64 Cal.App.5th 266
Cal. Ct. App.2021Background
- The State Water Resources Control Board adopted an MCL for 1,2,3‑trichloropropane (TCP) of 5 parts per trillion in 2017 and identified granular activated carbon as the best available technology.
- The Board estimated statewide aggregate annual compliance costs of $33.9 million for the 5 ppt MCL, with per‑connection increases of about $25/year for large systems and $609/year for small systems.
- The Board found the 5 ppt MCL technologically feasible, as treatment can achieve levels below 5 ppt, and concluded the MCL was economically feasible statewide while acknowledging burdens on some small systems and noting alternative treatments and financing options.
- California Manufacturers & Technology Association challenged the regulation by writ, arguing the Board misinterpreted “economic feasibility,” failed to perform a cost‑benefit analysis, applied no discernible standard, and violated APA economic‑impact assessment requirements for business water systems.
- The trial court denied the petition; the Court of Appeal affirmed, rejecting the Association’s statutory and APA challenges.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Meaning of “economic feasibility” under Cal. Health & Safety Code §116365 | “Feasible” means “reasonable,” so economic feasibility requires a reasonableness inquiry | “Feasible” means “capable of being done”; statute requires feasibility analysis focused on costs using best available technology | Court held “feasible” means capable of being done; economic feasibility = whether compliance is economically capable of being done, not a reasonableness balancing test |
| Whether §116365 requires a cost‑benefit analysis | Board must quantify and balance costs and benefits when setting MCLs | Statute prioritizes public‑health goals and requires a feasibility (costs-of-compliance) analysis, not a cost‑benefit monetization/balancing | Court held statute requires feasibility analysis (like American Textile), not a cost‑benefit analysis; Legislature placed public‑health goal above other considerations except where achievement is unachievable |
| Whether Board applied a discernible standard in assessing economic feasibility | Board failed to apply any economic standard or meaningful test | Board complied with §116365 by considering costs per customer and aggregate costs using best available technology | Court held Board considered the statutorily required costs and its approach satisfied the statute; no further specific economic standard was mandated |
| APA cost‑impact analysis for business‑operated water systems (Gov. Code §§11346.2, 11346.3) | Board failed to assess economic impacts on nontransient noncommunity/business water systems (later‑identified) | Board’s initial assessment used available data; it considered impacts on businesses and complied with the multi‑step APA process for economic impact assessment | Court held no substantial APA failure: Board’s initial determination was based on available data, public comment could update info, and there was no showing of unreasonable reliance or substantial noncompliance |
Key Cases Cited
- American Textile Manufacturers Institute v. Donovan, 452 U.S. 490 (U.S. 1981) (interpreting “feasible” as “capable of being done” and distinguishing feasibility analysis from cost‑benefit balancing)
- Western States Petroleum Assn. v. Board of Equalization, 57 Cal.4th 401 (Cal. 2013) (standard of review for quasi‑legislative agency rules and agency economic‑impact assessment process)
- Sierra Club v. Sigler, 695 F.2d 957 (5th Cir. 1983) (discussing varieties of cost‑benefit analysis and informal vs formal approaches)
- American Mining Congress v. Thomas, 772 F.2d 617 (10th Cir. 1985) (explaining feasibility analysis vs cost‑benefit analysis as mutually exclusive approaches)
- Quivira Mining Co. v. United States Nuclear Regulatory Commission, 866 F.2d 1246 (10th Cir. 1989) (describing feasibility analysis that constrains agency to public‑health protection to extent economically/technically feasible)