Communities for a Better Environment v. U.S. Environmental Protection Agency , 609 F. App'x 461 ( 2015 )

MEMORANDUM ^*

Pétitioners challenge the Environmental Protection Agency’s (“EPA”) approval of South Coast Air Quality Management District (“District”) Rule 1315 into the California State Implementation Plan (“SIP”). Rule 1315 specifies the district’s procedures for tracking and banking emissions reductions for later use as offset credits for new sources of pollution. We conclude that the EPA was neither arbitrary nor capricious in its approval of Rule 1315 into the California SIP. We therefore deny the petition for review.

1.The EPA’s general practice is to review and approve the rules governing the overall conduct of state offset programs, but not simultaneously to pass judgment on individual transactions. See 54 Fed.Reg. 27286, 27294 n. 8 (June 28, 1989). The agency’s practice is a permissible construction of § 173(a) of the Clean Air Act, which obligates SIP permit programs to require new sources of pollution to obtain “sufficient' offsetting emissions reductions.” 42 U.S.C. § 7503(a)(1)(A). The EPA did not purport, nor was it required, to validate the banked emissions reductions when it approved Rule 1315. Tracking procedures such as those provided in Rule 1315 are not expressly required by the Clean Air Act, the California SIP, or EPA rule. See Natural Res. Def. Council, Inc. v. S. Coast Air Quality Mgmt. Dist. (NRDC), 651 F.3d 1066, 1073 (9th Cir.2011). A challenge to the sufficiency of offsetting emissions reductions may proceed when a new source of pollution is permitted under the SIP. See id. at 1071-72. EPA did not err by following its general practice when it approved Rule 1315.

2. The EPA acted within its authority when it approved the Rule 1315 SIP revision based on its conclusion that Rule 1315 is equivalent to federal methods. See 42 U.S.C. § 7502(c)(8). Federal integrity criteria require offsets to be quantifiable and surplus. See 40 C.F.R. § 51.165(a)(3)(ii)(C)(l)(I). EPA concluded that Rule 1315 sets forth adequate procedures to quantify actual emission reductions and ensure that such reductions are surplus. We accord this conclusion deference, as it is not plainly erroneous or inconsistent with law. See Comm. for a Better Arvin v. EPA, 786 F.3d 1169, 1174-75 (2015).

3. We are similarly bound by the agency’s determination that Rule 1315 is consistent with the federal “base year” exception, which allows pre-base year reductions to be credited if subsequent attainment demonstrations account for the emissions notwithstanding their prior curtailment. See 40 C.F.R. § 51.165(a)(3)(ii)(C)(l)(ii). The EPA adequately reviewed the District’s most recent attainment demonstrations and confirmed that each properly handled pre-base year reductions banked under Rule 131.5. Furthermore, any concern about pre-base year reductions can be litigated when the district uses pre-base year emissions offsets banked pursuant to Rule 1315 to authorize a new source permit. See NRDC, 651 F.3d at 1071-72.

4. The EPA reasonably determined that the Rule 1315 SIP revision would not interfere with reasonable further progress toward attainment. “[EPA] shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress.... ” 42 U.S.C. § 7410(i). This appeal solely concerns the District’s tracking procedures for emissions offsets, as set forth in Rule 1315. It is not an appropriate vehicle to challenge the substance of the District’s attainment plans. The EPA may approve a SIP in piecemeal fashion; different portions of a SIP may be submitted at different times to be considered separately. See Hall v. EPA, 273 F.3d 1146, 1159 (9th Cir.2001). The EPA reasonably concluded that Rule 1315 will assist the District in meeting its attainment plans, and that conclusion was neither arbitrary nor capricious.

PETITION DENIED.

* This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.