New York v. Environmental Protection Agency

443 F.3d 880, 370 U.S. App. D.C. 239
CourtCourt of Appeals for the D.C. Circuit
DecidedMarch 17, 2006
DocketNos. 03-1380, 03-1381, 03-1383, 03-1390, 03-1402, 03-1453, 03-1454, 04-1029, 04-1035, 04-1064, 05-1234, 05-1287
StatusPublished
Cited by1 cases

This text of 443 F.3d 880 (New York v. Environmental Protection Agency) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
New York v. Environmental Protection Agency, 443 F.3d 880, 370 U.S. App. D.C. 239 (D.C. Cir. 2006).

Opinion

ROGERS, Circuit Judge.

In New York v. EPA, 413 F.3d 3 (D.C.Cir.2005) (“New York I”), the court addressed the first of two rules promulgated by the Environmental Protection Agency providing ways for stationary sources of air pollution to avoid triggering New Source Review (“NSR”). The court upheld in part and vacated in part the first rule. Id. at 10-11. We now address the second rule, the Equipment Replacement Provision (“ERP”), which amends the Routine Maintenance, Repair, and Replacement Exclusion (“RMRR”) from NSR requirements. Under section 111(a)(4) of the Clean Air Act, 42 U.S.C. § 7411(a)(4), sources that undergo “any physical change” that increases emissions are required to undergo the NSR permitting process. See also id. §§ 7501(4), 7479(2)(C)(cross-referencing id. § 7411(a)(4)). The exclusion has historically provided that routine maintenance, repair, and replacement do not constitute changes triggering NSR. The ERP both defined and expanded that exclusion. EPA explained:

[The] rule states categorically that the replacement of components with identical or functionally equivalent components that do not exceed 20% of the replacement value of the process unit and does not change its basic design parameters is not a change and is within the RMRR exclusion.

Equipment Replacement Provision of the Routine Maintenance, Repair and Replacement Exclusion, 68 Fed.Reg. 61,248, 61,270 (Oct. 27, 2003) (“Final Rule”); see also 70 Fed.Reg. 33,838 (June 10, 2005)(“Recon-sideration”). Hence, the ERP would allow sources to avoid NSR when replacing equipment under the twenty-percent cap notwithstanding a resulting increase in emissions. The court stayed the effective date of the ERP on December 24, 2003. We now vacate the ERP because it is contrary to the plain language of section 111(a)(4) of the Act.

The Clean Air Act requires new and modified sources of pollution to undergo NSR, a permitting process that imposes specific pollution control requirements depending upon the geographic location of the source.1 Section 111(a)(4) of the Act describes when a source is to be considered “modified”:

The term “modification” means any physical change in, or change in the method of operation of, a stationary source which increases the amount of any air pollutant emitted by such source or which results in the emission of any air pollutant not previously emitted.

42 U.S.C. § 7411(a)(4) (emphasis added). Since the inception of NSR, RMRR has been excluded from the definition of “modification.” See 39 Fed.Reg. 42,510, 42,514 (Dec. 5, 1974); 43 Fed.Reg. 26,388, 26,403-04 (June 19, 1978). Heretofore, EPA applied the RMRR exclusion through “a case-by-case determination by weighing the nature, extent, purpose, frequency, and cost of the work as well as other factors to [243]*243arrive at a common sense finding.” 67 Fed.Reg. 80,290, 80,292-93 (Dec. 31, 2002). Consistent with Alabama Power Co. v. Costle, 636 F.2d 323 (D.C.Cir.1979), which recognized EPA’s discretion to exempt from NSR “some emission increases on grounds of de minimis or administrative necessity,” id. at 400, EPA has for over two decades defined the RMRR exclusion as limited to “de minimis circumstances.” 68 Fed.Reg. at 61,272. The ERP provides a bright-line rule and expands the traditional scope of the RMRR by exempting certain equipment replacements from NSR. See, e.g., 40 C.F.R. § 52.21(cc)(2005).2

The government and environmental petitioners contend that the ERP is contrary to the plain text of the Act because the statutory definition of “modification” applies unambiguously to any physical change that increases emissions, necessarily including the emission-increasing equipment replacements excused from NSR by the rule. They maintain that the word “any,” when given its natural meaning, requires that the phrase “physical change” be read broadly, such that EPA’s attempt to read “physical change” narrowly would relegate the word “any” to an insignificant role.

In evaluating the petitioners’ contention, we proceed under the familiar two-part test of Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). If “Congress has directly spoken to the precise question at issue ... that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.” Id. at 842-43, 104 S.Ct. 2778. Only if the statute is silent or ambiguous do we defer to the agency’s interpretation, asking “whether [it] is based on a permissible construction of the statute.” Id. at 843, 104 S.Ct. 2778. “If a court, employing traditional tools of statutory construction, ascertains that Congress had an intention on the precise question at issue, that intention is the law and must be given effect.” Id. at 843 n. 9, 104 S.Ct. 2778.

The petitioners and EPA agree that the phrase “physical change” is susceptible to multiple meanings, each citing dictionary definitions. However, “the sort of ambiguity giving rise to Chevron deference ‘is a creature not of definitional possibilities, but of statutory context.’ ” American Bar Ass’n v. FTC, 430 F.3d 457, 469 (D.C.Cir.2005) (quoting Brown v. Gardner, 513 U.S. 115, 118, 115 S.Ct. 552, 130 L.Ed.2d 462 (1994)); see California Indep. Sys. Operator Corp. v. FERC, 372 F.3d 395, 400 (D.C.Cir.2004); Cincinnati Ins. Co. v. Flanders Elec. Motor Serv., Inc., 40 F.3d 146, 152 (7th Cir.1994). As the parties point out, the ordinary meaning of “physical change” includes activities that [244]*244“make different in some particular,” “make over to a radically different form,” or “replace with another or others of the same kind or class.” Webster’s Third New International Dictionary 373 (1981). To say that it is “physical,” in this context, indicates that the change must be “natural or material,” rather than “mental, moral, spiritual, or imaginary.” Id. 1706. The parties agree that in “[r]eal-world, common-sense usage,” 68 Fed.Reg. at 61,271, “physical change” includes equipment replacements. They further agree that the ERP would excuse from NSR requirements certain emission-increasing activities that EPA has historically considered to be “physical changes.” See id. at 61,-270.

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443 F.3d 880, 370 U.S. App. D.C. 239, Counsel Stack Legal Research, https://law.counselstack.com/opinion/new-york-v-environmental-protection-agency-cadc-2006.