936 F.3d 308
5th Cir.2019Background
- In 2015 EPA promulgated a more stringent Effluent Limitations Guidelines (ELGs) for steam electric power plants, setting BAT and pretreatment standards for seven wastestreams with an earliest compliance date of November 2018 and a final compliance window through December 2023.
- Petitioners (environmental groups) challenged aspects of the 2015 Rule; industry groups (UWAG) and SBA sought reconsideration and suspension of deadlines based on new information about costs and achievability for certain technologies.
- Following notice-and-comment and public hearings, EPA issued a 2017 Postponement Rule that: left the 2015 Rule largely intact, but postponed only the earliest compliance dates by two years (to Nov. 1, 2020) for two specific wastestreams (FGD wastewater and bottom ash transport water) while keeping the Dec. 31, 2023 final deadline.
- Petitioners sued, arguing the Postponement Rule (1) was an unauthorized stay or its functional equivalent, (2) failed to consider mandatory statutory BAT factors in the revision, and (3) violated a purported CWA three-year maximum compliance deadline.
- The Fifth Circuit reviewed under the APA’s arbitrary-and-capricious standard and upheld EPA: finding statutory authority to revise, adequate explanation and procedure (notice-and-comment), and a reasonable exercise of discretion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Postponement Rule is an unauthorized stay or its functional equivalent | Postponement is effectively a stay of the 2015 Rule and thus unauthorized | EPA: action was a revision via notice-and-comment rulemaking, and agencies have inherent authority to reconsider/revise rules under CWA | Not a stay; it is a valid revision and not the functional equivalent of an unauthorized stay |
| Whether EPA failed to comply with APA/ statutory BAT-factor requirements when revising dates | EPA should have re-evaluated and restated all statutory BAT factors when altering compliance dates | EPA relied on the original 2015 BAT record, considered the issues raised, and used notice-and-comment procedure for a narrow targeted change | EPA acted within discretion; prior record and targeted reconsideration sufficed; APA complied with |
| Whether the CWA imposes an absolute three-year compliance limit on any BAT revisions | Petitioners: §1311(b)(2)(C) mandates compliance within three years of promulgation for any BAT limits | EPA: statutory three-year limit applies to initial promulgation only; statute’s text and structure permit later rulemaking to set dates | Court adopts EPA’s reading: three-year limit applies to initial BAT promulgation, not to later revisions |
| Whether EPA’s action was arbitrary and capricious | Petitioners: EPA’s rationale and scope were inadequate and arbitrary | EPA: provided reasoned explanation, targeted rulemaking to avoid needless costs, preserved substantive limits and final deadline | Court: EPA’s decision was reasonable and not arbitrary or capricious |
Key Cases Cited
- Tex. Oil & Gas Ass’n v. EPA, 161 F.3d 923 (5th Cir.) (discussing deferential review of agency policy choices)
- Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402 (1971) (court may not substitute its judgment for the agency under APA review)
- Perez v. Mortg. Bankers Ass’n, 135 S. Ct. 1199 (2015) (agencies must use same procedures to revise a rule as to issue it)
- Motor Vehicle Mfrs. Ass’n v. State Farm, 463 U.S. 29 (1983) (agency must provide reasoned explanation; no post-hoc rationalizations)
- FCC v. Fox Television Stations, Inc., 556 U.S. 502 (2009) (agencies may revise past decisions but must supply reasoned analysis)
- Nat’l Ass’n of Home Builders v. EPA, 682 F.3d 1032 (D.C. Cir.) (agency reevaluation of policy is within discretion)
- Envtl. Def. Fund v. Gorsuch, 713 F.2d 802 (D.C. Cir.) (changes to effective dates constitute rulemaking)