Court Opinion

ID: 9960444
Source: CourtListenerOpinion
Date Created: 2024-04-16 14:11:08.968283+00
Date Added: 2024-06-11T08:19:28.292445
License: Public Domain

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pennsylvania Independent Oil & Gas        :
Association, Pennsylvania Grade           :
Crude Oil Coalition, and Pennsylvania     :
Independent Petroleum Producers           :
Association,                              :
                                          :
                        Petitioners       :
                                          :
                v.                        : No. 574 M.D. 2022
                                          : Submitted: December 6, 2023
Department of Environmental               :
Protection of the Commonwealth of         :
Pennsylvania and Environmental            :
Quality Board of the Commonwealth         :
of Pennsylvania,                          :
                                          :
                        Respondents       :

BEFORE:     HONORABLE RENÉE COHN JUBELIRER, President Judge
            HONORABLE PATRICIA A. McCULLOUGH, Judge
            HONORABLE ANNE E. COVEY, Judge
            HONORABLE MICHAEL H. WOJCIK, Judge
            HONORABLE ELLEN CEISLER, Judge
            HONORABLE LORI A. DUMAS, Judge
            HONORABLE STACY WALLACE, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION
BY JUDGE WOJCIK                                        FILED: April 16, 2024

            Before this Court, in our original jurisdiction, are the Preliminary
Objections (POs) of the Commonwealth of Pennsylvania, Department of
Environmental Protection (DEP), and Environmental Quality Board (EQB)
(collectively, the Agencies) to the Pennsylvania Independent Oil & Gas Association,
Pennsylvania Grade Crude Oil Coalition, and Pennsylvania Independent Petroleum
Producers Association’s (collectively, Petitioners) Petition for Review in the Nature
of a Complaint for Declaratory Relief (PFR) challenging the promulgation of the
emergency-certified final-omitted “Control of VOC[1] Emissions from Conventional
Oil and Natural Gas Sources” (Conventional VOC Regulation). For the reasons that
follow, we overrule the Agencies’ POs.

                                        I. Background
               Petitioners, which are trade organizations representing conventional oil
and natural gas producers, filed this action pursuant to the Declaratory Judgments
Act (DJA), 42 Pa. C.S. §§7531-7541, seeking a determination of legal rights and
obligations with regard to the Agencies’ rulemaking and the adoption of the
emergency-certified final-omitted Conventional VOC Regulation, which went into
effect on December 2, 2022. The Agencies promulgated the Conventional VOC
Regulation pursuant to their authority under the Air Pollution Control Act 2 to
implement standards set forth in the federal Clean Air Act.3 The Clean Air Act
required States to establish “reasonably available control technology” (RACT) to
control VOC emissions, which contribute to ozone formation, from the oil and
natural gas industry emission sources by December 16, 2022, or face sanctions. To
facilitate compliance, on October 16, 2016, the United States (U.S.) Environmental
Protection Agency (EPA) issued the “Control Techniques Guidelines for the Oil and

      1
          Volatile Organic Compounds.

      2
          Act of January 8, 1960, P.L. (1959) 2119, as amended, 35 P.S. §§4001-4015.

      3
          42 U.S.C. §§7401-7671q.
                                               2
Natural Gas Industry” (Federal Guidelines), which provided information to assist
States in determining what constitutes RACT for VOC emissions. The Federal
Guidelines make no distinction between unconventional and conventional oil and
gas operations. PFR, ¶¶1-7, 9, 16-18.
                Guided by the Federal Guidelines, the Agencies engaged in five
rulemaking actions over the course of six years pursuant to the Regulatory Review
Act4 (RRA) and Commonwealth Documents Law5 (CDL) to comply with the federal
mandate. Rulemaking is the process by which agencies adopt regulations.6

       4
           Act of June 25, 1982, P.L. 633, as amended, 71 P.S. §§745.1-745.14.

       5
          Act of July 31, 1968, P.L. 769, as amended, 45 P.S. §§1102-1602; 45 Pa. C.S. §§501-
907. Former Section 101 of the CDL, formerly 45 P.S. §1101, which constituted the short title,
was repealed by the Act of July 9, 1976, P.L. 877. In the absence of a new title, we continue to
refer to the act as the “Commonwealth Documents Law.”

       6
          Typically, the rulemaking process includes public notice of the agency’s intention to
promulgate an administrative regulation and the opportunity to comment. Section 201 of the CDL,
45 P.S. §1201. Such notice shall include the text of the proposed regulation, a statement of
statutory authority, a brief explanation, and a request for written comments by any interested
persons. Id. The agency shall hold a public comment period which shall commence with the
publication of the proposed rulemaking in the Pennsylvania Bulletin for at least 30 days.
71 P.S. §745.5(b). The agency shall review and consider any written comments submitted
pursuant to Section 201 and may hold public hearings as appropriate. Section 202 of the CDL,
45 P.S. §1202; see Section 5.1(a) of the RRA, 71 P.S. §745.5a(a).

        In addition, Section 5(a) of the RRA requires the agency to submit the proposed regulation
and regulatory analysis to the Independent Regulatory Review Commission (IRRC) and the
Pennsylvania House of Representatives and Senate Committees that oversee the agency
(legislative committees). 71 P.S. §745.5(a). A regulation that follows these notice and comment
procedures is referred to as a “final-form regulation.” Section 3 of the RRA, 71 P.S. §745.3.

       “[P]rocedures exist to expedite the administrative rulemaking process.” Corman v. Acting
Secretary of Pennsylvania Department of Health, 267 A.3d 561, 574 n.5 (Pa. Cmwlth.), aff’d, 268
A.3d 1080 (Pa. 2021). Under limited circumstances, an agency may omit the public notice and
comment procedures and proceed to “final-omitted” rulemaking if the agency for “good cause”
(Footnote continued on next page…)
                                                3
              The Agencies’ first and second rulemaking proceedings proposed a
regulation implementing RACT requirements to reduce VOC emissions for both
unconventional and conventional oil and natural gas sources in a combined VOC
rulemaking proceeding (combined rulemaking). PFR, Exhibit No. 2; see 50 Pa. B.
2633 (2020). After notice and comment, on March 15, 2022, the EQB submitted the
final-form “Control of VOC Emissions from Oil and Natural Gas Sources”

finds that the notice and comment procedures are “impracticable, unnecessary, or contrary to the
public interest.” Section 204(3) of the CDL, 45 P.S. §1204(3); see Section 203 of the CDL,
45 P.S. §1203; 71 P.S. §745.5(b); Pennsylvania Builders Association v. Department of Labor and
Industry, 284 A.3d 1287, 1293 n.12 (Pa. Cmwlth. 2022). A “final-omitted regulation” goes
directly to the IRRC and legislative committees for review. 71 P.S. §745.3.

        The process may be further expedited if the regulation is “emergency certified.” See
Section 6(d) of the RRA, 71 P.S. §745.6(d); see Section 5(l) of the RRA, 71 P.S. §745.5a(l). An
emergency-certified regulation takes effect immediately upon the date of publication in the
Pennsylvania Bulletin or on the date specified in the agency’s adoption order while its review by
the IRRC and legislative committees takes place over a 120-day period thereafter.
71 P.S. §745.6(d); Corman v. Acting Secretary of Pennsylvania Department of Health, 266 A.3d
452, 462 (Pa. 2021); see Section 903 of the CDL, 45 Pa. C.S. §903 (relating to effective date of
documents); 1 Pa. Code §1374 (effectiveness prior to publication); 1 Pa. Code §313.2 (“An
emergency[-]certified final regulation shall take effect immediately upon publication in the
Pennsylvania Bulletin, or on the date specified in the agency’s adoption order.”). Such emergency
measures apply

              if the Attorney General certifies that the final-form or final-omitted
              regulation is required pursuant to the decree of any court or to
              implement the provisions of a statute of the [U.S.] or regulations
              issued thereunder by a Federal agency or if the Governor certifies
              that the final-form or final-omitted regulation is required to meet an
              emergency which includes conditions which may threaten the public
              health, safety or welfare; cause a budget deficit; or create the need
              for supplemental or deficiency appropriations of greater than
              $1,000,000.

71 P.S. §745.6(d).
                                                4
(Combined VOC Rule) to the Independent Regulatory Review Commission (IRRC)7
and the legislative committees for consideration. PFR, ¶¶39-40.
               The Pennsylvania House of Representatives Environmental Resources
and Energy Committee (House ERE Committee) disapproved the final-form
Combined VOC Rule. On April 26, 2022, the House ERE Committee sent a letter
to the IRRC expressing its disapproval on the basis that the EQB was required to
submit two rulemaking packages—one that applied to unconventional oil and natural
gas sources and one that applied to conventional oil and natural gas sources -- based
on its interpretation of the Pennsylvania Grade Crude Development Act (CDA).8
The letter initiated the concurrent resolution process under Section 7(d) of the RRA,
71 P.S. §745.7(d), which allows the General Assembly to adopt a resolution that
disapproves and permanently bars a final regulation from taking effect. In response,

       7
          The IRRC reviews proposed, final-form, final-omitted, or existing regulations for
consistency with the criteria contained in the RRA. Section 5.2 of the RRA, added by the Act of
December 6, 2002, P.L. 1227, as amended, 71 P.S. §745.5b. Specifically, the IRRC reviews
whether the “agency has the statutory authority to promulgate the regulation” and “whether the
regulation conforms to the intention of the General Assembly in the enactment of the statute upon
which the regulation is based.” 71 P.S. §745.5b(a). The IRRC considers “written comments
submitted by the committees and current members of the General Assembly, pertinent opinions of
Pennsylvania’s courts and formal opinions of the Attorney General.” Id. In addition, the IRRC
considers economic or fiscal impacts of the regulation; the protection of the public health, safety
and welfare, and the effect on the Commonwealth’s natural resources; the clarity, feasibility, and
reasonableness of the regulation; whether the regulation represents a policy decision of such a
substantial nature that it requires legislative review; comments, objections, or recommendations
of a committee; compliance with the RRA; whether the regulation is supported by data; and
whether a less costly or less intrusive alternative is available. 71 P.S. §745.5b(b)(1)-(8). The
IRRC acts “as a clearinghouse for complaints, comments and other input from members of the
General Assembly and from the public regarding existing, proposed, final-form and final-omitted
regulations.” Section 12 of the RRA, 71 P.S. §745.12.

       8
            Act of June 23, 2026, P.L. 375, as amended, 58 P.S. §§1201-1208. Section 7(b) of the
CDA, 58 P.S. §1207(b), provides that “[a]ny rulemaking concerning conventional oil and gas wells
. . . shall be undertaken separately and independently of unconventional wells.”
                                                5
by letter dated May 4, 2022, the EQB notified the IRRC that it was withdrawing the
final-form Combined VOC Rule from consideration.9 PFR, ¶¶53-55; see id., Exhibit
No. 2.
              Given the concerns expressed by the House ERE Committee and other
commentators regarding the combined rulemaking, the Agencies engaged in a third
rulemaking action limited to emissions from unconventional oil and natural gas
wells (unconventional rulemaking). The DEP modified the withdrawn Combined
VOC Rule by removing all applicable requirements related to the conventional oil
and natural sources of VOC emissions. The DEP then resubmitted the final-form
“Control of VOC Emissions from Unconventional Oil and Natural Gas Sources”
(Unconventional VOC Regulation) to the EQB for consideration. Following the
EQB’s adoption, the final-form Unconventional VOC Regulation was submitted to,
and approved by, the IRRC on July 21, 2022. Petitioners allege that at no point
during the development of the Combined VOC Rule or Unconventional VOC
Regulation did the Agencies solicit input from the Petitioners concerning the
development of provisions applicable to VOC emission sources at conventional oil
and natural gas wells and well sites. PFR, ¶¶56-62.
              In both the fourth and fifth rulemaking proceedings, the Agencies
proposed RACT requirements for VOC emissions for conventional oil and natural
gas wells (conventional rulemaking). Regarding the fourth rulemaking, on October
12, 2022, the EQB adopted the final-omitted Conventional VOC Regulation, No. 7-
579. The preamble to the final-omitted Conventional VOC Regulation stated that
the DEP developed the Conventional VOC Regulation to address concerns

         A withdraw removes “a proposed, final-form or final-omitted regulation by an agency
         9

from the review process so that the [IRRC] and the [legislative] committees are prevented from
taking further action on the regulation.” Section 3 of the RRA, 71 P.S. §745.3.
                                              6
expressed by the House ERE Committee and other commentators during the
regulatory process for the combined rulemaking. The preamble further stated that
“[p]ublic notice and solicitation of public comments are impracticable, unnecessary,
and contrary to the public interest” because the “rulemaking was already subject to
a notice and comment process” in the combined rulemaking and would delay
implementation of the VOC RACT requirements. PFR, Exhibit No. 5 at 2; 52 Pa.
B. 7635, 7636 (2022). The Regulatory Analysis Form (RAF) that accompanied the
final-omitted Conventional VOC Regulation described DEP meetings with advisory
committees for the Combined VOC Rule only. The Comment and Response
Document similarly addressed comments solicited on the proposed Combined VOC
Rule only. The RAF for the final-omitted Conventional VOC Regulation stated that
the DEP did not have data on how many gathering and boosting stations and natural
gas processing plants are used in the conventional industry and, thus, could not
estimate the VOC and methane emissions reductions from these sources. PFR, ¶¶64-
67 and Exhibit Nos. 2-4.
            On November 14, 2022, the House ERE Committee disapproved the
final-omitted Conventional VOC Regulation, which triggered a 14-day legislative
review period. The 14-day period began after the IRRC approved the final-omitted
Conventional VOC Regulation on November 17, 2022. During that 14-day period,
the regulation could not be published in the Pennsylvania Bulletin. Because the 2022
legislative session ended on November 30, 2022, the regulation could not be
published by the December 16, 2022 federal sanction deadline. See Section 5.1(j.3)
of the RRA, 71 P.S. §745.5a(j.3). This prompted the Agencies to take emergency
action. PFR, Exhibit No. 3.

                                         7
             The fifth and final rulemaking resulted in the emergency-certified final-
omitted Conventional VOC Regulation, No. 7-580, which is at issue. On November
22, 2022, the DEP announced the EQB would consider adopting an emergency-
certified final-omitted Conventional VOC Regulation at a meeting scheduled for
November 30, 2022. The emergency-certification was based upon the Governor’s
certification that an immediate amendment to the regulations was necessary to
prevent sanctions, namely, the loss of approximately $800,000,000.00 in federal
highway funding.       The emergency-certified final-omitted Conventional VOC
Regulation, No. 7-580, is identical to final-omitted Conventional VOC Regulation,
No. 7-579, except for the emergency certification. The preamble and documents
offered in support mirrored those presented with the final-omitted Conventional
VOC Regulation, No. 7-579. On November 30, 2022, EQB adopted the emergency-
certified final-omitted Conventional VOC Regulation, without notice or comment
pursuant    to   Section    204(3)    of    the   CDL,    45 P.S. §1204(3).        See
25 Pa. Code §§129.131-129.140.             The    emergency-certified    final-omitted
Conventional VOC Regulation went into effect on December 2, 2022, just short of
the federal deadline, and was published in the Pennsylvania Bulletin on December
10, 2022. PFR, ¶¶78-84 and Exhibit Nos. 1-4; 25 Pa. Code §129.131; see also 45
Pa. C.S. §903 (relating to effective date of documents), 1 Pa. Code §13.74
(permitting effective date prior to publication if deferral is “impractical or contrary
to the public interest”).
             Petitioners allege that the Agencies failed to comply with express
statutory provisions regarding the promulgation of the Conventional VOC
Regulation without good cause. Petitioners’ PFR sets forth two counts. In Count I,
Petitioners contend that the Agencies violated the CDL by failing to provide notice

                                            8
and public comment opportunity on the Conventional VOC Regulation. Petitioners
assert that the Agencies lacked good cause under the circumstances to meet the
statutory exception to the notice and comment requirements before finalizing the
emergency-certified final-omitted Conventional VOC Regulation because the
Agencies had six years to comply with federal mandates.
            In Count II, Petitioners claim that the Agencies failed to comply with
Section 7(b) of the CDA, 58 P.S. §1207(b), which requires the EQB to undertake
any rulemaking concerning conventional oil and gas wells “separately and
independently of unconventional wells . . . .”         Petitioners allege that the
Conventional VOC Regulation resulted from combined rulemaking concerning
conventional and unconventional oil and gas wells. They allege that the Agencies
did not undertake conventional rulemaking “separately and independently of
unconventional wells” or develop a RAF restricted to the subject of conventional oil
and gas wells.     Petitioners claim that these compliance failures render the
emergency-certified final-omitted Conventional VOC Regulation null and void.
            Petitioners ask this Court to find and declare:

            1. [T]he plain meaning of the phrase “any rulemaking
            concerning conventional oil and gas wells” in Section 7(b)
            of [the CDA, 58 P.S. §1207(b),] applies to a rulemaking
            concerning only the Pennsylvania oil and natural gas
            industry that imposes requirements and obligations on
            owners and operators of conventional oil and gas wells and
            well sites;

            2. [The] [A]gencies failed to comply with the mandates of
            Section 7(b) of [the CDA] when undertaking the
            [c]ombined [] [r]ulemaking as well as the emergency-
            certified final-omitted Conventional VOC Regulation
            derived from the Combined VOC Rule[];

                                         9
              3. [T]he emergency[-]certified final-omitted Conventional
              VOC Regulation was not promulgated in compliance with
              Section 7(b) of [the CDA];

              4. [T]he emergency[-]certified final-omitted Conventional
              VOC Regulation is therefore null and void; and

              5. DEP may not implement or enforce a final regulation
              concerning VOC emission sources at conventional oil and
              gas wells and well sites without complying with Section
              7(b) of [the CDA,]

              and provide any other relief the Court deems appropriate.
PFR, at 36.

                                       II. POs
              In response, the Agencies filed POs pursuant to Pa.R.Civ.P. 1028(a)(4)
(demurrer); 1028(a)(5) (lack of capacity to sue); and 1028(a)(7) (failure to exhaust
a statutory remedy). More particularly, the Agencies demur to Count I, claiming the
emergency-certified final-omitted Conventional VOC Regulation is a valid exercise
of their rulemaking authority, and Petitioners fail to offer any legal support for their
allegation that the regulation was not validly promulgated. The Agencies also demur
to Count II on the basis that the CDA does not apply to regulations promulgated
under the Air Pollution Control Act and, if it did, they fully complied with its
mandates. The Agencies next object on the ground that Petitioners have not
exhausted administrative remedies available to them before seeking relief from this
Court. Finally, the Agencies object on the basis that Petitioners are not aggrieved
and, therefore, lack standing to challenge the previous Combined VOC Rule because

                                          10
this rule was withdrawn in favor of the emergency-certified Conventional VOC
Regulation. Petitioners answered the POs. We address each of the POs in turn.10

                                        III. Discussion
                                    A. Demurrer – Count I
                                        1. Contentions
                                     a. Agencies’ Position
                First, the Agencies contend that Petitioners fail to state a viable legal
claim in Count I.          The emergency-certified final-omitted Conventional VOC
Regulation at issue in this case is a valid exercise of the Agencies’ rulemaking
authority. The Agencies assert they had good cause to omit the notice and comment
procedures specified in Sections 201 and 202 of the CDL, 45 P.S. §§1201, 1202.
Specifically, the Agencies justify the omission based on the federally-imposed
compliance deadline of December 16, 2022, to regulate VOC emissions and threat
of sanctions. Had the Agencies failed to meet this deadline, the Commonwealth
stood to lose millions of dollars in federal highway funding as a sanction. Petitioners
fail to offer any legal support for their allegation that this regulation was not a validly
promulgated rule under Pennsylvania law.

       10
            In ruling on POs, this Court

                must accept as true all well-pled facts that are material and all
                inferences reasonably deducible from the facts. However, [we] are
                not required to accept as true any unwarranted factual inferences,
                conclusions of law or expressions of opinion. For [POs] to be
                sustained, it must appear with certainty that the law will permit no
                recovery. Any doubt must be resolved in favor of the non-moving
                party.

Guarrasi v. Scott, 25 A.3d 394, 400 n.5 (Pa. Cmwlth. 2011); accord Pennsylvania Independent
Oil & Gas Association v. Department of Environmental Protection, 135 A.3d 1118, 1123 (Pa.
Cmwlth. 2015), aff’d, 161 A.3d 949 (Pa. 2017).
                                                11
                            b. Petitioners’ Position
            Petitioners counter that the Agencies used an improper procedure for
promulgating regulations under Section 204(3) of the CDL, 45 P.S. §1204(3), to
circumvent proper notice and comment procedures. According to Petitioners, the
Agencies lacked good cause because they had sufficient time – over six years – to
comply with the federal mandate. The Agencies have not stated any exigent
circumstances other than those of their own making through delay. Proceeding in
this manner was held to be improper by this Court in Automotive Services Councils
of Pennsylvania v. Larson, 474 A.2d 404 (Pa. Cmwlth. 1984).

                                   2. Analysis
            When adjudicating the validity of a regulation, the Court considers
whether the regulations are “(a) adopted within the agency’s granted power,
(b) issued pursuant to proper procedure, and (c) reasonable.”       Bucks County
Services, Inc. v. Philadelphia Parking Authority, 195 A.3d 218, 227 (Pa. 2018)
(citations omitted). As for proper procedure, a regulation must be promulgated
pursuant to the notice and comment procedures contained in the CDL in order to
have the force and effect of law. R.M. v. Pennsylvania Housing Finance Agency of
Commonwealth, 740 A.2d 302, 306 (Pa. Cmwlth. 1999). Section 201 of the CDL
provides:

            Except as provided in [S]ection 204[ of the CDL, 45
            P.S. §1204,] an agency shall give, in the manner provided
            in [S]ection 405 [of the CDL, 45 P.S. §1405,] (relating to
            additional contents of temporary supplements) public
            notice of its intention to promulgate, amend or repeal any
            administrative regulation. Such notice shall include:

            (1) The text of the proposed administrative regulation,
            except any portions thereof omitted pursuant to [S]ection
            407[ of the CDL, 45 P.S. §1407,] (relating to matter not
                                       12
             required to be published), prepared in such a manner as to
             indicate the words to be added or deleted from the
             presently effective text thereof, if any.

             (2) A statement of the statutory or other authority under
             which the administrative regulation or change therein is
             proposed to be promulgated.

             (3) A brief explanation of the proposed administrative
             regulation or change therein.

             (4) A request for written comments by any interested
             person concerning the proposed administrative regulation
             or change therein.

             (5) Any other statement required by law.
45 P.S. §1201.
             However, an agency may bypass these procedures under limited
circumstances for “good cause.” Section 204(3) of the CDL, 45 P.S. §1204(3); see
Larson, 474 A.2d at 405. Specifically, Section 204(3) of the CDL provides:

             The agency for good cause finds (and incorporates the
             finding and a brief statement of the reasons therefor in the
             order adopting the administrative regulation or change
             therein) that the procedures specified in sections 201 and
             202[ of the CDL, 45 P.S. §§1201, 1202,] are in the
             circumstances impracticable, unnecessary, or contrary to
             the public interest.
45 P.S. §1204(3) (emphasis added).          The reasons for departing from the
requirements must be stated and persuasive. See Larson, 474 A.2d at 405-06.
“[R]egulations not properly promulgated” under the CDL’s standard or emergency
procedures “are a nullity.” Id. at 405.
             In Larson, the Pennsylvania Department of Transportation (DOT)
promulgated a regulation without a comment period asserting good cause under
Section 204(3) of the CDL. Larson, 474 A.2d at 405. DOT justified its omission

                                          13
based on its need to comply with a court-imposed time constraint of August 1, 1983.
Id. We determined that DOT did not advance good cause, explaining:

             The regulations were in final form and submitted . . . by
             June 2, 1983. DOT could have published the regulations
             for comment at this time, yet it waited until July 23, 1983.
             Since there was sufficient time and opportunity to submit
             the regulations for the prescribed thirty-day comment
             period, DOT cannot claim that the period was
             unnecessary due to time limitations set by the federal
             court.
Id. at 406 (emphasis added). This Court opined that the purpose of the CDL’s notice
and comment procedures is “to provide parties with a fair opportunity to present
their position whether or not they will ultimately prevail.” Id. Allowing an agency
to bypass the CDL’s procedures “would significantly limit the public’s input as to
future proposed regulations.”     Id.   Because the regulation was not properly
promulgated, we declared it a nullity. Id.
             Later, in Jeffers v. Commonwealth, 601 A.2d 401, 404 (Pa. Cmwlth.
1991), we affirmed the validity of a regulation promulgated by DOT under
“emergency circumstances.” Jeffers was distinguishable from Larson in three key
respects. See id. at 403. First, unlike the procedure in Larson in which DOT
provided no opportunity for comment, in Jeffers, DOT gave the public 30 days in
which to comment upon the regulation. Id. Second, there was no evidence that DOT
“could have complied with the notice period.” Id. “[T]here was an emergency
situation which required immediate action.”       Id.   Specifically, the immediate
adoption of the regulation was necessary to facilitate the prosecution of drunk
driving cases. Id. Finally, the regulation was published in the Pennsylvania Bulletin,
which created a rebuttable presumption of validity under Section 905 of the CDL,

                                         14
45 Pa. C.S. §905, which was not rebutted. Jeffers, 601 A.2d at 404. Given these
distinctions, we held that the regulation was properly promulgated. Id.
             Thereafter, in Department of Transportation v. Colonial Nissan, Inc.,
691 A.2d 1005, 1009 (Pa. Cmwlth. 1997), we again considered the validity of certain
DOT regulatory amendments promulgated under Section 204 of the CDL. DOT
defended that it was not necessary to adhere to the procedures specified in Sections
201 and 202 of the CDL because it was “merely readopting” a prior regulation
without enlarging the scope of the existing regulation. Id. However, when the
regulation was published in the Pennsylvania Code, there were modifications from
the version previously published, which DOT subsequently corrected in an
amendment. Id. Ultimately, this Court invalidated the amendments promulgated
under Section 204 because the modifications and amendments to the prior regulation
necessitated “adherence to the normal notice and comment procedures.” Id. We
explained:

             [T]he reasons which DOT cited in its January 6, 1990
             announcement to justify proceeding under Section 204 of
             the [CDL] were defeated by the errors inadvertently
             contained in the January 1, 1994 publication and the
             subsequent corrective amendments of October 1994 make
             it obvious that adherence to the normal notice and
             comment procedures was far from “unnecessary.”
Id. We emphasized that “[t]he process by which regulations are promulgated
provides an important safeguard against the unwise or improper exercise of
discretionary administrative power and includes public notice of a proposed rule,
request for written comments, consideration of such comments, and hearings as
appropriate.” Id. (emphasis added).
             Here, as in Jeffers and Colonial Nissan, the emergency-certified final-
omitted Conventional VOC Regulation was published in the Pennsylvania Bulletin,
                                        15
thereby creating a rebuttable presumption of validity. See 45 Pa. C.S. §905. To
rebut this presumption, Petitioners alleged that the Agencies did not provide an
opportunity for public comment on the emergency-certified final-omitted
Conventional VOC Regulation, which the Agencies do not deny.              Petitioners
challenge the Agencies’ purported “good cause” justification on the basis that there
was ample time to comply with notice and comment procedures had the Agencies
acted sooner.
             The Agencies maintain that their actions were justified based on the
federal deadline of December 16, 2022, and the threat of significant sanctions.
However, under Larson, the Agencies’ stated reason is questionable considering
they had over six years to promulgate the regulation. Although the Agencies
engaged in combined rulemaking during this six-year period, the Agencies did not
engage in separate rulemaking until approximately six months before the deadline.
The Agencies’ third rulemaking action, which began in May 2022, complied with
the CDL’s notice and comment requirements. This separate rulemaking was limited
to the regulation of VOC emissions from unconventional oil and gas wells and led
to the adoption of the final Unconventional VOC Regulation.           However, the
Agencies did not similarly engage in separate rulemaking related to conventional oil
and gas wells at this time. Instead, the Agencies waited until October 2022, to begin
the rulemaking process for conventional oil and gas wells. Given the close proximity
to the compliance deadline, the Agencies bypassed notice and comment procedures
citing exigent circumstances. As in Larson, it appears that there was ample time and
opportunity to follow standard CDL procedures had they engaged in the rulemaking
process for conventional oil and gas wells at an earlier date.         Under these

                                         16
circumstances, it does not appear with certainty that the law will permit no recovery.
We, therefore, overrule the Agencies’ PO to Count I.

                              B. Demurrer – Count II
                                  1. Contentions
                               a. Agencies’ Position
             Next, the Agencies contend that Petitioners failed to state a viable legal
claim in Count II.     The emergency-certified final-omitted Conventional VOC
Regulation was promulgated to reduce air pollution under the Air Pollution Control
Act and, according to the Agencies, is not subject to the requirements of the CDA.
Petitioners’ assertion that the Regulation is subject to the requirements of CDA is
inconsistent with the rules of statutory construction. Although Section 7(b) of the
CDA states that “any rulemaking concerning conventional oil and gas wells
. . . shall be undertaken separately and independently of unconventional wells . . .”,
58 P.S. §1207(b), the meaning of “any” is wholly dependent on the statutory context
in which it is used. Therefore, it is inapplicable to regulations adopted under the Air
Pollution Control Act. Even assuming that the CDA requirements are applicable
here, the Agencies’ rulemaking process followed those very procedures. Finally, the
Petitioners are prohibited from asserting a cause of action under the RRA.

                              b. Petitioners’ Position
             Petitioners respond that Section 7(b) of the CDA clearly and
unequivocally states that “[a]ny rulemaking concerning conventional oil and gas
wells that the [EQB] undertakes . . . shall be undertaken separately and
independently of unconventional wells . . . .” 58 P.S. §1207(b) (emphasis added).
This plain statutory provision applies to the rulemaking in the pending action that
directly concerns conventional oil and gas wells. The General Assembly did not add
                                          17
any restrictive language that “any rulemaking” pertained only to proposed
regulations under the CDA.        Despite engaging in combined rulemaking for
approximately six years, the Agencies failed to promulgate a regulation that
complied with the mandates in Section 7(b) of the CDA. Contrary to the Agencies’
assertions, Petitioners have not asserted a cause of action under the RRA. Rather,
their claims arise under the CDL (Count I) and the CDA (Count II).

                                     2. Analysis
             Section 7(b) of the CDA provides:

             Any rulemaking concerning conventional oil and gas wells
             that the [EQB] undertakes after the effective date of this
             act shall be undertaken separately and independently of
             unconventional wells or other subjects and shall include a
             [RAF] submitted to the [IRRC] that is restricted to the
             subject of conventional oil and gas wells.
58 P.S. §1207(b) (emphasis added).
             In ascertaining the meaning of a statute, we are guided by the Statutory
Construction Act of 1972 (SCA).           The overriding object of all statutory
interpretation and construction “is to ascertain and effectuate the intention of the
General Assembly” in enacting the statute under review. Section 1921(a) of the
SCA, 1 Pa. C.S. §1921(a). In addition, we must construe rules which pertain to the
same subject together. Section 1932 of the SCA, 1 Pa. C.S. §1932.
             If statutory language is “clear and free from ambiguity, the letter of it
is not to be disregarded under the pretext of pursuing its spirit.” Section 1921(b) of
the SCA, 1 Pa. C.S. §1921(b). Thus, “when the words of a statute have a plain and
unambiguous meaning, it is this meaning which is the paramount indicator of
legislative intent.”    Snyder Brothers, Inc. v. Pennsylvania Public Utility

                                         18
Commission, 198 A.3d 1056, 1071 (Pa. 2018), order amended on reconsideration,
203 A.3d 964 (Pa. 2019). “However, in situations where the words of a statute ‘are
not explicit,’ the legislature’s intent may be determined by considering any of the
factors enumerated in Section 1921(c) [of the SCA, 1 Pa. C.S. §1921(c).]” Id. These
factors are:

               (1) The occasion and necessity for the statute.

               (2) The circumstances under which it was enacted.

               (3) The mischief to be remedied.

               (4) The object to be attained.

               (5) The former law, if any, including other statutes upon
               the same or similar subjects.

               (6) The consequences of a particular interpretation.

               (7) The contemporaneous legislative history.

               (8) Legislative and administrative interpretations of such
               statute.
1 Pa. C.S. §1921(c). This Court has further declared:

               [W]hen a statute is ambiguous, courts generally defer to
               the expertise of the agency upon which the General
               Assembly has vested enforcement or interpretive
               responsibilities and, consequently, should accept the
               agency’s interpretation of ambiguous statutory language.
               When an agency’s interpretation is entitled to such
               deference, courts will defer to such proposed
               interpretation unless an agency’s interpretation of a statute
               is erroneous or frustrates legislative intent.
Stodghill v. Pennsylvania Department of Corrections, 150 A.3d 547, 554 (Pa.
Cmwlth. 2016) (internal citations and quotations omitted); see Corman v. Acting
Secretary of Pennsylvania Department of Health, 266 A.3d 452, 485 (Pa. 2021).
                                            19
               The word “any” can take one of “two commonly accepted alternative
meanings in the English language” depending “on how it is used in a particular
statute.” Snyder Brothers, 198 A.3d at 1072. It can “mean ‘all’ or ‘every,’ as well
as ‘one.’” Id. (quoting Black’s Law Dictionary 94 (6th ed. 1991)). “[T]he meaning
of the term ‘any’” is “wholly dependent on the context in which it is used in the
particular statute under review.” Id. at 1073.
               Section 7(b) has not yet been interpreted by this, or any, Court.
Petitioners have advanced a viable interpretation that “[a]ny rulemaking concerning
conventional oil and gas wells that the [EQB] undertakes” must be “undertaken
separately and independently of unconventional wells” in any statutory context.
58 P.S. §1207(b). The House ERE Committee expressed this same interpretation
when disapproving the Combined VOC Rule. See PFR, ¶¶53-54 and Exhibit No. 2,
at 7. The Agencies counter that “any rulemaking” pertains only to regulations
promulgated under the CDA and is wholly inapplicable to regulations promulgated
under the Air Pollution Control Act. Although the Agencies’ interpretation is
entitled to deference, they have not demonstrated that their interpretation of Section
7(b) is so clear and free from doubt that Count II of Petitioners’ PFR should be
dismissed on POs. Because this issue is one of first impression and is not clear and
free from doubt, we overrule the Agencies’ PO to Count II. See Pennsylvania AFL-
CIO ex rel. George v. Commonwealth, 757 A.2d 917, 921 (Pa. 2000); Stodghill, 150
A.3d at 554.
               Assuming that the CDA applies to regulations promulgated under the
Air Pollution Control Act, the Agencies alternatively assert that Count II should be
dismissed because the Agencies satisfied those requirements in the combined
rulemaking that led to the adoption of the Conventional VOC Regulation. However,

                                         20
before this Court can address compliance, the legal question must first be resolved
as to whether the CDA is applicable to the regulation here. At this stage, we also
must accept as true Petitioners’ factual allegations that the Agencies engaged in
combined rulemaking concerning conventional oil and gas wells for approximately
six years without doing so separately and independently of unconventional oil and
gas wells. PFR, ¶¶21-22, 39-40, 64-74; see POs, ¶¶10-16, 57, 66, 112. Therefore,
the Agencies are not entitled to a demurrer on this alternate basis.
             Finally, regarding the Agencies’ RRA objection, Petitioners’ claims
arise under the CDL (Count I) and the CDA (Count II), not under the RRA. For
these reasons, we overrule the Agencies’ demurrer to Count II.

                 C. Failure to Exhaust Administrative Remedy
                                 1. Contentions
                              a. Agencies’ Position
             Next, the Agencies contend that Petitioners have not exhausted their
administrative remedies under the RRA’s review and comment process. Although
the emergency-certified final-omitted Conventional VOC Rule is fully effective and
enforceable, it is still subject to review by the IRRC and legislative committees in
the same manner as all other final-form and final-omitted regulations. The only
difference is that the emergency-certified final-omitted Conventional VOC
Regulation became effective immediately in advance of the review. It is through
this review process that Petitioners can submit comments and request the IRRC to
disapprove the Conventional VOC Regulation. There are several steps left in the
regulatory review process that must be completed under the RRA. Petitioners have
not asserted any grounds for bypassing this process.

                                          21
                              b. Petitioners’ Position
             Petitioners respond that the Agencies’ exhaustion of administrative
remedies argument fails because the comment remedy under the RRA is wholly
inadequate. Petitioners and other conventional producers have been subject to the
requirements of the challenged regulation since December 2, 2022, and they are
harmed by them. Petitioners will continue to incur compliance costs during the
comment process while they wait to see if the emergency-certified final-omitted
Conventional VOC Regulation will be permanently effective or disapproved. The
industry-wide cost of regulatory compliance is approximately $9,800,000.00 per
year. PFR, ¶81.

                                     2. Analysis
             Under the doctrine of exhaustion of administrative remedies, a party
must exhaust all available administrative remedies before the right of judicial review
arises. Empire Sanitary Landfill, Inc. v. Department of Environmental Resources,
684 A.2d 1047, 1054 (Pa. 1996); Keystone ReLeaf, LLC v. Pennsylvania Department
of Health, 186 A.3d 505, 514 (Pa. Cmwlth. 2018). “However, the exhaustion
doctrine is neither inflexible nor absolute.” Keystone ReLeaf, 186 A.3d at 514.
(citing Feingold v. Bell of Pennsylvania, 383 A.2d 791, 793 (Pa. 1977)). There are
narrow circumstances where exhaustion of remedies is not required. Id. Our
Supreme Court has recognized three exceptions to the exhaustion of administrative
remedies:

             The first exception is where the jurisdiction of an agency
             is challenged. The second exception is where the
             constitutionality of a statutory scheme or its validity is
             challenged. The third exception is where the legal or
             equitable remedies are unavailable or inadequate, or the

                                         22
             administrative agency is unable to provide the requested
             relief.
Empire Sanitary, 684 A.2d at 1054 (internal citations omitted) (emphasis added).
“Where the effect of the challenged regulations upon the industry regulated is direct
and immediate, the hardship thus presented suffices to establish the justiciability of
the challenge in advance of enforcement.” Arsenal Coal Co. v. Department of
Environmental Resources, 477 A.2d 1333, 1339 (Pa. 1984).
             Section 6 of the RRA, 71 P.S. §745.6, sets forth procedures for
disapproval of final-form and final-omitted regulations and emergency-certified
regulations. Specifically, Section 6(d) provides:

             The [IRRC] may not issue an order barring an agency
             from promulgating a final-form or final-omitted
             regulation if the Attorney General certifies that the final-
             form or final-omitted regulation is required pursuant to the
             decree of any court or to implement the provisions of a
             statute of the [U.S.] or regulations issued thereunder by a
             Federal agency or if the Governor certifies that the final-
             form or final-omitted regulation is required to meet an
             emergency which includes conditions which may threaten
             the public health, safety or welfare; cause a budget deficit;
             or create the need for supplemental or deficiency
             appropriations of greater than $1,000,000. In those cases,
             the final-form or final-omitted regulation may take effect
             on the date of publication or on a later date specified in the
             order adopting the final-form or final-omitted regulation.
             The [IRRC] and the [legislative] committees shall review
             the final-form or final-omitted regulation pursuant to the
             procedures provided for in this act. If the final-form or
             final-omitted regulation is disapproved pursuant to those
             procedures, that regulation shall be rescinded after 120
             days or upon final disapproval, whichever occurs later.
71 P.S. §745.6(d) (emphasis added); see Corman, 266 A.3d at 462; Corman v. Acting
Secretary of Pennsylvania Department of Health, 267 A.3d 561, 574 n.20 (Pa.
Cmwlth.), aff’d, 268 A.3d 1080 (Pa. 2021).

                                          23
              Section 7 of RRA, 71 P.S. §745.7, governs the procedures for
subsequent review of disapproved final-form or final-omitted regulations. Section
7 provides:

              (a) An agency may select one of the following options for
              proceeding with a regulation which has been disapproved
              by the [IRRC]:

                    (1) To proceed further with the final-form or final-
              omitted regulation pursuant to subsection (b).

                    (2) To proceed further with the final-form or final-
              omitted regulation pursuant to subsection (c).

                    (3) To withdraw the final-form or final-omitted
              regulation.

              (b) If the agency decides to adopt the final-form or final-
              omitted regulation without revisions or further
              modifications, the agency shall submit a report to the
              committees and the [IRRC] within 40 days of the agency’s
              receipt of the [IRRC]’s disapproval order. The agency’s
              report shall contain the final-form or final-omitted
              regulation, the [IRRC]’s disapproval order and the
              agency’s response and recommendations regarding the
              final-form or final-omitted regulation. If the committees
              are prevented from receiving the report because of
              adjournment sine die or expiration of the legislative
              session in an even-numbered year, the agency shall submit
              its report to the [IRRC] and the committees on the fourth
              Monday in January of the next year. If either committee
              has not been designated by the fourth Monday in January,
              the agency may not deliver the report to the committees
              and the [IRRC] until both committees are designated, but
              the agency shall deliver its report to the [IRRC] and the
              committees no later than the second Monday after the date
              by which both committee designations have been
              published in the Pennsylvania Bulletin. If the agency does
              not deliver the report to the committees and the [IRRC] in
              the time prescribed in this subsection, the agency shall be

                                          24
            deemed to have withdrawn the final-form or final-omitted
            regulation.

            (c) If the agency decides to revise or modify the final-form
            or final-omitted regulation in order to respond to
            objections raised by the [IRRC] and adopt that regulation
            with revisions or modifications, the agency shall submit a
            report to the committees and the [IRRC] within 40 days of
            the agency’s receipt of the [IRRC]’s disapproval order.
            The agency’s report shall contain the revised final-form or
            final-omitted regulation, the findings of the [IRRC], and
            the agency’s response and recommendations regarding the
            revised final-form or final-omitted regulation. If the
            committees are prevented from receiving the report
            because of adjournment sine die or expiration of the
            legislative session in an even-numbered year, the agency
            shall submit the report to the [IRRC] and the committees
            on the fourth Monday in January of the next year. If either
            committee has not been designated by the fourth Monday
            in January, the agency may not deliver the report to the
            committees and the [IRRC] until both committees are
            designated, but the agency shall deliver its report to the
            [IRRC] and the committees no later than the second
            Monday after the date by which both committee
            designations have been published in the Pennsylvania
            Bulletin. If the agency does not deliver its report to the
            [IRRC] and the committees in the time prescribed in this
            subsection, the agency shall be deemed to have withdrawn
            the final-form or final-omitted regulation.
71 P.S. §745.7.
            Here, the emergency-certified final-omitted Conventional VOC
Regulation became effective and fully enforceable as of December 2, 2022.
Although the regulation is subject to the RRA’s regulatory review process, there was
no remedy available to Petitioners while they submitted comments and waited to see
if the emergency-certified final-omitted Conventional VOC Regulation would

                                        25
become permanently effective or disapproved of under 71 P.S §745.6(d).11 Even if
disapproved, the Agencies are authorized to proceed under Section 7(b) or (c) of the
RRA, 71 P.S. §745.7(b) or (c). Because the regulation was effective and fully
enforceable as of December 2, 2022, the conventional oil and gas well industry
immediately faced substantial compliance costs and potential sanctions for
noncompliance.      Thus, the effects of the emergency-certified final-omitted
Conventional VOC Regulation were “direct and immediate” on the conventional oil
and gas well industry as of December 2, 2022. See Arsenal, 477 A.2d at 1339.
Although the IRRC has the power to consider comments in the review process, it
does not have “the power to grant declaratory judgment and injunctive relief
pursuant to the [DJA], . . . because only courts of record of the Commonwealth have
that jurisdiction.” Empire Sanitary, 684 A.2d at 1055. Upon review, we conclude
that the administrative remedy is not adequate. Thus, we overrule this PO.

                             D. Lack of Capacity to Sue
                                   1. Contentions
                                a. Agencies’ Position
             Finally, the Agencies object on the basis that Petitioners lack the
capacity to challenge the combined rulemaking process or Combined VOC Rule
under Pa.R.Civ.P. 1028(a)(5). The Combined VOC Rule was withdrawn in favor of
the Conventional VOC Regulation. Because the Combined VOC Rule no longer
exists, it became a nullity. It, therefore, follows that Petitioners cannot be aggrieved
by a regulation that does not exist. Consequently, Petitioners have no standing to
challenge whether the combined rulemaking process complied with the CDA.

      11
       We note that on April 20, 2023, the emergency-certified final-omitted Conventional
VOC Regulation received final approval from the IRRC.
                                           26
                              b. Petitioners’ Position
             Petitioners contend that they have standing to seek declaratory relief
regarding the combined rulemaking process because it was this very process that led
to the adoption of the emergency-certified final-omitted Conventional VOC
Regulation. The Agencies failed to comply with the mandates of Section 7(b) of the
CDA by not developing regulations for conventional oil and gas wells separately
and independently of unconventional oil and gas wells. The Agencies did not permit
notice and comment on a proposed rulemaking package developed specifically for
conventional wells separate and apart from unconventional gas wells. The Agencies
ask this Court to overlook six years of combined rulemaking undertaken in clear
violation of Section 7(b) of the CDA before proceeding to emergency-certified final-
omitted rulemaking procedures.

                                     2. Analysis
             In ruling on POs alleging a lack of capacity to sue, we must consider
the party’s standing.      PG Publishing Co., Inc. v. Governor’s Office of
Administration, 120 A.3d 456, 461 (Pa. Cmwlth. 2015), aff’d, 135 A.3d 578 (Pa.
2016). Our Supreme Court has explained that the hallmark of standing is that a party
that “is not adversely affected in any way by the matter [it] seeks to challenge is not
‘aggrieved’ thereby.” William Penn Parking Garage, Inc. v. City of Pittsburgh, 346
A.2d 269, 280 (Pa. 1975). A party is aggrieved if it has a “substantial, direct and
immediate interest in the outcome of the litigation.” Fumo v. City of Philadelphia,
972 A.2d 487, 496 (Pa. 2009).
             Here, Petitioners seek declaratory relief with respect to the emergency-
certified final-omitted Conventional VOC Regulation as well as the combined

                                          27
rulemaking process upon which the regulation was based because the process failed
to satisfy the statutory obligations of the CDA. Petitioners have pleaded that they
are aggrieved by the Agencies’ failure to comply with the requirements of Section
7(b) of CDA in the undertaking, development, and/or formulation of the Combined
VOC Rule because those rulemaking efforts were not “undertaken separately and
independently of unconventional wells.” Beginning in 2017, and over the next six
years, the Agencies engaged in combined rulemaking for both conventional and
unconventional oil and gas wells. Although this combined rulemaking ultimately
resulted in the disapproval and withdrawal of the Combined VOC Rule, this
rulemaking served as the foundation for the emergency-certified final-omitted
Conventional VOC Regulation. The Agencies admit that the emergency-certified
final-omitted Conventional VOC Regulation is identical to the final-omitted
Conventional VOC Regulation and is derived from the same RAF form used in the
combined rulemaking. See POs, ¶¶39, 51, 63. The Agencies justified bypassing
CDL procedures of notice and comment as “impracticable, unnecessary and contrary
to the public interest” because the “requirements for the conventional oil and natural
gas sources covered by this final-omitted rulemaking are identical to those
contained in the combined rulemaking.” PFR, Exhibit No. 5 at 2 (emphasis added);
52 Pa. B. at 7636 (emphasis added). Upon review, Petitioners have alleged sufficient
facts to withstand the Agencies’ objection to capacity to sue. Thus, we overrule this
PO.

                                         28
                                IV. Conclusion
            Accordingly, we overrule the Agencies’ POs and direct them to file an
answer to the PFR.

                                     MICHAEL H. WOJCIK, Judge

                                      29
         IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pennsylvania Independent Oil & Gas          :
Association, Pennsylvania Grade             :
Crude Oil Coalition, and Pennsylvania       :
Independent Petroleum Producers             :
Association,                                :
                                            :
                         Petitioners        :
                                            :
                v.                          : No. 574 M.D. 2022
                                            :
Department of Environmental                 :
Protection of the Commonwealth of           :
Pennsylvania and Environmental              :
Quality Board of the Commonwealth           :
of Pennsylvania,                            :
                                            :
                         Respondents        :

                                   ORDER

            AND NOW, this 16th day of April, 2024, Respondents’ preliminary
objections to Petitioners’ Petition for Review in the Nature of a Complaint for
Declaratory Relief (PFR) are OVERRULED. Respondents are directed to file an
answer to the PFR within 30 days of this order.

                                       __________________________________
                                       MICHAEL H. WOJCIK, Judge