United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 12, 2011 Decided October 28, 2011
No. 10-1105
NATURAL RESOURCES DEFENSE COUNCIL, ET AL.,
PETITIONERS
v.
ENVIRONMENTAL PROTECTION AGENCY,
RESPONDENT
On Petition for Review of a Final Rule
of the Environmental Protection Agency
Robert E. Yuhnke argued the cause for petitioners. With
him on the briefs was Adriano L. Martinez.
David J. Kaplan, Senior Attorney, U.S. Department of
Justice, argued the cause for respondent. With him on the
brief was John C. Cruden, Deputy Assistant Attorney
General.
Before: GINSBURG, * Circuit Judge, and EDWARDS and
WILLIAMS, Senior Circuit Judges.
*
As of the date the opinion was published, Judge Ginsburg had
taken senior status.
2
Opinion for the Court filed by Senior Circuit Judge
WILLIAMS.
WILLIAMS, Senior Circuit Judge: This case follows up
our decision in Environmental Defense, Inc. v. EPA, 509 F.3d
553 (D.C. Cir. 2007), in which we reviewed the
Environmental Protection Agency’s promulgation of a final
rule for “PM2.5 and PM10 Hot Spot Analyses in Project-Level
Transportation Conformity Determinations for the New PM2.5
and Existing PM10 National Ambient Air Quality Standards,”
71 Fed. Reg. 12,468 (Mar. 10, 2006) (the “2006 Rule”). The
“conformity determinations” referred to in the rule’s title are
approvals needed under the Clean Air Act (“CAA”) for
federally funded transportation projects in an area that is
designated “nonattainment” or “maintenance” with respect to
the National Ambient Air Quality Standards (“NAAQS”)—
approvals required in order to assure that the project
“conforms” to the applicable State Implementation Plan
(“SIP”). See Environmental Defense, 509 F.3d at 555–58.
“Hot spot” analysis means simply analysis of a project’s
localized impact. See 2006 Rule, 71 Fed. Reg. at 12,469/3.
We start with a quick review of the statutory and
regulatory provisions at issue in our remand in Environmental
Defense, explain the nature of that remand, describe the
EPA’s response to the remand, and (finally) explain the
adequacy of that response.
* * *
In 1990 Congress amended the CAA’s conformity
provisions to provide that
[c]onformity to an implementation plan means—
...
3
(B) that such activities will not—
(i) cause or contribute to any new violation of any
standard in any area;
(ii) increase the frequency or severity of any existing
violation of any standard in any area; or
(iii) delay timely attainment of any standard or any
required interim emission reductions or milestones in
any area.
42 U.S.C. § 7506(c)(1) (emphasis added).
The pertinent passage of the 2006 Rule, however,
appeared to disregard subsection (B)(iii). It provided that a
new transportation project:
must not [1] cause or contribute to any new localized CO,
PM10, and/or PM2.5 violations or [2] increase the
frequency or severity of any existing CO, PM10, and/or
PM2.5 violations in CO, PM10, and PM2.5 nonattainment
and maintenance areas. This criterion is satisfied . . . if it
is demonstrated that . . . no new local violations will be
created and the severity or number of existing violations
will not be increased as a result of the project.
2006 Rule, 71 Fed. Reg. at 12,510 (codified at 40 C.F.R.
§ 93.116(a)) (printed here with the same omissions and
alterations as printed in Environmental Defense, 509 F.3d at
557). Obviously the segments designated [1] and [2] neatly
match (B)(i) and (B)(ii), and are paralleled in the sentence
beginning “This criterion is satisfied if . . . .” But if the
statutory language “any area” required application of the
(B)(i) and (B)(ii) requirements at the local level, then the
EPA’s seeming failure to address B(iii), or to explain its not
doing so, was arbitrary and capricious. Environmental
4
Defense, 509 F.3d at 561. We therefore remanded the 2006
Rule to the EPA “either to interpret CAA § 176(c)(1)(B)(iii)
in harmony with (B)(i) and (B)(ii) or to explain why it need
not do so.” Id. at 562.
On remand the EPA acknowledged that it reads “any
area” in subsection (B) to include local areas, and that
therefore all three (B) requirements must be met in hot spot
conformity determinations. Transportation Conformity Rule
PM2.5 and PM10 Amendments, 75 Fed. Reg. 14,260, 14,276/1
(Mar. 24, 2010) (the “2010 Rule”). As amended by the 2010
Rule, the codified regulation now states that, to conform to an
SIP, a transportation project:
must not cause or contribute to any new localized CO,
PM10, and/or PM2.5 violations, increase the frequency or
severity of any existing CO, PM10, and/or PM2.5
violations, or delay timely attainment of any NAAQS or
any required interim emission reductions or other
milestones in CO, PM10, and PM2.5 nonattainment and
maintenance areas . . . . This criterion is satisfied . . . if it
is demonstrated that . . . no new local violations will be
created and the severity or number of existing violations
will not be increased as a result of the project, and the
project has been included in a regional emissions
analysis that meets applicable §§ 93.118 and/or 93.119
requirements.
Id. at 14,285/2 (codified at 40 C.F.R. § 93.116(a)) (with
emphasis for text added by 2010 Rule). It is apparent that
although the 2010 Rule modifies the passage to add a
reference to delay in the first sentence, it does nothing to
change the omission of delay from the next sentence, “This
criterion is satisfied if . . . .”
5
Three environmental organizations accordingly petition
for review, arguing principally that the 2010 Rule still fails to
embody (B)(iii)’s requirement that the project not “delay
timely attainment of any standard or any required interim
emission reductions or milestones in any area.” In this
argument they echo a concern we expressed in Environmental
Defense that satisfaction of the (B)(i) and (B)(ii) criteria
would not in every instance assure satisfaction of (B)(iii):
“[A]n individual project’s emissions could counterbalance
mitigation measures already in place, thereby delaying
attainment of emissions standards and violating the
requirement of (B)(iii) without either increasing or decreasing
emissions.” 509 F.3d at 560.
We review the challenge to determine whether the EPA’s
response was arbitrary or capricious, an abuse of discretion, or
otherwise not in accordance with law. See CAA
§ 307(d)(9)(A), 42 U.S.C. § 7607(d)(9)(A); see also 5 U.S.C.
§ 706. Challenges to the EPA’s interpretation of the CAA are
of course governed by Chevron, U.S.A., Inc. v. Natural
Resources Defense Council, Inc., 467 U.S. 837 (1984).
* * *
In addressing the EPA’s alleged disregard of (B)(iii)’s
mandate, we initially assume that that mandate requires only
that the project in question not delay attainment, etc., beyond
the dates of such attainment in the absence of the project.
(Petitioners question that assumption, and we’ll return to it in
due course.) The EPA has now explained, see 75 Fed. Reg. at
14,278/2–3, that the “counterbalance” scenario we
hypothesized in Environmental Defense would in fact not be
allowed by the current version of 40 C.F.R. § 93.116(a). This
is because, ever since adopting regulations in 1993 to
implement the (B) criteria, the EPA has applied a so-called
6
“build/no-build test”; 1 under that test, a “new violation” will
be found for an area if that area “would otherwise not be in
violation of the standard during the future period in question,
if the project were not implemented.” See 40 C.F.R. § 93.101
(definition for “[c]ause or contribute to a new violation”).
Similarly, to “[i]ncrease the frequency or severity” of a
violation means “to cause a location or region to exceed a
standard more often or at a greater concentration than
previously existed and/or would otherwise exist during the
future period in question, if the project were not
implemented.” See id. (definition of “[i]ncrease the
frequency or severity”). The build/no-build test is dynamic,
comparing concentrations with and without the project,
focusing on the location and the time period for which the
proposed project’s emissions are predicted to be most
pronounced. See 2006 Rule, 75 Fed. Reg. at 14280/1–2; see
also 58 Fed. Reg. 62,188, 62,212/2 (Nov. 24, 1993).
Thus, in a case where new emissions were predicted to
(partially or fully) counterbalance previously scheduled
mitigation measures—so as to delay attainment beyond the
previously scheduled achievement date—the project would
not conform because the project’s emissions would result in
either a new or aggravated violation relative to the initial
emissions trajectory. Petitioners have failed to provide any
hypothetical or actual example of a project that could delay
attainment without causing a “new” or “more severe”
violation under these definitions.
1
Adoption of the 2006 Rule was necessary simply because the EPA
had in the meantime added a pollutant to the list requiring hot spot
analysis, namely PM2.5, and revised the rule for PM10. See
Environmental Defense, 509 F.3d at 557.
7
Petitioners argue that the EPA’s interpretation of
subsection (B) violates the canon that a statute should be read
to give effect to every one of its parts. Petitioners’ Br. 34–35
(citing American Federation of Government Employees v.
FLRA, 944 F.2d 922, 932 (D.C. Cir. 1991)). But the 2010
Rule does give effect to each of subsections (i), (ii), and (iii).
Although its test is in form in two parts, those parts operate—
as we’ve shown—to implement all of the three components.
This in no way contradicts Congress’s decision, which it
made, obviously, without foreknowledge that the EPA would
write the implementing regulations in a way that would kill all
three birds (all subsections of section (B)) with two stones.
Petitioners further advocate a startling interpretation of
“delay timely attainment” as used in (B)(iii). According to
them, it requires “existing NAAQS violations to be eliminated
by the [attainment] deadline as a condition for project
approval.” Petitioners’ Br. 29 (emphasis added); see also id.
at 17. In other words, in a region that is already expected not
to meet an upcoming attainment deadline, a new local project
could not be approved unless it would accelerate the
reduction of emissions enough to ensure timely compliance,
even if the project would not delay attainment a millisecond
beyond its formerly expected date.
The EPA’s 2010 Rule obviously embodied a quite
different notion—that a new project delays attainment only if
its implementation postpones attainment beyond the date by
which it would have been achieved without the project. See
Respondent’s Br. 41. As the EPA points out, “In Petitioners’
view, even if a new transportation project in the build scenario
improves air quality, if it does not achieve enough reductions
to offset all other sources that cause violations, the project
could not proceed.” Id. at 40 (emphasis added). But for any
such extraordinary blockage of harmless development, one
would expect Congress to be most emphatic and clear.
8
“Congress . . . does not . . . hide elephants in mouseholes.”
Whitman v. American Trucking Ass’ns, 531 U.S. 457, 468
(2001).
The statutory language being of little use to them,
petitioners turn to a snippet of legislative history and an
excerpt from the EPA’s original 1993 regulations. The
snippet of legislative history in fact supports the EPA’s
position and requires no discussion at all. The passage from
the 1993 regulations, 58 Fed. Reg. at 62,191/1–2, expressly
turns on a different subsection of CAA § 176(c), namely
§ 176(c)(3)(A)(iii), and only as applied to ozone and carbon
monoxide nonattainment areas. See also 58 Fed. Reg. at
62,197/1.
Thus we find that the 2010 Rule does give effect to
(B)(iii), and that the EPA’s interpretation of that provision—
that “delay” is evaluated relative to what would otherwise
have occurred—is entirely reasonable.
* * *
Insofar as petitioners allege in their reply brief
deficiencies in how hot spot analyses measure new or
expanded projects’ contributions to background emissions,
their objections are forfeit and, in any event, outside the scope
of our remand to the EPA. Our remand in Environmental
Defense focused on EPA’s apparently inconsistent treatment
of CAA § 176(c)(1)(B)(i), (B)(ii), and (B)(iii), and does not
provide petitioners with the opportunity to challenge aspects
of conformity analysis not integral to the remand or the EPA’s
action in response. Cf. Natural Resources Defense Council,
Inc. v. EPA, 638 F.3d 1183, 1190 (9th Cir. 2011) (placement
of air quality monitors relative to highways was subject of
prior rulemaking and could not be challenged in the instant
action).
9
Petitioners additionally take issue with the 2010 Rule’s
new requirement that local projects must be “included in a
regional emissions analysis that meets applicable §§ 93.118
and/or 93.119 requirements.” See 75 Fed. Reg. at 14,285/2
(codified at 40 C.F.R. § 93.116(a)). They argue that the EPA
admits that “SIP [regional-level] modeling is unlikely to
identify all locations that warrant a hot-spot analysis,” see
Petitioners’ Br. 37 (quoting 75 Fed. Reg. at 14,278/1), that hot
spot analyses are statutorily and functionally distinct from
SIPs, see id. at 36–40, and that therefore the incorporation of
regional analysis into the 2010 Rule is “not a permissible
substitute for preventing localized NAAQS violations,” id. at
36.
The difficulty with petitioners’ argument is that no one
ever seems to have supposed that SIP regional analysis could
“substitute” for local conformity evaluations. The EPA
naturally responds that the regional requirement is “necessary,
but not sufficient, to satisfying the hot-spot requirement.”
Respondent’s Br. 38. The addition of the regional component
to the test merely clarifies that in order to conform,
transportation projects must comply with other (preexisting)
statutory and regulatory regional-level requirements.
* * *
In sum, given the EPA’s clarification that (B)(iii) applies
to local projects and its persuasive explanation of how the
substance of the “delay” condition is met, we are satisfied that
the 2010 Rule is not arbitrary, capricious, or inconsistent with
law for the reasons raised in Environmental Defense. In
particular, it is now clear that a project giving rise to the
“counterbalance” hypothetical we described in that case
would not be deemed conforming.
10
The petition is therefore
Denied.