Opinion ID: 780570
Heading Depth: 2
Heading Rank: 7

Heading: conformity determination under the caa

Text: 129 Petitioners also contend that DOT acted arbitrarily and capriciously in failing to conduct a conformity determination under the CAA. The CAA requires EPA to establish air quality standards for certain pollutants, 42 U.S.C. § 7409, and it has done so with respect to NOx and PM-10, the pollutants most at issue here, 40 C.F.R. § 50.6, .7, .11. Each state, in turn, is required to adopt and submit for EPA approval a State Implementation Plan (SIP) for each pollutant. 42 U.S.C. § 7410(a)(1). Each state is divided into air quality control regions, which are classified as attainment or nonattainment with respect to each pollutant for which there exists an air quality standard. Id. § 7407. SIPs must contain emissions limitations and other measures designed to bring nonattainment regions into attainment. Id. § 7410(a)(2). 130 To ensure compliance with these plans, the CAA contains a conformity requirement, mandating that [n]o 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 [a SIP]. Id. § 7506(c)(1). Most federal actions affecting levels of pollutants in nonattainment regions require that the responsible agency conduct a conformity determination. 40 C.F.R. § 93.150-.160. However, two categories of federal action are exempted from this requirement: (1) [a]ctions where the total of direct and indirect emissions are below the emissions level specified in [the regulations], id. § 93.153(c)(1); and (2) [a]ctions which would result in no emissions increase or an increase in emissions that is clearly de minimis, including [r]ulemaking and policy development and issuance, id. § 93.153(c)(2). DOT argues that its regulations fall within both of the above-listed exceptions: that the total emissions caused by the regulations fall below the specified amount, and that the regulations are categorically excluded from the statutory requirements because they are rulemaking. We review under the arbitrary and capricious standard an agency's decisions regarding SIP conformity determinations, as well as its decisions that certain projects do not require conformity determinations. Olmsted Falls, 292 F.3d at 270. 131 DOT's assessment that its regulations will cause emissions below the amounts specified in 40 C.F.R. § 93.153(b)(1), thus excusing it from making a conformity determination, is based on the predicted emissions in its EA. As we have already determined, however, DOT failed to conduct a reliable environmental analysis. Because of its illusory distinction between the effects of the regulations themselves and the effects of the presidential rescission of the moratorium on Mexican truck entry, DOT systematically underestimated the emissions that would result from its regulations. Furthermore, there were a number of methodological flaws in DOT's EA, including, most relevantly for CAA purposes, the failure to consider its regulations' environmental impact on a local or regional basis. 132 The CAA mandates that each state be divided into air quality control regions, which are evaluated individually as to their compliance with air quality standards. 42 U.S.C. § 7407. Thus, proper CAA analysis must be conducted at the local and regional levels. The national emissions analysis in DOT's EA is inadequate to comply with the CAA. Because DOT is required to perform a new, more thorough region-by-region environmental analysis to achieve compliance with NEPA, it should also determine, as a result of its new analysis, whether the emissions resulting from its actions will truly fall below the levels established in § 93.153(b)(1). Cf. Olmsted Falls, 292 F.3d at 270-73 (holding that petitioners did not meet their burden of proof on whether a conformity determination was required by simply suggesting that it was an open question whether the emissions limits would be exceeded). 133 Second, DOT claims that by listing [r]ulemaking as a type of [a]ction[] which would result in no emissions increase or an increase in emissions that is clearly de minimis, 40 C.F.R. § 93.153(c)(2), the EPA intended to exempt all federal regulations from the requirements of the CAA. Petitioners respond that the exception encompasses only the process of rulemaking itself, but not the agency's implementation and execution of validly promulgated regulations. A careful reading of the EPA regulations, keeping the statutory purpose in mind, dispenses with DOT's erroneous, albeit novel, assertion. 134 The first striking element is that rulemaking is listed as a type of [a]ction[] which would result in no emissions increase or an increase in emissions that is clearly de minimis. Id. If the EPA drafters truly intended to exempt all federal regulations from the conformity determination requirement, they certainly would have been aware that some federal regulations do in fact result in an increase in emissions (or an increase that is not merely de minimis). Indeed, the EPA regulations specify that there are two kinds of emissions, direct emissions and indirect emissions. Id. § 93.152. Indirect emissions are defined as: 135 those emissions ... that ... [a]re caused by the Federal action, but may occur later in time ... from the action itself but are still reasonably foreseeable; and ... [t]he Federal agency can practicably control and will maintain control over due to a continuing program responsibility of the Federal agency. Id. Caused by was used to refer to emissions that would not otherwise occur in the absence of the Federal action. Id. 136 Using the but-for analysis suggested by the EPA regulations, a substantial number of federal regulations would result in emissions above de minimis levels. If the EPA had wished to exclude all federal regulations from the scope of this requirement, it easily could have made a bolder statement exempting all federal regulations, regardless of whether they cause direct or indirect emissions. 137 Another clue as to the proper interpretation of the de minimis exception is the fact that the exception is for rulemaking and policy development and issuance. Id. § 93.153(c)(2)(iii). This juxtaposition strongly suggests that Petitioners are correct in arguing that the rulemaking exception should apply only to the process of developing and issuing federal regulations, as opposed to the substantive result produced by the actual implementation of the final rules. 138 Finally, it is relatively easy to imagine federal regulations or policies that could have drastic effects on emissions of regulated substances. Even assuming that it is possible the EPA intended these regulations to exclude such actions from the ambit of the CAA's statutory requirements, such a reading would conflict with the basic command of the statute: 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 [a SIP]. 42 U.S.C. § 7506(c)(1). A federal regulation in conflict with a federal statute is invalid as a matter of law. Watson v. Proctor (In re Watson), 161 F.3d 593, 598 (9th Cir.1998) (citing Chem. Mfrs. Ass'n v. Natural Res. Defense Council, Inc., 470 U.S. 116, 126, 105 S.Ct. 1102, 84 L.Ed.2d 90 (1985)) (emphasis in original). Consequently, the Supreme Court has held that an agency's interpretation of a regulation that conflicts with the plain language of the statute is entitled to no deference. Pub. Employees Ret. Sys. v. Betts, 492 U.S. 158, 171, 109 S.Ct. 2854, 106 L.Ed.2d 134 (1989). Thus, we read the EPA regulation, to preserve its validity, so that the categorical exception encompasses only the development and issuance of federal regulations, not the substantive results of their promulgation and implementation. 139 This conclusion does not conflict with Environmental Defense Fund, Inc. v. EPA, 82 F.3d 451 (D.C.Cir.) (per curiam), as amended, 92 F.3d 1209 (D.C.Cir.1996). In Environmental Defense Fund, the D.C. Circuit examined the validity of EPA regulations nearly identical to those here, 7 and specifically concluded that the de minimis exceptions were an appropriate exercise of the EPA's authority, inherent in the statutory scheme. Id. at 467. In examining the regulations, the court considered the conclusion that the categorical exemptions are de minimis [to be] 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,' and we neither see nor would expect to find any evidence to the contrary. Id. (quoting 40 C.F.R. § 51.853(c)(2)). Had the D.C. Circuit been reading the EPA regulations in the manner DOT suggests, it certainly would expect to find at least some evidence tending to contradict such a premise. Though it did not discuss the rulemaking exception specifically, the D.C. Circuit suggests that it would have invalidated the EPA regulation as conflicting with the CAA had the language or context suggested such a broad reading of the regulation. Thus, we decline DOT's suggestion to read the EPA regulation in a way that would tend to under-mine its validity.