Court Opinion

ID: 9847548
Source: CourtListenerOpinion
Date Created: 2023-09-24 04:01:55.516036+00
Date Added: 2024-06-11T09:17:19.978464
License: Public Domain

COOK, Circuit Judge,
concurring, joined by
SILER, Circuit Judge.
While we join parts I, II, III-A, and IV of Judge Clay’s opinion, we write separate*491ly to express the Court’s holding with respect to Plaintiffs’ second claim-that the EPA erred in approving Kentucky’s six exemptions from Tier II review. For the reasons that follow, we find that the EPA did err in approving these exemptions, and thus REVERSE the district court’s grant of summary judgment to the EPA on this point and REMAND the matter to the EPA for further proceedings consistent with this opinion.
I.
A.
Kentucky’s antidegradation regulations require new or expanded discharges into “exceptional” or “high quality” waters to pass Tier II review, but exempt five categories of discharges, designating them as causing insignificant water-quality loss. These discharges are:
1. Any expanded discharge under a renewed or modified KPDES permit, so long as the expansion does not increase pollutant loading by 20% or more;
2. Industrial discharges if the emitter discharges pollutants at less than half the concentration authorized by a normal KPDES water permit;
3. Domestic discharges if the emitter limits seven pollutants below certain targets — for example, residual chlorine to “no greater than 0.010 milligrams per liter”;
4. Discharges under storm water general permits;1 and
5. Discharges from concentrated animal feeding operations (“CAFOs”).2
See 401 Ky. Admin. Reg. 5:030 §§ l(2)(b)(l)(a), (d), (e); l(2)(b)(4)-(6); l(3)(b)(l)(a), (d), (e); l(3)(b)(2)-(4).
Unless a statute or regulation employs “extraordinarily rigid” language, courts recognize an administrative law principle that allows agencies to create unwritten exceptions to a statute or rule for “de minimis ” matters. Greenbaum v. EPA 370 F.3d 527, 534 (6th Cir.2004); see also Ober v. Whitman, 243 F.3d 1190, 1193-95 (9th Cir.2001) (finding that the EPA may “exempt de minimis sources of [a pollutant] from [Clean Air Act] pollution controls”). Under this principle, it is “permissible as an exercise of agency power, inherent in most statutory schemes, to overlook circumstances that in context may fairly be considered de minimis.” Ala. Power Co. v. Costle, 636 F.2d 323, 360 (D.C.Cir.1979). This authority “is not an ability to depart from the statute, but rather a tool to be used in implementing the legislative design.” Id. An agency thus has the implied authority to exempt “ “when the burdens of regulation yield a gain of trivial or no value.’ ” Greenbaum, 370 F.3d at 534 (quoting Ala. Power, 636 F.2d at 360-61). “ ‘Determination of when matters are truly de minimis naturally will turn on the assessment of particular circumstances, and the agency will bear *492the burden of making the required showing.’ ” Id. (quoting Ala. Power, 636 F.2d at 360).
Though Plaintiffs accept the EPA’s authority to approve de minimis exemptions to § 131.12, they challenge the EPA’s conclusion that the five exemptions listed above will result in only “insignificant” water degradation; Plaintiffs contend that these exemptions eviscerate Kentucky’s Tier II review process, allowing significant degradations in water quality without demonstrated necessity.
To assess whether Kentucky’s regulations permit significant degradation, we normally turn to the EPA’s calculations. See Citizens Coal Council, 447 F.3d at 890 (reiterating that courts must afford the highest level of deference to the EPA’s technical or scientific evaluations). Because § 131.12 protects assimilative capacity, we necessarily focus on how much assimilative capacity would be lost by utilization of the five Tier II exemptions. See JA 922 (Memorandum from Ephraim S. King, Director of EPA Office of Science and Technology, to Water Management Division Directors, Regions 1-10 (Aug. 10, 2005)) (stating proposed regulations “need to be very carefully evaluated to determine how they translate to reduction in assimilative capacity in order to understand whether a significant decrease in assimilative capacity will occur”). Relying on the EPA’s assimilative-capacity-loss estimates, we must determine de novo whether this loss is significant or merely de minimis.
While the EPA’s decision document in this case offers detailed technical analysis, it fails to aim its analysis at the legally operative question: will the extent to which various emitters avail themselves of the exemptions result in significant, rather than de minimis, degradation? The EPA measured Kentucky’s § 131.12 compliance by assessing whether each individual exemption resulted in “significant” or “insignificant” degradation, but that approach avoids assessing the exemptions’ cumulative effects on the State’s antidegradation compliance. Because § 131.12 regulates degradation, not individual sources of degradation, see id. (“The State shall develop and adopt a statewide antidegradation policy and identify the methods for implementing such policy pursuant to this sub-part.”), the legally relevant inquiry is whether Kentucky’s Tier-II-review exemptions together permit significant degradation, see Ohio Valley, 279 F.Supp.2d at 770 n. 3 (“From the perspective of water quality ... it does not matter whether the number of discharges is one or one hundred; the relevant question is how much water quality is lowered by any and all discharges into a water body”). The EPA’s decision document avoids answering this question, and we accordingly lack the information needed to meaningfully review the EPA’s decision to approve Kentucky’s regulations. See Motor Vehicle Mfrs. Ass’n, 463 U.S. at 43, 103 S.Ct. 2856 (holding that an agency action is arbitrary and capricious if the agency has “entirely failed to consider an important aspect of the problem”).
Moreover, though the EPA’s decision document details the tests conducted to measure each exemption’s impact, the document often fails to include the resulting measurements — i.e., the EPA’s estimate as to how much assimilative capacity would be lost. Instead, the EPA concludes only that the tests show “insignificant” degradation will occur. We cannot review this legal conclusion’s reasonableness without the EPA’s first discussing its assimilativecapacity loss estimates and explaining why it deems them insignificant. See id. (stating that a reviewing court “may not supply a reasoned basis for the agency’s action that the agency itself has not given”). We *493thus find a remand to the EPA necessary so that it may address these deficiencies in its consideration of Kentucky’s de minimis exemptions.
B.
Having determined that the EPA’s approval of five of Kentucky’s six exemptions must be reconsidered, we turn to the remaining exemption for coal-mining discharges. Unlike the de minimis exemptions, Kentucky carved this exception out of its general antidegradation provisions believing that its existing coal-mining regulations satisfy § 131.12’s requirements. JA 192-93. The EPA evaluated these existing regulations and agreed that they complied with § 131.12, acknowledging the five steps Kentucky takes before issuing a permit for a coal-mining discharge into Tier II waters. Taking issue with one discrete aspect of the EPA’s approval, Plaintiffs contend that the EPA erroneously credited Kentucky’s existing regulations as requiring coal-mining dischargers to demonstrate economic or social necessity when, in fact, the regulations do not. Indeed, Kentucky’s “socioeconomic review” is found not in its water-quality regulations, but in an informal commitment to the EPA. See JA 253. The Plaintiffs insist that the EPA may not rely on such promises, and we agree.
Kentucky agreed to subject proposed coal-mining discharges to socioeconomic review during the EPA’s audit of its anti-degradation procedures. When the EPA probed Kentucky about how it determined socioeconomic necessity for coal-mining discharges, the Cabinet replied that Kentucky “believes that the socioeconomic importance of coal mining is well documented ... and supported by sufficient data, so that a demonstration of importance for each coal mining activity is not required.” JA 298. Finding this explanation unsatisfactory, the EPA pressed for more. See 40 C.F.R. § 131.12(a)(2) (requiring a demonstration that degradation in Tier II waters is “necessary to accommodate important economic or social development in the area in which the waters are located” (emphasis added)). Through a response letter, the Cabinet assured the EPA that prior to issuing KPDES coal-mining permits to discharge into Tier II waters, it would “interpret” its existing regulations governing such permits to require a showing that the “discharge is from an activity of important social or economic development to the area in which the waters are located.” JA 253. Relying on this commitment, the EPA approved the coal-mining exemption. JA 194-95.
The Plaintiffs maintain that Kentucky’s response letter “effectively amended” the regulations outside the State’s procedure for promulgating or modifying administrative rules. See Ky.Rev.Stat. Ann. § 13A.130(1) (“An administrative body shall not by internal policy, memorandum, or other form of action ... [m]odify ... [or][e]xpand upon or limit a statute or administrative regulation.”). The EPA counters that Kentucky’s letter did not amend its regulations but merely furnished the State’s interpretation.
The EPA may clarify ambiguous state regulations by consulting with the state and relying on authorized state interpretations, see Defenders of Wildlife v. EPA 415 F.3d 1121, 1127-28 (10th Cir.2005) (holding that the EPA could rely on a state’s interpretation of an ambiguous water quality standard, so long as the EPA did not “effectively rewrite or amend” it), but that is not what happened here. Kentucky’s Tier II exemption for coal-mining discharges was not ambiguous. The anti-degradation regulations stated, in explicit terms, that Tier II review “shall not apply” *494to coal-mining discharges regulated under existing regulations. See 401 Ky. Admin. Reg. 5:030 §§ l(2)(b)(l)(b), l(3)(b)(l)(b). Those existing regulations do not require socioeconomic review. Indeed, when the EPA first queried the State on socioeconomic review for coal-mining discharges, the State responded that there was no such review. JA 298. Only after further inquiries from the EPA did Kentucky adopt a starkly different position — that its regulations (it did not cite a particular one) compelled a socioeconomic review for each proposed discharge. JA 253.
This securing an informal commitment from a state agency rather than requiring the state to amend its regulations violates the federal approval procedure established by 33 U.S.C. § 1313(c)(3) — the EPA either approves or disapproves the regulations proposed by a state. See Riverside Cement Co. v. Thomas, 843 F.2d 1246, 1248 (9th Cir.1988); Ohio Valley, 279 F.Supp.2d at 756 (finding the EPA’s strained reading of an unambiguous West Virginia regulation to be “an impermissible attempt to amend the regulation”); Natural Res. Defense Council v. EPA 16 F.3d 1395, 1399 (4th Cir.1993) (“EPA sits in a reviewing capacity of the state-implemented standards, with approval and rejection powers only.”) (citing 33 U.S.C. § 1313(c)). Short-circuiting the normal promulgation process by addressing deficiencies through agency commitments not only contravenes § 1313(c)(3), but also hinders an important objective — public participation in the rule-making process. See generally Appalachian Power Co. v. EPA, 208 F.3d 1015, 1024 (D.C.Cir.2000) (stating the EPA may not “escape the notice and comment requirements ... by labeling a major substantive legal addition to a rule a mere interpretation”). Enforceability also argues against the EPA’s reliance on informal state commitments. See, e.g., Riverside Cement, 843 F.2d at 1247 (an informal state interpretation at odds with a regulation’s text is the “bureaucratic equivalent of an illusory contract”); Nw. Envtl. Advocates v. EPA 268 F.Supp.2d 1255, 1269 (D.Or.2003) (finding the EPA erred by relying on an “unenforceable promise” — the state’s informal commitment to use a more protective water standard — to approve certain Clean Water Act regulations). Because the EPA relied on an informal Cabinet commitment to approve Kentucky’s Tier II exemption for coal-mining discharges, we find that the agency’s approval was “not in accordance with law.” 5 U.S.C. § 706(2). Accordingly, we hold that this exemption too requires remand to the EPA for reconsideration.
II.
For the these reasons, we REVERSE the district court’s grant of summary judgment to the EPA on Plaintiffs’ challenge to the approval of Kentucky’s six Tier-II-review exemptions and REMAND this matter for further proceedings consistent with this opinion.

. "With a general permit, the EPA issues a permit for specific types of activities and establishes specific rules for complying with the permit. Then, rather than apply for an individual permit, operators must file a Notice of Intent (‘NOI’) stating that they plan to operate under the general permit, and absent a negative ruling by the EPA, discharges that comply with the terms of the general permit are automatically authorized.” Tex. Indep. Producers & Royalty Owners Ass’n v. EPA, 410 F.3d 964, 968 (7th Cir.2005).

. "CAFOs are large-scale industrial operations that raise extraordinary numbers of livestock. For example, a 'Medium CAFO' raises as many as 9,999 sheep, 54,999 turkeys, or 124,999 chickens (other than laying hens). ‘Large CAFOs' raise even more staggering numbers of livestock — sometimes, raising literally millions of animals in one location.” Waterkeeper Alliance, Inc. v. EPA, 399 F.3d 486, 492 (2d Cir.2005) (footnotes omitted).