No UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT. SIERRA CLUB, et al., Plaintiffs-Appellees, v.

Transcription

1 Case: Document: Filed: 10/01/2010 Page: 1 No UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT SIERRA CLUB, et al., Plaintiffs-Appellees, v. CHRISTOPHER KORLESKI, Director, Ohio Environmental Protection Agency, Defendant-Appellant. On Appeal from the United States District Court for the Southern District of Ohio, Case No. 2:08-CV-865 BRIEF OF THE UNITED STATES AS AMICUS CURIAE SUPPORTING AFFIRMANCE SCOTT FULTON IGNACIA S. MORENO General Counsel Assistant Attorney General SARA SCHNEEBERG KATHERINE J. BARTON KRISTI M. SMITH PETER J. MCVEIGH* Office of General Counsel *Counsel of Record U.S. Environmental Protection Agency U.S. Department of Justice Washington, DC Environment and Natural Resources Division ANDRE DAUGAVIETIS P.O. Box 4390, Ben Franklin Station Office of Regional Counsel Washington, DC U.S. Environmental Protection Agency (202) Chicago, IL peter.mcveigh@usdoj.gov Counsel for the United States

2 Case: Document: Filed: 10/01/2010 Page: 2 TABLE OF CONTENTS Page TABLE OF AUTHORITIES... iii STATEMENT OF IDENTITY, INTEREST, AND AUTHORITY TO FILE...1 STATEMENT OF THE ISSUES...1 INTRODUCTION...2 ARGUMENT...4 I. The CAA s citizen suit provision, 42 U.S.C. 7604(a), authorizes Sierra Club s action to restrain the Director from issuing permits without determining that the permitted sources will employ BAT...4 A. The Ohio SIP s requirement that Ohio EPA determine that a source of pollution will employ BAT before issuing a permit is an emission standard or limitation...5 B. The Director violated the permitting-related requirement of the Ohio SIP The Director s failure to comply with a directly applicable requirement violated the Ohio SIP The Supreme Court s holding in Bennett v. Spear does not support Ohio EPA s argument...13 II. The doctrine of constitutional avoidance does not require this Court to conclude that a state agency does not violate a requirement of a SIP for purposes of 42 U.S.C. 7604(a) when the agency fails to comply with a commitment the state made in the SIP not to issue permits to sources of air pollution without determining that the sources will employ BAT...16 A. To the extent the district court s injunction restrains Ohio EPA from issuing permits in violation of the SIP, the Tenth Amendment is not implicated...18 i

3 Case: Document: Filed: 10/01/2010 Page: 3 B. An injunction that has the indirect effect of compelling Ohio EPA to implement its permitting program in accordance with the requirements of the Ohio SIP would not violate the Tenth Amendment An injunction directly compelling Ohio EPA to implement its permitting program in accordance with the requirements of the Ohio SIP would not violate the Tenth Amendment An injunction that has the indirect effect of compelling a state to implement a federal regulatory program does not violate the Tenth Amendment...27 CONCLUSION...29 ii

4 Case: Document: Filed: 10/01/2010 Page: 4 TABLE OF AUTHORITIES CASES: Page(s) ACORN v. Edwards, 81 F.3d 1387 (5th Cir. 1996)...23 BCCA Appeal Group v. EPA, 355 F.3d 817 (5th Cir. 2003)...24 Bennett v. Spear, 520 U.S. 154 (1997)... 8, Cellular Phone Taskforce v. FCC, 205 F.3d 82 (2d Cir. 2000)...19 Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)...11 Citizens Ass n of Georgetown v. Washington, 535 F.2d 1318 (D.C. Cir. 1976)...9 City of Abilene v. EPA, 325 F.3d 657 (5th Cir. 2003) City of New York v. United States, 179 F.3d 29 (2d Cir. 1999)...19 CleanCOALition v. TXU Power, 536 F.3d 469 (5th Cir. 2008)...6 Connecticut v. Physicians Health Servs., Inc., 287 F.3d 110 (2d Cir. 2002)...19 Dakota, Minnesota & E. R.R. v. South Dakota, 362 F.3d 512 (8th Cir. 2004)...19 Edward J. DeBartolo Corp. v. Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568 (1988)...17 EPA v. Brown, 431 U.S. 99 (1977)...24 Ex parte Young, 209 U.S. 123 (1908)...13 FERC v. Mississippi, 456 U.S. 742 (1982)...22, 27 Friends of the Earth v. Carey, 552 F.2d 25 (2d Cir. 1977) iii

5 Case: Document: Filed: 10/01/2010 Page: 5 Hodel v. Virginia Surface Min. & Reclamation Ass n, 452 U.S. 264 (1981)...22, 27 Kentucky v. Donovan, 704 F.2d 288 (6th Cir. 1983)...27 Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992)...17 McEvoy v. IEI Barge Servs., Inc., --- F.3d ---, 2010 WL (7th Cir. Sept. 7, 2010)...6 Miller v. French, 530 U.S. 327 (2000)...17 National Parks Conservation Ass n v. Tennessee Valley Authority, 480 F.3d 410 (6th Cir. 2007)...7 New York v. United States, 505 U.S. 144 (1992) , 24, Ohio Envtl. Council v. U.S. Dist. Court, 565 F.2d 393 (6th Cir. 1977)...26 Prairie Band Potawatomi Nation v. Wagnon, 476 F.3d 818 (10th Cir. 2007)...19 Printz v. United States, 521 U.S. 898 (1997)...17, 19 Reno v. Condon, 528 U.S. 141 (2000)...22 Safe Air for Everyone v. EPA, 475 F.3d 1096 (9th Cir. 2007)...26 Save Our Health Org. v. Recomp of Minnesota, Inc., 37 F.3d 1334 (8th Cir. 1994)...7 South Dakota v. Dole, 483 U.S. 203 (1987)...27 Spectrum Health Continuing Care Group v. Anna Marie Bowling Irrecoverable Trust, 410 F.3d 304 (6th Cir. 2005)...25 Trs. for Alaska v. Fink, 17 F.3d 1209 (9th Cir. 1994)...20 United States v. Demjanjuk, 367 F.3d 623 (6th Cir. 2004)...6 United States v. Oakland Cannabis Buyers Co-op., 532 U.S. 483 (2001)...16 iv

6 Case: Document: Filed: 10/01/2010 Page: 6 United States v. Ohio Department of Highway Safety, 635 F.2d 1195 (6th Cir. 1980)... 7, 10-11, 24 Virginia v. Browner, 80 F.3d 869 (4th Cir. 1996)...28 West Virginia v. U.S. Dep t of Health & Human Servs., 289 F.3d 281 (4th Cir. 2002)...28 Westside Mothers v. Haveman, 289 F.3d 852 (6th Cir. 2002)...4, 15, 25, 27 CONSTITUTION: U.S. Const. amend. X...18 STATUTES: 16 U.S.C. 1540(g)(1)(A) U.S.C. 1540(g)(1)(C)...14 Clean Air Act, 42 U.S.C q... passim 42 U.S.C. 7410(a) U.S.C. 7410(a)(1), (2)...2, 8 42 U.S.C. 7410(a)(2)(C) U.S.C. 7410(a)(2)(E) U.S.C. 7410(k)(1) U.S.C. 7410(k)(2)...3, U.S.C. 7410(k)(3)...1, 3, U.S.C. 7410(l) U.S.C. 7413(a) U.S.C. 7413(a)(1)...10 v

7 Case: Document: Filed: 10/01/2010 Page: 7 42 U.S.C U.S.C. 7509(b)(1) U.S.C. 7509(b)(2) U.S.C. 7602(k) U.S.C. 7604(a) , 4, 10, U.S.C. 7604(a)(2) U.S.C. 7604(f)(3)...5, U.S.C. 7604(f)(4)...5, U.S.C. 7607(b)(1)...23 RULES: Rule 29(a) of the Federal Rules of Appellate Procedure...1 FEDERAL REGULATIONS: 40 C.F.R. pt. 51, app. V C.F.R (b) C.F.R (c) C.F.R (c)(127)... 3 FEDERAL REGISTER: 66 Fed. Reg. 54,666 (Oct. 30, 2001) LEGISLATIVE: H.R. Rep. No (1977) vi

8 Case: Document: Filed: 10/01/2010 Page: 8 MISCELLANEOUS: Ohio Admin. Code (A) (2002)... 3 Ohio Admin Code (A)(3) (2002)... 3, 9, 12 Ohio Admin. Code (A)(3) (2010)... 3 Ohio Rev. Code Ann (T) (2010)... 3 vii

9 Case: Document: Filed: 10/01/2010 Page: 9 STATEMENT OF IDENTITY, INTEREST, AND AUTHORITY TO FILE The United States files this brief as amicus curiae pursuant to Rule 29(a) of the Federal Rules of Appellate Procedure. The United States Environmental Protection Agency ( EPA ) in cooperation with the individual states has responsibility for implementing and enforcing the Clean Air Act ( the CAA ), 42 U.S.C q. In fulfilling its statutory responsibility to determine whether state implementation plans ( SIPs ) meet the requirements of the CAA, EPA sometimes relies on binding regulations and other commitments states make therein to take, or refrain from taking, particular actions in a regulatory capacity. See 42 U.S.C. 7410(a), (k)(3). This case raises questions of the enforceability of a state agency s duty or commitment in a SIP, and therefore implicates the interests of the United States. STATEMENT OF THE ISSUES I. Does the Clean Air Act s citizen suit provision, 42 U.S.C. 7604(a), authorize an action to restrain the Director of the Ohio Environmental Protection Agency ( Director ) from issuing permits that authorize the construction or modification of stationary sources of air pollution without determining that the sources will employ best available technology to reduce pollution, when the Ohio SIP requires Ohio EPA to make such a determination before issuing a permit? 1

10 Case: Document: Filed: 10/01/2010 Page: 10 II. Does the doctrine of constitutional avoidance require this Court to conclude that a state agency does not violate a requirement of a SIP for purposes of the CAA s citizen suit provision, 42 U.S.C. 7604(a), when the agency fails to comply with a commitment the state made in the SIP not to issue permits authorizing construction or modification of sources of air pollution without determining that the sources will employ best available technology to reduce air pollution. INTRODUCTION The CAA establishes a program of cooperative federalism, whereby states develop and submit to EPA for approval SIPs that demonstrate how they will attain and maintain compliance with federal ambient air quality standards. See 42 U.S.C. 7410(a)(1), (2). In 1972, the State of Ohio chose to assume regulatory responsibilities under the CAA by designing and obtaining EPA s approval of a SIP outlining how Ohio would ensure that areas within the state would meet federal ambient air quality standards. 40 C.F.R (b). On many occasions during subsequent years, Ohio chose to redesign its SIP and submitted proposed revisions to EPA to comply with new or revised air quality standards or for other reasons. See 40 C.F.R (c). Consistent with its responsibilities under the CAA, EPA evaluated each of Ohio s SIP submissions to determine whether it was a 2

11 Case: Document: Filed: 10/01/2010 Page: 11 complete submission for purposes of the CAA. See 42 U.S.C. 7410(k)(1). EPA further evaluated complete SIP submissions to ascertain whether they met the Act s various requirements, a complex task that requires expertise and often takes an extended period of time. See 42 U.S.C. 7410(k)(2), (3). As a result of Ohio s own decisions to develop and revise the Ohio SIP, and EPA s approval of its submissions, the EPA-approved Ohio SIP prohibits the construction or modification of a stationary source of air pollution without a permitto-install ( permit ) and requires Ohio EPA to determine that a source will employ best available technology ( BAT ) to reduce air pollution before issuing a permit. See Ohio Admin. Code (A), -05(A)(3) (2002); 40 C.F.R (c)(127). In 2006, Ohio enacted legislation, and Ohio EPA promulgated a regulation, that purported to exempt certain minor sources of air pollution from the requirement that they employ BAT. See Ohio Rev. Code Ann (T) (2010); Ohio Admin. Code (A)(3) (2010). In 2008, Ohio EPA requested EPA s approval to revise its SIP to incorporate the new regulation. See R. 19-1, Kravitz Aff., pp / EPA denied the request as incomplete, because the request did not show that the revision would not cause the state to fail to attain 1/ In citing the record, this amicus brief refers to the clerk s pagination when citing exhibits attached to the affidavit of Brett A. Kravitz. See Sierra Club Br. at 11 n.7. 3

12 Case: Document: Filed: 10/01/2010 Page: 12 or maintain ambient air quality standards. See id. Ohio EPA has not resubmitted a request for approval or submitted the information its first request omitted. See id., p. 23. Even though the 2006 legislation and regulation conflict with the requirements of the approved Ohio SIP, Ohio EPA began issuing permits to minor sources of pollution without making the requisite BAT determination. See id., p. 21. This appeal raises the issue of whether an environmental group and several of Ohio s citizens can bring an action under the CAA s citizen suit provision to restrain Ohio EPA from continuing to do so, in violation of the approved SIP. ARGUMENT I. The CAA s citizen suit provision, 42 U.S.C. 7604(a), authorizes Sierra Club s action to restrain the Director from issuing permits without determining that the permitted sources will employ BAT. The CAA s citizen suit provision, CAA Section 304(a), authorizes an action against any person who has violated or is in violation of an emission standard or limitation. 42 U.S.C. 7604(a). It is undisputed that the Director is a person for purposes of the citizen suit provision. 2/ Ohio EPA did not dispute that 2/ Section 304(a) of the CAA authorizes citizen suits against any person, including a government agency to the extent permitted by the Eleventh Amendment. 42 U.S.C. 7604(a). This suit, an action against a state officer that seeks prospective injunctive relief, is permitted under the Ex parte Young exception to the Eleventh Amendment. Westside Mothers v. Haveman, 289 F.3d 4

13 Case: Document: Filed: 10/01/2010 Page: 13 the Ohio SIP s permitting-related requirement, under which Ohio EPA must determine that a source of pollution will employ BAT before issuing a permit, is an emission standard or limitation until its reply brief and thus has waived that issue. In any event, its argument is incorrect. And Ohio EPA violated this requirement of the Ohio SIP when it issued permits without determining that the sources would employ BAT. A. The Ohio SIP s requirement that Ohio EPA determine that a source of pollution will employ BAT before issuing a permit is an emission standard or limitation. Section 304(f)(4) of the CAA defines emission standard or limitation to include any standard or limitation established under a SIP. 42 U.S.C. 7604(f)(4). The SIP requirement at issue here under which Ohio EPA must determine that a source of pollution will employ BAT before issuing a permit establishes a standard and limitation governing the issuance of permits. It is thus an emission standard or limitation under CAA Section 304(f)(4). 3/ 852, 855, (6th Cir. 2002). 3/ As the SIP requirement falls within the scope of Section 304(f)(4), Ohio EPA s discussion of Sections 304(f)(1) and 304(f)(3) is beside the point. See Ohio EPA Reply Br. at 4-6. Ohio EPA does not dispute that the SIP requirement fits within the plain meaning of a standard or limitation, and the definitions that Ohio EPA relies on refer instead to the terms emission standard and emission limitation. See 42 U.S.C. 7602(k) (emphasis added). 5

14 Case: Document: Filed: 10/01/2010 Page: 14 Ohio EPA acknowledges in its opening brief that an emission standard or limitation includes a standard, limitation, or schedule... under any applicable state implementation plan. Ohio EPA Br. at 16 (quoting Section 304(f)(4)). Ohio EPA contends for the first time in its reply brief, however, that Section 304(f)(4) reaches only standards and limitations established in permits, not standards or limitations found in a SIP but not repeated in a permit. Ohio EPA Reply Br. at 6. That argument is waived. United States v. Demjanjuk, 367 F.3d 623, (6th Cir. 2004). In any event, that argument is inconsistent with the statute s plain language and has been repeatedly rejected by courts of appeals. A correct, detailed analysis of the meaning of this provision was recently set forth in the Seventh Circuit s decision in McEvoy v. IEI Barge Servs., Inc., --- F.3d ---, 2010 WL (7th Cir. Sept. 7, 2010). Relying on the plain language of the CAA, the Seventh Circuit held that the statute permits citizen enforcement of standards found in an SIP, even if those standards are not repeated in a permit. Id. at *5. Similarly, in CleanCOALition v. TXU Power, 536 F.3d 469 (5th Cir. 2008), the Fifth Circuit reasoned that Section 304(f)(4) defines emission standard and limitation to include any other standard, limitation, or schedule established... under any applicable State implementation plan. Id. at 476 (quoting Section 6

15 Case: Document: Filed: 10/01/2010 Page: (f)(4)); see also Save Our Health Org. v. Recomp of Minnesota, Inc., 37 F.3d 1334, 1336 (8th Cir. 1994). Ohio EPA contends (Ohio EPA Reply Br. at 6) that this Court emphasized Section 304(f)(4) s focus on permits in National Parks Conservation Ass n v. Tennessee Valley Authority, 480 F.3d 410 (6th Cir. 2007) ( TVA ). Ohio EPA s reliance on TVA is misplaced. This Court held that Section 304(f)(4) authorized a citizen suit to enforce a standard or limitation that [the defendant] violated. TVA, 480 F.3d at 418. As the standard or limitation at issue in TVA was set forth in a SIP, rather than a permit, TVA does not support Ohio EPA s argument. Id. at 413, B. The Director violated the permitting-related requirement of the Ohio SIP. Under the plain language of the CAA, the Director violated and has continued to violate the Ohio SIP s requirement that Ohio EPA determine that an air contaminant source will employ BAT before issuing a permit. This conclusion is consistent with the decisions of every federal court to have considered the issue. It is further supported by this Court s interpretation of the term violation in CAA Section 113 in United States v. Ohio Department of Highway Safety, 635 F.2d 1195 (6th Cir. 1980) ( Ohio DHS ), as well as the legislative history and EPA s 7

16 Case: Document: Filed: 10/01/2010 Page: 16 interpretation of the CAA. Moreover, the Supreme Court s holding in Bennett v. Spear, 520 U.S. 154 (1997), does not support Ohio EPA s contention that a state s failure to comply with a SIP s requirements while performing regulatory duties is not a violation for purposes of CAA Section 304(a). 1. The Director s failure to comply with a directly applicable requirement violated the Ohio SIP. The plain language of the CAA by authorizing an action against a person that violated an emission standard or limitation authorizes Sierra Club s action against Ohio EPA based on its violations of a permitting-related requirement of the Ohio SIP, which Ohio voluntarily adopted. Under the cooperative-federalism structure of the CAA, a state must demonstrate in a SIP how areas will attain and maintain compliance with ambient air quality standards. See 42 U.S.C. 7410(a)(1), (2). To make this demonstration, states frequently include in SIPs both requirements that apply directly to polluters and other requirements that apply directly to state agencies with regulatory responsibilities. See, e.g., 42 U.S.C. 7410(a)(2)(C) (explaining that a SIP must provide for the regulation of the modification and construction of any stationary source within the areas covered by the plan as necessary to assure that national ambient air quality standards are achieved ). And when a state agency fails to comply with a requirement that 8

17 Case: Document: Filed: 10/01/2010 Page: 17 applies directly to it while performing regulatory duties, the agency violates that requirement. See Sierra Club Br. at (discussing cases addressing this point). Indeed, as Ohio EPA acknowledges, a person may violate a provision of law by committing a breach, infringement, or transgression of a standard of conduct. Ohio EPA Br. at 16 (quoting Random House Unabridged Dictionary 2124 (2d ed. 2001)). Here, the Ohio SIP sets forth a standard of conduct directly applicable to Ohio EPA, requiring it to determine that an air contaminant source will employ BAT before issuing a permit. Ohio Admin. Code (A)(3) (2002). When Ohio EPA breached this standard and limitation, Ohio EPA violated it. Every court to have considered the issue has held that a state agency acting in a regulatory capacity violates a requirement of a SIP that is directly applicable to the agency when it fails to comply with such a requirement, and thus is potentially subject to suit under CAA Section 304(a). See Sierra Club Br. at (citing cases). 4/ This reading of Section 304(a) is also strongly supported by this Court s 4/ In Citizens Ass n of Georgetown v. Washington, 535 F.2d 1318 (D.C. Cir. 1976), the D.C. Circuit, in considering the propriety of an award of attorneys fees, concluded that the 1970 version of the citizen suit provision did not authorize an action against a state agency in its capacity as a regulator. Id. at But this conclusion was based on the court s interpretation of the term emission standard or limitation, not the term violation. Id. at In any event, the decision has not been followed, and Congress has expanded the definition of emission standard or limitation since See, e.g., 42 U.S.C. 7604(f)(3), (4). For example, the definition of emission standard or limitation relied on in this brief, 9

18 Case: Document: Filed: 10/01/2010 Page: 18 construction of similar language in CAA Section 113, which authorizes EPA to bring civil actions against any person who has violated or is in violation of a requirement of a SIP. 42 U.S.C. 7413(a)(1). The reading of Section 304(a) finds additional support in the legislative history pertaining to Section 113 and EPA s interpretation of that Section, as explained below. In Ohio DHS, this Court held that the 1970 version of Section 113 authorized EPA to bring a civil action against a state agency in its capacity as a regulator, concluding that the Ohio Department of Highway Safety violated a provision of a federal implementation plan ( FIP ) that required it to withhold registration from motor vehicles that did not pass emission inspections. Ohio DHS, 635 F.2d at 1197, Given the similar language used by Congress in CAA Sections 113 and 304(a) and the similar purposes these provisions serve, Congress obviously intended the term violation to have the same meaning in both provisions. See 42 U.S.C. 7604(a); 42 U.S.C. 7413(a). Accordingly, under Ohio DHS, for purposes of CAA Sections 113(a) and 304(a), a state agency acting in a regulatory which includes any standard or limitation under a SIP, was not incorporated into the CAA until See 42 U.S.C. 7604(f)(4). 10

19 Case: Document: Filed: 10/01/2010 Page: 19 capacity violates a requirement of a SIP when it fails to comply with the requirement. See Ohio DHS, 635 F.2d at In addition, the legislative history of the CAA indicates that EPA has authority under CAA Section 113 to bring civil enforcement actions against a state agency in its capacity as a regulator, and thus necessarily that a state agency acting in a regulatory capacity violates a requirement of a SIP when the state fails to comply with the requirement. H.R. Rep. No , at & n.26 (1977); 42 U.S.C. 7413(a). 5/ Further, EPA has interpreted the language of CAA Section 113 in connection with notice-and-comment rulemakings to authorize an action against a state agency in its capacity as a regulator, see 66 Fed. Reg. 54,666, 54,676 n.9 (Oct. 30, 2001), and this interpretation is entitled to deference under Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984). Ohio EPA provides no reasonable basis for interpreting the term violation differently in Section 113 than in Section 304(a), and indeed implicitly acknowledges in its reply brief that the term violation must have the same meaning in both Sections. Ohio EPA Reply Br. at / The same legislative history indicates that Congress was aware in 1977, when it expanded the definition of the term emission standard or limitation in Section 304(f), of case law holding that a citizen may bring an action against a state agency acting in a regulatory capacity. H.R. Rep. No , at

20 Case: Document: Filed: 10/01/2010 Page: 20 Ohio EPA contends its failure to comply with the permitting-related SIP requirement is not a violation, but rather is nonenforcement of an emission standard, analogizing its conduct to that of a police officer who fails to issue a ticket to a speeder. See Ohio EPA Br. at 17. A police officer, however, has discretion regarding whether to issue a ticket. Ohio EPA, by contrast, lacks discretion under the approved SIP to issue permits without determining that the sources of pollution will employ BAT. Ohio Admin. Code (A)(3) (2002). And when an applicable law forbids a police officer from issuing a ticket except under certain conditions, the police officer violates that law if he disregards the conditions and writes the ticket anyway. Likewise, Ohio EPA s reliance (Ohio EPA Br. at 20) on the fact that Section 304(a), unlike Section 113(a)(2), does not expressly address a state s failure... to enforce a SIP is misplaced. As discussed above, Ohio EPA s violation of federal law is not limited to a mere failure to enforce. Further, the phrase failure... to enforce is broader than a violation of a SIP requirement in that the phrase encompasses a state s failure to bring discretionary enforcement actions in addition to a state s failure to perform regulatory duties in accordance with a SIP s requirements. See 42 U.S.C. 7413(a). It is not surprising that Congress did not make a state s failure to enforce a SIP a basis for a citizen suit, 12

21 Case: Document: Filed: 10/01/2010 Page: 21 as Congress did not intend to authorize citizens to seek to compel states to bring discretionary enforcement actions. 6/ 2. Bennett v. Spear does not support Ohio EPA s argument. In its reply brief (Ohio EPA Reply Br. at 7-12), Ohio EPA argues that the reasoning of the Supreme Court in Bennett supports the conclusion that a state agency acting in a regulatory capacity cannot violate a requirement of a SIP. Ohio EPA is wrong. In Bennett, the Supreme Court interpreted the citizen suit provision of the Endangered Species Act ( ESA ), which expressly authorizes actions against 6/ The CAA s citizen suit provision, which only permits suits against government entities to the extent permitted by the Eleventh Amendment, would not authorize a citizen suit to compel Ohio EPA to exercise its discretion to bring an enforcement action. Because there is no requirement that Ohio EPA bring an enforcement action, the Ex parte Young exception to the Eleventh Amendment would not permit such a citizen suit. See Ex parte Young, 209 U.S. 123, 158 (1908) ( There is no doubt that the court cannot control the exercise of the discretion of an officer. ). The district court in this case ordered Ohio EPA to implement and enforce a provision of the Ohio SIP while also enjoining Ohio EPA from further implementation of the BAT exemption that contravenes the federally-approved Ohio SIP. R. 75, Order, p. 17. In using the word enforce, the district court was merely ordering Ohio EPA to give effect to the SIP, and neither party has interpreted this injunction as requiring Ohio EPA to bring discretionary enforcement actions against polluters. See also infra note 11 (discussing the scope of the district court s injunction). The Ex parte Young exception permits an action like Sierra Club s, because issuing permits without making the requisite BAT determination constitutes an act which [the Director] had no legal right to do under the Ohio SIP. Ex parte Young, 209 U.S. at

22 Case: Document: Filed: 10/01/2010 Page: 22 (1) any person who has violated the ESA or implementing regulations, 16 U.S.C. 1540(g)(1)(A); and (2) the federal administrator of the statute to compel the performance of non-discretionary duties, 16 U.S.C. 1540(g)(1)(C). To avoid rendering 16 U.S.C. 1540(g)(1)(C) superfluous, the Court concluded that the term violation [in 16 U.S.C. 1540(g)(1)(A)] does not include the Secretary s failure to perform his duties as administrator of the ESA. Bennett, 520 U.S. at 173. The Supreme Court further noted that a contrary interpretation of 16 U.S.C. 1540(g)(1)(A) would effect a wholesale abrogation of the Administrative Procedure Act s final agency action requirement 7/ and that Congress used the term violation in other contexts in which it was most unlikely to refer to failure by the Secretary or other federal officers and employees to perform their duties in administering the ESA. Id. at Contrary to Ohio EPA s assertions, therefore, the reasoning of Bennett does not apply here. While there are similarities between the CAA s citizen suit provision and the ESA s citizen suit provision (Ohio EPA Br. at 8), this action, where citizens seek to prevent a state agency from continuing to violate a 7/ If Section 1540(g)(1)(A) had been construed to apply to the Secretary s administration of the ESA, it could have permitted attacks on non-final action that would not be reviewable under the Administrative Procedure Act. See Bennett, 520 U.S. at (discussing the final agency action requirement). 14

23 Case: Document: Filed: 10/01/2010 Page: 23 commitment that the state chose to include in a proposed SIP revision and that EPA ultimately approved under a program of cooperative federalism, arises in a different context than the citizen suit in Bennett, where the plaintiffs challenged a federal agency s implementation of a federal statute. Allowing suits against state officials for violations of self-imposed SIP regulatory requirements pursuant to CAA Section 304(a) would not render any other provision of the CAA superfluous, is not inconsistent with the use of the term violation elsewhere in the statute, and would not abrogate other congressional limitations on suits against state agencies. 8/ Furthermore, at a minimum, Bennett does not support Ohio EPA so unambiguously as to authorize a panel of this Court to declare Ohio DHS overruled sub silento. 8/ Congress may not have intended that a state agency would be subject to civil penalties based on its failure to lawfully implement a SIP. Ohio EPA Reply Br. at But civil penalties are sought by EPA as a matter of discretion, and this case is not an effort by EPA to impose such penalties. Sierra Club does not seek civil penalties in this action, nor could it: Section 304(a), as explained, authorizes actions against state agencies only to the extent permitted by the Eleventh Amendment, and the Ex Parte Young exception to the Eleventh Amendment only permits prospective injunctive relief. See 42 U.S.C. 7604(a); Westside Mothers, 289 F.3d at

24 Case: Document: Filed: 10/01/2010 Page: 24 II. The doctrine of constitutional avoidance does not require this Court to conclude that a state agency does not violate a requirement of a SIP for purposes of 42 U.S.C. 7604(a) when the agency fails to comply with a commitment the state made in the SIP not to issue permits to sources of air pollution without determining that the sources will employ BAT. Under the doctrine of constitutional avoidance, a court may adopt a reasonable interpretation of an ambiguous statute to avoid an interpretation that raises constitutional problems. See United States v. Oakland Cannabis Buyers Co-op., 532 U.S. 483, 494 (2001) (explaining that the canon of constitutional avoidance has no application in the absence of statutory ambiguity ). Ohio EPA argues that the CAA s citizen suit provision cannot authorize Sierra Club s action without violating the Tenth Amendment and that in light of the requirements of the doctrine of constitutional avoidance, this Court should conclude that Ohio EPA did not violate a requirement of the Ohio SIP for purposes of 42 U.S.C. 7604(a), and thus is not subject to suit. See Ohio EPA Reply Br. at 19 (clarifying that Ohio EPA is not challenging the CAA s citizen suit provision on constitutional grounds). 9/ This Court need not consider Ohio EPA s Tenth Amendment arguments, however, because the avoidance doctrine does not authorize a court to adopt an interpretation of a statute that, like Ohio EPA s proposed interpretation, is 9/ Also, this Court need not address Ohio EPA s Tenth Amendment arguments because they are waived. See Sierra Club Br. at

25 Case: Document: Filed: 10/01/2010 Page: 25 plainly contrary to congressional intent. See supra at 8-11; Miller v. French, 530 U.S. 327, 341 (2000); Edward J. DeBartolo Corp. v. Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568, (1988). 10/ In any event, Ohio EPA s Tenth Amendment arguments are without merit. The district court in this case ordered Ohio EPA to implement and enforce the version of Section of the Ohio Administrative Code that is incorporated into the Ohio SIP and enjoined Ohio EPA from further implementation of the BAT exemption that contravenes the federally-approved Ohio SIP. R. 75, Order, p / To the extent the district court s injunction merely restrains Ohio EPA 10/ Likewise, because this Court s conclusion in Ohio DHS was based on Congress plain intent, subsequent decisions of the Supreme Court in Printz v. United States, 521 U.S. 898 (1997), and New York v. United States, 505 U.S. 144 (1992), do not require this Court, for purposes of resolving this appeal, to revisit its conclusion in Ohio DHS that a state agency violates a requirement of a FIP when it fails to comply with one while performing regulatory duties. See Miller, 530 U.S. at 341. In any event, for the reasons explained below, the Tenth Amendment concerns outlined in New York and Printz do not constrain Sierra Club s ability to bring this action. 11/ Ohio EPA characterizes the district court s injunction as compelling it to participate in the CAA, presumably by compelling it to issue permits. See Ohio EPA Br. at 25. Ohio EPA s interpretation is wrong, because Ohio voluntarily assumed responsibility for implementing the CAA. Moreover, the Sierra Club does not have standing to compel Ohio EPA to issue permits; the Sierra Club has an interest only in preventing air pollution, not in ensuring that sources of pollution obtain permits so that they may lawfully perform construction and modification projects. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (discussing constitutional standing requirements). 17

26 Case: Document: Filed: 10/01/2010 Page: 26 from issuing permits without complying with the requirements of the SIP, the Tenth Amendment is not implicated. Further, even if the district court s injunction can be read as having the indirect effect of compelling Ohio EPA to issue permits, it would not violate the Tenth Amendment because, among other reasons, Ohio voluntarily assumed responsibility to implement the SIP in a specific manner and retains the option to change those specific obligations by following applicable procedures or to relinquish its regulatory responsibilities altogether. A. To the extent the district court s injunction restrains Ohio EPA from issuing permits in violation of the SIP, the Tenth Amendment is not implicated. The Tenth Amendment provides that: [t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people. U.S. Const. amend. X. Under that constitutional framework, [t]he States... retai[n] a significant measure of sovereign authority... to the extent that the Constitution has not divested them of their original powers and transferred those powers to the Federal Government. New York v. United States, 505 U.S. 144, 156 (1992) (citation omitted). When Congress directly compels a state to administer a federal regulatory program, however, it violates the Tenth Amendment. Id. at 161 (citation omitted). 18

27 Case: Document: Filed: 10/01/2010 Page: 27 In this case, to the extent the district court s injunction merely restrains Ohio EPA from issuing permits without complying with the requirements of the EPAapproved Ohio SIP, the Tenth Amendment is not implicated. This is so because an action to enjoin state officials from continuing to violate federal law does not implicate the Tenth Amendment s prohibition against compelling states to administer federal regulatory programs. See Printz v. United States, 521 U.S. 898, 913 (1997) (discussing the duty of all state officers to enforce and interpret state laws in a manner that does not obstruct the operation of federal law); Dakota, Minnesota & E. R.R. v. South Dakota, 362 F.3d 512, 518 (8th Cir. 2004) (holding that an action to enjoin implementation of portions of state law that conflicted with federal law was not an effort to compel the state to enforce a federal regulatory program); Prairie Band Potawatomi Nation v. Wagnon, 476 F.3d 818, 829 (10th Cir. 2007) (same); City of New York v. United States, 179 F.3d 29, 35 (2d Cir. 1999) (rejecting a Tenth Amendment challenge to federal statutory provisions that did not directly compel states or localities to require or prohibit anything ); see also Connecticut v. Physicians Health Servs., Inc., 287 F.3d 110, 122 (2d Cir. 2002); Cellular Phone Taskforce v. F.C.C., 205 F.3d 82, 96 (2d Cir. 2000). Ohio EPA argues that cases like Dakota, Minnesota & E. R.R. Corp. are distinguishable from the instant case, on the theory that these decisions merely 19

28 Case: Document: Filed: 10/01/2010 Page: 28 illustrate the principle that federal courts can enjoin the enforcement of a State law due to a conflict with federal law. Ohio EPA Reply Br. at But that is exactly what the district court did in this case. Ohio s EPA-approved SIP, which has the force and effect of federal law, requires Ohio EPA to determine that a source of pollution will employ BAT before issuing a permit. See Trs. for Alaska v. Fink, 17 F.3d 1209, 1210 n.3 (9th Cir. 1994) (explaining that a SIP has the force and effect of federal law). In this case, Ohio enacted legislation, and Ohio EPA promulgated a regulation, that purported to create an exemption from this requirement. Thereafter, pursuant to this legislation and regulation, Ohio EPA began issuing permits to minor sources of pollution without first making the requisite BAT determination. This case thus illustrates the classic situation where state law and regulations conflict with the requirements of federal law. In this situation, a federal court may enjoin state officers from enforcing (i.e., giving effect to) the state law and regulation without violating the Tenth Amendment. See supra at 19. Accordingly, to the extent the district court s injunction restrains Ohio EPA from issuing permits without complying with permitting-related requirements of the SIP, the Tenth Amendment is not implicated. 20

29 Case: Document: Filed: 10/01/2010 Page: 29 B. An injunction that has the indirect effect of compelling Ohio EPA to implement its permitting program in accordance with the requirements of the Ohio SIP would not violate the Tenth Amendment. While the district court s injunction does not directly compel Ohio EPA to issue permits, it could indirectly cause or contribute to a decision on the part of Ohio EPA to issue permits in accordance with the SIP s requirements. But even assuming for the sake of argument that the district court s injunction thus can be read as having the indirect effect of compelling Ohio EPA to issue permits, it would not violate the Tenth Amendment for two reasons. Even directly compelling a state to implement a program in accordance with federal standards, when it voluntarily assumed responsibility for that program and retains the option to change or relinquish that responsibility, does not violate the Tenth Amendment. And in any event, an injunction that merely has the indirect effect of compelling a state to administer a federal regulatory program does not violate the Tenth Amendment. 1. An injunction directly compelling Ohio EPA to implement its permitting program in accordance with the requirements of the Ohio SIP would not violate the Tenth Amendment. Even an injunction directly compelling Ohio EPA to implement its permitting program in accordance with the requirements of the Ohio SIP would not violate the Tenth Amendment, where Ohio EPA voluntarily assumed responsibility to 21

30 Case: Document: Filed: 10/01/2010 Page: 30 implement the SIP in a specific manner and retains the option to change those specific responsibilities by following applicable procedures or to relinquish its regulatory responsibilities altogether. Statutes like the CAA that set standards or requirements for states voluntary participation in a federal regulatory program do not compel state participation, and thus do not violate the Tenth Amendment, as long as states can choose whether to participate. See Hodel v. Virginia Surface Min. & Reclamation Ass n, 452 U.S. 264, (1981); FERC v. Mississippi, 456 U.S. 742, (1982) ( FERC ). 12/ Under the courts of appeals interpretation of the Supreme Court s jurisprudence, statutory provisions do not violate the Tenth Amendment unless they leave a state with no choice but to regulate according to federal standards. Compare ACORN v. Edwards, 81 F.3d 1387, 1394 (5th Cir. 1996), with City of Abilene v. EPA, 325 F.3d 657, (5th Cir. 2003). 12/ The mere fact that a state might have to enact legislation to administer the federal program and comply with federal standards does not establish a Tenth Amendment violation. See Reno v. Condon, 528 U.S. 141, (2000) (citation omitted) ( That a State wishing to engage in certain activity must take administrative and sometimes legislative action to comply with federal standards regulating that activity is a commonplace that presents no constitutional defect. (citation omitted)); see also City of Abilene, 325 F.3d at 663 n.5 ( [T]he fact that the Cities may be required to undertake legislative or regulatory action to implement the conditions of their permits does not, by itself, establish a Tenth Amendment violation. Nor, taken alone, are the conditions prohibiting the Cities from taking any action in conflict with the permits sufficient to violate the Constitution. ). 22

31 Case: Document: Filed: 10/01/2010 Page: 31 In this case, the CAA s citizen suit provision does not, and indeed cannot, leave Ohio EPA without a constitutionally permissible choice for several reasons. As an initial matter, Ohio EPA was not compelled to assume regulatory responsibilities under the CAA. Rather, Ohio and Ohio EPA not only chose to participate in a federal regulatory program by deciding to develop a SIP, but they also chose to incorporate into the SIP the particular requirement that Ohio EPA has since ceased complying with. Moreover, Ohio EPA is not forever bound to implement its permit program in the manner currently required under the Ohio SIP. The CAA provides procedures by which Ohio can revise the SIP to remove the permitting-related requirement at issue in this case, see 42 U.S.C. 7410(l), and Ohio EPA can also relinquish altogether its responsibility to administer the SIP. 13/ Ohio and Ohio EPA thus essentially have the same choice today that they had when they submitted the original SIP to EPA for approval. Accordingly, because Ohio EPA can alter the regulations and other commitments in the Ohio SIP, which the state elected to undertake, after demonstrating that the state can still comply with federal ambient 13/ Judicial recourse is available if a state believes (1) EPA has failed to act on a SIP submission within one year of the submission being found or deemed complete; or (2) EPA did not have an adequate basis for disapproving a SIP submission. See 42 U.S.C. 7410(k)(2), (3); 42 U.S.C. 7604(a)(2); 42 U.S.C. 7607(b)(1). 23

32 Case: Document: Filed: 10/01/2010 Page: 32 air quality standards and obtaining EPA s approval, this case presents nothing like the situation described in New York, for example, where a state merely had [a] choice between two unconstitutionally coercive regulatory techniques. 505 U.S. at 176; see City of Abilene, 325 F.3d at & n.5 (explaining that the Cities must demonstrate that they had no choice but to accept these conditions. ). 14/ Furthermore, allowing states to alter particular SIP programs at will without demonstrating they can still comply with air quality standards would frustrate the proper functioning of the CAA. EPA, for example, necessarily relies on the regulations and other commitments states make in SIPs to take certain actions, and refrain from taking other actions, in their capacity as regulators. See, e.g., BCCA Appeal Group v. EPA, 355 F.3d 817, 839 n.25 (5th Cir. 2003). If states are permitted to change SIP requirements without complying with applicable procedures, EPA s ability to perform its statutory responsibility to determine that a SIP will ultimately lead to the attainment and maintenance of ambient air quality standards will be frustrated. See Friends of the Earth v. Carey, 552 F.2d 25, 35 (2d Cir. 1977) (relying on the fact that EPA would have disapproved a SIP if it had 14/ This case also presents nothing like the situation presented in the cases that led to EPA v. Brown, 431 U.S. 99 (1977), which interpreted the 1970 version of CAA Section 113. See Sierra Club Br. at 55-56; see also Ohio DHS, 635 F.2d at (discussing the cases that led to Brown). 24

33 Case: Document: Filed: 10/01/2010 Page: 33 known that its provisions for implementation and enforcement were illusory). Allowing states the unfettered ability to unilaterally alter portions of SIP programs would also be inconsistent with principles of cooperative federalism. Cooperative federalism necessarily involves both the receipt of benefits and an assumption of obligations. In developing and assuming responsibility to implement a SIP, a state enters into a mutual undertaking with the federal government. Friends, 552 F.2d at 37 (explaining that a state that assumes responsibility to implement a SIP enters into a pact based on cooperative federalism ). The state secures the benefit of avoiding the promulgation and federal implementation of a FIP and, in turn, agrees to implement the SIP in accordance with its requirements and to revise it according to the procedures outlined in the CAA. See id.; 42 U.S.C. 7410(a)(2)(E); 40 C.F.R. pt. 51, app. V. Of course, having accepted the benefits of cooperative federalism, the state must comply with federal procedures and standards in implementing the federal program. Spectrum Health Continuing Care Group v. Anna Marie Bowling Irrecoverable Trust, 410 F.3d 304, 313 (6th Cir. 2005); Westside Mothers, 289 F.3d at 856. And in the CAA context, courts have repeatedly concluded, after reviewing the structure of the CAA, that a state may not unilaterally alter the binding regulations and other commitments in a SIP. See Ohio Envtl. Council v. U.S. Dist. 25

34 Case: Document: Filed: 10/01/2010 Page: 34 Court, 565 F.2d 393, 395, 398 (6th Cir. 1977) (concluding that a state may not unilaterally modify a SIP); Safe Air for Everyone v. EPA, 475 F.3d 1096, 1105 (9th Cir. 2007) ( [A] state may not unilaterally alter the legal commitments of its SIP once EPA approves the plan. ); see also 42 U.S.C ( [I]f an emission standard or limitation is in effect under an applicable implementation plan... such State or political subdivision may not adopt or enforce any emission standard or limitation which is less stringent than the standard or limitation under such plan ). Cf. New York, 505 U.S. at 183 (noting in discussing the Tenth Amendment, that since New York had not joined a compact, any estoppel implications that might flow from membership in a compact... do not concern us here ). Accordingly, contrary to Ohio EPA s assertions, the Tenth Amendment s protections do not enable it to unilaterally modify a SIP, and Ohio EPA instead must adhere to the CAA s procedures for changing its requirements. See Friends, 552 F.2d at An injunction that has the indirect effect of compelling a state to implement a federal regulatory program does not violate the Tenth Amendment. An injunction that has the indirect effect of compelling a state to implement a federal regulatory program does not violate the Tenth Amendment. Federal statutes and regulations commonly affect state decisions regarding whether and how a state will perform regulatory duties. See, e.g., Westside Mothers, 289 F.3d at

35 Case: Document: Filed: 10/01/2010 Page: 35 But such statutes do not violate the Tenth Amendment based merely on the fact that they indirectly encourage, induce, or even coerce a state to administer a federal program. See FERC, 456 U.S. at 766 (explaining that it is not constitutionally determinative that federal regulation is likely to move the states to act in a given way, or even to coerce them into assuming a regulatory role, by impacting their freedom to make decisions); see also South Dakota v. Dole, 483 U.S. 203, 211 (1987) (rejecting an argument that Congress cannot achieve indirectly, by offering financial incentives, an objective that Congress is not empowered to achieve directly); Kentucky v. Donovan, 704 F.2d 288, 299 n.16 (6th Cir. 1983) ( Many courts have recognized that Congress may induce by the carrot of federal grants what it cannot coerce states to do. ). Rather, statutes violate the Tenth Amendment only when they directly compel state participation in a federal regulatory program. New York, 505 U.S. at 161; see Hodel, 452 U.S. at The courts of appeals have held, for example, that financial incentives like the CAA s highway funding sanction 15/ that induce states to administer federal regulatory programs do not violate the Tenth Amendment. See, e.g., Virginia v. 15/ 42 U.S.C. 7509(b)(1). 27

36 Case: Document: Filed: 10/01/2010 Page: 36 Browner, 80 F.3d 869, (4th Cir. 1996). 16/ Similarly, the CAA s offset sanction 17/ cannot violate the Tenth Amendment because it applies to polluters, and does not directly compel state action. See id. at 882. An offset sanction, however, can have the indirect effect of encouraging, inducing, or even coercing the state to correct whatever circumstances led to the imposition of the sanction, as polluters subject to the sanction will inevitably pressure the state to correct the problem. In this case, if Ohio EPA were to comply with the injunction by declining to issue permits, minor sources of pollution that need permits for construction and subsequent operation similarly might exert pressure on Ohio EPA to resume issuing permits without violating the requirements of the SIP. Thus, restraining Ohio EPA from issuing permits in violation of the SIP might ultimately result in Ohio EPA issuing permits in conformance with the SIP, because the district court s injunction otherwise requires Ohio EPA to refuse to issue permits to minor sources. But even if, as a result, the district court s injunction is read as having the indirect effect of compelling state participation in a federal regulatory program, just like the offset sanction, it would not violate the Tenth Amendment. 16/ Some circuit courts of appeals consider whether a financial incentive crosses a line and becomes impermissible outright coercion. West Virginia v. U.S. Dep t of Health & Human Servs., 289 F.3d 281, 288 (4th Cir. 2002) (discussing cases). 17/ 42 U.S.C. 7509(b)(2). 28