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Summit Petroleum Corp. v. United States Environmental Protection Agency
690 F.3d 733
6th Cir.
2012
Check Treatment
Docket

*3 by removing hydrogen duction wells sul- OPINION fide so that the can be used. Summit SUHRHEINRICH, Circuit Judge. production owns all of the wells and the This case arises from a final action of pipelines subsurface that connect each of Agency sweetening plant. Environmental Protection the wells (Title V), §§ 7661- U.S.C. over an area the CAA are located themselves

wells 7661f, operating permit establishing forty-three square miles approximately regulate sources program from the varying distances —from imposing than new pollution. air Rather away eight miles feet to —and five.hundred require- air quality control substantive property be- not own the does ments, supplements the CAA prop- or the well sites tween individual pollution of air requiring regulated sources the plant. the wells erty between include operating permits obtain a common well sites share None *4 limitations, standards, monitoring emission other, any nor do of boundary each schedules, and requirements, compliance boundary a share common the well sites necessary to com- other conditions assure Flares production plant. with Summit’s 42 U.S.C. pliance with the CAA. See by operations part plant work as 7661c(a); 7661a(a), §§ Interest Ohio Pub. to gas natural waste relieve burning off Whitman, Grp., 386 F.3d Research Inc. gas equipment. collection pressure (6th Cir.2004). “[sjtates Although 794 approximately flare is located The closest re- governments ‘primary and bear local from while the plant, half-mile one ” reg- sponsibility’ administering Title V remaining over one 'mile flares each ulations, Whitman, (citing F.3d 386 at 794 away. 7401(a)(3)), § 42 certain circum- U.S.C. sweetening plant majority and the The the EPA itself to permit require stances or production and gas wells of Summit’s promulgate regula- and Title establish territory within the flares located state in lieu of the EPA-approved tions Indian Michigan’s Saginaw Chippewa plans. EPA-ap- In the of an absence The Tribe’s Isabella Reservation. sweet- territory Indian lo- proved plan regulating wells, ening plant, gas production and state, given example, a cated within and ox- flares emit sulfur dioxides nitrous federal implement EPA is to a authorized ides, subject regulation air to pollutants juris- plan air control within that quality (CAA). plant Air Act The under Clean 7601(d)(4). case, § In diction. emits, emit, has potential alone or to jurisdiction regulate to EPA has asserted just pollu- under hundred tons of these one territory the State of Michi- Indian within per tants Each flare and each well year. including Saginaw Indi- gan, Chippewa emit, emits, potential or has the to site See, e.g., Isabella Reservation. Tribe’s How- pollutants. much lower amounts Quality Promulgation of Air Approval ever, if the emissions of sulfur dioxide Plans; Michigan; PSD Implementation any well production from one plant (PSD 73 Fed. Regulations Regulations), combined, they to would exceed were be 2008) (to 53,366 (Sept. be codified Reg. per year. tons of pollutants one hundred 52) pt. (“Michigan at is not 40’ C.F.R. carry Federally ap- to out its authorized Permitting B. Title V Country,’ proved program in ‘Indian as air Program 1151.”). dеfined 18 U.S.C. CAA, 42 Congress passed

In requires every “major source” of Title V 7401-7671q, §§ en- protect operating “to air a pollution U.S.C. obtain Title V 7661a(a). § Nation’s air re- The EPA’s quality permit. hance the 42 U.S.C. promote public plan health a sources so as Title V defines source of productive capacity “any facility and the or welfare include 7401(b)(1) emits, directly or § air which has population....” pollutants its U.S.C. (2006). emit, per one hundred tons Congress potential enacted year pollutant,” including major source, nitrous to constitute it a but “if (the pollutants sulfur oxides and dioxides potential emissions from sour gas pro- operations). emitted Summit’s See duction wells are gas included with the § 7602©; see also 40 C.F.R. U.S.C. emissions, sweetening plant the aggregat- “stationary § 71.2. The defines a ed may sources combined be considered structure, “any building, source” facili- single major pollutants, source for criteria ty, may or installation which emits emit namely nitrogen oxides and sulfur diox- pollutant.” regulated C.F.R. [air] ides.” request suggested 52.21(b)(5). Multiple pollutant-emitting of its aggregation facilities would im- be activities, sweetening such as Summit’s First, proper for two principal reasons. wells, and sour can production great Summit’s wells were “located dis- aggregated together and considered a from production facility tances on en- structure, “building, facility, installa- tirely tracts, different leases and surface i.e., tion,” source, single stationary under sites,” making them contiguous neither nor (1) *5 only they: Title if V are under common Second, to one another. the EPA (2) control; “are located one or on more not distinguished had between the defini- or contiguous adjacent properties”; and a tion of “facility” found in its hazardous (3) belong to same major industrial (HAP) pollutant air regulations from the § If pollu- 40 C.F.R. 71.2.1 the grouping. “facility” definition of a for pollu- criteria tant-emitting satisfy any activities fail to (Title V) tant purposes. The HAP criteria, they one these of three are consid- regulations specifically aggre- considered stationary separate ered sources and their gation multiple facilities the oil and aggregated emissions cannot be to meet gas industry and concluded that aggrega- major source for which a threshold improper: tion was “Emissions from required. Title permit V gas well, oil or exploration production or Major C. Source Determination with equipment, Cor- its associated and emis-

respondence Between any pipeline sions from compressor or and the EPA station pump shall not be aggregated with units, emissions other similar January 2005, Summit, together from or contig- not these are in a units Michigan Department of Environmen- uous area under common control....” See Quality (MDEQ), tal a request submitted II, Control, Article Part Air Pollution to the EPA to determine whether Sum- Michigan Natural and Resources mit’s facilities met the definition of a Title Act, Environmental pollution.2 Protection 1994 PA V source of air Summit’s (Act 451), request correctly as amended noted that emissions and 1980AACS (Rule 211) added). plant from R sweetening its were insufficient 336.1211 (emphasis group stationary belong 1. A applicability to the sources determination of Part grouping they same industrial if share a two- particular facility. to a theAt time of the (SIC) digit Standard Industrial Classification parties' request, determination Summit was code, type code a used determine the operating plant under its a Permit to Install activity engaged. in which the facilities are MDEQ (No. 632-821) by issued under Michi- § 71.2. The SIC C.F.R. manual available Act, gan's Air Pollution Control Part 55 of http://www.osha.gov/pls/imis/sic_manual. and Natural Resources Environmental Pro- html. Act, (Part § seq. tection M.C.L. 324.5501 ef 55), Michigan’s Implementa- and CAA State provides 71.3 an owner C.F.R. that Plan, R. tion 1980 AACS 336.1201. operator may of an a emission source submit request a written to the EPA for administrator on the infor- The EPA found based to Summit’s source responded EPA The by request, provided mation Summit’s April on request determination plant undisput- asserting jurisdic- wells were production confirming that it was owned, edly commonly of the same part facilities within regulate tion to on stating but that it located grouping, industrial the Isabella Reservation Accordingly, if the sites. contiguous conclude wells surface was “unable to Title single source for it “must evaluate agency constituted a concluded (i.e., distinguished its or close- EPA nearness adjacency, purposes.” V ness) maintaining gas the sweeten- regulations, and HAP of the sour wells to facilities could be ing plant” to determine whether Summit’s pollutant-emitting single stationary a station- a single to constitute faсilities constituted aggregated if operated subject regulation. Although ary source under Title source control, .were located wells production common noted that “because under sweetening and be- adjacent properties, supply gas gas to the contiguous It grouping. industrial meet the longed plant, to the same we believe the sites procedure proper notion of the EPA plant,” then identified the common sense determining source found that Wehrum Memorandum gas industry, outlined in an proximity the oil and clear that is the most “makes memorandum issued deter- guidance making formative factor involving Administrator William oil activities.” Acting Assistant mination *6 Finally, requested the EPA additional Wehrum: map of facilities formation —a Summit’s sites, 1) Identify the surface processes and a schematic its 2) each individual Evaluate whether the connection between Summit’s showed separate a site sta- qualifies surface “exploration production and activities”—to tionary source, if the emissions activi- or reaching assist a it decision. together to form grouped ties should be (i.e., if stationary their a source emission informa- provided requested Summit control, be- activities are under common 24, In tion dated April in a letter major group- to the industrial long same letter, agreed that under the Summit adjacent), and are and ing, contiguous Memorandum, proximity Wehrum was 3) stationary more Aggregate two or deter- making most factor source crucial they if are under сommon con- sources industry. gas for the oil and minations in proximity trol and are located of each Summit reminded EPA of the Wehrum other.3 re- Memorandum’s additional comments Wehrum, factor, proximity e.g., L. garding Memorandum from William Adm’r, that it Acting Reg’l position I- EPA’s was unreasonable Assistant Adm’rs (Jan. 2007) 12, production and field activi- http://www. aggregate X available wells dis- eenews.net/public/25/12769/features/ large geographic ties that “occur over processing documents/2009/10/13/document_pm_02. tances with downstream (last 2012) (Wehrum 16, plant single stationary a source.” See pdf May into visited Memorandum). concepts Summit submitted that the id. and, infra, notwithstanding sug- appears, express that prac- 3. Before Court tice, gestions conducting styles regards guidance Title the EPA and its for therein, non-binding, analyses actual de- advisory doc- source contained memorandums as case-by-case, are to be made on the Wehrum Memorandum terminations uments. Both Memorandum, situational, particularized and bases. McCarthy and the discussed permit and should as- information on contiguousness gather conditions other making land with the for sources before sess “whether the associated final determination. to, source pollutant-emitting activity is connected nearby, land associated with another 1. The EPA determines Summit’s pollutant-emitting activity.” support, In facilities to be again to the Wehrum pointed under Title V. Memorandum, which that “[a] advised re- 8, 2009, September On EPA issued its viewing authority can consider two surface sweetening determination that Summit’s if proximity they sites to in close plant and sour wells constituted a sin- physically adjacent, separat- or if source, gle stationary and were therefore a than by (e.g., ed no more a short distance major source, Title EPA under V. The did by highway, separated city across a Sum-, explain decision, the basis for its save distance).” block or some similar citing prior April 26, for production mit noted its wells April 2009 letters to Summit. Shortly larger separated were much dis- decision, after the EPA issued its it for- contemplated by tances than those a September warded Summit Wehrum Memorandum and reiterated its guidance prepared by memorandum request that EPA not consider them a Air Office of and Radiation Assis- single stationary source under Title V. McCarthy tant Gina Administrator entitled July the EPA responded that “Withdrawal for Source Determinations supplemental even materi- with Summit’s Oil (McCarthy Gas Industries” als, it again conclusively was unable to Memorandum). See Memorandum from determine whether Summit’s facilities com McCarthy, Adm’r, Gina Assistant to Reg’l single stationary stituted a source. Admr’s I-X Regions 2009), (Sept. emphasis addressed available at http://www.eenews.net/public/ Wehrum Memorandum and stressed that *7 25/12769/features/doeuments/2009/10/13/ physical only proximity was not the factor (last 16, doeument_pm_01.pdf May visited determinations, in adjacency stating that 2012). In pertinent part, McCarthy the “generally, EPA the determines whether Memorandum simplified reasoned that the ‘adjacent’ two facilities are on a based apprоach Memorandum, Wehrum the ‘common notion of a sense’ source and the emphasis physical on proximity in facilities, functional interrelationship of the the of what determination constituted a rather than on simply physical the distance source, stationary longer appropri- was no between the facilities.” The EPA conclud- McCarthy ate. The Memorandum called by requesting ed that Summit it contact as permitting “rely authorities to instead possible soon as to further “discuss the foremost on three regulatory the criteria requirements the ... permit for aggregating multiple emissions from applications for sources located tribal sources, (1) ... whether the activities are lands.” (or under the of the person control same parties engaged The in a conference call (2) control); person under common wheth- Summit, July According 2009. er activities are located on or more one EPA that it might longer (3) indicated no be contiguous properties; using guid- the Wehrum Memorandum whether the belong activities same ance in Summit’s source determination. industrial grouping.” (citing 40 C.F.R. 52.21(b)(6)). The EPA investigate said would guidance § The memoran- status of the Memorandum Wehrum and dum nevertheless conceded that evidence to demonstrate that be made on should

source determinations cases, “truly sources not interde- “in emissions were case-by-ease and that some basis The EPA thus overwhelming pendent.” concluded may as the ‘proximity’ serve given interrelationship, authority’s this functional permitting factor in a not consid- Summit’s facilities “should decision.” Id. determination separate emission sources.” ered 8, September to the EPA’s response Re- filed a Petition for determination, Summit second filed its initial Summit 18, 2010. in this Court on October on view for Review with Court Petition denied, 2012, opposed, The EPA and this Court 4, January 5, 2009. November On to intervene filed American EPA motion request- a letter to the Summit sent (API). Petroleum Institute This Court stay an of the ing administrative deadline granted unopposed motions of API and imposed had on Summit to obtain the EPA Exploration and Production American permit a Title so operating (AXPC) Amici) (collectively to sub- Council additional information for the could submit mit briefs in the case. amicus granted consideration. request parties submit- Analysis II. abeyance joint ted a motion for to this 4, grant- This Court Review Court on March A. Standard of 2010, holding on March ed motion 307(b) CAA, Section abeyance vacating case 7607(b), § specify does not a stan U.S.C. parties to allow the time briefing schedule judicial of an EPA final dard for review their is- pending to resolve administrative this Court Accordingly, action. reviews sues. EPA’s source determination under 18, 2010, judicial provisions of On the EPA sent review the Adminis October (APA). confirming final trative Act Summit a letter that even Procedure U.S.C. 706(2)(A). information, Dep’t supplemental See Alaska Envtl. with Summit’s E.P.A., the EPA facilities a 496- considered Summit’s Conservation (2004). source, single stationary and thus a 157 L.Ed.2d 967 source, requires agency Title The EPA The APA us to credit an explained under V. McCarthy “arbitrаry, it is capricious, directed action unless Memorandum discretion, regulatory it to all consider three factors. abuse otherwise *8 adjacency, On of facilities’ accordance with law.” 5 U.S.C. the issue 706(2)(A). here, Where, it as review the EPA indicated that had never estab- we regu an of its specific pollu- agency’s interpretation lished a distance between own of a tant-emitting application entities at which were lation and statute adjacent. passed by Congress, no The EPA must defer to the longer reiterat- we that, historically, agency’s interpretation “plainly ed factors such unless it is regula relationship of the erroneous or inconsistent “nature between Robbins, Auer v. 519 “degree interdepen- facilities” and tion.” U.S. (inter 905, 137 (1997) 117 them” been L.Ed.2d 79 important dence between had S.Ct. omitted). to the two nal marks and citations question quotation facilities adjacent. agency’s its We afford an no agency were discussed wells, deference, however, language if the of the plant, view that Summit’s and flares regulation doing unit so together unambiguous, as a that “to- is worked agency, guise a under the gether produced single product” “permit and would to a create de provide interpreting regulation, found that had failed to Summit regulation.” “truly unreasonable, a new Christensen v. interrelated” is facto Cnty., 576, 588, urges Harris 120 S.Ct. U.S. to Court vacate the EPA’s de- (2000). regu- 146 L.Ed.2d 621 If the plant termination that Summit’s and wells due, ambiguous lation is and deference is single stationary a Spe- constitute source. we have noted that re- cifically, still “deferential” argues Summit that the term “ad- inconsequential, Ky. view is not Water- jacent” unambiguous, is and that EPA’s Johnson, F.3d ways Alliance interpretation of it defies its plain and (6th Cir.2008), and we must satis- ordinary be meaning. agree. We agency’s minimally fied that the action B. As plan, used the EPA’s Title V

volved a “rational connection between the “adjacent” unambigu- the term is facts ‍​​‌​​‌‌​‌​‌​​‌‌‌‌‌‌‌‌‌‌​‌‌‌​​​​‌​‌‌‌‌​‌​​‌​‌‌‌​​‍found and the choice made.” Motor ous. U.S., Vehicle Ass’n Inc. v. Mfrs. Co.,

State Mut. Farm Auto. Ins. Summit argues that the term “ad 29, 43, 2856, 77 L.Ed.2d 443 jacent,” both generally and as it appears (1983). in the regulatory requirement that aggregated activities be “located con relatively

The issue the instant case is tiguous properties,” unam is Summit, EPA, straightforward. biguous. The EPA disagrees, submitting, agree Amici EPA has properly alia, “adjacent” inter that the term is un jurisdiction regulate exercised to the tribal questionably ambiguous because the EPA lands on which Summit’s facilities lo- has never specific physical defined a dis They agree produc- cated. that Summit’s by it tance which is defined with which plant tion and sour gas wells are common- is simultaneous. Resp’t See Br. at 30 ly major owned share industrial (connecting premise parts grouping, satisfying two of the three- ambiguous because it lacks a definite dis part test for source under the tance with the ap conclusion that “[a]s permitting program. EPA’s Title Y All plant operations to plied that vary enor parties agree further Summit’s if mously across the different industries aggregated and wells are into a sin- regulated [CAA], “adja term [the gle stationary source, the total emissions ambiguous cent”] at minimum as to from this source exceed would the thresh- whether emissions that are part units required old for a stationary source integrated operation industrial and lo source, considered and 500 feet roughly eight cated miles required would be obtain a apart may be to be considered located on permit regulate its emissions of criteria ”). ‘adjacent’ properties.... pollutants. Finally, parties agree production plant and sour dictionary We conclude that both i.e., “contiguous,” wells are not located on etymological history definition and *9 bordering, properties. Undisputedly, “adjacent,” term as applicable well as case sole disputed issue us before is whether law, support Summit’s position. “adjacent” to Summit’s facilities are one

another, converting a dictionary thus them into sta- 1. The definition source, source, tionary “adjacent” and a implies under physical proximity. Title V. Amici, Court,

Together argues well, This and as have others the EPA’s conclusion that Summit’s often consulted dictionaries to ascertain See, “adjacent” they activities are meaning e.g., because are of words. Terrell (6th (search: (last 442, “adjacent” “jet”) States, visited F.3d Cir. United 2012). 16, Thus, 2009) Corp. literally, v. AT May quite Telecomms. two (citing MCI 2223, Co., 218, 225, adjacent they are if have been things T & (1994)). “throw[n], Our research L.Ed.2d 182 cast ... ... in relation down to ” agree dictionaries that two gener- satisfiеs us ... in space.... [one another] See adjacent are they when entities are Etymology Dictionary, supra. ally Online to, to; ... ad lying [n]ext near “[c]lose they argues though The are Heritage Dictionary of joining.” American incorrect, provide not dictionaries an in- English Language, available at www. “adjacent,” definition of and that complete (search (last “adjacent”) ahdictionary.com the functional two interrelationship of fa- 2012). 16, The EPA does not May visited physi- be cilities must considered because locate, any cite, authority nor we could meaningless cal is con- distance without “adjacent” in suggesting that the term (“It Resp’t only at 27 text. See Br. is an of the functional rela vokes assessment examining the relative context that a rea- See, e.g., tionship between two activities. can as sonable determination be made to Dictionary, at available Merriam-Webster objects ‘proxi- two are whether ‘close’ (search adja www.merriam-webster.com another.”). to one notion that mate’ The (last cent”) 2012) (“not May visited adjacency expands and contracts with con- nearby city adjacent <the distant: text, is, it true as must be overextend- >; a having endpoint or suburbs common instance, certainly ed. first it is ...; <adjacent immediately lots> border adjacent that two be correct states could following); preceding or Oxford Dictionar country, another in one the context of ies, available www.oxforddictionaries. just be (search adjacent as twо houses could (last “adjacent”) May com visited noted, 2012) of a It (“next neighborhood. context is something to or adjoining however, rooms; the contextual element of else; adjacent adjacent area ”). space the overall within which one asks station fire two things does not etymology Even the of the term belies fundamentally change the physical and position the EPA’s that the term’s defini- geographical question. nature of the partially tion is based on contex- even an impermissible illogical EPA makes relationship, opposed geo- tual to the stretch when states that one must ask Here, location, graphic of two activities. purpose which two activities exist study our reveals that the word adja- order to consider whether originated early century in the fifteenth Resp’t cent to one another. Br. at 26-27 syllables from the combination of “ad” (“A prop- distance of one mile two between “jet.” Etymology Dictionary, Online may sufficiently be small erties considered (search www.etymonline.com available at close to each other if (last 2012). driving one “adjacent”) May visited them; trying if between not so one is “prefix expressing “Ad” is a direction to- other.”). one to, throw softball from to the to, ward or in addition ... with regard ” Whether the two facili- ... distance between in relation to .... space [or] time (search “ad-”) (last given relationship ties enables to exist May visited 2012) added). concept them immaterial between to the (emphаsis As incorporated “adjacent,” merely ques- “jet” implies answers verb —it *10 activity in a tion of whether a certain can or resulting physical action certain rest- throw, ing place object: an “to ... cannot occur between two locations that for cast ” (oneself) were, regardless with notion of ‘to cast down.’ Id. and will continue to be of

743 host the activity, physically persuasive most authority comes physically adjacent. distant or from Supreme Court’s in decision Ra States, v. panos 715, United 547 U.S. 126 supports law understanding. Case this 2208, (2006). 165 S.Ct. L.Ed.2d 159 Simi case, lar to Rayanos reg concerned a supports 2. Case the idea law ulation enacted agen administrative adjacency only relates cy, Army Corps of Engineers (Corps), physical proximity. interpreting Congress’ legislation in the specifically Several cases address wheth (CWA). Clean Water 723-24, Act at “adjacent” er the term is ambiguous. 126 S.Ct. 2208. Specifically at issue in While some courts conclude “adja Rayanos was a provision pro CWA ambiguous cent” is in the limited sense of . hibiting the discharge of pollutants lacking definition, an abstract there is waters,” “navigable which the fur CWA recognition common adja fact ther defined as “the waters of the United cency a purely physical geographi States, including the territorial seas.” Id. cal, even if case-by-case, determination. 723, at 126 2208 (citing S.Ct. 33 U.S.C. United States v. St. Anthony R.R. Co. is 1362(7)). § regulations implement an illustrative example. The EPA claims ing CWA, Corps interpreted “the support in the сase because of its state waters of the include, United States” to “[adjacency] ment that: must be defined pertinent part, adjacent “[w]etlands to ... with reference to the context, at least to (other waters [and tributaries] than the some extent[].” United v. States St. An waters that ]).” are themselves wetlands[ Co., thony 524, 530, R.R. 724, Id. at S.Ct. (citing C.F.R. 333, (1904). 48 L.Ed. 548 Ironically, the 328.3(a)(7)). In the action that was the disregards the context of Su .the impetus suit, the Corps interpreted preme assertion, Court’s undisput which regulation their own jurisdic to exercise edly any purported cabined ambiguity to tion over a private owner’s “sometimes purely physical dimensions: “[a]s the word parcel saturated” of land located eleven ‍​​‌​​‌‌​‌​‌​​‌‌‌‌‌‌‌‌‌‌​‌‌‌​​​​‌​‌‌‌‌​‌​​‌​‌‌‌​​‍to [adjacent] is frequently uncertain and rela twenty miles from the body nearest tive as to its meaning,” the Court rea water, navigable a proximity it deemed soned, might “it ... regarded as more sufficiently “adjacent” to constitute it part extended when used with reference to a of “the waters the United States.” Id. large object than with to a reference com 720-21, 126 S.Ct. 2208. paratively words, small one. In other must be defined reference the con The Sixth Circuit deferred to the Corps’ text, at least to some extent.” Id. See regulation, of its but also, e.g., v. Lally, 160313, Padula No. Supreme reversed, Court holding that def- 16193907, (Mass.Land 1994 WL at *2 Ct. erence was not due to “the Corps’ defini- 1994) Feb. (noting that all definitions tion of ‘adjacent,’ which ... has been ex- the word put before the court tended beyond reason....” Id. at “suggest оbjects ... two must be in 2208. In S.Ct. swift refutation of the dis- Enters, reasonable proximity”); Syufy sent’s view that should be inter- Ind., Home 94-0756, Ins. Co. No. 1995 preted expansively, the majority held that “ (N.D.Cal. 1995) WL at *2 Mar. the Court previously had ‘adjacent’ used ” (stating that the “‘ordinary popular’ ‘adjoining’ interchangeably and had reading ‘adjacent’ of the term only denotes a previously concluded that a wetland physical sense of proximity”). was navigable to a body of water *11 744 ” “ See ly ‘[functionally Rapanos, related].’ on a ‘actually it abutfted] ‘[][b]ecause’ ” 748, light 126 S.Ct. 2208. In 547 U.S. at 747, 126 at waterway.’ Id. S.Ct.

navigable conclusion, hold that EPA added). of this we the (some Finally, the emphasis 2208 interpreted regulatory has its own term ambiguous “[h]owever that Court noted unreasonably a manner inconsistent with abstract, ‘adjacent’ the may be term plain meaning its and vacate EPA’s ambiguous ‘physically ... between not is ” hereby source determination di- 748, ‘nearby.’ merely at abutting’ and recting aggrega- the EPA to reassess 126 S.Ct. tion of Summit’s facilities under the ordi- ordinary and dictio- with Together nary requirement of its understanding “adjacent,” the nary of the term definitions that Summit’s and wells be located law, decision, Rapanos and similar case i.e., adjacent, physically proximate, on the conclusion that points clearly toward properties. aggregat- requirement the regulatory contiguous ed be “located activities interpreta- 1. The unreasonable EPA’s adjacent unambiguous is in the properties” heightened is tion not entitled defer- here it is considered. context in which mеrely longstanding. ence because it is reasons, adopt we this foregoing For the conclusion, The EPA claim opposes position. it ing because has established his tory of supplementing traditional defi interpretation C. The EPA’s nition of the concept with of “adjacent,” to which no def- term relatedness, activities’ functional we must contrary owed, runs erence is heightened its interpretation review meaning. plain Resp’t (citing deference. Br. at 31-32 Having determined that the word Conservation, Dep’t Alaska Envtl. no unambiguous, apply is we 487, U.S. at (stating S.Ct. in in our review the EPA’s deference particular “normally courts accord defer Christensen, terpretation of it. 529 U.S. interpretation ‘long ence to an agency Instead, 588, must 120 S.Ct. 1655. we duration”) standing’ North (quoting Haven interpretation against test agency’s Bell, Bd. Ed. 522 n. meaning unambiguous reg of its plain (1982))). 72 L.Ed.2d 299 S.Ct. Here, we conclude that ulation. appeal “longstanding to the EPA’s requirement unsurprising, duration” principle is since on contiguous activities be “located a cursory even overview demonstrates that i.e., adjacent properties,” that activities ever, rarely, if agency has considered can long so are func be physical proximity qua the sine non of two related, tionally irrespective of the dis being pollutant-emitting “adja activities them, separates tance that See, undermines e.g., cent” to another. one Letter text, demands, plain meaning of the which Reich, EPA to Clyde From Edward E. B. definition, that would-be fa аggregated Eller, 16, 1980), (May IX Region proximity. The mere physical cilities have www.epa.gov/region7/air/nsr/ available at sense, (last fact that in a limited term “ad nsrmemos/shelhpdf May visited 2012) (two jacent” susceptible not defi apart abstract facilities 1.8 miles unclear, nition does not render for “how are a by pipeline connected products ever term in the ambiguous may facility produces because neither abstract, ... from E. ‘adjacent’ ambiguous independently); Letter Edward Rothblatt, Reich, EPA EPA Re ‘[physically proximate]’ between and mere- to Steve *12 (June 30, 1981), adjacency analysis available at www. should include gion op erational, not epa.gov/region7/air/title5/t5memos/defsrce geographical, inquiries, e.g., 2012) (two (last 16, May visited 2.pdf whether the facilities are situated to en single a source apart one mile are plants working integration, able whether materi by they are connected railroad because people routinely als and transported are operated together); Letter from Rob them, the production between and whether Long, Kellam R. EPA ert G. to Richard any way process split between the 27, 1996), (Aug. VIII available at Region facilities); from Blakley, Letter Pamela http://www.epa.gov/region07/air/nsr/ Smith, Region EPA V to Don Minn. Pollu (last May 16, visited nsrmemos/abntpdf (Mar. 23, 2010), Control Agency tion avail 2012) (landfarm brewery six miles at http://www.epa.gov/region7/air/nsr/ able single source because the land- apart (last 16, nsrmemos/single.pdf May visited brеwery to the operation integral farm 2012) (facilities separated three miles Long, Letter from Richard R. operation); any physical without connection are a sin Lynn Menlove, R. Region EPA VIII to gle source because materials are trans 8, Quality Dept, (Aug. of Envtl. Utah daily). between them ported See also Let 1997), www.epa.gov/region07/ available at Smith, VI, ter from Region Winston A. to (last air/nsr/nsrmemos/util-atl.pdf visited Poole, Randy Mecklenburg Cnty. C. Dept. 2012) 16, May (pump produc station and 19, 1999), (May of Envtl. Protection operations apart tion 21.5 miles and on available at http://www.epa.gov/region07/ single sides of a lake a opposite source (last air/nsr/nsrmemos/wel999.pdf visited channel raw transports because connective 16, 2012) (two May bulk gas terminals materials between them and facilities have separated by are separate .9 miles sources support relationship); a Letter from Che although because in proximity, they close Newton, V, EPA ryl Region L. to Donald related). functionally are not (Mar. Sutton, 13, 1998), Illinois EPA avail Though the EPA has previously at www.epa.gov/region7/air/nsr/ able considered the functional relationship be (last nsrmemos/acme.pdf May visited assessing tween activities in 2012) (steel mill apart facilities 3.7 miles lie on “contiguous properties,” Calumet, separated by landfills, Lake request of increased deference to this expressway, 1-94 the Little Camu interpretation premise on the rests River are a single let source because sоme measure of deference is in fact owed proximi “USEPA considers that the close to the EPA’s the first sites, ty along interdepen with the reject premise instance —a we in light of dency operations and their historical unambiguousness regulation ...”); operation as one source Letter Christensen, issue. See U.S. at VIII, Long, Region from Richard again, rely 1655. Here we Myers, Air Dennis Colorado Pollution authority Supreme from the Court Rá 1999), (Apr. Control Div. available at panos: http://www.epa.gov/region07/air/nsr/ (last In a appeal curious entrenched execu-

nsrmemos/amersoda.pdf May visited 2012) error, (“distance tive the dissent contends that ‘the does not pre alone” appropriateness Corps’ 30-year thirty-five forty clude mine and implementation of the Clean Act apart by pipeline but be Water miles connected given Congress should be addressed or the ing considered “inte facilities”); Corps rather to the gral Judiciary.’ connectedness of than the[] (EPA Gil, (2001) guidance Surely principle et al. Forest is novel admin- *13 Ass’n, 42-43, at adverse 463 U.S. 103 S.Ct. 30-year of law—a sort istrative Here, if the of even we to find that disregard were insulates possession It “adjacent” ambiguous, was we would judicial from review. word statutory text ju- the interpretation in our find that of deservedly precedent has no still EPA’s requirement Title regulatory its V risprudence. stationary on single sources are located 126 S.Ct. 547 U.S. at Rapanos, adjacent was “contiguous properties” omitted). (internal Rapa Like сitations (1) entirely regula- inconsistent the with: nos, may not agency that an we conclude tory history permitting plan; of its Title V merely be itself from correction insulate (2) guidance its own memorandums not corrected soon it has been cause application the its Title V regarding is an longstanding for a error still enough, industry. the regulations to oil and argu thus the EPA’s reject error. We inter- would thus that EPA’s We conclude have little hesi contrary to the ment Auer, under pretation was unreasonable first taking in opportunity tation this —the in be the and our decision this case would in the EPA’s given has been our Court same. history executive er own of “entrenched the unreasonable agency’s ror”—to vacate interpretation 1. The EPA’s is incon- interpretation permitting of its Title V regulatory histo- sistent with plan. Id. ry plan. of its Title V Assuming arguendo term “ad- D. regulatory On the issue the EPA’s jacent” ambiguous, is the EPA’s V, history interpreting we first note Title interpretation is inconsistent the EPA’s refusal incongruity between regulatory history with relationship include a functional test to plan Title EPA- and the Y stationary its single analysis and its guidance issued memorandums. cannot be position analysis current its Although unambiguous- we consider it. without completed regulatory term ness In order for activities to be multiple clear, we that our hold- quite be conclude “building,” considered a together if we were to ing would be same even “structure,” “facility,” or “installation” regula- the EPA’s that its accept argument meaning Title of the EPA’s within ambiguous. tion is (1) the activities must: be under plan, (2) control; contigu- its located on agency interprets Where common (3) belong ambiguous regulation, properties; we credit ous or own Auer, grouping. the same interpretation great deference. industrial Indeed, § at 71.2. The EPA first established 519 U.S. 117 S.Ct. 905. C.F.R. only agency’s plain if the source test for use reject Significant ly erroneous or will we Prevention of Deterioration inconsistent (PSD) program. 40 C.F.R. it. Id. Because even deferential review See 52.21(b)(6) structure, however, facility, Ky. inconsequential, (“Building, not see Wa Alliance, pollutant- will all terways 540 F.3d at we or installation means emitting belong unbri activities grant agencies administrative which terms of industrial are located interpret grouping, dled discretion same contiguous adjacent proper- regulations their own conceivable one more Auer, ties, at are under control of the same generally manner. See (or con- 905; persons under common person Motor Vehicle Mfrs. trol).... ”). It developed narily the test in the regarded would be separate.” wake of the Alabama Power Co. v. 52,695. Costle Reg. Fed. The EPA therefore decision, challenge a 1979 to the EPA’s set out to add a third criteria which would regulations, adjudicated former PSD narrow the field aggregated sources to Appeals United States Court of for the those more in line with the “common sense *14 D.C. Circuit. See Alabama Power Co. v. plant.” notion of a Id. Costle, (D.C.Cir.1979). 636 F.2d 323 As- test, The functional relationship which sessing the EPA’s then-existing stationary EPA admittedly now uses to dеtermine test, source the Alabama Power Court activities are to one an- advised that allow an entire “[t]o other, was one of the additional criteria the appropriate grouping other of industrial EPA rejected considered and during its activity subject to be as a single unit ... post-Aia&ama Power rule-making process. EPA regulatory should devise definitions First, EPA the “asked for comment on ‘structure,’ of the terms ‘building,’‘facility,’ whether factors other than proximity and provide and ‘installation’ to aggre- the control, such as the functional relationship gation, appropriate, where of industrial ac- activity another, of one should be used according tivities to considerations such as stationary [in source determinations].” 45 proximity ownership.” at Id. 52,694. Fed. Reg. Then, at after due con- required The court also the EPA sideration, rejected the EPA option aggregation make its sufficiently pre- test (in adding a third requirement addition to give plausibly regulated dictable to entities ownership and proximity) that the activi- (and “explicit notice as to whether on what comprising ties a single stationary source statutory authority) the EPA construes functionally be related to one another. 45 term [stationary] source....” Id. 52,695. Fed. at Reg. The EPA specifically In preamble to the 1980 amend- assessing found that whether activities rules, ments to the final PSD the EPA sufficiently were functionally related to recognized that required Alabama Power single constitute a source “would highly be a new dеfinition single stationary of a subjective” and would make “administra- to, alia, source “approximate inter a com- tion of the definition substantially more mon ‘plant[ sense notion of a ... ]’ [and] difficult, any since attempt to assess those avoid aggregating pollutant-emitting activ- interrelationships would have embroiled ities that as a group would not fit within numerous, Agency fine-grained anal- ordinary meaning of ‘building,’ ‘struc- yses.” In rejected lieu of ” function- ture,’ ‘facility,’ or Require- ‘installation.’ test, al interrelationship the EPA elected Preparation, ments for Adoption, and Sub- incorporate grouping” “industrial Implementation Plans; mittal of April criterion, a factor which asks whether the 2012 Approval Promulgation of Imple- multiple activities are engaged the same Plans, 52,676 mentation 45 Fed. Reg. (Aug. type business, i.e., operate under the (to 7,1980) pts. codified at 40 C.F.R. n.2; same supra SIC code. See 40 C.F.R. 124). 52, and Consistent with this under- § 71.2. standing, the EPA adopt declined to proposed court’s dual-prong proximi- a. The EPA’s mis-characterization test, ty/ownership finding that this “defini- regulatory history of its own tion ap- [of would fail to source] unconvincing. proximate a common sense notion of a ‘plant,’ since in a significant argues number of The EPA prior rejection its cases it would group activities that ordi- proposal that “functional related- stationary- ly against argument of its the EPA’s prong third

ness” be relat- use assessment functional its deci- is immaterial because source test (even in own edness is reasonаble a stand-alone factor not to use this as sion view). Ultimately, the EPA has failed to its use of con- is not inconsistent why us the criterion it consid- convince supplement to its anal- as a cept ered, strongly rejected, then is now ways, neither ‍​​‌​​‌‌​‌​‌​​‌‌‌‌‌‌‌‌‌‌​‌‌‌​​​​‌​‌‌‌‌​‌​​‌​‌‌‌​​‍Title ysis. least two ability adequate dispensable to its to make nor sense history common regulatory Vs determinations. position. the EPA’s supports conclusion, foregone given the absence First, considered the fact that procedures amending notice and comment ownership prox- adding to tests of plan to include an as- functional relatedness imity with test of *15 activities’ related- sessment of functional fac- its contention that the belies current ness, EPA’s test is is that the current functional proximity and related- tors practice completely inconsistent with one EPA ad- ness are in the same. wording regulation. of its own it Alabama Power’s mits retained test, proximity and suggested ownership interpretation 2. The EPA’s only seeking a third test reduce the inconsistent with its own is stationary single number of sources guidance memorandums. of a representative plant. those common just EPA’s We next note as the requirement— adopted proximity If the present adjacency is the requirement articulated the EPA as regulatory history consistent with on contiguous that activities “located or plan, its too is it permitting Title V so adjacent properties” suggested a meas- — very with the EPA-issued inconsistent relatedness, functional ure of the activities’ guidance EPA memorandums on which the would no need to consider there have been relies instant in the case. As discussed adopting already-included test as supra, first the EPA’s two letters to Sum- single prong third in the source mit cited the Wehrum Memorandum as analysis. Clearly, at least the time the authority decision-making in its primary adopted stationary regula- source process. The had Wehrum Memorandum tion, the EPA understood in particular relevance to the EPA’s geographical, operational, rather than source was determination Summit—it terms. guide permitting spe- issued to authorities Second, the EPA’s decision not to em- to the cifically on the of Title V application ploy aggregation functional relatedness test was cate- activities pollutant-emitting and Far gorical unqualified. gas industry. from advo- in the oil and The Wehrum cating rejected geo- functional the notion that use of a relatedness Memorandum graphically gas not all oil natural ac- part assessment as but of the sta- distant tivities tionary analysis, “contiguous” could be considered source EPA ex- “adjacent:” any conclusion pressed sweeping operational relationship reference to the industry, [F]or this we do not believe subjec- highly between activities “would be determining whether two activities tive,” would “make administration of the operationally dependent the de- drives difficult,” substantially definition more proper- termination as to whether two numerous, Agency would burden contiguous adjacent, “the ties because 52,- fine-grained analyses.” Reg. Agency precisely 45 Fed. it would embroil analysis fine-grained 695. This condemnation heavi- we intended broad cuts avoid, potentially and it would lead to the belong activities to the same industrial results which do not adhere to the com- grouping.” (citing 40 C.F.R. sense, 52.21(b)(6)). plant.... mon notion of a Given supra, As discussed gas nature of the oil and McCarthy the diverse Memorandum concedes that at activities, that proximity we believe is case-by-case end analysis, prox- in making imity the most informative factor may well be overwhelming source determinations for these indus- determinative factor. If McCarthy tries. says Memorandum anything about includ- ing supplemental unexpected factors Memorandum, supra. Wehrum We need in the analysis, not strain to conclude the EPA’s against cautions it. Summit, in source determination for which admittedly the EPA that aggrega- found dispute There some par- between the tion of sweetening plant Summit’s and ties as to which of the EPA’s letters de- appropriate despite sour wells was claring and wells a single their physical separation, patently incon- stationary source was the EPA’s “final guidance. sistent with this agency determination.” argues While the EPA withdrew Wehrum that the EPA’s *16 correspon- October 2010 Memorandum and issued McCarthy the dence was a mere reiteration of its final shortly Memorandum before final the iter- September 2009; thus, determination in single ation of its contends, source determination for Summit the Wehrum Memoran- Summit, McCarthy the Memorandum applied does dum to the EPA’s decision and its support analysis, the EPA’s emphasis either. physical on proximity in the ad- sure, To be the McCarthy jacency Memorandum analysis should have caused Sum- criticized the Wehrum Memorandum’s em- mit’s facilities to separate be considered phasis physical proximity, noting that emissions Ultimately, sources. whether endpoint such was not “a sufficient in the the Wehrum Memorandum had been su- decision-making process.” McCarthy perceded by McCarthy the Memorandum Memorandum, supra. Apart from revok- at the time of the EPA’s final determina- however, ing prior guidance, this the tion impact would not our decision. Al- McCarthy promotes Memorandum a neu- though the Wehrum Memorandum made plain meaning application tral and of the clear the near-singular importance of the plan, EPA’s Title directing permitting physical proximity of two in facilities “rely authorities to foremost on the three EPA’s stationary analysis, source regulatory aggregating criteria” for McCarthy emis- supports Memorandum Sum- “(1) sources, i.e., sions from multiple position mit’s with its focus on applying whether the activities are regulatory under the con- text in Title V decisions. (or trol of person person case, then, the same under either guid- the EPA-issued (2) control); common whether the activi- ance support memorandums the error in ties are located on one or contiguous more interpretation regula- EPA’s of its own (3) adjacent properties; tory term.4 HH, additionally argues, 4. Summit Subpart Significant as it has since Section V of the EPA, correspondence initial its with Changes Proposed Comments and to "facility” regula- definition of a Regulations, HAP EPA's Standards of HAP within which against aggregation adja- tions cuts of even EPA states that "EPA it would believes not be gas industry. cent aggregate facilities the oil and reasonable to emissions from sur- lease, specifically cites the Preamble to face sites that are on the located same sense, related), sup- thus, functionally in a API by Amicus API Arguments E. of with- port argues, aggregation conclusion. activities our physical their regard proximity out many of support finds Our decision Indeed, inherently unreasonable. in the brief of Ami- raised arguments a “common sense notion of concept of First, of the oil and a member cus API.5 facilitating ag- construed as plant” itself, urges API us consid- industry but operationally related gregation the EPA’s er the fact activities, of function- little include a measure distant there is physically subjective unpredict- relationship is aggregation al limit to the foreseeable able, undermining the Alabama Power spread literally out across points emission give the EPA’s test mandate Court’s Moreover, API cautions that country. (and on what as to whether “explicit notice on activ- dependent determinations source authority) the construes statutory quickly functional relatedness will be ities’ ” See Ala- [stationary] source.... the term gas producers oil аnd add and outdated as Power, Relatedly, F.2d at 397. bama produc- from their points remove emission supporting EPA for API criticizes requiring nearly systems, potentially tion concept with the source determination re- constant renewed source determination a plant,” reason- “common sense notion quests and decisions. clearly principle is ing general struck API’s fi- particularly constrain, We enlarge, rather than meant nal observation —that of a the EPA’s definition in this case is an ironic source. determination very fears that caused the showcase argues that the EPA’s inter- API also *17 a functional related- agency adopt not to case, in this and will pretation has led in the ness test for source determinations lead, to absurd source deter- continue to MDEQ’s From and first instance. Summit industry. In a con- minations within the in joint request source determination Jan- often gas producers and text where oil final of the uary 2005 to the iteration points emission say have little over where decision, nearly years passed. five every facility nearly and is are located (and engaged twenty-five in at least by pipeline parties another connected to one (cautioning that the definition great apart.” Summit notes 8490-91 would but are distances of dis- only that the Preamble "makes no mention “apply in the context of this section and pol- tinguishing HAP emissions from criteria meanings not be confused with other should V],” arguing Title [under lutant emissions (preven- 'major parts C of the term source’ in non-aggregation should the same standard (non- deterioration) significant tion of or D regulated apply pollutant-emitting sources attainment) Act.”). Because Michi- at The Wehrum under Title V. Pet’r Br. regulations gan's Title V are also not at issue support Sum- Memorandum would seem to case, appeal Summit's similar to the in this procedure position three-step for mit's as its plan incongruity EPA's Title V and between determining stationary source cites to EPA's (which precludes aggregation Michigan's plan Still, regulations. HAP this is not gas despite contiguousness facilities of oil strongest argument. As even Summit con- adjacency) fails. also cedes, "HAPs are not at issue in this case.” Furthermore, Pet'r at 36. the Senate Br. raising 5. While we credit Amicus AXPCwith discussing the new definition of a committee well, arguments, they persuasive as several regulations spe- "source” within EPA's HAP positions overlap have substantial cifically would cautioned that definition already and have thus been taken only S.Rep. 101-228 at refer to HAPs. See No. addressed. 3385, (1989), 150-51 1990 U.S.C.C.A.N. History reprinted Legislative at 3535-36 in 5 exchanged conference calls and “a small I. REVIEW OF AGENCY ACTION paper” period. within mountain this majority acknowledges, As the we defer Certainly, produce the cost Summit to agency’s interpretation to an of its own requested by the data and schematics ambiguous regulation “controlling” un “ EPA, for the EPA and the cost to distill less that interpretation ‘plainly errone ” same, high and understand the were ous or regulation.’ inconsistent with the monetary caрital terms of both re- Robbins, 452, 461, Auer v. 519 U.S. out, points API process sources. As 905, (1997) S.Ct. 137 L.Ed.2d 79 (quoting exactly produced “fine-grained” Valley Robertson v. Methow Citizens administratively burdensome result the Council, 332, 359, 1835, 490 U.S. sought drafting (1989)); avoid of its 104 L.Ed.2d 351 Bowles v. Semi test, Co., see 45 Fed. nole Rock & Sand 413- 52,695, (1945); Reg. strong and is S.Ct. 89 L.Ed. 1700 evidence that Sebelius, Claiborne-Hughes Health Ctr. v. regula- the EPA’s of its own (6th Cir.2010). 609 F.3d As in the tion was unreasonable. context of agency interpretation of stat utes, judicial deference to an agency’s in III. Conclusion terpretation regulations premised stated, For the reasons we VACATE the relative institutional expertise and po agency the final determination of the litical accountability of an agency as com court; moreover, EPA aggregating pared Summit’s sour wells to a agency’s authority to sweetening plant interpret regulations into a its own single and implementing statute is incident to the permitting source under its Title V authority to interpret that statute. See plan. We REMAND this case Stephenson Matthew C. & Pogoriler, Miri EPA for a reassessment of Summit’s Title Domain, Seminole Rock’s 79 Geo. Wash. request light V source determination (2011). 1449, 1456-57 L. Rev. proper, plain-meaning application of the requirement that Summit’s activities In addition to the give deference we aggregated only if are located on administrative interpretations regulato- *18 physically contiguous adjacent proper- or ry language, agency will not overturn we ties. action “arbitrary, capricious, unless discretion, abuse of or otherwise not in ' accordance with law.” 5 U.S.C. MOORE, KAREN NELSON Circuit 706(2)(A); § see also Mоtor Vehicle Mfrs. Judge, dissenting. Ass’n, Inc. v. State Farm Mut. Auto. Ins. Congress passed the Clean Air Act (State Farm), 29, 42-43, Co. (“CAA”) “to protect quali- and enhance the (1983). S.Ct. 77 L.Ed.2d 443 ty of the air Nation’s resources so as to II. MAJOR-SOURCE AGGREGATION

promote public health and welfare and productive capacity population.” The EPA aggregate will the emissions of 7401(b)(1). § 42 U.S.C. Because the ma- multiple stationary sources to determine if jority hamstrings the Environmental Pro- together major the sources a constitute (“EPA”) Agency’s ability tection to pursue (1) source if those sources “are under com- by refusing this mission (2) to defer to the person,” mon control of the same “are agency’s interpretation reasonable of its contiguous adja- located on one or more or (3) regulation, I respectfully own dissent. properties,” “belong[] cent determining relevant in whether two 40 be grouping.” industrial major are objects given apart that are a distance case, the EPA deter- In this 71.2. C.F.R. adjacent considered flares, enough close wells, sour-gas mined that Summit’s context. The EPA does not contend this are con- plant, which gas-sweetening adja- stationary sources are multiple underground pipe- by a nected dedicated functionally simply cent because are of a exclusively part line and are used interrelated, majority and the either mis- together operation, single, interconnected agen- or understands mischaracterizes part As of its source. constituted it. cy’s position describing in so variоus sta- that Summit’s determination located on tionary sources were sense, “adjacent” is In this more limited the fact the EPA considered properties, “adjacent” fact that re- ambiguous. The functionally in- those sources were objects two fers to the distance between terrelated. into a explain go does not what factors objects that determination of whether two majority its conclusion

The bases given apart are “next to” distance regula- of its own interpretation the EPA’s other, “close,” “immediately pre- each or factors: impermissible on three tion was The cited definitions ceding following.” or “adjacent,” plain meaning word the consid- unambiguously do not foreclose history major- regulatory of CAA of factors other than absolute eration determinations, and aggregation object One in a se- physical distance.1 view, my none of policy considerations. “immediately preced[es] or fol- quence deferring us from prevent these factors sequence, the next item in the for low[s]” upholding EPA and its decision this objects physically that are example. Two case. along connected fall “next to” each other “Adjacent” Meaning stationary A. The or more that connection. Two functionally sources that are interrelated majority peruses The several dictionar- “next to” similarly can be described as ies and concludes refers other; one follows the other in a each geogrаphical relationship or physical process. common objects. objects between two or more The distant,” to,” Moreover, to,” functional interrelatedness must be “not “next “close “immediately preceding following.” can inform the determination of whether objects given apart of its Title two that are a distance adjacent. properties If two are close regulations to allow consideration enough to each other to house functional interrelatedness sources that contribute to the same determinations does contradict *19 only plain meaning “adjacent.” operation, oper- of the word terrelated and to ation, properties likely those are more question The ultimate remains whether reasonably consid- properties physically enough enough two are close be close to be Likewise, adjacent. the EPA adjacent purposes to be considered for the ered could reasonably conclude that two or more aggregation under Title V. The EPA’s only simply part that other factors in sources that exist as same position is sequence likely will physical larger process to absolute distance can addition "adjacent” contradictorily majority acknowledges that but then concludes 1. The any factor than specific refer to EPA cannot consider other does not distance objects deciding stationary two as to two distance in whether that context matters adjacent, adjacent properties. given apart a are sources are located on that are distance See enough plant. to each other to be consid- the emission units and the close recognizes, App. the EPA Pet’r at 31. adjacent. ered As may in which the dis- circumstances exist Moreover, case, in Summit’s functional stationary is tance between two sources dimension; a physical interrelatedness has for those sources to be consid- great too each source is connected via a if adjacent, functionally even are ered pipeline. operation dedicated The is thus This fact does not mean that interrelated. only functionally phys- not interrelated but factor, can never be a but interrelatedness ically interconnected. Each (gas source support finding adja- it not a that will well, flare, sweetening plant) stop is a cency that instance. along physically pro- a connected consistency approach The of the EPA’s cess; each well is “next to” and “immedi- regulation apparent from the with well, ately precedes]” following for in this case. The EPA record did example. Nothing process outside of this adjacen- ignore physical dimension of physically functionally interrupts either cy; aggregate the EPA’s decision Sum- of gas underground the traverse from an wells, flares, not, plant mit’s was as through past field wells and majority allеges, “irrespective made sweetening plant. flares to the prop- The separates the distance that them.” Dis- erties on which each well or flare are a concluding tance was factor located likewise connected to each oth- located various sources were er, property and to on which the April In its 2007 letter to properties. is located.2 Summit, example, requested for the EPA a The position comports thus location of map showing the each emission plain meaning “adjacent” of the word unit, potential as well as the to emit of description geographical as a rela- each unit located within one mile of the tionship objects. between two The EPA gas-sweetening plant. App. Pet’r only uses interrelatedness determine The EPA discussed the distance between properties whether two enough close wells, gas-sweetening plant, gas Summit’s adjacent. to each other to be considered in its October 2010 letter flares Functional operates interrelatedness thus explaining aggregate its decision each only in that realm of operations major source in ambiguous; replace proximity, does not source, noting, example, ap- that “it determining but serves as a means of

pears that there are a dozen or more sour proximity. Accordingly, deference is war- gas wells within one mile-radius of the ranted. sweetening plant.” Resp. at 90-91 & App. If truly only majority’s n.21. had considered cited caselaw does not interrelatedness, Indeed, contrary functional it would have dictate a ma- result. operation jority’s persuasive authority” declared Summit’s to be “most ‍​​‌​​‌‌​‌​‌​​‌‌‌‌‌‌‌‌‌‌​‌‌‌​​​​‌​‌‌‌‌​‌​​‌​‌‌‌​​‍on the April meaning reg- its initial 2007 letter after within the CAA noting that a Supreme each source was interrelated ulations is Court decision that sought and would not have additional involved a different statute and did not *20 regarding purport provide general formation the distance between to definition of fact, Although rely the EPA does not on this located. The different locations within the underground gas gas the fields from which the is field from which each well draws are thus beyond parcels only physically proximate, are drawn extend the individual not but actual- ly contiguous. land each or flare is on which well 754 ” 747-48, ting’ merely ‘nearby.’ In Id. at “adjacent.”3 Rapanos

the word 715, 740-42, States, specific, United 2208. Given the limited 126 S.Ct. (2006), L.Ed.2d 159 which S.Ct. discussion, really nature of this has no (“CWA”), Act the Clean Water dealt with any inquiry to into the mean- applicability that, for of the concluded plurality Court “adjacent” generally more or in ing meaning the a wetland to fall within otherwise, In determining other context. and thus be “waters of the United States” air, majority the sea for the the mistakes CWA, under the the subject regulation to leaving the fish and the fowl confused. actually navigable must abut wetland anything, Rapanos actually in If under- waterway. opinion In its earlier United Inc., Homes, Bayview v. Riverside States position demonstrating mines Summit’s 121, 106 S.Ct. 88 L.Ed.2d 419 U.S. meaning “adjacent” that contextu- the is (1985), Army had held that the the Court al that the determination of whether Engineers’s interpretation of the Corps of adjacent objects depend upon two can certain wetlands was rea CWA to cover which purpose for the deci- precise boundary be sonable because being Rapanos, ques- sion is made. always not clear tween water and land is was how close a wetland must be to tion expert agency positioned and an is best to navigable qualify waters as “waters of regulatory far decide how CWA’s States,” the United and the Court held situations; scope extend in such in should “adjacent” that in that context meant Bayview, had de Riverside Court physically abutting only abutting because regulat the wetlands that could be scribed reasonably wetlands could constitute “wa- those that ed under CWA as were ters” at all. See id. at 741 n. “adjacent” navigable Rapanos, waters. 2208. Different factors are relevant when 740-41, at Be U.S. 126 S.Ct. 2208. question multiple is how close station- only actually cause wetlands that abut wa ary quali- sources must be to each other to implicate ters the issue of how to deter fy aggregated major as an source. boundary, mine a in Court land/water Rapanos clarified that its use of the word “adjacent” ambiguous Because is as Bayview meant Riverside objects how to determine whether two and, only physically abutting accordingly, given apart are a distance should be con- only physically thosе wetlands that adjacent, sidered we should defer to the navigable abut waters could be considered EPA’s decision to consider functional adjacent pur to such for waters CWA making terrelatedness as a means of Indeed, poses. 126 S.Ct. 2208. Moreover, determination. the values plurality expressly stated “[i]n promotes which deference would served be expounding ‘adjacent’ the term used in by doing so. Whether two or more sta- Bayview, explaining Riverside arewe our tionary adjacent sources are located on prior interpret own use of that word properties goes to whether the EPA phrase definitional ‘the waters Unit ” sources; aggregate should those individual “[hjowever ambigu ed States’ and that ultimately, regulatory term that abstract, may ous the term ... interpreting considering EPA is when ‘adjacent’ Bayview as used in Riverside ambiguous ‘physically properties “major between abut- Court, majority's proffered 3. The other caselaw is cisions of the Massachusetts Land notably sparse. typically We do not find example. authority unpublished persuasive much de- *21 pend upon interrelatedness, 71.2.4The conse- source.” See C.F.R. the latter aggregating of the various station- quence would have had independent force as a ary operation within an is that the sources separate requirement. subject will be to the CAA’s operation Next, majority characterizes permitting requirements, categorical rejection as a Preamble of operation an industrial should be

whether consideration functional interrelated- subject regulations to CAA is a decision Although rejects ness. the Preamble expert agency best left to the tasked with terrelatedness as “another abstract factor” aggrega- that The EPA’s enforcing law. analyzed in aggregation be all determi- its tion decisions reflect institutional ex- nations, 52,695, 45 Fed. Reg. nothing in pertise regarding how various industrial the Preamble possibility forecloses the operations quality. affect air In all its talk that interrelatedness could relevant in adjacency, majority forgets pur- specific aggregation determination or oth- adjacency pose of the determination. To rejects erwise interrelatedness as a criteri- majori- metaphors, mix environmental on that could be considered within the ty’s analysis regula- of the EPA’s clean-air adjacency analysis. below, As discussed tions misses the forest for the trees. functional gas-drill- interrelatedness ing industry is both particularly pertinent Regulatory History B. likely and less to involve the kind of “sub- concluding would not defer jective” assessments or “fine-grained anal- interpretation to the EPA’s yses” that the EPA cited as reasons not to ambigu- even if it found that term to be adopt interrelatedness as across-the- ous, majority heavily relies on the requirement, Moreover, board see id. regulations Preamble to the EPA’s 1980 historical record majority’s belies the char- defining “stationary source” under acterizаtion of categori- the Preamble as a Significant CAA’s Prevention of Deterio- rejection cal of interrelatedness. The program, ration in which the EPA ex- EPA considered ag- interrelatedness plained adopt its decision not to function- gregation determinations within ten al independent interrelatedness as an months of the 1980 Preamble —evidence applied factor that to all aggregation de- that the consideration of interrelatedness terminations all across industries. See is not a recent phenomenon that somehow 52,676, 52,693-95 Reg. (Aug. 45 Fed. agency’s deviates from the original regula- 1980). majority The first reasons tory intent. See Letter from Edward EPA would not have considered add- Reich, Rothblatt, EPA to Steve EPA Re- ing separate require- intexrelatedness (June 1981) gion (concluding if adjacency ment and interrelatedness “two facilities approximately one [that] argument logical, are the same. This apart, mile have a dedicated railroad line but position. misconstrues between them and programmed to- equate adjacency The does not gether produce one line of automobiles interrelatedness; the latter is a factor adjacent”). ... can be considered can help some cases determine requirement ag- of the former Preamble also makes clear that gregation is met. Because does not de- aas source is warranted if U.S.A., cases, noting It is worth that Chevron Inc. ence involved the EPA's Counсil, Inc., Natural Resources "stationary source” in a different section of Defense 837, 840, 81 L.Ed.2d the CAA. (1984), grandparent agency-defer- *22 majority the val- the “common sense Summit stress operation an reflects in predictability regulatory regime the three ue of a plant,” notion of [a] emphasize recog- that the EPA itself aggregation requirements —common danger having indus- nized the to conduct “nu- ownership, adjacency, and shared merous, fine-grained analyses” aggrega- in intended to answer grouping trial —are 52,694- at Reg. Reg. 45 Fed. at tion determinations. See 45 Fed. question. See 52,695. majority Summit and the Different industries are structured What 95. however, industry, recognize, fail to is that such differently. gas In the oil and not in case. might implicated that in other contexts concerns are activities clearly are interrelat- single building may operations within a Summit’s housed par- supplies gas only out ed. Each well sour spread stead be across different Viewing gas-sweetening plant. Summit’s The cels of land. distance be- in not receive sour from other drilling operation two facilities does tween Each unit light physically in of their functional interrelatedness source. connected purpose identifying op- by pipeline. thus serves the dedicated Summit does not “highly subjective” that reflect the “common contend otherwise. No erations sense plant.” “fine-grained analys[i]s” required.5 was notion of [a] Moreover, Finally, aggre- long the fact that the EPA’s the EPA has considered gation major- determinatiоn in this case is some- interrelatedness as a factor determinations, prefer- with the policy aggregation what inconsistent includ expressed ing gas industry, ences the withdrawn in the oil and so Wehrum Summit not claim credibly surprise Memo does render determination cannot impermissible. agency The Wehrum Memo relies did so in this case. The concern policy focusing reasons for on distance that deference to an agency’s interpreta interrelatedness, regulations rather than an tion of own argu- “require would regulated meaning “adjacent.” parties agency’s ment based on the to divine the interpretations in advance or else be held Similarly, the Wehrum Memo would not identify physical agency liable when the announces its inter proximity need as “the pretations for the in an most informative factor” in an first time enforce proceeding ment only possible determination if it was the and demands deference” implicated. is not Christopher factor. Pet’r v. Smith- App. See , — —, Corp. Kline Beecham U.S . — (2012). S.Ct. 183 L.Ed.2d 153 Policy C. Considerations majority longstanding is correct that a judge agency interpretation worthy Our role is not to the wisdom of is not of def action, agency permissibility. interpretation but its To erence if that conflicts with conflict, the extent that chal- policy-based regulation; absent such how ever, lenges longstanding to the EPA’s of its agen duration of relevant, regulations cy’s interpretation certainly weighs own Title are even to Walton, they up scrutiny. do not hold wards deference. Barnhart v. See Indeed, length paper- 5. The of time and volume of ness concluded factor. case, operations work in this bemoaned the American that Summit's were interrelated Institute, likely nothing fairly early process, informing Petroleum more in the symptoms large response than the familiar of a bureau- of this conclusion in its initial be, cracy. they may request Unfortunate as Summit's source-determination April App. not the result of the EPA's use of interrelated- 2007. See Pet'r at 31.

757 219-20, 122 152 III. S.Ct. CONCLUSION 535 U.S. (2002). L.Ed.2d 330 Because I believe that the EPA’s consid- Further, majority recognizes, as the eration of functional interrelatedness as a “adjacent” meaning does not have a set along physical factor distance in its any bright- distance. Absent specific both determination was reason- far is too far line rule as how (and deference) worthy of able thus and adja- to be considered numerous sources correct, I affirm its ag- would decision to cent, any aggregation that determination gregate the various sources in alone could involve the considers distance drilling operation major Summit’s as a “subjective” “fine- very assessments majority source. that Recognizing analyses” that Summit fears. grained otherwise, that, I in closing concludes note ability to consider the in- Stripped essentially holding aside from that func- terrelatedness of Summit’s wells tional an impermissible interrelatedness EPA would have had to consider plant, the consider, majority factor to not does well, each the distance between individual aspect find that other of the EPA’s between each well along with the distance aggregation determination was un- flawed each plant, and the and decide whether der the Act Administrative Procedure adja- was too far to be considered distance for agency decisionmaking standards case, process this could cent. Summit’s Farm, State articulated in at 42- U.S. adja- require separate over one hundred remand, then, 2856. On S.Ct. drilling op- cency determinations. Other EPA is free to reach the same conclusion similarly erations that are structured but operations aggre- Summit’s should be distances or traverse dif- cover different gated major permit- as a source for Title V rely landscapes might ferent not be able ting purposes, long so as it bases that case in on the determination conclusion on the considerations that they subject predicting whether would See majority today appropriate. deems to aggregation. Chenery Corp., Sec. & Exch. Comm’n v. po- majority’s adoption of Summit’s 194, 196, 200-01, Pri- policy

sition raises its own concerns. (1947). L.Ed. 1995 marily, today’s ruling frees the oil and

industry gerrymander way out of regulation. long

Title So as sufficient (so exists between each well

distance majority

they are not as the term), or someone other than

defines parcels owns of land drilling company (so ‍​​‌​​‌‌​‌​‌​​‌‌‌‌‌‌‌‌‌‌​‌‌‌​​​​‌​‌‌‌‌​‌​​‌​‌‌‌​​‍each well are not between drilling operation cannot

“contiguous”), through as a

be classified provisions aggregation. Unlike CAA LLC, ENHANCER, PETROLEUM governing pollutant hazardous air emis- Plaintiff/Counterclaim see sions, 7412(n)(4), U.S.C. Defendant-Appellee, grant gas industry the oil does court immunity aggregation; from effectively provi- should not create such WOODWARD, Defendant, R. Congress has not done so. Lester

sion when

Case Details

Case Name: Summit Petroleum Corp. v. United States Environmental Protection Agency
Court Name: Court of Appeals for the Sixth Circuit
Date Published: Aug 7, 2012
Citation: 690 F.3d 733
Docket Number: 09-4348, 10-4572
Court Abbreviation: 6th Cir.
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