Club v. United States Environmental Protection Agency
793 F.3d 656
6th Cir.2015Background
- EPA redesignated the Cincinnati-Hamilton area (Ohio, Indiana, Kentucky) from nonattainment to attainment for the 1997 PM2.5 NAAQS in 2011, relying in part on regional cap-and-trade programs (NOx SIP Call, CAIR, CSAPR) to explain air-quality improvements.
- Sierra Club challenged the redesignations, arguing (1) improvements credited to cap-and-trade were not “permanent and enforceable” under 42 U.S.C. § 7407(d)(3)(E)(iii), and (2) Ohio and Indiana had not implemented required RACM/RACT measures under 42 U.S.C. § 7502(c)(1), so their SIPs could not have been "fully approved" under § 7407(d)(3)(E)(ii).
- Sierra Club filed direct petitions for review in this court; Ohio and a utilities group intervened in support of EPA. Kentucky’s redesignation was not contested on the RACM/RACT ground by Sierra Club due to waiver.
- The court first resolved standing on direct review, holding petitioners must carry a burden of production similar to summary judgment and finding Sierra Club had representational standing based on member affidavits showing aesthetic, recreational, and health concerns tied to potential increases in PM2.5.
- On the merits, the court applied Chevron deference where appropriate: it upheld EPA’s counting of regional cap-and-trade reductions as “permanent and enforceable” for purposes of § 7407(d)(3)(E)(iii), but held EPA unlawfully approved the Ohio and Indiana redesignations because their SIPs lacked the mandatory RACM/RACT provisions required by § 7502(c)(1) and thus could not be “fully approved” under § 7407(d)(3)(E)(ii).
- Result: the court vacated the redesignations for the Ohio and Indiana portions of the Cincinnati-Hamilton area and left Kentucky’s redesignation intact.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sierra Club has standing to seek review of EPA redesignations | Sierra Club argued its members suffer aesthetic, recreational, and health injuries from increased PM2.5 exposure if redesignation removes controls | EPA contended standing not established on the administrative record | Court: Petitioner must carry a summary-judgment level burden on direct review; Sierra Club met it via member declarations — standing satisfied |
| Whether reductions credited from regional cap-and-trade programs satisfy the "permanent and enforceable" requirement in § 7407(d)(3)(E)(iii) | Sierra Club: "Permanent" requires source-by-source, never-to-increase reductions; cap-and-trade (credits, banking) are not permanent/enforceable | EPA: Statute silent as to location; regional reductions under cap-and-trade create enforceable caps and can be counted | Court: EPA’s regional interpretation is reasonable; cap-and-trade reductions may be "permanent and enforceable" at the regional/state level — EPA upheld |
| Whether "improvement in air quality" under § 7407(d)(3)(E)(iii) must come from sources within the nonattainment area | Sierra Club: Improvements must be from sources in the nonattainment area; extra-area reductions cannot justify redesignation | EPA: Statute does not require intra-area reductions; regional transport justifies counting upwind reductions | Court: Statute ambiguous on geography; EPA’s regional focus is a permissible construction — EPA upheld |
| Whether EPA may approve a redesignation if the pre-attainment SIP lacks RACM/RACT required by § 7502(c)(1) (i.e., whether § 7407(d)(3)(E)(ii) requires a "fully approved" SIP to include RACM/RACT) | Sierra Club: § 7502(c)(1) unambiguously requires SIPs for nonattainment areas to "provide for the implementation" of RACM/RACT prior to redesignation | EPA: "Applicable implementation plan" and "applicable requirements" refer only to measures necessary for attainment; RACM/RACT need not be in place if not needed to attain | Court: Following Wall v. EPA, the statutory language unambiguously requires RACM/RACT in pre-redesignation SIPs; EPA unlawfully approved Ohio and Indiana redesignations |
Key Cases Cited
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing framework and burdens of proof)
- Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., 528 U.S. 167 (environmental plaintiffs' aesthetic/recreational injury)
- Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (deference framework for agency statutory interpretation)
- Sierra Club v. EPA, 292 F.3d 895 (D.C. Cir.) (burden on petitioner on direct review of agency action)
- Wall v. EPA, 265 F.3d 426 (6th Cir. 2001) (holding RACT/RACM required in SIPs prior to redesignation)
- Klein v. Dep't of Energy, 753 F.3d 576 (6th Cir. 2014) (standing analysis and representational standing principles)
- EPA v. EME Homer City Generation, L.P., 134 S. Ct. 1584 (Supreme Court) (upholding CSAPR as a valid interstate transport remedy)