Opinion ID: 3065495
Heading Depth: 3
Heading Rank: 2

Heading: MacClarence’s Petition

Text: [1] This petition for review requires us, for the first time, to consider a petitioner’s burden under 42 U.S.C. 3422 MACCLARENCE v. USEPA § 7661d(b)(2) to “demonstrate[ ] to the Administrator that [a Title V] permit is not in compliance with the requirements of [the CAA].” § 7661d(b)(2). Specifically, we must determine whether the Administrator’s interpretation of the word “demonstrate,” as expressed in his order denying MacClarence’s petition, was a permissible construction of § 7661d(b)(2), and whether the Administrator’s application of § 7661d(b)(2) to the petition was arbitrary and capricious. Chevron provides the guiding principles for according deference to an agency’s interpretation of a statute it administers. See 467 U.S. at 842. Here, it is undisputed that EPA is tasked with the administration of the CAA. Therefore, we first decide “whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear . . . the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.” Id. at 842-43. If, however, the statute is ambiguous, “Chevron deference applies, ‘when it appears that Congress delegated authority to the agency generally to make rules carrying the force of law, and that the agency interpretation claiming deference was promulgated in the exercise of that authority.’ ” Nw. Ecosystem Alliance v. United States Fish & Wildlife Serv., 475 F.3d 1136, 1141 (9th Cir. 2007) (quoting United States v. Mead Corp., 533 U.S. 218, 226-27 (2001)). Under Chevron deference, the agency’s interpretation is valid so long as it “is based on a permissible construction of the statute.” Chevron, 467 U.S. at 843. When Chevron deference does not apply, we are guided by the principles of Skidmore v. Swift, 323 U.S. 134 (1944); “[t]he ‘fair measure of deference’ may then range from ‘great respect’ to ‘near indifference,’ depending on ‘the degree of the agency’s care, its consistency, formality, and relative expertness, and . . . the persuasiveness of the agency’s position.’ ” Nw. Ecosystems Alliance, 475 F.3d at 1141 (quoting Mead, 533 U.S. at 228). [2] Several of our sister circuits have concluded that the word “demonstrate” in § 7661d(b)(2) is an ambiguous term. MACCLARENCE v. USEPA 3423 See Sierra Club v. EPA, 557 F.3d 401, 406 (6th Cir. 2009); Sierra Club v. Johnson (Sierra Club II), 541 F.3d 1257, 1266 (11th Cir. 2008); Citizens Against Ruining the Environment v. EPA, 535 F.3d 670, 677-78 (7th Cir. 2008); N.Y. Pub. Interest Research Group v. Johnson (“NYPIRG II”), 427 F.3d 172, 179 (2d Cir. 2005). We agree. The word “demonstrate” may mean variously, to “point out;” “to manifest clearly, certainly, or unmistakably;” or “to make evident or reveal as true by reasoning processes, concrete facts and evidence, experimentation, operation, or repeated examples.” Webster’s Third New International Dictionary 600 (1993). As the Eleventh Circuit pointed out in Sierra Club II, the plain meaning of the term “demonstrate” in § 7661d(b)(2) “does not resolve important questions that are part and parcel of the Administrator’s duty to evaluate the sufficiency of a petition, for example, the type of evidence a petitioner may present and the burden of proof guiding the Administrator’s evaluation of when a sufficient demonstration has occurred.” 541 F.3d at 1266. The ambiguity of this provision in the statute suggests that Congress has left the meaning of “demonstrate” open for EPA to supply a reasonable interpretation under Chevron. See NYPIRG I, 321 F.3d at 333 n.11 (“There clearly is some room for the exercise of agency expertise in [§ 7661d(b)(2)] . . . .”). [3] Whether we defer to the Administrator’s interpretation of “demonstrate” under Chevron’s reasonableness standard or Skidmore’s persuasiveness standard, nothing in the Administrator’s order denying MacClarence’s petition qualifies as an impermissible interpretation of his burden under § 7661d(b)(2). The Administrator denied MacClarence’s petition, in part, because MacClarence “failed to provide adequate information to support his claim that the entire PBU should be aggregated . . . .” Specifically, he noted that MacClarence “ma[d]e only generalized statements that all facilities in the PBU must be aggregated and d[id] not provide adequate references, legal analysis, or evidence in support of these general assertions.” 3424 MACCLARENCE v. USEPA [4] This construction of MacClarence’s burden under § 7661d(b)(2) is both reasonable and persuasive, and is consistent with our common understanding of the word “demonstrate.” The Administrator’s expectation that MacClarence provide “references, legal analysis, or evidence” comports with Webster’s definition of “demonstrate”—“to make evident or reveal as true by reasoning processes, concrete facts and evidence, experimentation, operation, or repeated examples.” New International Dictionary, supra, at 600. Further, the Administrator’s interpretation is consistent with § 7661d(b)(2) as a whole, which mandates that the Administrator “shall issue an objection” to the permit with which the permitting authority must comply, should a petitioner satisfy his burden under the statute. See Sierra Club v. Johnson (Sierra Club I), 436 F.3d 1269, 1280 (11th Cir. 2006) (quoting 42 U.S.C. § 7661d(b)(2)) (holding that the Administrator’s duty to object to a permit once a petitioner demonstrates that it does not comply with the CAA is mandatory, not discretionary); NYPIRG I, 321 F.3d at 333 (same). Because a petition that properly demonstrates that a permit is not in compliance with the CAA requires the Administrator and state permitting authority to take certain action, the Administrator’s requirement that MacClarence support his allegations with legal reasoning, evidence, and references is reasonable and persuasive. [5] Thus, the Administrator’s conclusion that MacClarence “failed to provide adequate information to support his claim that the entire PBU should be aggregated” was not arbitrary or capricious. The success of MacClarence’s petition turned on his argument that aggregation of the entire PBU pollutantemitting sources was necessary for the permit to comply with the CAA and that the final aggregation decision — the huband-spoke model — did not comply with the CAA. Rather than offering a reasoned analysis of why the entire PBU should be aggregated or of the deficiencies in the hub-andspoke model, MacClarence merely stated in his petition: MACCLARENCE v. USEPA 3425 As reinforced by ADEC’s original analysis, shown at Attachment 2, the March 7, 2003 version of this permit complies with all federal requirements for source aggregation. ADEC’s rationale for requiring aggregation is based on EPA directives. By contrast, the permit decisions referenced in the final permit are at variance with your agency’s own guidance. Although MacClarence’s March 2002 comments and ADEC’s March 2003 Statement of Basis, which were attached to the petition, provided an explanation of why aggregation of the entire PBU pollutant-emitting sources was necessary to comply with the CAA, he merely alleged that the final aggregation decision, the hub-and-spoke model, was “at variance with [EPA’s] own guidance.”5 Neither MacClarence’s petition nor the documents attached to the petition address EPA guidance memoranda or directives with which the hub-and-spoke model conflicted or explained how the hub-and-spoke model contravened such guidance or the CAA.6 At the end of his petition, MacClarence did challenge ADEC’s reliance on permit decisions by other states to support its final aggregation decision. His brief discussion of these references, however, noted only that the facilities at issue in those other permit decisions were dissimilar to the PBU, and at best, showed that those permit decisions did not support ADEC’s decision to adopt a hub-and-spoke aggregation model. MacClarence made no attempt to show that the 5 MacClarence argues that the Administrator did not consider the documents he attached to his petition in evaluating his arguments and thus prohibited him from “incorporating by reference” arguments and other information. In light of the Administrator’s statement that he considered “available information, including . . . information provided by the Petitioner in his petition,” we are not persuaded by this argument. 6 MacClarence’s attempt to challenge the merits of the hub-and-spoke aggregation model before this court are unavailing. Our review is limited to the record before the Administrator. Asarco, Inc. v. EPA, 616 F.2d 1153, 1158-60 (9th Cir. 1980). 3426 MACCLARENCE v. USEPA hub-and-spoke model was at “variance” with the CAA or any other EPA guidance. MacClarence also argues that the Administrator improperly faulted him for failing to challenge the reasonableness of ADEC’s Statement of Basis for the final permit. In denying MacClarence’s petition, the Administrator stated that MacClarence “does not provide any argument as to why ADEC’s decision not to aggregate [the entire PBU], which is described in great detail in the Statement of Basis for the final Revision 1 permit, is unreasonable.” MacClarence argues that this statement reflects an improper interpretation of his burden under § 7661d(b)(2) by requiring him to show the “unreasonableness” of ADEC’s rationale for employing the hub-andspoke model in the final permit, rather than the final permit’s noncompliance with the CAA. [6] We reject this argument. The Administrator’s order denying MacClarence’s petition properly sets forth MacClarence’s burden under § 7661d(b)(2), stating that “[t]o justify exercise of an objection by EPA to a title V permit pursuant to [§ 7661d(b)(2)], a petitioner must demonstrate that the permit is not in compliance with the requirements of the CAA” and later concluding that “the general allegations of the Petitioner in the April 2004 Petition . . . fail to demonstrate a basis for Petitioner’s claim that Revision 1 to the GC 1 Permit violates the CAA . . . .” In light of the Administrator’s proper recitation of MacClarence’s burden, we view the Administrator’s statement that MacClarence should have shown that ADEC’s explanation for its aggregation decision was unreasonable, as requiring MacClarence to challenge the basis or reasons for ADEC’s final decision and to demonstrate that the permit did not comply with the CAA. We see nothing wrong with the Administrator’s expectation that MacClarence needed to challenge this reasoning. MacClarence’s petition relied on ADEC’s March 2003 Statement of Basis. ADEC, however, rejected the aggregation decisions reflected in that Statement of Basis and explained why it did so in the new MACCLARENCE v. USEPA 3427 Statement of Basis for the final permit. The Administrator reasonably expected MacClarence to challenge that explanation. [7] Further, the Administrator’s conclusion that MacClarence did not challenge ADEC’s reasoning for the final permit was not arbitrary or capricious. ADEC’s final Statement of Basis explained how the hub-and-spoke aggregation model complied with the CAA, why complete aggregation of the facilities in the PBU was impractical and unprecedented, and why the hub-and-spoke model was a better alternative than complete aggregation. Although MacClarence asserted in his petition that the out-of-state permit decisions cited by ADEC did not support its final aggregation decision, his petition failed to demonstrate that the hub-and-spoke aggregation model did not comply with the CAA. More importantly, MacClarence failed to challenge ADEC’s reasoning that “[t]he complexity of administering . . . and operating . . . a stationary source as large as the PBU without clear corresponding environmental benefit argues against [the aggregation of the entire PBU].” Therefore, we conclude that the Administrator’s determination that MacClarence did not demonstrate that the entire PBU should be aggregated did not constitute an impermissible interpretation of MacClarence’s burden under 42 U.S.C. § 7661d(b)(2), to “demonstrate” that ADEC’s final Title V permit for BP’s GC 1 did not comply with the CAA, nor was it arbitrary or capricious. PETITION DENIED.