1113 

(quoting Alabama Power Co. v. Costle, 636 F.2d 323, 

360-61 (D.C.Cir.1979)).

The “legislative design” is not being flouted by 

EPA's reading of the five-year review provision because the statutory command is not so clear as to rule 

out EPA's application of a de minimis exception. The 

Public Citizen court relied heavily on the “almost 

inescapable” terms of the Delaney Clause and the 

substantial legislative history supporting an absolutist 

application of the language. See Public Citizen, 831 

F.2d at 1112-17. The terms at issue here are not so 

rigid: the phrase “any hazardous substances” could 

*1535 **333 easily mean “even one hazardous substance” as opposed to “any amount of any hazardous 

substance.” In addition, the legislative history provides no convincing support for the States' position. 

The States point to the comment of a single Senator to 

bolster their position:
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The periodic review provision is intended to assure 

that Superfund cleanups keep pace with developing 

technologies and that remedial actions are upgraded 

to take advantage of such developing technologies. 

The ultimate goal of the Superfund program must be 

to implement permanent solutions at all national 

priorities list sites. One way to accomplish this goal 

is to require periodic review and to assure that sites 

are not removed from the ambit of the program until 

such solutions have been implemented.

132 Cong.Rec. 28,426 (1986) (statement of Sen. 

Mitchell). EPA's interpretation is completely consistent with Senator Mitchell's comments, which do not 

in any way suggest that a permanent solution has not 

been implemented within the meaning of the statute 

once a site is rendered safe for all purposes and for an 

unlimited period of exposure. Thus, EPA's implementation of five-year review represents a permissible 

construction of the statute.

Even assuming arguendo that the States' reading 

of the statute were indeed the “literal” one, a de minimis exception might nonetheless be appropriate. The 

Public Citizen court noted that the literal meaning of a 

statute need not be followed where the precise terms 

lead to absurd or futile results, or where failure to 

allow a de minimis exception is contrary to the primary legislative goal. The States' version of the statute 

would require that every CERCLA site be subject to 

five-year review because, as discussed supra p. 1530, 

EPA cannot detect whether “true” zero has been attained with respect to a particular hazardous substance. Section 9621(c) certainly does not appear to 

have been drafted to require perpetual five-year review at every Superfund site. EPA's interpretation, 

which requires review only where a hazardous substance is present in an amount appreciable enough to 

present some possibility of harm, squares with the 

health-protective purpose of the statute. To go beyond 

that is to adjudge Congress incompetent to fashion a 

rational legislative design.

The States also argue that under EPA's approach, 

any five-year reviews that are conducted-at those sites 

where the initial cleanup action does not allow unlimited use and unrestricted exposure-will be rendered 

meaningless because EPA has stated that “the 

five-year review is not intended as an opportunity to 

consider an alternative to a protective remedy that was 

initially selected.” 55 Fed.Reg. 8730-31 (1990). The 

States argue that because all remedies must be “protective” as of implementation, the review will never 

provide an opportunity for new remedial action. EPA 

responds convincingly that new action will occur 

when the review reveals that the remedy is no longer

protective-for example, where a remedial technology 

has failed, or where a newly promulgated standard 

indicates that the old standard is no longer protective. 

Thus, EPA's construction does not render the five-year 

review provisions a nullity.

The more substantial argument is that the Agency 

will not bring new toxicological information or new 

technologies to bear at those sites that initially fell 

within the Agency's de minimis exception and are 

therefore not subject to five-year review. The States 

are correct that five-year review will not occur at sites 

deemed safe under the standards prevailing at the time 

of the determination, and that the latest information 

therefore will not automatically be brought to bear at 

these sites through the five-year review mechanism. 

However, this fact does not demonstrate that the 

Agency's regulation is an impermissible interpretation 

of the statute. As long as the de minimis exception is 

permissible under the statute, as we hold that it is, the 

fact that new technologies and information will not be 

applied through the five-year review mechanism does 

not render EPA's construction of the statute impermissible.

We also hasten to note that a location initially 

deemed safe for all purposes and for an unlimited 

period of exposure would never *1536 **334 be listed 

as a Superfund site in the first instance. Moreover, to 

say that new information will not be applied to a site 

via the five-year review mechanism is not to say that 

the new information will not be applied at all. If a site 

deemed safe for any use and any amount of exposure 

is later understood to be unsafe under new standards 

developed in light of new toxicological information, 

the site could again be eligible for Superfund treatment. Although five-year review of such sites might 

lead to greater protection of public health (at greater 

cost), we cannot say that omitting these sites from 

five-year review is an impermissible construction of 

the statute.

IV

The States make three additional challenges to the 

NCP remedy selection and cleanup provisions, none 

of which are ripe for judicial review. The ripeness 
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doctrine requires us to “evaluate both the fitness of the 

issues for judicial decision and the hardship to the 

parties of withholding court consideration.” Abbott 

Laboratories v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 

1507, 1515, 18 L.Ed.2d 681 (1967). Both prongs of 

this test dictate delaying review of the States' remaining claims.

The claims are unfit for resolution because 

“judicial appraisal ... is likely to stand on a much surer 

footing in the context of a specific application of th 

[ese] regulation[s] than could be the case in the 

framework of the generalized challenge made here.”

Toilet Goods Ass'n v. Gardner, 387 U.S. 158, 164, 87 

S.Ct. 1520, 1524, 18 L.Ed.2d 697 (1967). “Where we 

believed the agency's practical application of a statement would be important, we have found the issue not 

ripe.” Public Citizen v. Nuclear Regulatory Commission, 940 F.2d 679, 683 (D.C.Cir.1991). As to the 

second prong of the ripeness analysis, the States will 

not be prejudiced or suffer any other significant 

hardship by our decision to defer resolution of these 

issues until they are raised in the context of a 

site-specific challenge. See 42 U.S.C. §§ 9604(c)(3), 

9621(f)(2), 9622(d), 9659, 9613(h)(4). We discuss 

each of the claims in turn.

A. Does NCP remedy selection guidance concerning 

the use of engineering and institutional controls violate CERCLA's remedy selection requirements?

[10] The States first argue that one of EPA's 

“program expectations” violates CERCLA by authorizing the use of institutional controls (such as fences 

and deed restrictions) as a sole remedy at Superfund 

sites. The NCP provision regarding selection of an 

appropriate remedy provides in part as follows:

(iii) Expectations. EPA generally shall consider the 

following expectations in developing appropriate 

remedial alternatives:

....

(D) EPA expects to use institutional controls such as 

water use and deed restrictions to supplement engineering controls as appropriate for short- and 

long-term management to prevent or limit exposure 

to hazardous substances, pollutants, or contaminants.... The use of institutional controls shall not 

substitute for active response measures (e.g., 

treatment and/or containment of source material, 

restoration of ground waters to their beneficial uses) 

as the sole remedy unless such active measures are 

determined not to be practicable, based on the balancing of trade-offs among alternatives that is 

conducted during the selection of remedy.

40 C.F.R. § 300.430(a)(1)(iii).

The States interpret this language to authorize 

EPA to choose, based on cost considerations, institutional controls as the sole remedy for cleaning up 

hazardous waste sites. As a result, they believe that 

this provision may allow EPA to use cost considerations to select a cleanup remedy that may not comply 

with the minimum human health and environmental 

protectiveness requirements of CERCLA, see 42 

U.S.C. § 9621(b)(1), (d)(1), and to select a remedy in 

which there is no treatment or removal of contaminants.

However, EPA explained in the Federal Register 

that the program expectations are not intended to 

displace the use of the nine *1537 **335 criteria 

identified in 40 C.F.R. § 300.430(e)(9)(iii):

EPA has placed the expectations in the rule to inform the public of the types of remedies that EPA 

has achieved, and anticipates achieving, for certain 

types of sites. These expectations are not, however, 

binding requirements. Rather, the expectations are 

intended to share collected experience to guide 

those developing cleanup options.... However, the 

fact that a proposed remedy may be consistent with 

the expectations does not constitute sufficient 

grounds for the selection of that remedial alternative. All remedy selection decisions must be based 

on an analysis using the nine criteria.

55 Fed.Reg. 8702 (1990) (emphasis added); see 

also 40 C.F.R. § 300.430(f)(1)(i)(A) (“Overall protection of human health and the environment and 

compliance with ARARs ... are threshold requirements that each alternative must meet in order to be 

eligible for selection.”) Thus, any remedy relying on 

institutional controls must meet the threshold requirement of protectiveness.

As the foregoing discussion amply demonstrates, 

this issue is unfit for judicial decision at this time 

because the States' argument is premised on a hypothetical application of a nonbinding statement in the 
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NCP. The States acknowledge that institutional controls can be utilized as a sole remedy where other 

remedies are not practicable, and they must concede 

that EPA might never implement institutional controls 

as a sole remedy in a manner that the States (or another 

party with standing) find objectionable. Furthermore, 

any appeal that is brought would necessarily have to 

be decided on the basis of the precise circumstances of 

the cleanup at issue and the alternative remedies 

available and practicable in that context. Thus, the 

issue is better resolved in the context of a specific 

application of the nonbinding statement.

B. Do the NCP provisions concerning ground water 

restoration strategies and approaches improperly 

exempt certain contaminated groundwater resources?

[11] The States next argue that the NCP provisions for dealing with contaminated ground water are 

inconsistent with the CERCLA mandate for protection 

of human health and the environment and for compliance with ARARs. See 42 U.S.C. § 9621(b)(1), 

(d)(1), (d)(2)(A). In the preamble to 40 C.F.R. § 

300.430, EPA sets out the following program expectations:

EPA expects to return usable ground waters to their 

beneficial uses wherever practicable, within a 

timeframe that is reasonable given the particular 

circumstances of the site. When restoration of 

ground water to beneficial uses is not practicable, 

EPA expects to prevent further migration of the 

plume, prevent exposure to the contaminated 

ground water, and evaluate further risk reduction.

55 Fed.Reg. 8846 (1990). The NCP also provides 

that the documentation of a remedy selection must 

“[i]ndicate, as appropriate, the remediation goals ... 

that the remedy is expected to achieve. Performance 

shall be measured at appropriate locations in the 

ground water, surface water, soils, air, and other affected environmental media.” 40 C.F.R. § 

300.430(f)(5)(iii)(A).

The States challenge the NCP approach to ground 

water contamination on four grounds. First, the States 

assert that EPA's expectation of selecting “a timeframe that is reasonable given the particular circumstances of the site,” 55 Fed.Reg. 8846, permits significant delay in implementing remedies and thereby 

permits EPA to avoid making improvements in the 

environment and the level of protectiveness. The 

States claim that the NCP should require rapid implementation of remedies whenever possible. EPA 

points in response to language describing its general 

ground water policy and explaining that the Agency's

preference is for rapid restoration, when practicable, 

of Class I ground waters and contaminated ground 

waters that are currently, or likely in the near-term 

to be, the source of a drinking water supply. The 

most appropriate timeframe must, however, be determined through an analysis of alternatives....

More rapid restoration of ground water is favored 

in situations where a future *1538 **336 demand 

for drinking water from ground water is likely and 

other potential sources are not sufficient. Rapid 

restoration may also be appropriate where the institutional controls to prevent the utilization of 

contaminated ground water for drinking water

purposes are not clearly effective or reliable.

55 Fed.Reg. 8732 (1990). Thus, in a situation 

where health could be jeopardized, EPA intends to 

rapidly restore the water; in other situations, the 

timeframe may be longer.

Second, the States argue that the NCP improperly 

permits a remedy to incorporate a point of compliance 

that is an unlimited distance away from the source of 

ground water contamination. The States point to the 

following language in the preamble to 40 C.F.R. § 

300.430(f)(5)(iii)(A):

EPA believes that remediation levels should generally be attained throughout the contaminated plume, 

or at and beyond the edge of the waste management 

area, when the waste is left in place. However, EPA 

acknowledges that an alternative point of compliance may also be protective of public health and 

the environment under site-specific circumstances.

55 Fed.Reg. 8753. The States emphasize the 

flexible nature of the preamble language. EPA notes in 

reply that the preamble expresses a clear preference 

for remediation throughout the plume and states that 

alternatives must in any case be protective of public 

health and the environment.

Third, the States argue that the EPA ground water 

policy permits EPA to ignore compliance with 
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ARARs. The States assert that EPA achieves this 

result with respect to Class I and II ground water by 

establishing an exclusive federal ARAR. The States 

point to the following statement of EPA's general 

ground water policy:

For Class I and II ground waters, preliminary remediation goals are generally set at maximum 

containment levels, and non-zero MCLGs where 

relevant and appropriate, promulgated under the 

Safe Drinking Water Act or more stringent state 

standards....

55 Fed.Reg. 8732. EPA responds that the NCP 

clearly requires compliance with all ARARs as a 

threshold requirement, and that the general statement 

on ground water policy does not affect the NCP requirement.

As for Class III ground water, the States argue 

that EPA has determined improperly that Safe 

Drinking Water Act (“SDWA”) standards are not 

ARARs. The States note the following language:

For Class III ground water (i.e., ground water that is 

unsuitable for human consumption-due to high salinity or widespread contamination that is not related to a specific contamination source-and that 

does not have the potential to affect drinkable or 

environmentally significant ground water), drinking 

water standards are not ARAR and will not be used 

to determine preliminary remediation goals.

55 Fed.Reg. 8732. EPA responds that standards 

from other statutes such as the SDWA only apply 

where “legally applicable.” 42 U.S.C. § 

9621(d)(2)(A). Thus, EPA argues, it has properly 

concluded that where the ground water does not come 

within the scope of the SDWA, the Agency is not 

obligated to apply those standards. EPA acknowledges that it must apply the standards in any case if it 

determines that they are otherwise “relevant and appropriate under the circumstances” of the specific site 

in question. Id. The NCP sets out the procedure for 

making the “relevant and appropriate” determination. 

See 40 C.F.R. § 300.400(g)(2).

Fourth, and finally, the States assert that a variety 

of additional preamble statements, regarding general 

ground water policy and specific NCP regulations, 

permit remedies that are inconsistent with the CERCLA mandate for remedies that protect human health 

and the environment and are permanent to the maximum extent practicable. See 42 U.S.C. § 9621(b)(1), 

(d)(1). EPA again responds that the nine criteria set 

out in 40 C.F.R. § 300.430(e)(9)(iii)-the first of which 

is protection of human health and the environment, see 

id. § 300.430(e)(9)(iii)(A), and the third of which is 

permanence, see id. § 300.430(e)(9)(iii)(C)-must always be used in selecting a remedy. EPA points out 

that the nine criteria will be balanced on a site-specific 

basis, but that overall protection of *1539 **337 the 

environment is a threshold requirement that each alternative must meet in order to be considered. 40 

C.F.R. § 300.430(f)(1)(i)(A).

The States must make site-specific challenges to 

press each of its four ground water contamination 

claims-that the NCP permits remedy implementation 

timeframes that are unreasonably long, that the NCP 

permits remedies to incorporate unreasonably remote 

points of compliance, that the NCP permits EPA to 

ignore compliance with ARARs, and that the NCP 

permits remedies that are inconsistent with the 

CERCLA mandates of protection of human health and 

the environment and permanence. EPA argues with 

regard to each claim that the States have simply misapprehended the import of the various statements that 

form the basis of their arguments. Because the claims 

are premised on hypothetical applications of nonbinding statements in the NCP, we conclude that they 

should be addressed in site-specific challenges in 

which the reviewing court can consider “the agency's 

practical application” of its statements. See Public 

Citizen, 940 F.2d at 683.

C. Does the NCP improperly fail to apply Federal 

Water Quality Criteria (“FWQC”) as ARARs?

[12] The States' final set of unripe claims involves 

EPA's decision to use MCLs and non-zero MCLGs in 

place of the federal water quality criteria established 

under the Clean Water Act (“CWA”). CERCLA requires that remedial actions attain these federal water 

quality criteria (“FWQC”) wherever “relevant and 

appropriate under the circumstances of the release or 

threatened release.” 42 U.S.C. § 9621(d)(2)(A). Like 

MCLGs, FWQC do not have any independent regulatory impact. See supra pp. 1529-30. Rather, they 

present scientific data and guidance on the effects of 

pollutants from which state and federal authorities 

may derive actual requirements.
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CERCLA provides the following guidance in 

deciding when an FWQC is relevant and appropriate:

In determining whether or not any [FWQC] ... is 

relevant and appropriate under the circumstances of 

the release or threatened release, the President shall 

consider the designated or potential use of the surface or groundwater, the environmental media affected, the purposes for which such criteria were 

developed, and the latest information available.

42 U.S.C. § 9621(d)(2)(B)(i). The preamble to 40 

C.F.R. § 300.430(e)(2) states as follows with regard to 

the choice between MCLGs and MCLs on the one 

hand, and FWQC on the other, as ARARs:

EPA believes that an MCL or non-zero MCLG is 

generally the [ARAR] for ground water that is a 

current or potential source of drinking water ... 

even if an FWQC for human health is also available....

....

EPA believes that MCLs or non-zero MCLGs generally will be the [ARAR] for surface water designated as a drinking water supply, unless the state 

has promulgated water quality standards (WQS) for 

the water body that reflect the specific conditions of 

the water body.

55 Fed.Reg. 8755 (1990) (emphasis added). In 

addition, the NCP provides that MCLs and non-zero 

MCLGs “shall be attained by remedial actions for 

ground or surface waters that are current or potential 

sources of drinking water” where relevant and appropriate under the circumstances of the release. 40 

C.F.R. § 300.430(e)(2)(i)(B).

The States argue that the NCP preamble and regulations embody an unreasonable decision to use 

MCLs and non-zero MCLGs in place of FWQC. EPA 

responds that the issue is not ripe for review because 

the preamble merely sets out a general view that may 

or may not be followed in particular cases. We agree. 

Although EPA sets out a detailed rationale for its 

tentative conclusion, the preamble guidance is nonetheless nonbinding. Thus, this claim should also be 

disposed of in a site-specific challenge in which the 

reviewing court can consider a specific application of 

the challenged language. Public Citizen, 940 F.2d at 

683.

*1540 **338 V

The States' final group of claims focus on the 

proper role of individual states in CERCLA cleanups 

and the allocation of costs between the federal and 

state governments.

A. Does the NCP improperly limit the States' ability to 

take actions authorized by CERCLA?

[13] The States next challenge the NCP's provisions regarding the delegation of CERCLA authority. 

Specifically, the States argue that Subpart F of the 

NCP impermissibly precludes state officials from 

applying for cleanup and related enforcement authority pursuant to section 104 of CERCLA, and from 

exercising authority that is properly assignable to 

them under the statute.

The applicable part of section 104 states:

A State or political subdivision thereof or Indian 

tribe may apply to the President to carry out actions 

authorized in this section. If the President determines that the State ... has the capability to carry out 

any or all of such actions in accordance with the 

criteria and priorities established pursuant to section 

9605(a)(8) of this title and to carry out related enforcement actions, the President may enter into a 

contract or cooperative agreement with the State ... 

to carry out such actions. The President shall make 

a determination regarding such an application 

within 90 days after the President receives the application.

42 U.S.C. § 9604(d)(1)(A) (1988) (emphasis 

added). Under this provision, states may apply for 

enforcement authority and the President “shall make a 

determination” regarding any such application within 

ninety days. If a state is determined to be capable of 

carrying out the policies of the statute, section 104 

allows the President to delegate all of the responsibilities authorized in section 104 as well as the authority 

to take “related enforcement actions.” Moreover, a 

delegation under this section authorizes states to carry 

out these actions on behalf of federal authorities, not 

merely in conjunction with them. See id. §§ 

9604(d)(3) (states may act “on behalf of the President”), 9611(f) (President may delegate to states authority to obligate federal funds and settle claims 

against Superfund).
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The actions authorized under section 104, in addition to the undefined “related enforcement actions,”

include the right to take removal or remedial action or 

“any other response measure consistent with the national contingency plan which the President deems 

necessary to protect the public health or welfare or the 

environment.” Id. § 9604(a)(1). The section also 

confers the authority to investigate releases of hazardous substances, direct responses and recover the 

costs thereof, select remedial actions, and obtain information about and entry upon contaminated sites. Id.

§ 9604(b), (c)(4), (e). The fundamental dispute here 

centers on the scope of EPA's discretion to bar States 

from even applying for certain enforcement authority 

under section 104.

The NCP regulations pertaining to state participation in CERCLA response actions are contained in 

Subpart F, 40 C.F.R. §§ 300.500-.525 (1991). See 55 

Fed.Reg. 8666, 8775 (1990) (Subpart F “codifies all 

regulatory requirements or state participation and 

involvement in CERCLA-authorized response actions”). There are two types of state-led response 

actions that are implicated by the Subpart F regulations. The first involves a state acting as the lead 

agency in a federally financed cleanup (“state-lead, 

fund-financed”); in such a situation, the NCP limits 

state participation to preparing proposed remedial 

plans and the final record of decision (“ROD”) setting 

forth the selected remedy. Specifically, states must 

first enter into a cooperative agreement with EPA in 

order to receive Superfund financing. 40 C.F.R. § 

300.515(a). The state may then perform initial site 

assessment activities, conduct the remedial investigation (“RI”), do the feasibility study (“FS”), draft and 

recommend a proposed remedial action plan, and 

prepare the final ROD. Id. However, in state-lead, 

fund-financed actions, the state may not publish a 

remedial plan that has not been approved by EPA, or 

proceed with the response action unless EPA has 

concurred in, and adopted, the ROD. Id. § 

300.515(e)(1), (e)(2)(ii). Thus, all final authority is 

reserved to EPA.

*1541 **339 The second type of state-led response action under Subpart F involves a state acting 

as the lead agency in potentially responsible party 

(“PRP”) or state funded cleanups. In these actions 

(“state-lead, non-fund-financed”), states need not get 

EPA concurrence to publish and implement a remedy, 

but, under the NCP, the states are barred from invoking CERCLA authority. Id. § 300.515(e)(2)(ii). In 

other words, a state may not even apply for such authority pursuant to section 104. Thus, if a state elects 

to proceed on its own authority, there is a risk that 

EPA will take later actions or select different remedies 

under CERCLA that could potentially expose the state 

or the PRP to additional liabilities. The States contend 

that, without the ability to invoke CERCLA authority 

as the lead agency, state officials are severely handicapped in their ability to enforce and settle cleanup 

obligations.

In the States' view, the Subpart F scheme unlawfully restricts the scope of state participation under 

CERCLA. The statute provides for the delegation of 

CERCLA authority to states that apply for, and are 

found capable of carrying out, section 104 actions. 

Subpart F, however, establishes a blanket limitation 

on state participation, barring states from exercising 

the most important CERCLA authority (remedy selection) in fund-financed cleanups and from using any 

CERCLA authority in non-fund-financed cleanups, 

without regard to the capability of any given state.

The first question subsumed by the States' petition on this issue is whether CERCLA requires the 

grant of authority to a state under section 104 whenever it is sought. The answer to this question is obvious: under the statute, EPA's determination (on 

behalf of the President) to delegate section 104 responsibilities to state officers is clearly discretionary. 

The statute directs that states “may apply to the President to carry out actions authorized in this section.... 

[T]he President may enter into a contract ... with the 

State ... to carry out such actions.” 42 U.S.C. § 

9604(d)(1)(A) (emphasis added). Naturally, terms 

such as “may” are indicative of discretionary authority. International Union, UAW v. Dole, 919 F.2d 753, 

756 (D.C.Cir.1990). Furthermore, cooperative contracts are “subject to such terms and conditions as the 

President may prescribe.” 42 U.S.C. § 9604(d)(1)(B). 

Seeking to counter the clear language of the statute, 

the States cite several portions of the legislative history as purportedly revealing that the statute's 

draftsmen intended states to exercise the full range of 

CERCLA authority. See, e.g., 126 Cong.Rec. 26,761 

(1980) (statement of Rep. Florio) (federal Government “required to provide for contracts and grants” to 

states that have response capability). However, the 

history cited by the States is composed of isolated 

references from a long and tangled legislative process. 
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In light of the clear discretionary language used in the 

enacted version of the statute, we find these statements 

unpersuasive. Thus, the statute manifestly does not 

require EPA to delegate full CERCLA authority in 

either state-lead, fund-financed, or state-lead, 

non-fund-financed responses.

This does not dispose of the issue, however, for 

the States have raised a second question challenging 

EPA's determination to preclude all states from even 

applying for enforcement authority that is otherwise 

permissible under section 104. As noted above, under 

section 104, the President must make a determination 

within ninety days on any application from a state to 

participate in a CERCLA cleanup through a cooperative agreement. 42 U.S.C. § 9604(d)(1)(A). Thus, 

under the statute, states have a right to apply for enforcement authority under section 104, and the President is required to respond based on the particular 

state's capability of performing. Subpart F, though, 

categorically precludes states from taking CERCLA 

actions that are not included in the NCP codification 

of delegable duties, irrespective of the state's capabilities. For instance, Subpart F does not allow delegation of the authority to select the final remedy, despite 

the fact that such authority is one of those enumerated 

in CERCLA section 104. Nor is there any mention in 

Subpart F of enforcement authority that may be delegated to the states. In effect, EPA has determined in 

a rulemaking that no state may qualify to exercise all

of the potentially delegable authority of section 104.

*1542 **340 To the extent that the NCP merely 

defines the terms of arrangements governing “cooperative agreements” under 42 U.S.C. § 9604(d)(1)(A)

we can see no problem with the regulations. CERCLA 

expressly provides that such cooperative agreements 

are to be governed by the terms and conditions of 

EPA's choosing. Id. § 9604(d)(1)(B). Thus, in one 

sense, the NCP provisions in Subpart F merely provide for a uniform set of conditions to which states 

entering into cooperative agreements must adhere. 

Viewed as such, the provisions are a valid exercise of 

the Agency's rulemaking authority. See SEC v. Chenery Corp., 332 U.S. 194, 203, 67 S.Ct. 1575, 1580, 

91 L.Ed. 1995 (1947) (agencies may choose to implement federal policy on either case-specific basis or 

in rulemaking); National Small Shipments Traffic 

Conference v. Interstate Commerce Commission, 725 

F.2d 1442, 1447 (D.C.Cir.1984) (same).

Moreover, the conditions EPA has placed on state 

participation under the cooperative agreements are far 

from arbitrary. Since EPA bears ultimate responsibility under the statute to ensure appropriate remedial 

responses at release sites, it is not surprising that the 

Agency also intends to control final remedial selection. See Ohio v. EPA, 838 F.2d 1325, 1330-31 

(D.C.Cir.1988) (“The most fundamental policy is not 

that [the states] should be involved in the cleanup but 

that the cleanup of hazardous waste sites should occur.”). Similarly, at least with regard to fund-financed 

cleanups, EPA must also protect scarce federal resources. Id. at 1331. Subpart F of the NCP is one 

means of accomplishing these two legitimate ends.

The problem with EPA's blanket prohibition in 

the latest version of the NCP is that it reflects an inexplicable change in policy. Both the 1982 and 1985 

NCPs provided that EPA could enter into agreements 

allowing states to exercise most of the statutory authority available under the statute. See 40 C.F.R. § 

300.62 (1983); 40 C.F.R. § 300.62 (1986). In neither 

of the earlier NCPs was an entire category of powers 

excluded. See, e.g., 47 Fed.Reg. 31,180, 31,186 

(1982) (extent of state participation to be a 

case-specific determination). Thus, the provisions of 

the current NCP that expressly exclude states from 

exercising enforcement and remedy selection authority represent a departure from EPA's previous policy 

of making individualized determinations based on 

state capability.

Assuming that a regulation of the sort here at issue might be lawful, it could not be promulgated by 

EPA without some reasoned explanation from the 

Agency justifying the significant change in policy. 

Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. 

Ins. Co., 463 U.S. 29, 57, 103 S.Ct. 2856, 2874, 77 

L.Ed.2d 443 (1983); Pittsburgh Press Co. v. NLRB,

977 F.2d 652, 655 (D.C.Cir.1992). In the present case, 

EPA offered only the most general and cursory explanation for the new blanket exclusion-the necessity 

of retaining federal control over remedy selection to 

ensure consistency. See 55 Fed.Reg. 8783 (1990). Yet, 

the Agency never explained the relationship between 

remedial consistency and statutory objectives, nor did 

it substantiate its assumption that state remedy selection would lead to less consistency than the present 

system in which remedies are selected by diverse EPA 

field offices. Given that EPA may condition any cooperative agreement as it deems necessary, we see no 
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reason to assume that greater remedial inconsistency 

would follow from state remedy selection.

The Agency's failure to offer any reasoned explanation is particularly troubling given that several 

states commented on the blanket exclusion and suggested alternative procedures during the rulemaking 

proceedings. See, e.g., Comments of Minnesota, reprinted in Joint Deferred Appendix (“J.D.A.”) at 

61-62. Under the circumstances, EPA has no excuse 

for failing to explain its shift in policy. See Brookings 

Mun. Tel. Co. v. FCC, 822 F.2d 1153, 1169 

(D.C.Cir.1987) (agency must consider alternatives 

suggested in rulemaking and give reasons for rejecting 

them). Thus, we grant the petition in so far as EPA has 

not substantiated its new blanket rule against the 

delegation of certain CERCLA remedial authorities to 

states, and remand the case to EPA for proceedings 

consistent with this opinion.

In remanding, we are unwilling to say that every 

state is entitled to an individualized *1543 **341

determination on every question that might arise as to 

“capability” under section 104; indeed, we have no 

doubt that EPA could easily justify certain categorical 

requirements applicable to all states. Nonetheless, the 

Agency must make those determinations on the record 

based on reasoned consideration.

B. Does the NCP improperly establish federal/state 

cost sharing requirements?

The next two issues raised by the States relate to 

the allocation of the financial burdens of CERCLA 

cleanup responses between federal and state authorities.

1. Sharing of Operation and Maintenance Costs

[14] Section 104(c)(3) of CERCLA states that:

(A) the State will assure all future maintenance of 

the removal and remedial actions provided for the 

expected life of such actions as determined by the 

President ... (C) the State will pay or assure payment 

of (i) 10 per centum of the costs of the remedial action, including all future maintenance, or (ii) 50 

percent (or such greater amount as the President 

may determine appropriate, taking into account the 

degree of responsibility of the State or political 

subdivision for the release) of any sums expended in 

response to a release at a facility, that was operated 

by the State or a political subdivision thereof....

42 U.S.C. § 9604(c)(3) (emphasis added). The 

States read this provision to impose a 10%/90% 

(state/federal) allocation for most operations and 

maintenance costs related to CERCLA cleanup actions. EPA agrees that states are only responsible for 

10% of the costs of the remedial action, but claims that 

the NCP properly codifies the Agency's long-standing 

practice of requiring states to fund 100% of the 

maintenance of a fund-financed remedy. See 40 

C.F.R. §§ 300.435(f), 300.510(c). The positions of the 

parties may be summarized as follows:

States' Position:

10%-States' share for “remedial action”

10%-States' share of “all future maintenance”

50%-States' share of sums expended in response 

to a release at a facility that was operated by the 

States

EPA's Position:

10%-States' share for “remedial action”

100%-States' share of “all future maintenance”

at least 50%-States' share of sums expended in response to a release at a facility that was operated by 

the States.

The States and EPA reach their respective constructions of the statute via diametrical routes. To 

begin with, the plain language of the section is open to 

two plausible interpretations. EPA maintains that the 

central distinction in the statute is between maintenance costs, for which the States are completely responsible under subparagraph (A), and remedial actions, for which the States must pay at least ten percent 

of the costs under subparagraph (C). EPA argues that 

the inclusion of “all future maintenance” in subparagraph (C) was merely meant to highlight that distinction. In other words, according to EPA, “all future 

maintenance” cannot modify (or be encompassed 

within) “remedial action,” so the “10 per centum”

does not refer to the former.

By contrast, the States understand the phrase 

“including all future maintenance” in section 
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104(c)(3)(C)(i) to mean that the states' 10% cost share 

applies to remedial costs as well as “all future maintenance” costs. Since Congress chose the word “including” rather than “in addition to” or “plus,” this is 

not an unreasonable interpretation. However, it is 

certainly not compelled.

Hence, to further bolster their case, the States attack EPA's construction as incompatible with the 

statutory context. As the States point out, the second 

part of subparagraph (C) (relating to cost sharing for 

“releases” for which the state was responsible) does 

not include a reference to “future maintenance costs.”

Nonetheless, both parties appear to assume that such 

“releases” include all future maintenance at such sites. 

Thus, on this assumption, it would seem an especially 

odd statutory scheme under which *1544 **342 states 

are responsible for only 50% of costs (presumably part 

of “any sums expended”) at sites that the states 

themselves operated, but were obligated to pay 100% 

of maintenance costs at all other sites.

However, EPA's construction does not necessarily lead to the posited quandary. According to EPA, 

subparagraph (c)(3)(C)(ii) requires states to pay at 

least 50% of all sums expended in response to a release at a state operated facility. Since states are responsible for 100% of maintenance costs under subparagraph (c)(3)(A), the constraints imposed by subparagraph (c)(3)(C)(ii) are inapposite. Therefore, 

although it imposes an awkward structure upon the 

statute, the Agency's construction equally accounts for 

state culpability at release sites.

Just as the parties have antithetical readings of the 

language of section 104(c), they draw different inferences from the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), Pub.L. No. 

99-499, 100 Stat. 1613 (1986). In that legislation, two 

additional subparagraphs were added to CERCLA. 

First, section 104(c)(6) was added, which specifies 

that, for up to ten years of operation, ground and surface water restoration measures are “remedial action”

rather than operations and maintenance. 42 U.S.C. § 

9604(c)(6). Second, SARA added section 104(c)(7), 

which provides that federal funds are to be used for the 

“[f]ederal share of the payment of the cost of operation 

or maintenance pursuant to paragraph (3)(C)(i) or 

paragraph (6).” Id. § 9604(c)(7). Since section (c)(6) 

redesignated maintenance costs for water treatment 

measures “remedial” for the purposes of section 

(3)(C)(i), the States contend that Congress must have 

been referring to the federal share of the cost of other 

maintenance actions under subparagraph (c)(3). Yet, 

under EPA's interpretation, this addition would be 

largely meaningless since maintenance costs in (c)(3) 

are solely the states' responsibility.

EPA, naturally, has a different understanding of 

the SARA amendments. Prior to and since SARA, 

EPA has applied a 10/90 cost sharing ratio to the costs 

of remedial actions and to the costs of one year of 

maintenance (the “shakedown” period after ROD 

objectives are achieved). See 50 Fed.Reg. 47,912, 

47,924 (1985) (long-term maintenance costs not 

funded entirely by states since EPA will fund up to 

one year); 40 C.F.R. § 300.510(c)(2) (EPA may share 

maintenance costs for up to one year). EPA applied 

this ratio to all cleanup sites, even those that included 

water restoration actions, which typically require 

several years of pumping to achieve final cleanup 

objectives after the maintenance period has begun. In 

response to state complaints about this cost sharing 

arrangement, Congress added section 104(c)(6), essentially redefining maintenance for water treatment 

actions as “remedial action” for up to ten years. See

H.R.Rep. No. 253, 99th Cong., 1st Sess., pt. 1 at 70 

(1985). However, Congress did not change the cost 

sharing provisions in section 104(c)(3). Thus, Congress shifted the financial burden of funding maintenance costs for the long-term operation of water 

restoration systems from the states to EPA. See id. at 

60; S.Rep. No. 11, 99th Cong., 1st Sess. 21 (1985). 

Yet, as EPA argues, such a cost shifting would have 

been unnecessary if the States' interpretation obtained, 

since EPA would already have been bound to pay for 

ninety percent of the maintenance costs of all types of 

responses pursuant to section 104(c)(3). Moreover, 

faced with a clear opportunity to repudiate established 

EPA policy regarding cost sharing, Congress' decision 

to merely redefine the maintenance period for water 

treatment measures represents, if not an implicit 

adoption of the policy, at least tacit acceptance. See 

United States v. Riverside Bayview Homes, 474 U.S. 

121, 137, 106 S.Ct. 455, 464, 88 L.Ed.2d 419 (1985)

(refusal of Congress to overrule an agency interpretation is “some evidence of the reasonableness of that 

construction”).

With regard to the States' argument that section 

104(c)(7) necessarily implies a federal share of the 

payment of maintenance costs pursuant to subpara-
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graph (c)(3)(C), the legislative history suggests that 

the phrase “federal share” in section 104(c)(7) refers 

only to the maintenance of water treatment operations, 

restyled as remedial action in section (c)(6), and the 

costs of maintenance over the one year “shakedown”

period for other remedial*1545 **343 actions, which 

EPA has traditionally funded at the 90% level. See

S.Rep. No. 11 at 21 (“Under current EPA policy, the 

costs of such operation are provided on a 90 percent 

Federal share for only one year.”); Staff of Joint 

Comm. on Taxation, 99th Cong., 1st Sess., Background and Issues Relating to House Bills for Reauthorization and Financing of Superfund 17 (Joint 

Comm. Print (JCS-13-85) 1985) (states “generally ... 

required to pay 10 percent of the capital and first-year 

operating costs of a remedial action ... and 100 percent 

of the operating costs in subsequent years”). Thus, the 

Agency's construction is not in tension with section 

104(c)(7).

In sum, both parties have proposed plausible 

constructions of this cumbersome statutory section. 

However, when confronted with language as heavily 

laden with ambiguity as section 104(c) of CERCLA, 

we may not second-guess a permissible and reasonable construction posited by the agency charged with 

implementing the statute. Chevron v. Natural Resources Defense Council, 467 U.S. 837, 842-43, 104 

S.Ct. 2778, 2781-82, 81 L.Ed.2d 694 (1984). Here, 

EPA's interpretation of section 104(c)(3) is both a 

permissible, reasonable reading of the statute under 

the second step of the Chevron test, see 467 U.S. at

842-44, 104 S.Ct. at 2781-82, and not otherwise arbitrary or capricious under the test of State Farm, 463 

U.S. at 41-44, 103 S.Ct. at 2865-67.

2. Costs Related to Remedial Treatment of Wastewater

[15] Section 104(c)(6) of CERCLA provides that 

states are only responsible for 10% of maintenance 

costs for a limited type of remedial action (up to ten 

years of “treatment or other measures ... necessary to 

restore ground and surface water quality to a level that 

assures protection of human health”). 42 U.S.C. § 

9604(c)(6). The NCP expressly excludes “source 

control maintenance measures” and “ground- or surface-water measures initiated for the primary purpose 

of providing a drinking-water supply” from the activities covered by section 104(c)(6). 40 C.F.R. § 

300.435(f)(4). The States consider these exclusions to 

be arbitrary and directly contrary to the statute. Since 

Congress did not define which measures are “necessary to restore” ground and surface water quality “to a 

level that assures protection of human health and the 

environment,” EPA may apply its expertise to interpret those phrases, as long as the interpretations are 

permissible and reasonable. Chevron, 467 U.S. at 

843-44, 104 S.Ct. at 2782.

The States' primary complaint is that “source 

control measures” may be an integral part of a water 

restoration measure and, yet, under the NCP, not eligible for 90% federal funding. For instance, landfill 

covers and leachate collection systems, which are 

designed to prevent the migration of water into and out 

of contaminated sites, are among the source control 

measures that EPA has excluded from categorization 

under section 104(c)(6). See 40 C.F.R. § 300.5. The 

States contend that section 104(c)(6) requires EPA to 

operate an entire water quality restoration remedy, 

including elements such as these that may also function as source control measures.

EPA, on the other hand, construed the “necessary 

to restore” language of the statute as contemplating 

only those measures that “actively cleanup ground and 

surface water.” 55 Fed.Reg. 8737 (1990). This interpretation is consistent with the legislative history of 

CERCLA. See S.Rep. No. 11 at 21 (exemption applies 

where “pumping and treating of water or other technology is required”); H.R.Rep. No. 253, Pt. 1 at 70 

(section directed at “long-term cleanup remedies, such 

as pumping and treating of groundwater”). Source 

control measures do not treat any surface or ground 

water, nor are they “necessary” to “restore” water 

quality; instead, these activities are required to maintain the effectiveness of remedial measures. See 55 

Fed.Reg. 8738. The States nonetheless insist that these 

measures are necessary to restore water quality because without them additional releases may result. 

However, were that the test, virtually all related 

maintenance activities would qualify as necessary to 

restore water quality, and hence, as “remedial” under 

the statute. Such a construction exceeds the apparent 

reach of the section. The NCP provision excluding 

*1546 **344 source control measures from the scope 

of the section 104(c)(6) exemption is far more congruent with the terms of the statute. Thus, we deny the 

States' petition in so far as it challenges the facial 

validity of section 300.435(f)(4)(i) of the NCP.

The States also challenge the NCP's exclusion of 
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measures whose primary purpose is to provide 

drinking water from the scope of section 104(c)(6) of 

CERCLA. Briefly, the States argue that the exclusion 

leads to absurd results since a measure used to treat 

water that will be discharged without beneficial use 

would qualify for 90% federal funding, whereas the 

same measure used to provide drinking water would 

not qualify.

The States, however, have stretched section 

104(c)(6) beyond its intended reach. Section 104(c)(6) 

is designed to ensure that federal funds are used to pay 

for the long-term restoration of ground and surface 

water to protected levels. Yet, under the States' approach, federal funds would pay 90% of the costs of 

treatments designed not to restore water to protective 

levels, but to provide drinking water, which is not the 

object of CERCLA responses. Thus, 40 C.F.R. § 

300.435(f)(4)(ii), which excludes from section 

104(c)(6) treatment measures whose primary purpose 

is to provide drinking water, is entirely consistent with 

the terms of the statute. This portion of the States' 

petition is, therefore, denied.

C. Does the NCP improperly define when a remedy 

becomes operational and functional?

[16] Given that states are responsible for 100% of 

operations and maintenance (“O & M”) costs, the 

determination of the point at which a response becomes “operational” is an extremely important aspect 

of the cost sharing issue. Section 300.435(f)(2) of the 

NCP provides that “[a] remedy becomes „operational 

and functional‟ either one year after construction is 

complete, or when the remedy is determined concurrently by EPA and the state to be functioning properly 

and is performing as designed, whichever is earlier.

EPA may grant extensions to the one-year period, as 

appropriate.” 40 C.F.R. § 300.435(f)(2) (emphasis 

added); see also 40 C.F.R. § 300.510(c)(2) (EPA may 

share O & M costs for up to one year to ensure remedy 

is operational and functional). EPA contends that the 

regulatory presumption that a remedy is operational 

after one year reflects the practical realities of remedy 

management. See 55 Fed.Reg. 8739 (analogizing to 

construction grant regulations). The States argue that 

this aspect of the NCP is arbitrary and capricious 

because states will be burdened with the costs of 

responses that are not actually operational once a year 

has passed since the completion of construction.

Here again, though, the States' challenge is premature. By its terms, the NCP merely has articulated a 

rebuttable presumption that remedies are operational 

and functional one year after completion. If, in a specific situation, a remedy is not fully functional at the 

end of a year, EPA has indicated that an extension will 

be appropriate. 40 C.F.R. § 300.435(f)(2). See also 55 

Fed.Reg. 8739 (extensions available where remedy 

not fully operational after a year). If the Agency refuses to grant such an extension, that decision would 

be subject to challenge. At this point, however, we 

have no reason to assume that EPA will deny an extension in any situation in which a remedy is not operational after one year. Thus, the challenge to this 

portion of the NCP is premature.

D. Does the NCP establish improper provisions on 

state assurances for institutional controls and site 

access?

The States next complain that the NCP unlawfully 

requires assurances relating to institutional controls 

and site access from states seeking federal funds for 

response actions.

1. State Assurances of Institutional Controls

Section 300.510(c) of the NCP conditions receipt 

of fund-financing upon state assurances that institutional controls (e.g., zoning restrictions) implemented 

as part of a remedial action are “in place, reliable, and 

will remain in place after the initiation of O & M.” 40 

C.F.R. § 300.510(c)(1). The States challenge two 

aspects of this provision. First, the States argue that 

this section was *1547 **345 promulgated without 

proper notice and opportunity for comment. Second, 

the States maintain that the section is arbitrary and 

capricious because it requires states to act beyond their 

legal authority on threat of losing federal funding for 

hazardous waste cleanups.

[17] On the first point, the States contend that 

neither the originally proposed rule, 53 Fed.Reg. 

51,394 (1988), nor the interim final rule, 54 Fed.Reg. 

4132 (1989), gave notice of the rule finally promulgated in section 300.510(c)(1); the States therefore 

argue that the rule was adopted in violation of the 

Administrative Procedure Act, 5 U.S.C. §§ 551-559, 

701-706. The test, of course, is whether the final rule 

that emerged from the administrative process was a 

“logical outgrowth” of the earlier proposed rules. 

Chemical Waste Mgmt. v. EPA, 976 F.2d 2, 28 

(D.C.Cir.1992), cert. denied, 507 U.S. 1057, 113 S.Ct. 

1961, 123 L.Ed.2d 664 (1993).
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In this case, EPA's proposed rule required states 

to provide assurances that they would “assume responsibility for operation and maintenance of implemented remedial actions.” 53 Fed.Reg. 51,510. In that 

same proposed rule, EPA made it clear that it regarded 

institutional controls as an integral part of many “remedial actions.” See 53 Fed.Reg. 51,423, 51,427.

There was, therefore, reasonable notice that assurances for institutional controls might be required of 

states where such controls were part of the long-term 

response to a release. Thus, the final rule was presaged 

by the proposed rules and a further round of rulemaking is not required.

[18] The States also challenge the substance of 

this requirement as arbitrary and capricious. The 

States claim that the NCP poses an insuperable barrier 

to fund-financed remedial action where the state lacks 

the authority necessary to make the assurances that 

EPA may require under section 300.510(c)(1). For 

instance, state officials often are powerless to implement changes in many local zoning ordinances. 

Thus, where a proposed fund-financed remedy requires such changes, the state must either act ultra 

vires or forego federal funding.

Whatever dilemma this framework poses for the 

states is a product of the statute. Under CERCLA, the 

states are required to assure all future maintenance of 

the removal and remedial actions, 42 U.S.C. § 

9604(c)(3), which may include institutional controls, 

see id. § 9601(24) (listing responses encompassed 

within the phrase, “remedial actions”). Section 

300.510(c)(1) was added to the NCP precisely because 

EPA lacks the authority to impose many of these 

controls. 55 Fed.Reg. 8706 (1990). Thus, to the extent 

that institutional controls are a necessary component 

of a fund-financed remedial action, it is entirely appropriate under section 104(c)(3) for EPA to require 

assurance of the integrity of these controls prior to 

spending federal funds on the cleanup. If, for whatever

reason, the state cannot or will not give the necessary 

assurances, the statute forbids EPA from proceeding 

with a fund-financed cleanup. A state wishing to 

proceed with a fund-financed remedy in such a case 

may either work with local officials to secure the 

required assurances (perhaps through a three-party 

agreement, see 40 C.F.R. §§ 300.515(a)(1), 

35.6115(a)), or advocate a remedial scheme that does 

not depend on the problematic institutional controls.

For the foregoing reasons, we deny the petition 

for review with respect to this portion of the NCP.

2. Site Access

[19] The States also attack the NCP's site access 

provisions as arbitrary and capricious. Section 

35.6805(p) of the Subpart O regulations provides that, 

“[t]he State ... is expected to use its own authority to 

secure access to the site and adjacent properties, as 

well as rights-of-way and easements necessary to 

complete the response actions.” 40 C.F.R. § 

35.6805(p) (emphasis added). The States complain 

that this section constitutes an additional state “assurance,” not authorized by CERCLA section 

104(c)(3), upon which federal funding is conditioned.

If it were the case that the NCP required states to 

assure site access, the States would have a colorable 

claim. By its terms, though, the NCP expressly does 

not condition fund financing on state assurance of site 

access. *1548 **346 See 40 C.F.R. §§ 35.6105(b), 

35.6805(i) (list of required state assurances does not 

include site access). Instead, section 35.6805(p)

merely articulates EPA's preference for state acquisition of site access. EPA has explained that this preference is a matter of expediency and that “EPA will 

acquire site access only if the state cannot do so.” 55 

Fed.Reg. 22,994, 23,005 (1990). If at some time in the 

future EPA attempts to condition federal funding on 

state assurance of site access, the state involved may 

bring a site-specific challenge. At this point, any such 

claim is premature. See supra pp. 1536-40.

E. Does the NCP improperly limit the allowable time 

for support agency review of technical documents?

[20] Section 121(f) of CERCLA requires EPA to 

promulgate regulations providing for “substantial and 

meaningful involvement by each State in initiation, 

development, and selection of remedial actions to be 

undertaken in that State.” 42 U.S.C. § 9621(f)(1). One 

aspect of this requirement is that states are to be given 

a “reasonable opportunity” to review and comment 

upon several documents that are generated in the remedial decision-making process. Id. § 9621(f)(1)(E). 

The NCP implements this statutory requirement

through section 300.515(h)(3), which establishes 

specific default time periods in which a support 

agency (EPA in state-lead cleanups) must review and 

comment on lead agency documents. See 40 C.F.R. § 

300.515(h)(3). Absent a Superfund memorandum of 
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agreement (“SMOA”) to the contrary, a support 

agency has fifteen working days to comment on the 

RI/FS, ROD, applicable or relevant and appropriate 

requirements (“ARAR”) determination, and ten 

working days to comment on the proposed remedial 

plan. Id. In addition, the NCP also provides states with 

numerous opportunities to participate throughout 

remedy selection and implementation. See, e.g., 40 

C.F.R. § 300.515(d) (states involved in RI/FS 

process), 300.515(e) (states involved in remedy selection). Thus, states may participate in the creation of 

remedial action documents as well as review the final 

product of the process.

Nonetheless, the States maintain that section 

300.515(h)(3) of the NCP denies them a reasonable 

opportunity to review and comment on what are often 

complex and lengthy documents. We are unpersuaded. 

The participation process described in sections 

300.515(d) and (e) is so extensive that we fail to see 

how the states will be unfairly burdened by the rules 

covering review of RI/FSs or proposed remedial plans. 

The documents subject to review will not be unfamiliar to state officials, so it is not as if the states will be 

forced to act in the blind in unreasonably short periods 

of time. For instance, under section 300.515(d), the 

lead and support agencies are directed to identify 

potential ARARs and communicate them to each other 

in a timely fashion. Id. § 300.515(d)(1). If EPA intends to waive any state identified ARAR, “or does 

not agree with the state that a certain state standard is 

an ARAR, it shall formally notify the state when it 

submits the RI/FS report for state review.” Id. § 

300.515(d)(3). Thus, potential conflicts between states 

and EPA should become apparent during the process 

and, if not explicitly identified by EPA, be anticipated 

by the states. Given this structure, an extended review 

period is unnecessary.

Moreover, the NCP specifically provides for 

modification of the time periods in section 

300.515(h)(3) on a site-specific basis using a SMOA. 

Id. § 505(a)(3); see also 55 Fed.Reg. 8781 (1990)

(review times in the NCP “can be modified by a 

SMOA”). Thus, where novel problems are presented, 

or where the release is of such magnitude that extremely complex remedial measures are anticipated, 

states may negotiate longer review periods and, again, 

an EPA refusal to negotiate such an agreement would 

be open to a site-specific challenge. Absent such circumstances, the review times provided in the NCP 

allow states a reasonable opportunity to review and 

comment upon EPA documents. This facet of the 

States' challenge is, therefore, denied.

F. Does the NCP improperly define “onsite” for 

purposes of the exemption from obtaining permits for 

remedial actions?

[21] Section 121(e)(1) of CERCLA provides for a 

waiver of state and federal permitting*1549 **347

requirements for cleanup actions taken “entirely onsite.” 42 U.S.C. § 9621(e)(1). The NCP defines “onsite” to mean “the areal extent of contamination and 

all suitable areas in very close proximity to the contamination necessary for implementation of the response action.” 40 C.F.R. §§ 300.5, 300.400(e)(1). 

The States challenge this facet of the NCP, arguing 

that it allows EPA to expand the permit exemption of 

section 121(e)(1) beyond its intended scope.

Although used in several places, “onsite” is not 

defined in the statute. Normally, in such a situation, 

we would presume that Congress intended the disputed term to have its common meaning. Kosak v. 

United States, 465 U.S. 848, 853, 104 S.Ct. 1519, 

1523, 79 L.Ed.2d 860 (1984). That presumption does 

not help us here, though, because “onsite” is a statutory term of art with no “plain” meaning. Faced with 

this ambiguity, we turn to the definitions offered by 

the parties. The State petitioners (excluding Ohio, 

New York, Minnesota, New Jersey and California) 

define “onsite” formalistically, confining the term to 

“the continuous contaminated area having the same 

legal ownership as the actual site of the original disposal.” States Brief at 166. For obvious reasons, we 

cannot hold that Congress meant this and nothing 

more in its reference to “onsite.”

CERCLA provides for an overarching framework 

within which the federal Government, states, and 

PRPs can respond to hazardous waste releases. The 

statutory scheme is meant to transcend artificial geographical and legal distinctions in order to facilitate 

remedial action. See, e.g., 42 U.S.C. § 9621(e)(1) (no 

federal, state or local permits required for actions 

taken under CERCLA), 9621(d)(2) (requirements of 

other environmental laws become ARARs for actions 

taken under CERCLA), 9621(d)(4) (EPA may waive 

substantive requirements of other environmental laws 

for actions taken under CERCLA). The petitioning 

States ignore this fundamental statutory premise, and 

rest their definition of “onsite” on precisely the artifi-
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cial constraints that the statute meant to reject.

On the other hand, the ability of the statute to 

accommodate a broader, more functional definition of 

“onsite” is not limitless. In the definition section of 

CERCLA, the term “facility” is defined as “any site, 

or area where a hazardous substance has been deposited ... or otherwise come to be located.” Id. § 

9601(9)(B); cf. 55 Fed.Reg. at 8689 n. 3 (“onsite”

broader than “facility”). The statute's implicit definition of “site” in terms of the area of the actual contamination, leads us to conclude that the definition of 

“onsite” must be anchored to that area as well. How 

far this anchor will allow EPA to drift, though, is not 

readily ascertainable using the traditional tools of 

statutory interpretation.

EPA's definition of “onsite” contained in the NCP 

is at best ambiguous. The Agency's definition includes 

“suitable areas in very close proximity to the contamination.” 40 C.F.R. § 300.5. Yet, absent a specific 

application of the NCP, we have no way of knowing 

what EPA considers a “suitable area,” or how far away 

from the site of contamination EPA would deem “in 

very close proximity.” Thus, we are not presented with 

a typical Chevron second prong case, in which we 

may determine whether the Agency's interpretation 

reasonably comports with congressional intent. Here, 

the meaning of the term “onsite” as it is used both in 

the statute and the NCP is indeterminate. Thus, no 

final judgment can be made on the permissibility or 

reasonableness of EPA's interpretation absent an application of the rule to a specific set of facts. However, 

forced to construe the NCP definition in a vacuum, we 

have no trouble in concluding that the regulation on its 

face is not unlawful.

The NCP definition allows EPA to respond to 

releases expeditiously and, one would hope, efficaciously. It is a definition that reflects the practical 

aspects of responding to hazardous waste releases 

under various conditions. For instance, in many situations, it may be prohibitively burdensome or, in fact, 

impossible to conduct necessary response measures 

within a narrowly “contaminated” area. See 53 

Fed.Reg. 51,406-07 (1988) (flexibility needed to respond to a contaminated plume of ground water extending far beyond the area of contaminated soil); 55 

Fed.Reg. 8689-90 (1990) (impossible to locate an 

incinerator in a contaminated lowland *1550 **348

marsh). Nonetheless, the necessary response measures 

may so closely relate to the concerned site as to be 

effectively managed under the aegis of CERCLA.

The same reasoning disposes of the challenge 

raised to this aspect of the NCP by the Missouri Coalition for the Environment (“MOCO”). MOCO would 

have “onsite” defined by exactly the same parameters 

as the area of the contamination, essentially paralleling the CERCLA definition of a “facility.” See

MOCO Brief at 3. Driving this definition is MOCO's 

concern that allowing CERCLA responses to proceed 

in areas beyond the extent of the contamination will 

lead to the subversion of state and local participation 

in the handling and treatment of hazardous substances 

in disparate uncontaminated areas. See MOCO Brief 

at 5. If, after experience with the latest NCP, petitioners can show that EPA has abused its flexible 

definition of “onsite” to deliberately bypass other 

environmental laws or to implement response activities far afield of contaminated areas, the NCP definition would doubtless be subject to challenge. In the 

interim, we have no basis to believe that EPA will so 

abuse the minimal discretion contained in the NCP. 

Therefore, this portion of the States' petition is denied.

[22] The States have also challenged one part of 

the Preamble to the NCP in which EPA proposed to 

treat non-contiguous, but reasonably related facilities 

as a single “site.” See 55 Fed.Reg. 8690-91. It appears, 

though, that this issue was not properly raised before 

the Agency, thus foreclosing our review. See Linemaster Switch Corp. v. EPA, 938 F.2d 1299, 1308-09 

(D.C.Cir.1991). In support of their contention that the 

issue was raised below, the States have referred us to a 

public comment challenging EPA's definition of “onsite.” See States' Reply Brief at 71 n. 36. The comment 

relied upon offered a proposed definition of “onsite”

that limited the term to contiguous areas. See Comments of Colorado, reprinted in J.D.A. at 128-29. 

However, this minimal reference to the contiguity 

issue is so tangential to the principal thrust of the 

comment that it cannot fairly be said to have been 

presented to EPA for resolution. Therefore, this portion of the petition for review is dismissed.

CONCLUSION

The petitions for review are granted in part with 

respect to the issues discussed in Part V.A of this 

opinion. Although CERCLA does not require EPA to 

delegate full CERCLA authority in state-lead response 

actions, the NCP regulations which categorically bar 
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states from exercising enforcement and remedy selection authority represent an inadequately justified 

departure from the Agency's prior practice. The petition is granted with respect to these regulations, and 

the matter is remanded to the Agency for further 

proceedings consistent with this opinion.

The petitions for review are denied with respect to 

the issues discussed in parts II.A, II.B, II.C, II.D, 

III.A, III.B, III.C, III.D, V.B.1, V.B.2, V.D.1, and V.E 

of this opinion. The petitions for review are also denied with respect to the issues discussed in part V.F of 

this opinion insofar as the petitions present a facial 

challenge to the regulation in question.

The petitions for review are dismissed as premature with respect to the issues discussed in Parts IV.A, 

IV.B, IV.C, V.C, and V.D.2 of this opinion. The petitions for review with respect to the issues discussed in 

Part V.F of this opinion are also dismissed as premature insofar as they attempt to raise a site-specific, 

as-applied challenge to the regulation in question.

So ordered.

RANDOLPH, Circuit Judge, concurring:

With respect to the issue discussed in Part V.A of 

our per curiam opinion, I believe EPA may retain 

exclusive remedial and enforcement authority without 

running afoul of CERCLA. I join this portion of today's opinion because the current NCP fails to provide 

a reasoned explanation for categorically denying 

states the right to apply to exercise enforcement and 

remedy selection authority pursuant to § 104(d)(1)(A) 

of CERCLA. 42 U.S.C. § 9604(d)(1)(A). But I see no 

problem with EPA imposing such a categorical restriction so long as the Agency provides an adequate 

justification for doing so. Section 104(d)(1) gives the 

President unlimited discretion to determine whether a 

*1551 **349 state is capable of carrying out CERCLA 

enforcement actions. Under section 104(d)(1)(A), if 

the President determines that a state has the capability 

to carry out CERCLA authority, the President “may”

enter into a cooperative agreement with the state. 

Furthermore, such “contract or cooperative agreement 

... shall be subject to such terms and conditions as the 

President may prescribe.” 42 U.S.C. § 9604(d)(1)(B). 

The President can always refuse to grant states enforcement authority after receiving their applications. 

It follows that EPA can announce beforehand that it

will never enter into any agreements depriving EPA of 

final approval over remedy selection. The regulations 

already contain numerous conditions on approval of 

state applications. See 40 C.F.R. § 35.600 et seq.

These conditions do not prevent states from applying 

to enter into cooperative agreements; they simply 

inform the states that their applications will not be 

considered unless those conditions are met. The states, 

in other words, can apply for anything they want, but 

EPA may decide that there are some things they just 

will not get, ever.

C.A.D.C.,1993.

State of Ohio v. U.S. E.P.A.

997 F.2d 1520, 36 ERC 2065, 302 U.S.App.D.C. 318, 

62 USLW 2063, 23 Envtl. L. Rep. 21,157

END OF DOCUMENT
Page 1

1 of 1 DOCUMENT

Analysis

As of: Aug 31, 2011

RICHARD L. BRODSKY, New York State Assemblyman, from the 92nd Assembly 

District in his official and individual capacities, WESTCHESTER CITIZEN'S 

AWARENESS NETWORK (WESTCAN), ROCKLAND COUNTY CONSERVATION ASSOCIATION, INC. (RCCA), PUBLIC HEALTH AND SUSTAINABLE 

ENERGY (PHASE), and SIERRA CLUB - ATLANTIC CHAPTER (SIERRA 

CLUB), Petitioners, -- v. -- U.S. NUCLEAR REGULATORY COMMISSION, Respondent, ENTERGY NUCLEAR OPERATIONS, INC., Intervenor.

Docket No. 08-1454-ag

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

578 F.3d 175; 2009 U.S. App. LEXIS 19230

May 11, 2009, Argued 

August 27, 2009, Decided

SUBSEQUENT HISTORY: Related proceeding at 

Brodsky v. United States NRC, 2011 U.S. Dist. LEXIS 

22088 (S.D.N.Y., Mar. 4, 2011)

CASE SUMMARY:

PROCEDURAL POSTURE: Pursuant to the Hobbs 

Act, 28 U.S.C.S. § 2342, petitioner assemblyman and 

citizen groups sought review of a final order of the 

United States Nuclear Regulatory Commission (NRC) 

that granted an exemption from certain fire safety regulations to the operator of a nuclear power plant. The NRC 

moved to dismiss the petition.

OVERVIEW: Although 28 U.S.C.S. § 2342(4) gave the 

appellate court jurisdiction to review the NRC's final 

orders made reviewable under 42 U.S.C.S. § 2239, it 

lacked jurisdiction to consider the NRC's grant of an 

exemption under 10 C.F.R. § 50.12 where the agency 

interpreted the Hobbs Act to mean that exemptions were 

different from amendments to a license, and that interpretation was consistent with the plain language of the 

statute. In the absence of jurisdiction, the appellate court 

lacked the authority to review not only an NRC order

that issued an exemption, but also any orders preliminary 

or ancillary to an exemption, such as a denial of a hearing request. Moreover, the NRC reasonably applied its 

regulations when it classified the relief granted to the 

operator as an exemption where a requirement that exemptions be temporary would have conflicted with the 

special circumstances of 10 C.F.R. § 50.12(a)(2), there 

was no requirement that a modification had to be treated 

as an amendment to a license if it relaxed a safety standard, and the NRC did not require hearings for exemptions involving material questions directly related to an 

agency's licensing action.

OUTCOME: The petition was dismissed without prejudice. All other pending motions were denied as moot.

COUNSEL: [**1] RICHARD L. BRODSKY, Albany, 

NY, for Petitioners.

ROBERT M. RADER, Senior Attorney, (Karen D. Cyr, 

General Counsel, John F. Cordes, Jr., Solicitor, on the 

brief), Office of the General Counsel, U.S. Nuclear Regulatory Commission, John Cruden, Acting Assistant Attorney General, Ellen Durkee, Trial Attorney, Appellate 
Page 2

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

Section, U.S. Department of Justice, Environment & 

Natural Resources Division, Washington, DC, for Respondent.

MICHAEL B. WALLACE, (Paul E. Barnes, on the 

brief), Wise Carter Child & Caraway, P.A., Jackson, MS, 

for Intervenor.

JOHN J. SIPOS, Assistant Attorney General, (Barbara D. 

Underwood, Solicitor General, Katherine Kennedy, Special Deputy Attorney General, Michelle Aronowitz, 

Deputy Solicitor General, Janice A. Dean, Assistant Attorney General, Monica Wagner, Assistant Solicitor 

General, on the brief), for Andrew M. Cuomo, Attorney 

General of the tate of New York, New York, NY, for 

Amicus Curiae New York State.

JUDGES: Before: WALKER and J. Clifford WALLACE, * Circuit Judges. **

* The Honorable J. Clifford Wallace, of the 

United States Court of Appeals for the Ninth 

Circuit, sitting by designation.

** The Honorable Sonia Sotomayor, originally 

a member of the panel, was elevated to the Supreme [**2] Court on August 8, 2009. The two 

remaining members of the panel, who are in 

agreement, have determined the matter. See 28 

U.S.C. § 46(d); Local Rule 0.14(2); United States 

v. Desimone, 140 F.3d 457 (2d Cir. 1998).

OPINION BY: JOHN M. WALKER, JR.

OPINION

[*177] Pursuant to the Hobbs Act, Petitioners seek 

review of a final order of the U.S. Nuclear Regulatory 

Commission, granting an exemption from certain fire 

safety regulations to Entergy Nuclear Operations, Inc., 

the operator of Indian Point nuclear power plant in Buchanan, NY. We hold that we lack jurisdiction under the 

Hobbs Act to review exemptions. We also conclude that 

the order being challenged is indeed an exemption, and 

not actually an amendment or other order covered by the 

Hobbs Act.

DISMISSED without prejudice for want of jurisdiction.

JOHN M. WALKER, JR., Circuit Judge:

This case tests the limits of our jurisdiction under 

the Hobbs Act to review orders of the U.S. Nuclear Regulatory Commission ("NRC" or "Commission"). The 

NRC is the federal agency that licenses and regulates all 

nuclear power plants in the United States, including the 

Indian Point Energy Center ("Indian Point") in Buchanan, NY, operated by Entergy Nuclear Operations, Inc. 

("Entergy"). [**3] The Atomic Energy Act ("AEA"), 

which gives the NRC its authority, requires the Commission to hold hearings before taking certain actions, such 

as granting or amending a license. Petitioners Richard 

Brodsky et al. contend that the NRC violated this hearing 

requirement when granting Indian Point an exemption 

from a fire safety regulation with which it was out of 

compliance. Petitioners also argue that, apart from the 

hearing requirement, the exemption is an invalid exercise 

of the NRC's authority.

Petitioners filed their action in this court pursuant to 

the Hobbs Act, which vests the courts of appeals with 

exclusive jurisdiction over NRC orders made reviewable 

by the AEA. We hold, however, that the Hobbs Act does 

not give us jurisdiction over NRC exemptions. We also 

conclude that the order being challenged by Petitioners is 

indeed an exemption, and not an amendment or other 

type of NRC order within the ambit of the Hobbs Act. 

Accordingly, we dismiss the petition without prejudice 

for lack of jurisdiction.

BACKGROUND

Indian Point, like all nuclear power plants, is licensed and regulated by the NRC, pursuant to the AEA. 

The AEA requires that, when granting a license, the 

NRC determine that [**4] a plant's operation is "in accord with the common defense and security and will 

provide adequate protection to the health and safety of 

the public." 42 U.S.C. § 2232(a). Under the AEA, "all 

licenses shall be subject to amendment, revision, or 

modification . . . by reason of rules and regulations issued [by the NRC] in accordance with [the Act]." Id. § 

2237.

The AEA also mandates that the NRC hold hearings, 

if requested, when taking certain license-related actions:

 In any proceeding . . . for the granting, 

suspending, revoking, or amending of any 

license[,] . . . the Commission shall grant 

a hearing upon the request of any person 

whose interest may be affected by the 

proceeding, and shall admit any such 

person as a party to such proceeding.

Id. § 2239(a)(1)(A). Additionally, the NRC has promulgated regulations requiring a public notice-and-comment 

period to precede any amendments to a license. See 10 

C.F.R. § 50.91(a).

NRC regulations also permit the agency to grant 

"exemptions from the requirements of the regulations," 

as long as (1) [*178] the exemptions are "[a]uthorized 
Page 3

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

by [**5] law, will not present an undue risk to the public health and safety, and are consistent with the common 

defense and security," and (2) "special circumstances are 

present." 10 C.F.R. § 50.12(a). The regulations set out 

six potential "special circumstances," any of which can 

justify an exemption. See id. § 50.12(a)(2)(i)-(vi). 

1 The 

regulations do not require the NRC to hold hearings for 

exemptions.

1 Special circumstances are "present whenever":

 (i) Application of the regulation 

in the particular circumstances 

conflicts with other rules or requirements of the Commission; or

(ii) Application of the regulation in the particular circumstances would not serve the underlying purpose of the rule or is not 

necessary to achieve the underlying purpose of the rule; or

(iii) Compliance would result 

in undue hardship or other costs 

that are significantly in excess of 

those contemplated when the regulation was adopted, or that are 

significantly in excess of those 

incurred by others similarly situated; or

(iv) The exemption would result in benefit to the public health 

and safety that compensates for 

any decrease in safety that may 

result from the grant of the exemption; or

(v) The exemption would 

provide [**6] only temporary relief from the applicable regulation 

and the licensee or applicant has 

made good faith efforts to comply 

with the regulation; or

(vi) There is present any other 

material circumstance not considered when the regulation was 

adopted for which it would be in 

the public interest to grant an exemption.

10 C.F.R. § 50.12(a)(2).

In 1980, the NRC adopted fire safety regulations in 

response to a nearly catastrophic fire five years earlier at 

the Browns Ferry power plant. The regulations, inter 

alia, required nuclear plants to use fire barriers to protect 

the electrical cables that power the plants' shutdown systems. See Fire Protection Program for Operating Nuclear Power Plants, 45 Fed. Reg. 76,602, 76,608 (Nov. 

19, 1980). By shielding these electrical systems, the barriers would improve a plant's ability to shut down its 

reactors safely after a fire had started. The regulations

mandated that the barriers should be able to withstand a 

fire for at least one hour, and longer if the plant does not 

have automatic sprinklers installed. See id.

In 1984, the NRC granted Indian Point several exemptions from compliance with certain of the fire protection program's requirements. In doing so, [**7] the 

agency noted that the plant was using a popular fire barrier called Hemyc, which was rated for one hour of protection. However, in 2005, the NRC discovered that 

Hemyc, despite its one-hour rating, could actually withstand a fire for only 27 to 49 minutes. The agency required Indian Point and all other licensees "to confirm 

compliance with the existing applicable regulatory requirements in light of" this newfound problem. Licensees 

were directed to "implement appropriate compensatory 

measures and develop plans to resolve any nonconformances." The NRC asked for a response from each licensee so that it could "determine whether a facility license should be modified, suspended, or revoked, or 

whether other action should be taken."

In June 2006, Entergy alerted the NRC to potentially 

noncompliant Hemyc barriers at Indian Point. Entergy 

stated that it could not meet NRC standards, but that it 

had implemented hourly "fire watch tours" and other 

compensatory measures. Entergy asked the NRC to issue 

Indian Point a revised exemption to reflect a thirty-minute fire resistance rating, in lieu of the one-hour 

rating, for two "[f]ire [a]reas" at the plant. In August 

2007, Entergy amended its request [**8] to ask that one 

of the two fire areas be rated for 24 minutes.

[*179] On September 24, 2007, pursuant to the 

National Environmental Policy Act ("NEPA"), 42 U.S.C. 

§§ 4321-4347, the NRC issued an environmental assessment ("EA") finding that Entergy's requested exemption would not significantly impact the environment. 

Four days later, the NRC granted the revised exemption, 

which was published in the Federal Register on October 

4, 2007. Revision to Existing Exemptions, 72 Fed. Reg. 

56,798 (Oct. 4, 2007). In approving Entergy's request, 

the agency explained that, "given the existing fire protection features in the affected fire zones, [Entergy] continues to meet the underlying purpose" of the fire protection 

program. Id. at 56,799.
Page 4

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

On December 3, 2007, Petitioners wrote to the NRC 

objecting to the agency's "grant of an exemption . . . in 

an amendment" to the Indian Point license. Petitioners 

asked the agency to reopen the matter, grant them leave 

to intervene, and hold a public hearing. The NRC responded on January 30, 2008, treating the petition solely 

as a request for a hearing. The agency explained that 

Petitioners were "challenging . . . an exemption from 

NRC regulations[,] . . . not a license [**9] amendment 

as asserted in [the] petition." The agency stated that the 

AEA "does not provide for hearings on exemptions from 

NRC regulations" and denied the request.

On March 27, 2008, Petitioners filed the instant petition in this court, seeking review of the NRC's order 

denying their December 3 petition. Petitioners contend 

that the September 28 exemption "fails, among other 

things, to provide reasonable assurance of adequate protection of the health and safety of the public as required 

by law under the [AEA]." The petition also argues that 

the NRC violated the AEA, NEPA, Administrative Procedures Act ("APA"), and various regulations by granting the exemption, and that the agency acted arbitrarily 

and abused its discretion in granting the exemption. Petitioners request that we vacate the exemption and remand 

for a public hearing on the matter.

The NRC moved to dismiss the petition, arguing that 

Petitioners' challenges to the September 28 exemption 

were untimely, and that the agency's January 30 order 

should be summarily affirmed because exemptions do 

not warrant hearings under NRC regulations. A previous 

panel of this court referred the motion to us. See Brodsky 

v. U.S. Nuclear Regulatory Comm'n, No. 08-1454-ag (2d 

Cir. July 7, 2008). [**10] We reserved decision on that 

and two other motions.

DISCUSSION

I. Whether We Have Jurisdiction Over Exemptions

Pursuant to the Hobbs Act, Petitioners have challenged the NRC's actions directly in this court without 

first filing in a district court. The Act gives the courts of 

appeals "exclusive jurisdiction to enjoin, set aside, suspend (in whole or in part), or to determine the validity of 

. . . all final orders of the [NRC] made reviewable by 

section 2239 of title 42." 28 U.S.C. § 2342(4). 

2 Section 

2239, in turn, makes reviewable "[a]ny final order entered in any proceeding of the kind specified in [§ 

2239(a)]." 42 U.S.C. § 2239(b)(1). And § 2239(a), in 

relevant part, encompasses "any proceeding . . . for the 

granting, suspending, revoking, or amending of any license." In defining the scope of our jurisdiction under 

[*180] the Hobbs Act, § 2239(a) does not mention exemptions.

2 The Hobbs Act actually refers to the Atomic 

Energy Commission ("AEC"), not the NRC, but 

the AEC has been abolished. 42 U.S.C. § 5814. 

The AEC's functions (including licensing) have 

largely been transferred to the NRC, and NRC 

orders entered pursuant to those functions are 

[**11] reviewable as if entered by the AEC. See

42 U.S.C. §§ 5841(f), 5871(g); Gen. Atomics v. 

U.S. Nuclear Regulatory Comm'n, 75 F.3d 536, 

538 n.2 (9th Cir. 1996).

The NRC contends that the Hobbs Act should nonetheless apply to exemptions because of the Supreme 

Court's decision in Florida Power & Light Co. v. Lorion, 

470 U.S. 729, 105 S. Ct. 1598, 84 L. Ed. 2d 643 (1985). 

Lorion sheds light on how § 2239(a) operates. Section 

2239(a) serves multiple ends: In addition to establishing 

Hobbs Act jurisdiction in the courts of appeals, it also 

dictates when the NRC must hold hearings. 42 U.S.C. § 

2239(a)(1)(A). These two purposes may or may not 

coexist in particular instances. For example, with respect 

to license amendments, § 2239(a) gives the courts of 

appeals the exclusive jurisdiction to review an amendment and simultaneously compels the NRC to hold a 

hearing (if requested) before issuing an amendment. See 

id. Lorion tells us, however, that the jurisdictional element and hearing requirement of § 2239(a) are not coextensive, because we have Hobbs Act jurisdiction over 

"all final orders in licensing proceedings whether or not a 

hearing before the Commission occurred or could have 

occurred." 3 Lorion, 470 U.S. at 737. The NRC argues 

[**12] that this distinction between § 2239(a)'s two elements establishes that we have Hobbs Act jurisdiction 

over exemptions even though, under § 2239(a), exemptions do not require hearings. We disagree.

3 For instance, the Lorion Court noted that we 

have Hobbs Act jurisdiction over final orders in 

summary proceedings and informal NRC rulemaking, even though hearings may be unavailable with respect to each. See 470 U.S. at 742 & 

n.10.

In separating § 2239(a)'s hearing requirement from 

the provision's jurisdictional component, Lorion did not 

alter the basis for jurisdiction pursuant to that section: we 

have jurisdiction over only an appeal from an order "issued in a 'proceeding . . . for the granting, suspending, 

revoking, or amending of any license.'" Id. at 735 (quoting 42 U.S.C. § 2239(a)(1)) (ellipsis in original). The 

Supreme Court has commanded "strict fidelity to the[] 

terms" of judicial review provisions that create jurisdiction, such as those contained in the Hobbs Act. Stone v. 

INS, 514 U.S. 386, 405, 115 S. Ct. 1537, 131 L. Ed. 2d 

465 (1995). The plain text of § 2239(a) does not confer 

appellate jurisdiction over final orders issued in pro-
Page 5

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

ceedings involving exemptions, irrespective of any hearing requirement.

Lorion's [**13] facts are instructive on this point. 

Lorion specifically held that the Hobbs Act gives the 

courts of appeals exclusive jurisdiction to review the 

NRC's denial of a citizen petition without a hearing. Id. 

at 746. The NRC suggests that the Hobbs Act similarly 

applies to an appeal from a final order granting an exemption without a hearing. But a citizen petition is a 

"request to institute a proceeding . . . to modify, suspend, 

or revoke a license." 10 C.F.R. § 2.206(a) (emphasis 

added). The petition is "but the first step in a process that 

will, if not terminated for any reason, culminate in a full 

formal proceeding under 42 U.S.C. § 2239(a)(1)." Lorion, 470 U.S. at 745 n.11.

In contrast, the NRC contends that an exemption is 

distinct from "the granting, suspending, revoking, or 

amending" of a license. We think this is a reasonable 

interpretation of the Hobbs Act, and one that deserves 

deference. See Chevron U.S.A. Inc. v. NRDC., 467 U.S. 

837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984). The NRC 

takes this stance to avoid having to hold hearings for 

exemptions; but by asserting that exemptions are different from amendments, a position to which we defer, the 

NRC necessarily deprives us of the [**14] ability 

[*181] to review exemptions pursuant to § 2239(a).

There are, of course, policy advantages in finding 

Hobbs Act jurisdiction over exemptions. Placing initial 

review of agency action in the courts of appeals improves judicial efficiency. "The factfinding capacity of 

the district court is . . . typically unnecessary to judicial 

review of agency decisionmaking," and thus proceeding 

in the district court often adds an unneeded layer of review. Lorion, 470 U.S. at 744-45. These advantages led 

the Lorion Court to hold that, "[a]bsent a firm indication 

that Congress intended to locate initial APA review of 

agency action in the district courts, we will not presume 

that Congress intended to depart from the sound policy 

of placing initial APA review in the courts of appeals." 

Id. at 745. The First Circuit gave this policy "special 

weight" when finding that it had Hobbs Act jurisdiction 

to review NRC rules that, as a textual matter, "appear[ed] 

to fall outside" the Act. Citizens Awareness Network, 

Inc. v. United States, 391 F.3d 338, 346-47 (1st Cir. 

2004). But ultimately, policies alone are not dispositive. 

"Whether initial subject-matter jurisdiction lies initially 

in the courts of appeals [**15] must of course be governed by the intent of Congress and not by any views 

we may have about sound policy." Lorion, 470 U.S. at 

746.

"[T]he plain language of the enacted text is the best 

indicator of intent." Nixon v. United States, 506 U.S. 224, 

232, 113 S. Ct. 732, 122 L. Ed. 2d 1 (1993). Indeed, 

when the First Circuit broadly construed its Hobbs Act 

jurisdiction in light of the Lorion policies, the statutory 

text still constrained the court to hold that it could "review any NRC action that could be cognizable in a petition for review from a proceeding under section 2239." 

Citizens Awareness Network, 391 F.3d at 347 (emphasis 

added). Here, we cannot read exemptions into the plain 

text of § 2239(a), particularly when the NRC itself (to 

which deference is owed) is urging that exemptions are 

different from "amending . . . [a] license" and the other 

orders mentioned in that section. See, e.g., Resp't's Mot. 

to Dismiss at 7 ("An exemption is not a licensing action 

or rulemaking."); Resp't's Br. at 39 ("License amendments and post-licensing exemptions are entirely distinct 

and serve distinct purposes under NRC's regulatory 

scheme . . . ."). Moreover, the NRC's exemption program 

has been on the books in some form since 1956, [**16] 

see 21 Fed. Reg. 356 (Jan. 19, 1956), and Congress has 

amended § 2239(a) since then, see Energy Policy Act of 

1992, Pub. L. 102-486, 106 Stat. 2776, 3120, but has 

never included exemptions in the statute's text. This 

reinforces our view, evident from the text, that Congress 

intended to have exemptions treated differently from the 

orders mentioned in § 2239(a).

The NRC points out that the First and Sixth Circuits 

have each reviewed an exemption under the Hobbs Act. 

In both cases, however, other orders plainly within § 

2239(a)'s scope were also being challenged. In Commonwealth of Massachusetts v. U.S. Nuclear Regulatory 

Commission, 878 F.2d 1516 (1st Cir. 1989), the petitioners appealed not only an NRC exemption, but also a 

citizen petition denial (the subject of Lorion) and a decision allowing a previously shutdown plant to resume 

operations. Id. at 1519-20. Similarly, Kelley v. Selin, 42 

F.3d 1501 (6th Cir. 1995), concerned several NRC orders, only one of which was an exemption. Id. at 

1503-04. Neither case explained how or why exemptions 

fall under the Hobbs Act. It is possible that the issue was 

not squarely presented to those courts, which frequently 

occurs when parties prefer that [**17] the court decide 

an issue despite its potential jurisdictional infirmity, especially when the problem is relevant to only part of the 

[*182] appeal. It is also possible that the two courts 

assumed some type of supplemental jurisdiction over the 

exemption, in light of their undisputed Hobbs Act jurisdiction over the other orders at issue. See Conoco, Inc. v. 

Skinner, 970 F.2d 1206, 1214 n.10 (3d Cir. 1992) ("As 

long as this court has jurisdiction over one of the challenged regulations, the interests of judicial economy and 

efficiency allow us to hear the entire matter."). Regardless, to the extent that Commonwealth of Massachusetts

and Kelley are inconsistent with our jurisdictional analysis, we decline to follow them.
Page 6

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

We therefore hold that we lack jurisdiction under the 

Hobbs Act to review an NRC exemption. In the absence 

of jurisdiction, we lack the authority to review not only 

an NRC order that issues an exemption, but also any 

orders "preliminary or ancillary" to an exemption, such 

as a denial of a hearing request. Lorion, 470 U.S. at 743

("[R]eview of orders resolving issues preliminary or ancillary to the core issue in a proceeding should be reviewed in the same forum as the final order [**18] resolving the core issue."). But our inquiry does not end 

there, because we lack jurisdiction in this case only if the 

challenged NRC order is indeed an exemption and not an 

amendment or otherwise within the purview of § 2239, 

an issue to which we now turn.

II. Whether the NRC's Order is an Exemption

Whether the challenged order is an exemption, as 

the NRC has labeled it and thus beyond our jurisdiction, 

or is properly regarded as an amendment and within our 

Hobbs Act jurisdiction, is itself an issue that is within our 

jurisdiction. See Estate of Pew v. Cardarelli, 527 F.3d 

25, 28 (2d Cir. 2008) ("As always, we have jurisdiction 

to determine our jurisdiction.").

"The particular label placed upon [an order] by [an 

agency] is not necessarily conclusive, for it is the substance of what the [agency] has purported to do and has 

done which is decisive." Columbia Broad. Sys., Inc. v. 

United States, 316 U.S. 407, 416, 62 S. Ct. 1194, 86 L. 

Ed. 1563 (1942). Still, the NRC's labels, though not dispositive, deserve deference when those labels are reasonable. The NRC, in deciding whether to treat an order 

as an exemption, applies its regulations governing when 

exemptions can be granted. See 10 C.F.R. § 50.12. An 

agency's application [**19] of its own regulations is 

"controlling unless plainly erroneous or inconsistent with 

the regulation[s]." Auer v. Robbins, 519 U.S. 452, 461, 

117 S. Ct. 905, 137 L. Ed. 2d 79 (1997) (internal quotation marks omitted); see also Fed. Express Corp. v. Holowecki, 552 U.S. 389, 128 S. Ct. 1147, 1155, 170 L. Ed. 

2d 10 (2008) ("[T]he agency is entitled to . . . deference 

when it adopts a reasonable interpretation of regulations 

it has put in force."). We serve as an important check on 

the agency's decisionmaking process, but ultimately the 

agency's judgment, if reasonable, must prevail.

Here, we think the NRC reasonably applied its regulations when it classified the relief granted to Indian 

Point as an exemption. 4 Consistent with 10 C.F.R. § 

50.12, the agency concluded that treating the challenged 

order as an exemption was authorized by law, presented 

no undue risk to public health and safety, and was consistent with the common defense and security. As required by 10 C.F.R. § 50.12, the NRC also found that 

"special circumstances" justified this exemption: specifically, that "the underlying purpose" of the fire safety 

rule would still be satisfied after the modification. See 10 

C.F.R. § 50.12(a)(2)(ii). Although it appears that 

[*183] the NRC could have alternatively [**20] 

treated the order as an amendment to Indian Point's license, the Commission applied its regulations reasonably 

in opting instead to grant Indian Point an exemption.

4 We assume without deciding that the regulations themselves are valid. Although the parties 

contest the issue, our lack of jurisdiction precludes us from resolving it.

Neither Petitioners nor amicus curiae New York 

State have persuaded us otherwise. Petitioners argue that 

this exemption should be deemed an amendment because 

it is permanent, noting that the First Circuit found that 

the exemption at issue in Commonwealth of Massachusetts did "not amount to a license amendment" because it 

had only "temporarily exempted the licensee" from a 

rule. 878 F.2d at 1521. But the NRC had granted that 

exemption pursuant to 10 C.F.R. § 50.12(a)(2)(v), which 

allows exemptions providing "temporary relief from the 

applicable regulation." 878 F.2d at 1521 & n.7. In citing 

the temporary nature of the exemption before it, the First 

Circuit confirmed that the NRC had applied its regulations reasonably, but did not announce a general standard 

for distinguishing exemptions from amendments. Nor 

would such a standard comport with the NRC regulations: [**21] a requirement that exemptions must be 

temporary would conflict with the five "special circumstances" that allow for exemptions even if the relief is 

permanent. See 10 C.F.R. § 50.12(a)(2)(i)-(iv), (vi); supra note 1.

We also reject New York State's position that a 

modification, purported to be an exemption, should be 

treated as an amendment if it relaxes a safety standard. 

The State's position may or may not be sound policy, but 

it lacks a basis in law. 5

5 The State relies on Bellotti v. U.S. Nuclear 

Regulatory Commission, 725 F.2d 1380, 233 U.S. 

App. D.C. 274 (D.C. Cir. 1983), to support its 

position, noting that Bellotti held that "automatic 

participation at a hearing may be denied only 

when the Commission is seeking to make a facility's operation safer." Id. at 1383. However, Bellotti concerned the different question of whether 

the Massachusetts Attorney General could intervene in the statutorily required hearing for an 

amendment, see id. at 1381-82, and is therefore 

inapposite.

Petitioners' claim that the NRC requires hearings for 

exemptions involving "material questions directly related 

to an agency's licensing action" is also unavailing. Pet'rs' 

Reply Br. at 19. Petitioners rely solely on In re Private 
Page 7

578 F.3d 175, *; 2009 U.S. App. LEXIS 19230, **

Fuel Storage, L.L.C., 53 N.R.C. 459 (2001), [**22] to 

demonstrate this alleged NRC practice, but Private Fuel 

Storage concerned the unrelated issue of whether claims 

normally appropriate for an exemption, and thus not 

warranting a hearing, nonetheless can be included in an 

ongoing licensing hearing. Id. at 461, 466. Here, there is 

no such hearing.

In sum, none of the standards offered by Petitioners 

and the State for deciding when to treat exemptions as 

amendments withstand scrutiny. More importantly, none 

of their proffered distinctions between exemptions and 

amendments establish that the NRC acted unreasonably 

in considering the modification at issue in this case to be 

an exemption.

We recognize that, under the NRC regulations, little 

appears to distinguish an exemption from an amendment. 

But as long as the NRC has applied its regulations reasonably, we will not displace the agency's judgment with 

our own as to whether an exemption or amendment is 

warranted. Accordingly, we defer to the NRC's classification in this case and hold that the modification order 

that the Commission granted to Entergy and labeled an 

exemption is indeed an exemption. Petitioners challenge 

only that exemption in this appeal. Because we lack jurisdiction under [**23] the Hobbs Act over exemptions, 

we must dismiss the petition.

Finally, because we lack jurisdiction, we also express no opinion as to whether the NRC's hearing denial 

was proper, whether [*184] the exemption at issue is 

arbitrary and capricious, or the other issues raised by 

Petitioners. We hold only that Petitioners are indeed 

challenging an exemption, and that exemptions cannot be 

reviewed under the Hobbs Act. 6

6 We note that our holding does not necessarily 

shut off every avenue Petitioners may have at 

their disposal for relief. Petitioners are free to 

seek review in the district court of the NRC's actions pursuant to the APA. See Sharkey v. Quarantillo, 541 F.3d 75, 84 (2d Cir. 2008) ("[A] suit 

that arises under the APA is properly brought in 

district court.").

CONCLUSION

For the foregoing reasons, we DISMISS the petition 

without prejudice for want of jurisdiction. All pending 

motions are denied as moot.
Page 1

FOCUS - 2 of 7 DOCUMENTS

Caution

As of: Aug 31, 2011

ENVIRONMENTAL DEFENSE FUND, INC., SIERRA CLUB, NATURAL RESOURCES DEFENSE COUNCIL, INC., CONSERVATION LAW FOUNDATION, 

OREGON ENVIRONMENTAL COUNCIL, DELAWARE VALLEY CITIZENS 

COUNCIL FOR CLEAN AIR, PETITIONERS v. ENVIRONMENTAL PROTECTION AGENCY, ET AL., RESPONDENTS AMERICAN TRUCKING ASSOCIATIONS, INC. AND AMERICAN ROAD AND TRANSPORTATION BUILDERS 

ASSOCIATION, INTERVENORS

Nos. 94-1044, 94-1062

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA 

CIRCUIT

82 F.3d 451; 317 U.S. App. D.C. 207; 1996 U.S. App. LEXIS 8471; 42 ERC (BNA) 

1577; 26 ELR 20968

December 13, 1995, Argued 

April 19, 1996, Decided 

SUBSEQUENT HISTORY: [**1] Amending 

Order of July 29, 1996, Reported at: 1996 U.S. App. 

LEXIS 42573. 

PRIOR HISTORY: On Petitions for Review of 

Rulemakings of the Environmental Protection Agency. 

DISPOSITION: Petitions for review Denied. 

CASE SUMMARY:

PROCEDURAL POSTURE: Petitioners, six environmentalist associations, sought review of regulations 

promulgated by the Environmental Protection Agency 

(EPA) pursuant to § 176 of the Clean Air Act, 42 

U.S.C.S. § 7506.

OVERVIEW: Section § 176(c)(2) specifically addressed conformity of transportation programs and plans 

developed pursuant to Title 23 or the Urban Mass 

Transportation Act. This required that a metropolitan 

planning organization establish for its area both a "long 

range" transportation plan and a "transportation improvement program" (TIP), 23 U.S.C.S. § 134(g), (h); 49 

U.S.C.S. § 5303(f), 5304(a). The Act directed the EPA to 

promulgate criteria and procedures for determining conformity under the statute. Accordingly, the EPA published regulations, portions of which the petitioners 

challenged. The court held that § 176(c) of the Clean Air 

Act was adopted as part of a larger regulatory program 

through which federal and state governments worked 

together to control air pollution. It required that a federal 

action conform to the implementation plan that was currently in place, not to a revised plan that had yet to be 

examined and approved by the EPA. Given certain safeguards, as well as the enforcement power wielded by the 

EPA, the court found that the regulations were reasonable, narrowly drawn, consistent with the purpose of the 

Act, and within the EPA's discretion.

OUTCOME: The petition for review was denied.

COUNSEL: Howard I. Fox, for Sierra Club Legal Defense Fund, et al., and Robert E. Yuhnke, for Environ-
Page 2

82 F.3d 451, *; 317 U.S. App. D.C. 207;

1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

mental Defense Fund, Inc., argued the cause for the petitioners. On brief were William S. Curtiss and James T. 

Tripp.

Eileen T. McDonough and Alan J. Birnbaum, Attorneys, 

Department of Justice, argued the cause for the respondents. On brief were Lois J. Schiffer, Assistant Attorney 

General, Department of Justice, Sara Schneeberg, Attorney, Environmental Protection Agency, and Peter J. 

Plocki, Attorney, Department of Transportation. Mary E. 

Ward, Attorney, Department of Justice, entered an appearance.

F. William Brownell and Lee A. Casey, for American 

Road and Transportation Builders Association, and Linda S. Mounts, for American Trucking Associations, Inc., 

were on the joint brief for the intervenors. Mark G. 

Weisshaar entered an appearance for American Road and 

Transportation Builders Association. 

JUDGES: Before: SILBERMAN, GINSBURG and 

HENDERSON, Circuit Judges. Opinion for the Court 

filed PER CURIAM. 

OPINION

[*454] PER CURIAM: The petitioners, six environmentalist associations, [**2] 1

(collectively cited as 

EDF) seek review of regulations promulgated by the 

Environmental Protection Agency (Agency or EPA) 

pursuant to section 176 of the Clean Air Act, 42 U.S.C. § 

7506. For the reasons set forth below, we deny the petitions for review.

1 These are the Environmental Defense Fund, 

Inc., the Sierra Club, the Natural Resources Defense Fund, Inc., the Conservation Law Foundation, the Oregon Environmental Council, and the 

Delaware Valley Citizens Council for Clean Air.

I. STATUTORY BACKGROUND

Since 1970 the Clean Air Act has required states to 

adopt, after reasonable notice and public hearings and 

approval by the Agency, State Implementation Plans 

(SIPs) that "provide[] for implementation, maintenance, 

and enforcement" of "national ambient air quality standards." 42 U.S.C. § 7410(a)(2)(A). In 1977 Congress 

amended the Act by adding section 176, 42 U.S.C. § 

7506. That section, as amended, requires each federal 

agency to determine that a proposed activity in a "nonattainment" or "maintenance" [**3] area 2

conforms to 

an applicable SIP before the agency can "engage in, 

support in any way or provide financial assistance for, 

license or permit, [*455] or approve" the activity and 

prohibits a "metropolitan planning organization" 3from 

approving "any project, program, or plan which does not 

conform to [an applicable SIP]." 42 U.S.C. § 7506(c)(1). 

4 Subsection (c)(2) of section 176 specifically addresses 

conformity of transportation programs and plans "developed pursuant to Title 23 or the Urban Mass Transportation Act." Each of the cited laws requires that a metropolitan planning organization establish for its area both a 

"long range" transportation plan and a "transportation 

improvement program" (TIP). 23 U.S.C. § 134(g), (h); 

49 U.S.C. § 5303(f), 5304(a). 

5 Subsection (c)(2) requires 

that the transportation plans and TIPs "implement the 

transportation provisions of any applicable [SIP] applicable to all or part of the area covered by such transportation plan or program" and prohibits federal approval, 

acceptance or funding of any transportation plan unless it 

is first found to conform to the SIP. 6 42 U.S.C. § 

7506(c)(2). In addition, subsection (c)(4) further directs 

the [**4] Agency to "promulgate criteria and procedures for determining conformity" under the statute. Accordingly, the Agency published its final "Transportation 

Conformity Rule" on November 24, 1993, see 58 Fed. 

Reg. 62,188, and its final "General Conformity Rule" on 

November 30, 1993, see 58 Fed. Reg. 63,214. It is to 

portions of these rules that the petitioners mount their 

challenge. We address each challenged regulation separately.

2 The Agency has always construed the conformity requirement to apply only to "nonattainment" areas (those that have not attained a national ambient air quality standard for a particular 

pollutant) and to maintenance areas (former nonattainment areas that have attained the standard). 

See 40 C.F.R. § 51.394(b), 51.853. Petitioners 

stated, in their nonbinding statement of issues on 

review in this court, that this was one aspect of 

the rules on which it would petition for review. 

Argument as to this aspect was not included in 

petitioners' briefs and therefore has not been 

raised in this court. Apparently, petitioners prevailed in the Northern District of California on a 

claim that the Agency failed to take statutorily 

required action when it extended coverage of the 

conformity rules only to nonattainment areas. We 

understand that this case is on appeal in the Ninth 

Circuit. Intervenors American Road and Transportation Builders Association and American 

Trucking Associations, Inc. moved this court for 

a writ to protect our jurisdiction over this issue, 

said by intervenors to be exclusive under the statute. In the meantime, Congress has amended the 

Clean Air Act to make clear that the conformity 

requirements extend only to nonattainment or 

maintenance areas. See National Highway System Designation Act of 1995, Pub. L. No. 
Page 3

82 F.3d 451, *; 317 U.S. App. D.C. 207;

1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

104-59, § 305(b), 109 Stat. 568, 580 (1995). We 

assume that Congress' action renders intervenors' 

concerns moot. 

[**5] 

3 Under 23 U.S.C. § 134(b) and 49 U.S.C. § 

5303(c)(1), a metropolitan planning organization 

must be designated to develop transportation 

plans and programs for each urban area with a 

population of at least 50,000. 

4 For the statutory definition of "conformity," 

see infra Part VII (quoting 42 U.S.C. § 

7506(c)(1)). 

5 The long range plan, to be updated "periodically," must (1) identify transportation facilities 

"that should function as an integrated metropolitan transportation system," (2) provide for financing implementation of the plan, (3) assess 

capital investment and other measures necessary 

to preserve and make the most efficient use of 

existing metropolitan transportation facilities and 

(4) provide for "transportation enhancement activities." The TIP, to be updated "at least once 

every 2 years," must include a priority list of 

transportation projects to be conducted each triennium and a plan for financing the projects. 23 

U.S.C. § 134(g), (h); 49 U.S.C. § 5303(f), 

5304(a)-(b). 

6 Subsection (c)(2) provides:

 (A) no transportation plan or 

transportation improvement program may be adopted by a metropolitan planning organization designated under Title 23 or the Urban Mass Transportation Act, or 

be found to be in conformity by a 

metropolitan planning organization until a final determination has 

been made that emissions expected from implementation of 

such plans and programs are consistent with estimates of emissions 

from motor vehicles and necessary 

emissions reductions contained in 

the applicable implementation 

plan, and that the plan or program 

will conform to the requirements 

of paragraph (1)(B);

 (B) no metropolitan planning 

organization or other recipient of 

funds under Title 23 or the Urban 

Mass Transportation Act shall 

adopt or approve a transportation 

improvement program of projects 

until it determines that such program provides for timely implementation of transportation control 

measures consistent with schedules included in the applicable 

implementation plan;

 (C) a transportation project may 

be adopted or approved by a metropolitan planning organization or 

any recipient of funds designated 

under Title 23 or the Urban Mass 

Transportation Act, or found in 

conformity by a metropolitan 

planning organization or approved, accepted, or funded by the 

Department of Transportation only 

if it meets either the requirements 

of subparagraph (D) or the following requirements--

 (i) such a project comes from a 

conforming plan and program;

 (ii) the design concept and 

scope of such project have not 

changed significantly since the 

conformity finding regarding the 

plan and program from which the 

project derived; and

 (iii) the design concept and 

scope of such project at the time of 

the conformity determination for 

the program was adequate to determine emissions.

 (D) Any project not referred to 

in subparagraph (C) shall be 

treated as conforming to the applicable implementation plan only 

if it is demonstrated that the projected emissions from such 

project, when considered together 

with emissions projected for the 

conforming transportation plans 

and programs within the nonattainment area, do not cause such 

plans and programs to exceed the 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

emission reduction projections and 

schedules assigned to such plans 

and programs in the applicable 

implementation plan.

42 U.S.C. § 7506(c)(2)(A)-(D). 

[**6] II. GRANDFATHER PROVISION 

First, the petitioners challenge "grandfather" provisions that temporarily exempt [*456] certain projects 

from the section 176 conformity determination requirements. Both final rules require generally that conformity 

determinations for covered projects be made before any 

federal action is taken on them. See 40 C.F.R. § 

51.850(a)-(b), 51.394(a). 7 Each rule exempts from the 

conformity determination requirement, however, projects 

that have undergone recent National Environmental Policy Act (NEPA) analyses--for non-transportation projects 

within the preceding five years and for transportation 

projects within the preceding three years. See 40 C.F.R. § 

51.850(c)(1), 51.394(c)(1). 8 The petitioners contend the 

rules' "grandfather" provisions conflict with the clear 

conformity mandate of section 176(c)(1) and (c)(2). We 

disagree.

7 The general conformity regulation provides:

 (a) No department, agency or 

instrumentality of the Federal 

Government shall engage in, support in any way or provide financial assistance for, license or permit, or approve any activity which 

does not conform to an applicable 

implementation plan.

 (b) A Federal agency must 

make a determination that a Federal action conforms to the applicable implementation plan in accordance with the requirements of 

this subpart before the action is 

taken.

40 C.F.R. § 51.850(a)-(b). The transportation 

conformity regulation provides:

 (a) Action applicability.

 (1) Except as provided for in 

paragraph (c) of this section or § 

51.460, conformity determinations 

are required for:

 (i) The adoption, acceptance, 

approval or support of transportation plans developed pursuant to 

23 CFR part 450 or 49 CFR part 

613 by [a metropolitan planning 

organization] or [the Department 

of Transportation];

 (ii) The adoption, acceptance, 

approval or support of TIPs developed pursuant to 23 CFR part 

450 or 49 CFR part 613 by [a 

metropolitan planning organization] or [the Department of 

Transportation]; and

 (iii) The approval, funding, or 

implementation of FHWA/FTA 

projects.

40 C.F.R. § 51.394(a). 

[**7] 

8 The general regulation provides:

 (c) Paragraph (b) of this section 

does not include Federal actions 

where ...:

 (1) A National Environmental 

Policy Act (NEPA) analysis was 

completed as evidenced by a final 

environmental assessment (EA), 

environmental impact statement 

(EIS), or finding of no significant 

impact (FONSI) that was prepared 

prior to January 31, 1994;

 ....

40 C.F.R. § 51.850(c)(1). The transportation regulation provides:

 (c) Limitations. (1) Projects 

subject to this regulation for which 

the NEPA process and a conformity determination have been 
Page 5

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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

completed by FHWA or FTA may 

proceed toward implementation 

without further conformity determinations if one of the following 

major steps has occurred within 

the past three years: NEPA 

process completion;....

40 C.F.R. § 51.394(c)(1). 

While the statute requires that a conformity determination be made before any federal action is taken, it 

also vests the Agency with discretion to set "the appropriate frequency for making conformity determinations" 

so long as "such determinations for [**8] transportation 

plans and programs [not] be less frequent than every 

three years." 42 U.S.C. § 7506(c)(4)(B)(ii). Exercising its 

discretion, the Agency set a conformity determination 

deadline of five years after a NEPA analysis for 

non-transportation projects and three years after a NEPA 

analysis for transportation projects. See 40 C.F.R. § 

51.857(a) ("The conformity status of a Federal action 

automatically lapses 5 years from the date a final conformity determination is reported under § 51.855, unless 

the Federal action has been completed or a continuous 

program has been commenced to implement that Federal 

action within a reasonable time."); 40 C.F.R. § 

51.394(c)(1) (exempting conformity determinations for 

transportation projects if there has been a "NEPA process 

completion" "within the past three years"). As the Agency explained, the accommodation was necessary to avoid 

immediate "retroactive" implementation of the new conformity requirement which would impose a substantial 

and unforeseen burden on federal projects that had already satisfied existing federal requirements. 58 Fed. 

Reg. at 63,216; see also 58 Fed. Reg. at 62,200 ("By 

proposing to allow projects which have [**9] final approval to proceed, and by proposing to require only one 

project-level conformity determination, EPA intended to 

avoid disrupting the implementation process for projects 

which are underway."). The resulting scheme permits 

projects in compliance with former statutory requirements, as demonstrated by the NEPA review, to proceed 

as planned so long as the [*457] newly required compliance determination is made according to the Agency's 

regulatory schedule. Because its schedule is consistent 

with the statutory language (preserving the one statutorily fixed three-year deadline for transportation project 

compliance determinations), we conclude it must be 

upheld as a reasonable exercise of the Agency's express 

statutory discretion to set conformity determination 

deadlines. See Woolen Mill Assocs. v. FERC, 286 U.S. 

App. D.C. 367, 917 F.2d 589, 593 (D.C. Cir. 1990).

III. IMPLEMENTATION 

Next, the petitioners challenge two additional regulations on the ground that they permit untimely implementation of "transportation control measures" (TCMs) 9

in violation of the express requirements of section 176. 

We conclude both regulations reflect reasonable interpretations of the statutory language.

9 The Agency has construed a "TCM" to mean 

"any measure that is directed toward reducing 

emissions of air pollutants from transportation 

sources." 40 C.F.R. § 51.100(r). "Such measures 

include, but are not limited to, those listed in section 108(f) of the Clean Air Act." Id. Section 108 

describes various possible TCMs that reduce vehicle emission concentrations by, for example, 

providing incentives for mass transit, car-pooling 

and nonmotorized travel. See 42 U.S.C. § 

7408(f)(1)(A). 

[**10] The petitioners first contend that 40 C.F.R. 

§ 51.418(c)(1) allows approval of a TIP when the TIP's 

TCMs "are behind the schedule established in the applicable implementation plan" and therefore violates the 

statutory requirement that "no metropolitan planning 

organization or other recipient of funds under Title 23 or 

the Urban Mass Transportation Act shall adopt or approve a transportation improvement program of projects 

until it determines that such program provides for timely 

implementation of transportation control measures consistent with schedules included in the applicable implementation plan." 42 U.S.C. § 7506(c)(2)(B). According 

to the petitioners, the challenged regulation conflicts 

with the statute's clear mandate that no transportation 

project be approved unless it requires implementation of 

TCMs in strict compliance with the SIP schedules. We 

believe the petitioners construe the phrase "consistent 

with" too narrowly. Preceding the preposition "with," 

"consistent" means "agreeing or according in substance 

or form," that is "congruous" or "compatible." 3 Oxford 

English Dictionary 773 (2d ed. 1989). Thus, the statutory 

language does not require exact correspondence [**11] 

between the SIP TCM schedule and the TIP's implementation schedule but only congruity or compatibility between them. Cf. NL Indus., Inc. v. Kaplan, 792 F.2d 

896, 898-99 (9th Cir. 1986) (statutory phrase "consistent 

with the national contingency plan" in 42 U.S.C. § 

9607(a)(2)(B) "does not necessitate strict compliance 

with [national contingency plan's] provisions") (citing 

Wickland Oil Terminals v. Asarco, Inc., 792 F.2d 887, 

891-92 (9th Cir.1986)). Such congruity is attained under 

the promulgated regulation which permits deviation from 

a SIP schedule only when "the [metropolitan planning 

organization] and [the Department of Transportation] 

have determined that past obstacles to implementation of 

the TCMs have been identified and have been or are being overcome, and that all State and local agencies with 
Page 6

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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

influence over approvals or funding for TCMs are giving 

maximum priority to approval or funding of TCMs over 

other projects within their control." 40 C.F.R. § 

51.418(c)(1). The Agency determined that "this approach 

is a practical necessity to accommodate uncontrollable 

delays." 58 Fed. Reg. at 62,197. Given the flexible statutory language we must defer to the agency's [**12] 

determination.

Second, the petitioners challenge 40 C.F.R. § 

51.418(b)(1) and (c)(1) insofar as those subsections require that transportation plans and TIPs provide for 

timely implementation of only those TCMs "which are 

eligible for funding under title 23 U.S.C. or the Federal 

Transit Act." The Agency explained the reason for limiting the regulation to projects eligible for federal funding 

in the preamble to the final transportation conformity 

rule:

 Clean Air Act section 176(c)(2)(B) requires TIPs to provide for timely implementation of TCMs, but does not define 

TCMs. The statute is therefore ambiguous 

with respect to which TCMs must be implemented, [*458] and EPA may take 

any reasonable interpretation of the definition of TCMs. Chevron v. NRDC, 467 

U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 

694 (1984). Since plans and TIPs can at 

the most "provide for" only those projects 

which are eligible for Federal funding, it 

is reasonable to define those TCMs required to be implemented by Clean Air 

Act section 176(c)(2)(B) to be only those 

SIP TCMs that are eligible for Federal 

funding.

58 Fed. Reg. at 62,211. We find the Agency's rationale 

persuasive and the challenged limitation consistent with 

the statutory language. [**13] The petitioners argue 

that under the statute transportation plans and TIPs must 

"provide for" timely implementation of non-federally 

fundable TCMs by allocating federal funding of eligible 

projects in such a way that state funds are freed for 

funding of ineligible projects. Like the Agency we doubt 

that Congress intended so strained a reading of its federal 

funding legislation. Nevertheless, assuming that the petitioners' position is reasonable, we must still defer to the 

Agency's view which is at least equally compatible with 

the statutory language. See Natural Resources Defense 

Council, Inc. v. Thomas, 256 U.S. App. D.C. 310, 805 

F.2d 410, 439 (D.C. Cir. 1986) (in spite of petitioners' 

"often plausible" interpretations, where "the EPA was 

able to adduce an equally reasonable interpretation of the 

law it was assigned to execute, we must defer to the 

agency").

IV. "CONTRIBUTE TO" IN THE INTERIM PERIOD

Section 176(c) provides for conformity determinations to be made for transportation plans, programs, and 

projects before revised SIPs are approved by the Agency. 

During this so-called "interim period," transportation 

plans and improvement programs may be found to conform if inter alia they, "with respect [**14] to ozone 

and carbon monoxide nonattainment areas, contribute to 

annual emissions reductions consistent with [42 U.S.C. § 

7511a(b)(1) and 7512a(a)(7)]." 42 U.S.C. § 

7506(c)(3)(A) (emphasis added). Section 7511a(b)(1)

requires that SIPs provide for "Moderate Area" emissions reductions of volatile organic compounds in an 

amount "of at least 15 percent from [1990] emissions" by 

1996, and for "such specific annual reductions in emissions of volatile organic compounds and oxides of nitrogen as necessary to attain the national primary ambient 

air quality standard for ozone" by the applicable date. 

42 U.S.C. § 7511a(b)(1)(A)(i). Section 7511a(b)(1) further provides that certain emissions reductions--increasingly demanding tailpipe exhaust standards, 

for example--will not be creditable toward the required 

15% reduction. Section 7512a(a)(7) states that, within 

"Moderate Areas," SIPs must provide for attainment of 

the carbon monoxide national ambient air quality standard and for "such specific annual emission reductions as 

are necessary to attain the standard" by the applicable 

date.

The Agency's rules for determining whether a 

transportation plan ( 40 C.F.R. § 51.436) or program 

[**15] ( 40 C.F.R. § 51.438) "contributes to annual 

emissions reductions" during the interim period require 

two comparisons. The metropolitan planning organization (or other recipient of federal highway funds) determines what the transportation emissions levels for volatile organic compounds, oxides of nitrogen, and carbon 

monoxide were for 1990. The metropolitan planning 

organization must also predict the emissions from its 

transportation system if the projects existing or very near 

completion today were to continue to exist at specified 

points in the future but without the plan or program. This 

level of emissions is called the "Baseline" or "no build" 

scenario. And, the future emissions if the given transportation plan or improvement program were to be implemented and if other regionally significant projects were 

to be undertaken--the "Action" or "build" scenario--must 

be determined. Once these three emissions levels are 

calculated, the metropolitan planning organization compares the Action scenario emissions with the emissions 

under the Baseline scenario and with the emissions level 

as of 1990. If the Action scenario emissions are lower 
Page 7

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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

than both the Baseline and 1990 emissions, then the 

[**16] transportation plan or improvement program has 

met the "contribute to" requirement.

Petitioners challenge the "contribute to" rules, which 

allegedly fail to require that the transportation plan or 

improvement program [*459] reduce emissions at all, 

much less at the amount that the statute is said to command. Petitioners complain that non-plan and 

non-improvement program technologies and measures 

that reduce emissions after 1990 may render the Action 

scenario emissions lower than 1990 levels even though 

the plan or improvement program fails to produce any 

emissions reduction. 10 Further, petitioners contend that 

the rule improperly allows the Action scenario to account 

for projects and traffic reduction measures not included 

in the plan or improvement program. If non-plan, 

non-improvement program projects reduce Action scenario emissions enough, the plan and improvement program need not reduce emissions at all and may in fact 

increase emissions. It is also argued that the Action scenario allows credit to be taken for emissions reductions 

that are expressly non-creditable under section 

7511a(b)(1)(D). Permitting plans and programs to be 

found to conform despite their contributing no [**17] 

emissions reductions is particularly egregious, petitioners 

suggest, since the plan or improvement program must 

reduce emissions at a level sufficient to meet the 15% 

requirement set forth in section 7511a(b)(1).

10 Petitioners acknowledge that this concern 

exists only in the Action/1990 comparison. It 

does not affect the Action/Baseline comparison 

as these reductions appear on both sides of that 

equation. 

The Agency does not disagree with petitioners' assessment of the possible consequences of its "contribute 

to" regime. Rather, it takes issue with the premise of petitioners' criticisms: that the plan or improvement program must itself produce an absolute reduction in the 

given emissions. According to the Agency, section 

176(c)(3)(a)(iii) may be interpreted such that a plan or 

improvement program need not itself produce demonstrable emissions reductions so long as the projected 

emissions of a region with the plan or improvement program are lower than those for the region without the plan 

or improvement program. [**18] The Agency asserts 

that plans and improvement programs may "contribute 

to" emissions reductions by "avoiding or reducing increases in emissions over the years." EPA Br. at 46. It is 

also argued that the contribution to the emissions reductions need only be "consistent with" the provisions of 

sections 7511a and 7512a--a requirement that is met so 

long as the contribution is "congruous" or "compatible" 

with the reductions required by those sections even 

though the contribution may not comport with every jot 

and tittle of those sections. Along these lines, the Agency 

further contends that the determination of whether a plan 

or improvement program contributes to annual emissions 

reductions need not be performed according to the standards of section 7511a(b)(1)(D)--which provides that 

certain kinds of emissions reductions are not creditable. 

Those crediting restrictions are said to apply only to SIP 

revisions, not to plans and programs adopted in the interim. And, those provisions apply to computing the ultimate 15% reduction in emissions, not to the annual 

emissions reductions required by section 7511a(b)(1) to 

which section 176(c)(3)(a)(iii) specifically refers.

Petitioners contend that [**19] the "contribute to" 

rules run afoul of the plain language of the statute by 

failing to require that any given plan or program produce 

emissions reductions by itself. The Agency has demonstrated, however, that the "contribute to" language of the 

statute--particularly in combination with the "consistent 

with" language--is ambiguous. In the first place, the language leaves wide open the question of how large a reduction in emissions must be to constitute a contribution. 

As the Agency discussed in its notice of proposed rulemaking, the language could be read to require that the 

plan or program produce "any nonzero reduction" or it 

could be read to require that the plan or program provide 

for the entire 15% reduction in volatile organic compounds required under section 7511a(b)(1). Nor does the 

language clearly set forth whether emissions reductions 

that can be counted as contributing to annual emissions 

are those directly attributable to the implementation of 

the plan or program, or those that follow indirectly. In 

the face of this ambiguity, and given the statute's express 

directive to the Agency to "promulgate criteria and procedures for demonstrating [*460] and assuring conformity in the case [**20] of transportation plans, programs, and projects," § 176(c)(4)(A), we will uphold the 

Agency's rules if they are reasonable. 11

11 Petitioners quote from what they call the 

"conference report" to bolster their argument that 

the contribution to emissions reductions must be 

sufficient to realize the required 15% reduction: 

"The sponsors intend that the mobile source contribution to overall emissions in the nonattainment areas be reduced annually at the same percentage rate that would apply for the development of a SIP." 136 CONG. REC. S16,973 (Oct. 

27, 1990) (remarks of Sen. Baucus). This document, inserted in the Congressional Record by 

Senator Baucus, and entitled "Clean Air Act 

Amendments of 1990 Chafee-Baucus Statement 

of Senate Managers," was described by Senator 

Baucus as having "not been reviewed or approved by all of the conferees." Id. at S16,933. 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

The report of the House and Senate conference 

committee on the Clean Air Act amendments is 

H.R. CONF. REP. NO. 952, 101st Cong., 2d 

Sess. (1990), which contains no discussion of this 

issue. The statement of Senator Baucus is certainly probative of congressional intent as to the 

amount of emissions reduction that must be 

proved, but cannot undermine the statute's language or the explicit delegation to the Agency of 

the task of setting forth conformity criteria. See, 

e.g., Chrysler Corp. v. Brown, 441 U.S. 281, 311, 

60 L. Ed. 2d 208, 99 S. Ct. 1705 (1979). 

[**21] We think that it was reasonable for the 

Agency to construe the "contribute to ... consistent with" 

requirement as not necessarily requiring the reduction of 

emissions attributable to the plan or program standing 

alone. Sections 7511a(b)(1) and 7512a(a)(7) require reductions in volatile organic compounds, nitrogen oxide, 

and carbon monoxide, but do not require that the emissions come entirely from mobile sources. 12 A requirement that the transportation plan or program provide all 

the statutorily required reductions would seem to impinge on the prerogative of states to determine how and 

where to comply with the Act's emissions reductions 

requirements. A plan or program that does not reduce 

emissions, but that facilitates the reduction of emissions 

by other projects could still "contribute to annual emissions reductions consistent with sections 7511a(b)(1) and 

7512a(a)(7)." And, as we have noted with respect to the 

requirement of timely implementation of transportation 

control measures, the requirement that the contributions 

be "consistent with" sections 7511a(b)(1) and 

7512a(a)(7) calls for congruence or compatibility with 

those sections, not lock-step correspondence. The Agency's [**22] test for interim-period conformity may not 

be perfect--it seems to us that the test could also result in 

the converse of the problem petitioners identify: emissions reductions directly attributable to a plan or program 

could be erased by increased emissions from non-plan, 

non-program projects included in the Action scenario--but we cannot say that it is unreasonable. The 

Agency acted well within its delegated discretion in construing the "contribute to" language for interim-period 

transportation plans and improvement programs as it has.

12 Of course, as the Agency noted in its notice 

of proposed rulemaking, a state may decide in the 

course of revising its SIP that it wants to achieve 

the necessary reductions strictly through reducing 

motor vehicle emissions without reducing stationary source emissions. 58 Fed. Reg. 3782 (1993). 

V. STATE TRANSPORTATION PLANS AND PROGRAMS 

Under 23 U.S.C. § 135 (1994), states must prepare 

statewide transportation plans and improvement programs similar to those required of metropolitan [**23] 

planning organizations. The Agency's transportation regulations require that metropolitan planning organization's 

transportation plans and programs conform to the relevant SIP, but do not require conformity determinations 

for state transportation plans or programs. See 40 C.F.R. 

§ 51.392 (definition of "transportation improvement program" and "transportation plan"). Petitioners challenge 

the exclusion of state transportation planning from the 

Clean Air Act's conformity requirements, arguing that 

the Agency has improperly circumscribed a broad statutory provision. Section 176(c)(2), after all, requires conformity determinations to be made for "any transportation plan or program."

We agree with the Agency that it reasonably defined 

"transportation plan or program" to be only those plans 

or programs [*461] adopted by metropolitan planning 

organizations and that not requiring state plans or programs to conform in no way works to reduce the protections afforded air quality under the statute. A state transportation plan or program must include the plans or improvement programs adopted by metropolitan planning 

organizations within that state. Before any plan or improvement program can be included [**24] in the 

state's plan or program, it must be found by the relevant 

metropolitan planning organization to conform to the 

SIP. See 23 C.F.R. § 450.3(12)(a). A state may well include both areas that have and areas that have not attained the national ambient air quality standards. The 

conformity requirements, however, apply only to nonattainment areas. The Agency concluded, therefore, that 

little was to be gained by requiring state plans and programs to conform. An area inside a state that was covered by the conformity rules--a nonattainment area--and 

contained a metropolitan planning organization would 

necessarily already have a conforming plan or improvement program. Under petitioners' reading of the statute, 

attainment areas within the state would be forced to undergo conformity determinations that Congress did not 

intend to require. 13 We further agree with the Agency 

that the information yielded by conformity determinations at the state level is of minimal additional value--we 

are told, and petitioners do not dispute, that analyses for 

purposes of determining conformity are performed by 

region, not by state. See 58 Fed. Reg. at 62,206.

13 Petitioners argued in their reply brief that 

requiring conformity determinations for state 

transportation improvement programs would 

"ensure conformity in those smaller nonattainment areas that lack" metropolitan planning organizations. We think that the Agency's complex 

of rules dealing with transportation projects in 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

such areas ensures that petitioners' concern is 

adequately addressed. See 40 C.F.R. § 51.452(d); 

see also 58 Fed. Reg. 62,207-08. 

[**25] VI. TRANSPORTATION PROJECTS 

As noted above, "transportation plans, programs, 

and projects" are subject to specific conformity requirements to which their non-transportation counterparts are 

not. The Agency's transportation conformity rules define 

"transportation project" to encompass only highway or 

transit projects. 40 C.F.R. § 51.392. Petitioners challenge this limited definition, arguing that the Agency has 

ignored Congress' intent to apply the conformity requirements specific to transportation to all manner of 

transportation. The effect of the Agency's definition is to 

leave air, water, and rail transportation projects and their 

emissions subject only to the general conformity requirements--if they are subject to any requirement at all: 

petitioners argue that because projects included in transportation plans or improvement programs are exempted 

from the general conformity rule, non-highway and 

non-transit transportation projects slip all statutory 

punches.

The Agency counters that it reasonably construed 

"transportation projects" to include only highway or 

transit modes. It argues that the statute, read as a whole, 

clearly contemplates conformity requirements only for 

plans [**26] encompassing transit or highway projects. 

The only statutory references in section 176(c)(2) are to 

statutes concerned with highway and transit projects: 23 

U.S.C. and the Urban Mass Transit Act, 49 U.S.C. § 

5301, et seq. Non-highway and non-transit transportation 

facilities, such as airports, ports, and interstate railroads, 

are covered by statutes not set forth in section 176(c). 

The Agency acknowledges that 23 U.S.C. § 134(a) identifies promotion of intermodal transportation as an important national goal. Toward that end, however, metropolitan planning organizations are given no authority 

over non-highway and non-transit modes of transportation. Given the metropolitan planning organization's inability to control the development of air, rail (other than 

transit rail), or water transportation, and Congress' manifest intent in section 176(c) to prescribe special conformity requirements for highway and transit forms of 

transportation, the Agency contends that it reasonably 

limited the definition of "transportation projects."

We have little difficulty upholding the Agency's definition of "transportation project." It is hardly insensible 

to conclude that [*462] the types of transportation 

[**27] that Congress wished to reach with the special 

transportation conformity rules were those modes over 

which the entities listed, metropolitan planning organizations and recipients of funds under Title 23 or UMTA, 

have authority. As the Agency notes, metropolitan planning organizations and recipients of highway and transit 

funds (at least in their capacity as recipients of highway 

funds 14 ) have no authority with respect to airports, shipping, or non-transit rail transportation. Petitioners contend that metropolitan planning organizations' responsibility for intermodal planning ought to be sufficient to 

regard airports, ports, and interstate railroads as part of 

the metropolitan planning organization's bailiwick. In 

fact, however, both statutory sections imposing the "intermodal" planning requirement list air, water, and rail 

modes separately from "intermodal transportation facilities," suggesting that, e.g., an airport is not an intermodal 

transportation facility. See 23 U.S.C. § 134(f)(7) (metropolitan planning organizations must "consider" "international border crossings and access to ports, airports, intermodal transportation facilities, major freight distribution routes, [**28] national parks, recreation areas, 

monuments and historic sites, and military installations.") (emphasis added); see also 49 U.S.C. § 

5303(b)(7) (same). Congress has also stated that the "National Intermodal Transportation System" shall "provide 

improved access to ports and airports," 49 U.S.C. § 

5501(b)(4), further suggesting that a requirement of intermodal planning does not give the metropolitan planning organization control over airports--it merely requires that access to airports be accounted for in intermodal planning. 15 Given Congress' clear focus in section 

176(c)(2) on projects that are "adopted," "approved," or 

"accepted" by metropolitan planning organizations or 

highway fund recipients, we think that the Agency properly limited the reach of Congress' transportation rules to 

projects over which these entities have authority.

14 The Agency appreciated the possible disconnect between the receipt of highway funds on 

the one hand and other activities on the other, and 

concluded that Congress specified recipients of 

highway funds in their capacity as recipients of 

highway funds. See 58 Fed. Reg. 3768, 3772 

(1993). 

[**29] 

15 Although Congress has not explicitly defined "intermodal," we take it to mean "between 

or among modes." See, e.g., WEBSTER'S 

THIRD INTERNATIONAL DICTIONARY, 

1176 (1971). 

Nor are we persuaded by petitioners' contention that 

air, water, and rail modes of transportation will fall into a 

regulatory nether region if they are not subject to the 

transportation rules. The regulation to which petitioners 

point as providing the supposed loophole, 40 C.F.R. § 

51.858(a)(5)(ii), permits activities "specifically included" 

by a metropolitan planning organization in a conforming 

plan or improvement program to proceed without a further conformity determination. We doubt that the Agen-
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

cy could argue that the projects over which a metropolitan planning organization has no authority--a lack of 

authority on which it relied in not requiring transportation conformity determinations for these projects in the 

first place--could nonetheless be "specifically" included 

in a metropolitan planning organization's transportation 

plan or program. 16

16 In its notice of proposed rulemaking, the 

Agency described the effect of § 51.858(a)(5)(ii)

as providing "that vehicular activity from a Federal action may be determined to conform with 

the air quality criteria if the Federal action and its 

vehicular activity is specifically included in the 

conforming transportation plan and transportation 

improvement program for the area." 58 Fed. Reg. 

13,836, 13,845 (1994) (emphasis added). Since 

"vehicular" is best understood in this sentence as 

the adjectival form of "motor vehicle"--a term 

used throughout the rulemaking and apparently 

understood by Congress as well as all participants 

to the rulemaking to mean vehicles of the sort 

that travel on highways (as opposed to "any motorized conveyance")--we think it is clear that the 

Agency perceives this supposed loophole in its 

regulation as limited to the sorts of Federal activities that involve motor vehicles and would be 

involved in transportation plans and programs: 

highway or transit projects. 

[**30] VII. INDIRECT EMISSIONS 

In performing a conformity determination, a federal 

agency is to consider the emissions that will result from 

its action both directly and indirectly. 40 C.F.R. § 

51.858(a); 58 Fed. Reg. 63,218/2. The EPA has defined 

direct emissions as "those emissions [*463] of a criteria pollutant or its precursors that are caused or initiated 

by the Federal action and occur at the same time and 

place as the action." 40 C.F.R. § 51.852. Indirect emissions, on the other hand, are those that:

 (1) Are caused by the Federal action, 

but may occur later in time and/or may be 

farther removed in distance from the action itself but are still reasonably foreseeable; and

 (2) The Federal agency can practicably 

control and will maintain control over due 

to a continuing program responsibility of 

the Federal agency.

Id.

EDF objects to the second clause of this latter definition on the ground that it creates an exemption for 

emissions that are the reasonably foreseeable result of 

federal action but that are not within the agency's "continuing program responsibility." This exemption, EDF 

contends, is inconsistent with the Congress's broad 

command that "no department, [**31] agency, or instrumentality of the Federal Government shall engage in 

... [or] support in any way" an activity that does not conform to the applicable state implementation plan, 42 

U.S.C. § 7506(c)(1), and with the statutory definition of

"conformity" set out in 42 U.S.C. § 7506(c)(1):

 Conformity to an implementation plan 

means--

 (A) conformity to an implementation 

plan's purpose of eliminating or reducing 

the severity and number of violations of 

the national ambient air quality standards 

and achieving expeditious attainment of 

such standards; and

 (B) that such activities will not--

 (i) cause or contribute to any new violation of any standard ...;

 (ii) increase the frequency or severity 

of any existing violation of any standard 

...; or

 (iii) delay timely attainment of any 

standard or any required interim emission 

reductions or other milestones in any area.

EDF argues that the "support in any way" and "cause or 

contribute" wording evinces an intent by the Congress to 

require each federal agency to take into account all reasonably foreseeable emissions, regardless of whether 

they are within the agency's continuing control. [**32] 

Under this reading, for example, before the Army Corps 

of Engineers could grant a permit for dredge-and-fill 

activities as part of a new private shopping center development, the Army Corps would have to examine all reasonably foreseeable emissions--including not only the 

emissions produced by the equipment involved in the 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

dredge-and-fill operation but also those resulting from 

the construction and continuing operation of the shopping center.

The question before us, then, is whether the statute 

requires consideration of the emissions that the EPA 

exempted--that is, emissions that are the reasonably foreseeable result of the federal action, but that are separated in time or place from the federal action itself and 

are not within the agency's control. In answering this 

question, we must first look to the statute itself to determine whether the Congress clearly expressed its intent. 

Because the legislative history of the statute provides 

little guidance on the general conformity rule, our inquiry begins and ends with the text of the statute.

Neither "support" nor "cause" are defined in the statute, nor does the statute address whether or to what extent the federal agency must consider [**33] emissions 

that are caused by the federal action only indirectly. 

Moreover, in enacting this statute the Congress expressly 

delegated to the EPA the responsibility for promulgating 

"criteria and procedures for determining conformity" 

under the general conformity rule. 42 U.S.C. § 

7506(c)(4)(A). We must therefore defer to the EPA's 

interpretation of the relevant and undefined terms in the 

statute, as long as that interpretation is reasonable. See 

Chevron U.S.A., Inc. v. Natural Resources Defense 

Council, Inc., 467 U.S. 837, 843-44, 81 L. Ed. 2d 694, 

104 S. Ct. 2778 (1984).

In determining to what extent federal agencies must 

consider indirect emissions in their conformity analyses, 

the EPA properly focused upon the provision that forbids 

the federal government to "support in any way" an activity that does not conform to the applicable implementation plan. See 58 Fed. Reg. 63,220-22. That is the only 

proscription [*464] that could describe the relationship between a federal action and a subsequent activity 

that is outside the control or responsibility of the federal 

agency. (The prohibitions on a federal agency's engaging 

in, providing financial assistance for, licensing, permitting, or approving a nonconforming activity, [**34] 

see 58 Fed. Reg. 63,221 n.4, all bar direct federal involvement in a nonconforming activity.) In other words, 

emissions that result from but are not directly produced 

by the federal action itself are covered by the statute only 

if that initial federal action constitutes federal "support" 

of the subsequent event or activity that actually produces 

the emissions in question.

As the EPA pointed out in the preamble to the final 

rule, the word "support" has a wide range of possible 

meanings, "from mere facilitation to continuing responsibility." 58 Fed. Reg. 63,221/3. Under the broadest definition of "support," the EPA noted, the prohibition in 

section 176(c)(1) "might be interpreted to include virtually all Federal activities, since all Federal activities 

could be argued to support, at least in some remote way, 

an action that ultimately emits pollution." 58 Fed. Reg. 

63,221/2. Concluding that the Congress could not have 

intended "such egregious or absurd applications" of section 176(c)(1), id., the EPA settled upon a definition that 

"focuses on the extent to which the Federal agency has 

continuing program responsibilities, and whether it can 

practicably control emissions from its [**35] own and 

other party activities," 58 Fed. Reg. 63,221/3. This is 

certainly a reasonable interpretation, and therefore it is 

entitled to our deference.

Contrary to EDF's contention, the EPA's definition 

of indirect emissions is not inconsistent with the statutory definition of "conformity," which we quoted above. 

EDF maintains that the broad terms of subsection (B) of 

that provision require the agency to take into account all 

reasonably foreseeable emissions, whether produced by 

the federal action itself or by a subsequent action that is 

contingent upon the federal action having been taken. By 

the terms of the statute, however, an agency is required 

to ask whether an activity will "cause or contribute to 

any new violation" or "delay timely attainment" of an air 

quality standard only if the activity that produces the 

emissions will itself be supported in some way by the 

agency. The broad "cause or contribute" provision, 

therefore, pertains only to whether the federally supported activity itself would produce emissions not accounted for in the implementation plan, either at the time 

and place of the activity (direct emissions) or later or 

elsewhere (indirect emissions). See 58 Fed. [**36] 

Reg. 63,218/2 (indirect emissions must be included by 

virtue of "support in any way" criterion, not "cause and 

contribute" criterion).

By its terms, therefore, the statute prescribes a 

two-stage inquiry for federal agencies, and the EPA's 

regulations appropriately recognize and implement this 

structure. First, the agency is to determine whether it will 

be in some way supporting an activity that could potentially produce emissions. Second, the agency is to determine whether that activity conforms to the applicable 

implementation plan, which involves an inquiry into 

whether the activity would, inter alia, cause or contribute 

to a violation of an air quality standard. If the federal 

action leads to or facilitates a subsequent activity that 

could potentially produce emissions, the agency must 

again ask whether the action under consideration will be 

"supporting" that subsequent activity; if so, then the reasonably foreseeable emissions produced by the subsequent activity must also be taken into account as the indirect emissions of the agency action. The EPA's definition of "indirect emissions"--including only those reasonably foreseeable emissions that are within the continuing responsibility [**37] of the agency--is thus entire-
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

ly consistent with the requirement that federally supported activities not cause or contribute to a violation.

Neither are we persuaded that the two other Clean 

Air Act provisions to which EDF refers us are evidence 

that the Congress intended that the general conformity 

rule be applied any more broadly than the EPA has applied it. First, EDF points to section 176(c)(2), the provision requiring conformity for transportation plans and 

projects, in which the Congress specifically required that 

the "emissions from motor vehicles" traveling on a new 

highway be included in the conformity [*465] determination for the highway construction project. 42 

U.S.C. § 7506(c)(2)(A). Because the Congress clearly 

intended that motor vehicle traffic that is outside the 

continuing program responsibility of the Department of 

Transportation be included in the conformity determination, EDF argues, the Congress must also have intended 

the general conformity rule to extend beyond activities 

within the continuing control of the relevant agency. As 

we view this provision, however, it suggests the opposite 

point: the Congress referred explicitly to motor vehicle 

emissions in section 176(c)(2)(A) [**38] precisely 

because such emissions would not necessarily be included in the conformity determination by virtue of the 

provisions setting out the conformity requirements.

Second, EDF directs our attention to section 316(b) 

of the Act, which sets out the conformity requirements 

that apply to EPA grants for construction of sewage 

treatment plants. See 42 U.S.C. § 7616(b). This section 

explicitly authorizes the EPA to withhold or attach conditions to federal sewage treatment grants if the new sewage capacity would "reasonably be anticipated to cause 

or contribute to, directly or indirectly, an increase in 

emissions of any air pollutant in excess of the increase 

provided for under the provisions" of the applicable SIP, 

or if the new capacity "would otherwise not be in conformity with the applicable implementation plan." 42 

U.S.C. § 7616(b)(3). The statute also specifies that in 

nonattainment areas the relevant SIP provisions must 

account for emissions "resulting directly or indirectly 

from areawide and nonmajor stationary source growth." 

42 U.S.C. § 7616(b). According to EDF, the structure of 

this provision implies that the reasonably anticipated 

effects of the newly created treatment [**39] capacity 

are among the relevant factors in concluding whether the 

grant itself is in conformity. As the EPA explained, 

however, this provision is evidence that the Congress 

clearly intended a conformity review in this particular 

area. 58 Fed. Reg. 63,223/3. By specifically requiring 

the conformity analysis to be performed with respect to 

the capacity of the new sewage treatment plant, see 42 

U.S.C. § 7616(b)(3), the Congress indicated that it was 

not satisfied in this area to limit conformity review to 

emissions caused by the construction of the plant, as it 

was for other types of federal construction permits or 

grants. Therefore, as with the transportation provision 

discussed above, we are not persuaded that this provision 

provides evidence that the Congress intended a broader 

application of the general conformity rule than the EPA's 

regulation indicates.

VIII. EXEMPTION FOR NON-MAJOR FEDERAL 

ACTIONS 

The EPA's general conformity regulations apply only to "major" sources of emissions. 58 Fed. Reg. 

63,229/1. This limitation appears in the regulations in the 

form of tonnage thresholds of emissions, below which 

the conformity of the federal action is presumed. 40 

C.F.R. § 51.853(b)(1), [**40] (c)(1), (g)(2). The regulations also identify certain categories of government 

action that are exempt from the conformity rule because 

the emissions increases they produce, if any, are de minimis. These exempt actions include judicial and legislative proceedings, recurring activities such as permit renewals where the activities to be conducted will be similar in scope and operation to activities already being 

conducted, rulemaking and policy development and issuance, routine maintenance and repair activities, civil 

and criminal law enforcement activities, actions related 

to foreign affairs, and so on. See 40 C.F.R. § 

51.853(c)(2), (c)(3) (listing exempt actions).

EDF maintains that these exemptions and thresholds 

are in conflict with the statute. According to EDF, the 

broad prohibition in section 176(c)(1)--"no department, 

agency, or instrumentality of the Federal Government 

shall engage in ... any activity"--shows that the Congress 

intended the general conformity requirement to apply to 

every activity of the federal government, however minor 

a source of emissions it may be. Moreover, the threshold 

levels adopted by the EPA are taken from the major stationary source definitions [**41] promulgated by the 

EPA for the use of states, in doing their SIPs, to determine which sources will be subject to review for compliance with air quality standards. [*466] In the 

present proceeding, argues EDF, the EPA has not and 

could not prove that these exemptions are truly de minimis: the cumulative effect of the exempted federal actions would produce at least some negative impact upon 

a state's prospects of attaining the national air quality 

standards.

As we explained in Alabama Power Co. v. Costle, 

204 U.S. App. D.C. 51, 636 F.2d 323 (D.C. Cir. 1979), 

categorical exemptions from the requirements of a statute 

may be permissible "as an exercise of agency power, 

inherent in most statutory schemes, to overlook circumstances that in context may fairly be considered de minimis." Id. at 360. This principle derives from the commonplace notion that "the law does not concern itself 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

with trifling matters." Id. The ability to create a de minimis [**42] exemption "is not an ability to depart from 

the statute, but rather a tool to be used in implementing 

the legislative design." Id.

Of course, as EDF points out, a de minimis exemption cannot stand if it is contrary to the express terms of 

the statute. See, e.g., Public Citizen v. Young, 265 U.S. 

App. D.C. 349, 831 F.2d 1108, 1122 (D.C. Cir. 1987)

(rejecting agency's attempt to create de minimis exemption for certain chemicals that caused cancer in animals 

but posed only minuscule risk to humans, because statute 

barred listing of chemicals causing cancer "in man or 

animal"); Sierra Club v. EPA, 301 U.S. App. D.C. 175, 

992 F.2d 337, 343-45 (D.C. Cir. 1993); Kokechik Fishermen's Ass'n v. Secretary of Commerce, 268 U.S. 

App. D.C. 116, 839 F.2d 795, 801-02 (D.C. Cir. 1988). 

As long as the Congress has not been "extraordinarily 

rigid" in drafting the statute, however, "there is likely a 

basis for an implication of de minimis authority to provide [an] exemption when the burdens of regulation yield 

a gain of trivial or no value." Alabama Power, 636 F.2d 

at 360-61; see also Public Citizen v. FTC, 276 U.S. App. 

D.C. 222, 869 F.2d 1541, 1556-57 (D.C. Cir. 1989)

(doctrine permits exemptions when application of statute 

would have no benefit, not merely when agency [**43] 

concludes that costs exceed benefits). For example, in 

State of Ohio v. EPA, 302 U.S. App. D.C. 318, 997 F.2d 

1520 (D.C. Cir. 1993), we upheld the EPA's recognition 

of a de minimis exemption from a statute requiring periodic review of certain Superfund sites; the EPA's regulation required periodic review only of sites where hazardous substances remained at levels precluding unrestricted use of and exposure to the site, thus exempting 

the sites at which a nonhazardous amount remained. The 

exemption stood because the Congress had not set out its 

requirement for periodic review in rigid terms: the statute 

requiring periodic review for a site at which "any hazardous substances" remain, we concluded, could easily 

be referring to "even one" hazardous substance, as opposed to "any amount of any hazardous substance." 997 

F.2d at 1534-35. Moreover, we noted in that case, as we 

had in Public Citizen v. Young, that "the literal meaning 

of a statute need not be followed where the precise terms 

lead to absurd or futile results, or where failure to allow a 

de minimis exemption is contrary to the primary legislative goal." Id. at 1535. Because the EPA's regulation 

avoided a "mammoth monitoring burden" and yet [**44] 

"squared with the health-protective purpose of the statute," we concluded that to require a different result 

would be "to adjudge Congress incompetent to fashion a 

rational legislative design." Id. at 1534-35.

In this case, as in Ohio v. EPA, we do not think that 

the Congress has taken a position so rigid that it will not 

admit of a de minimis exemption. Although the terms of 

the statute do prohibit the federal government from engaging in "any activity" that is not in conformity, it 

seems eminently reasonable for the EPA to interpret this 

provision to refer to "any activity" that is likely to interfere with the attainment goals in a SIP--that is, to major 

federal actions and to lesser actions that could still produce a regionally significant level of emissions. See 40 

C.F.R. § 51.853(b), (i); 58 Fed. Reg. 63,229/1 (applying 

conformity requirements to de minimis actions would 

generate "vast numbers of useless conformity statements"). The purpose of section 176(c)(1), after all, is 

not to minimize emissions but to ensure that federal actions conform with state implementation plans. 58 Fed. 

Reg. 63,215/2. Moreover, we find nothing in the statute 

to preclude the [*467] EPA's identification [**45] of 

categories of federal action that would produce either no 

or a trivial level of emissions; these activities by definition could not threaten a state's attainment of the goals in 

its SIP. Although a series of de minimis federal actions, 

taken together, could conceivably effect a significant 

environmental harm, the EPA appropriately did not consider the cumulative effect of the exempted federal actions; the statute requires each individual federal activity 

to be in conformity with the SIP and does not demand a 

mechanism that would evaluate the emissions of various 

federal activities in the aggregate.

EDF contends, in the alternative, that the EPA's 

ability to create de minimis exemptions is conditioned 

upon its providing a higher level of justification than it 

gave in this case. In Alabama Power, it is arguable, we 

indicated that a high level of justification is indeed necessary to support a de minimis exemption. See 636 

F.2d at 360 ("Determination of when matters are truly de 

minimis naturally will turn on the assessment of particular circumstances, and the agency will bear the burden of 

making the required showing"). We decided Alabama 

Power, however, before the Supreme [**46] Court's 

decision in Chevron, which clarified the degree to which 

a reviewing court should defer to an agency acting within 

the scope of its delegated authority, whether implicit or 

explicit. To the extent that both Chevron and Alabama 

Power address agency power inherent in a statutory 

scheme, the same deference due to an agency's reasonable interpretation of an ambiguous statute may also be 

due to an agency's creation of a de minimis exemption. 

Thus, in Ohio v. EPA we upheld a de minimis exemption 

after finding it to be "permissible" under the statute--the 

same standard applied by the Supreme Court in the 

second step of the Chevron analysis. See Ohio, 997 F.2d 

at 1535; Chevron, 467 U.S. at 843; see also Western 

Nebraska Resources Council v. EPA, 943 F.2d 867, 870 

(8th Cir. 1991) (upholding exemption as "permissible" 

construction of statute, and citing both Alabama Power

and Chevron). But see Natural Resources Defense Council, Inc. v. EPA, 966 F.2d 1292, 1306 (9th Cir. 1992)
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

(rejecting de minimis exemption because of "lack of data" to show that regulation would be of "trivial or no 

value").

In this case, however, we need not resolve whether, 

[**47] under Chevron, an agency may create a de minimis exemption with a justification less rigorous than 

we indicated in Alabama Power, because the EPA has 

adequately explained itself even by the standard of the 

latter case. The tonnage requirements that the EPA 

adopted in the final rule are taken from the major stationary source definitions because these thresholds are a 

reasonable measure of the level of emissions that would 

result from a major federal action, and that limitation is 

entirely reasonable given the aforementioned futility and 

wastefulness of applying the conformity requirements to 

all federal actions, however minor. 58 Fed. Reg. 

63,228-29. When the EPA chose to deviate from these 

standards by prescribing a lower tonnage threshold for 

lead, it explained that this adjustment was required because even relatively small increases in lead emissions, 

as compared to other pollutants, may threaten a state's 

ability to attain the national standards for lead. 58 Fed. 

Reg. 63,229/1. Moreover, the EPA provided a safety net 

to account or actions that produce emissions at a level 

lower than the tonnage requirements but still high 

enough to be "regionally significant" for that particular 

pollutant, see 40 C.F.R. § 51.853 (i); the tonnage requirements are therefore not the sole basis upon which an 

agency is to determine whether a conformity analysis is 

warranted, and the EPA need not have justified the requirements as if they were. Given that the tonnage requirements in this context serve only to ensure conformity with SIPs and do not purport to distinguish between 

those federal actions that are harmful to the environment 

and [**48] those that are not, a more specific analysis 

linking the actual threshold levels with the goal of public 

health was not necessary.

Finally, that the categorical exemptions are de minimis is entirely self-evident; the EPA has concluded that 

these activities "would result in no emissions increase or 

an increase in emissions that is clearly de minimis," 40 

C.F.R. § 51.853(c)(2), and we neither see nor would expect to find any evidence to the contrary. The brevity of 

the EPA's explanations therefore does not preclude us 

from affirming these provisions as an appropriate exercise of the EPA's authority, inherent in the statutory 

scheme, to create de minimis exemptions.

IX. CONFORMITY WITH PROMISED SIP REVISIONS 

The EPA's general conformity rule permits an 

agency to approve an activity [*468] when it conforms not with the SIP currently in place but with the SIP 

as it will be when the state carries out a commitment to 

revise it; in other words, the regulation permits a state to 

change its SIP to accommodate a federal action, as long 

as the state complies with certain safeguards intended to 

ensure that the revision is actually forthcoming. See 40 

C.F.R. § 51.858(a)(5)(i)(B). EDF argues that [**49] 

this provision is contrary to the Congress's command that 

federally supported activities conform to "an implementation plan after it has been approved or promulgated 

under section 7410 of this title." 42 U.S.C. § 7506(c)(1).

EDF did not present this argument during the rulemaking proceedings. The provision at issue, however, 

was not included in the proposed rule, so EDF would 

have had to present its argument, if at all, in a petition for 

reconsideration. Because the Clean Air Act, unlike some 

others, does not, for regulations such as this one, require 

exhaustion of all available remedies, compare, e.g., National Labor Relations Act, 29 U.S.C. § 160(e) with

Clean Air Act, 42 U.S.C. § 7607(b)(1), EDF's failure to 

bring a petition for reconsideration does not preclude our 

hearing its argument. Cf. Darby v. Cisneros, 509 U.S. 

137, 113 S. Ct. 2539, 2548, 125 L. Ed. 2d 113 (1993)

(holding § 10(c) of APA, similar in substance to Clean 

Air Act, precludes court from requiring litigants "to exhaust optional appeals"); Ciba-Geigy Corp. v. EPA, 310 

U.S. App. D.C. 291, 46 F.3d 1208, 1210 n.2 (D.C. Cir. 

1995). Although in a more fact-intensive case we might 

invoke the prudential doctrine of ripeness and remand to 

the agency an issue raised here in the first instance, 

[**50] see, e.g., Ciba-Geigy, 46 F.3d at 1210, we do 

not think that is necessary in this case.

The plain meaning, if there is one, controls our interpretation of a statute "except in the "rare cases [in 

which] the literal application of a statute will produce a 

result demonstrably at odds with the intentions of its 

drafters.' " United States v. Ron Pair Enterprises, Inc., 

489 U.S. 235, 242, 103 L. Ed. 2d 290, 109 S. Ct. 1026 

(1989) (quoting Griffin v. Oceanic Contractors, Inc., 458 

U.S. 564, 571, 73 L. Ed. 2d 973, 102 S. Ct. 3245 (1982)). 

This is one of those rare cases. This case requires a more 

flexible, purpose-oriented interpretation if we are to 

avoid "absurd or futile results." Alabama Power v. Costle, 204 U.S. App. D.C. 51, 636 F.2d 323, 360 n.89 (D.C. 

Cir. 1979) (quoting United States v. American Trucking 

Ass'ns, 310 U.S. 534, 543, 84 L. Ed. 1345, 60 S. Ct. 1059 

(1939)).

Section 176(c) of the Clean Air Act was adopted as 

one part of a larger regulatory program through which 

federal and state governments work together to control 

air pollution. While the air quality standards are developed by the EPA, see 42 U.S.C. § 7409, the Congress 

directed each state to develop and submit for the EPA's 

approval a state implementation plan containing the 

state's strategies for achieving the [**51] air quality 

standards, see 42 U.S.C. § 7410. Section 176(c)(1) was 
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1996 U.S. App. LEXIS 8471, **; 42 ERC (BNA) 1577

enacted to prevent federal activities from interfering with 

the efforts of a state to attain the goals set out in its SIP. 

As the EPA explains, "this integration of Federal actions 

and air quality planning is intended to protect the integrity of the SIP by helping to ensure that SIP growth projections are not exceeded, emissions reduction progress 

targets are achieved, and air quality attainment and 

maintenance efforts are not undermined." 58 Fed. Reg. 

63,215/2.

Read literally, section 176(c)(1) of the Clean Air Act 

requires that a federal action conform to the implementation plan that is currently in place, not to a revised plan 

that has yet to be examined and approved by the EPA. 

See 58 Fed. Reg. 63,237-38 ("The plain language of the 

statute does not allow the flexibility suggested" by the 

comment proposing that conformity determinations be 

based upon the most recent SIP revisions submitted to 

EPA). When the state expresses a willingness to revise 

its SIP specifically to account for the emissions that will 

arise from a proposed federal action, the literal terms of 

the statute would prevent the federal action [**52] from 

proceeding until such time as a full-fledged SIP revision 

could be developed, submitted, and approved. The result 

would be to frustrate the process of state and federal cooperation and the integrated planning that section 

176(c)(1) was created to foster; this rigid application of 

the conformity rule would block a federal action that the 

state desires and promises to accommodate [*469] 

through the appropriate adjustments to levels of emissions from other sources. Because this literal reading of 

the statute would actually frustrate the congressional 

intent supporting it, we look to the EPA for an interpretation of the statute more true to the Congress's purpose.

As the EPA explained in its preamble to the final 

rule, section 51.858(a)(5)(i) of the regulations "is consistent with the congressional desire to assure that State 

plans are not undermined by Federal actions; thus, where 

the State voluntarily commits to revise its SIP so that a 

Federal action conforms, that action would not undermine the State's decision-making ability and should be 

allowed to conform." 58 Fed. Reg. 63,236/1. The circumstances in which this provision applies are quite 

narrow; in order to ensure that the SIP will [**53] indeed be revised as promised, a commitment "must be 

made by the Governor or Governor's designee for submitting SIP revisions and must provide for revision of 

the SIP so that emissions from the Federal action would 

conform to the SIP emission budget in a time period 

consistent with the time that emissions from a Federal 

action would occur." Id. This commitment must include, 

inter alia, a specific schedule for SIP revision, identification of specific accommodation measures that would be 

taken, and written documentation to support the conformity determination. Given these safeguards, as well as 

the enforcement power wielded by the EPA, see 40 

C.F.R. § 51.858(a)(5)(i)(C); 42 U.S.C. § 7509, we find 

that the regulation is reasonable, narrowly drawn, consistent with the purpose of the Act, and therefore within 

the EPA's discretion.

For the preceding reasons, the petitions for review 

are

Denied.