Cal. Manufacturers & Tech. etc. v. State Water Resources Control Bd. ( 2021 )

Filed 5/17/21
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Sacramento)
----
CALIFORNIA MANUFACTURERS & C089451
TECHNOLOGY ASSOCIATION,
(Super. Ct. No.
Plaintiff and Appellant, 34201780002769)
v.
STATE WATER RESOURCES CONTROL
BOARD,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Sacramento County, Allen H.
Sumner, Judge. Affirmed.
Reed Smith, Raymond A. Cardozo, and Brian A. Sutherland for Plaintiff and
Appellant.
Xavier Becerra, Attorney General, Matthew Rodriguez, Chief Assistant Attorney
General, Robert W. Byrne, Senior Assistant Attorney General, Tracy L. Winsor and
Russell B. Hildreth, Deputy Attorneys General, for Defendant and Respondent.
Robins Borghei, Todd E. Robins, Jed J. Borghei, and Taeva C. Shefler for Arvin
Community Services District and Vaughn Water Company as Amicus Curiae on behalf
of Defendant and Respondent.
1
The State Water Resources Control Board (Board) is charged with implementing
the California Safe Drinking Water Act, a comprehensive statutory scheme designed to
ensure that members of the public are provided with safe and clean drinking water.
(Health & Saf. Code, § 116270 et seq.; the Act).1 Among other things, the Board is
responsible for setting drinking water standards for contaminants which may have an
adverse effect on public health. (§ 116365, subd. (a).) This case concerns the drinking
water standard for 1, 2, 3 - trichloropropane (TCP), a chemical known to cause cancer.
The Board promulgated a regulation setting the drinking water standard for TCP in
2017. (Cal. Code Regs., tit. 22, § 64444, Table 64444-A.) Kern County Taxpayers
Association and California Manufacturers and Technology Association (Association)
challenged the regulation by petition for writ of ordinary mandate.2 (Code Civ. Proc., §
1085.) The trial court denied the petition. The Association appeals, arguing the Board
failed to comply with the Act’s requirement that new drinking water standards be
“economically feasible.” The Association also argues the Board failed to comply with
the economic impact assessment requirements of the Administrative Procedures Act
(Gov. Code, § 11340 et seq.). We reject both contentions and affirm.
I. BACKGROUND
A. The Federal and California Safe Drinking Water Acts
Congress passed the Safe Drinking Water Act (the federal Act) in 1974. (Pub. L.
No. 93-523 (Dec. 16, 1974) 88 Stat. 1660, codified at 42 U.S.C.S. § 300f et seq.) The
federal Act was intended “to assure that water supply systems serving the public meet
minimum national standards for protection of public health.” (See Bath Petroleum
1 Undesignated statutory references are to the Health and Safety Code.
2 Kern County Taxpayers Association filed a request for dismissal on February 4, 2020,
approximately one week after the filing of the opening brief in this appeal. We granted
the request by order dated February 11, 2020.
2
Storage, Inc. v. Sovas (N.D.N.Y. 2004) 309 F.Supp.2d 357, 366.) The federal Act
empowers the U.S. Environmental Protection Agency (federal EPA) to establish national
drinking water regulations applicable to all public water systems. (42 U.S.C.S. §
300f(1).) Such regulations are commonly expressed as maximum contaminant levels
(MCLs), which refer to “the maximum permissible level of a contaminant in water which
is delivered to any user of a public water system.” (42 U.S.C.S. § 300f(3).)
Our Legislature passed California’s version of the federal Act in 1976. (Stats.
1976, ch. 1087, § 2, pp. 4908-4930, formerly codified at § 4010 et seq., presently
codified at § 116270 et seq.) Among the legislative purposes of the Act are “to ensure
that the water delivered by public water systems of this state shall at all times be pure,
wholesome, and potable.” (§ 116270, subd. (e).) To effectuate this purpose, the Act
articulates a state policy to “reduce to the lowest level feasible all concentrations of toxic
chemicals that, when present in drinking water, may cause cancer, birth defects, and other
chronic diseases.” (§ 116270, subd. (d).) The Act also expresses an intent to establish a
safe drinking water program “that is more protective of public health than the minimum
federal requirements.” (§ 116270, subd. (f).)
As relevant here, the Act directs the Board to promulgate “primary drinking water
standards for contaminants in drinking water.” (§ 116365, subd. (a).) Primary drinking
water standards include MCLs for contaminants that, “in the judgment of the state board,
may have an adverse effect on the health of persons.” (§ 116275, subd. (c)(1).) Section
116365, subdivision (a) directs the Board to set the MCL for a given contaminant “as
close as feasible” to the public health goal for that contaminant, “placing primary
emphasis on the protection of public health.”3 Public health goals are set by the Office of
3 Section 116365, subdivision (a) provides: “The state board shall adopt primary
drinking water standards for contaminants in drinking water that are based upon the
criteria set forth in subdivision (b) and shall not be less stringent than the national
3
Environmental Health Hazard Assessment, and reflect “an estimate of the level of the
contaminant in drinking water that is not anticipated to cause or contribute to adverse
health effects, or that does not pose any significant risk to health.” (§ 116365, subd.
(c)(1).) Unlike MCLs, which are the product of several statutorily enumerated
considerations (described below), public health goals are based exclusively on public
health considerations. (§ 116365, subd. (c)(1).) Public health goals are aspirational
rather than mandatory or enforceable. (§ 116365, subd. (c); see also Ohio v. United
States EPA (D.C. Cir. 1993) 997 F.2d 1520, 1529.)
Section 116365, subdivision (b), with which we are principally concerned, directs
the Board to consider three criteria in setting MCLs. First, the Board must consider the
public health goal for the contaminant. (§ 116365, subd. (b)(1).) Second, the Board must
consider the national primary drinking water standard for the contaminant, if any. (§
116365, subd. (b)(2).) Third, the Board must consider: “The technological and
economic feasibility of compliance with the proposed primary drinking water standard.”
(§ 116365, subd. (b)(3).) “For the purposes of determining economic feasibility pursuant
to this paragraph,” subdivision (b)(3) elaborates, “the state board shall consider the costs
of compliance to public water systems, customers, and other affected parties with the
primary drinking water standards adopted by the United States Environmental Protection
Agency. A primary drinking water standard adopted by the state board shall be set at a
level that is as close as feasible to the corresponding public health goal placing primary
emphasis on the protection of public health, and that, to the extent technologically and
economically feasible, meets all of the following: [¶] (1) With respect to acutely toxic
substances, avoids any known or anticipated adverse effects on public health with an
adequate margin of safety. [¶] (2) With respect to carcinogens, or any substances that
may cause chronic disease, avoids any significant risk to public health.”
4
proposed primary drinking water standard, including the cost per customer and aggregate
cost of compliance, using best available technology.” (§ 116365, subd. (b)(3).) The
present case turns on the meaning of “economic feasibility,” as used in section 116365,
subdivision (b)(3).
B. The Challenged Regulation
The Board began rulemaking proceedings to adopt an MCL for TCP in February
2017. An initial statement of reasons accompanying the proposed regulation describes
TCP as a chlorinated hydrocarbon that has historically been used as an industrial solvent,
cleaning and degreasing agent, and paint and varnish remover. TCP has also been found
in soil fumigants. According to the initial statement of reasons, TCP has been detected in
drinking water sources in a significant number of California counties (24 out of 58),
including more than 100 drinking water sources in Kern County alone. As noted, TCP is
a known carcinogen.
The initial statement of reasons sets forth the Board’s findings for each of the
criteria required by section 116365, subdivision (b) (summarized below), and proposes an
MCL of 5 parts per trillion, the lowest and most protective of six possibilities considered
by the Board.4 Most of the Board’s findings are undisputed; even so, they are recounted
here briefly for context.
First, the Board determined that the public health goal for TCP has been set at 0.7
parts per trillion, a determination the Association does not challenge. Thus, the Board
was required to set the MCL for TCP “as close as feasible” to the public health goal of
0.7 parts per trillion. (§ 116365, subd. (a).)
4 Contaminant concentrations are sometimes expressed in terms of micrograms per liter
(“parts per billion”) or, at lower concentrations, as nanograms per liter (“parts per
trillion”).
5
Second, the Board determined that the EPA has not established an MCL for TCP,
another determination the Association does not challenge. Thus, the Board was not
required to consider any national MCL for TCP.
Third, the Board considered the technological and economic feasibility of six
possible MCLs for TCP: 5, 7, 15, 35, 70, and 150 parts per trillion. For technological
feasibility, the Board identified granular activated carbon as the best available technology
for treating TCP in drinking water. The Board found that granular activated carbon has
been shown to successfully reduce TCP in drinking water to levels below 5 parts per
trillion, below the lowest of the MCLs under consideration. The Board thus determined
that an MCL of 5 parts per trillion was technologically feasible, and “as close as feasible
to the corresponding public health goal” of 0.7 parts per trillion. (§ 116365, subd. (a).)
The Association does not challenge any of the Board’s findings or conclusions with
respect to technological feasibility.
Turning to economic feasibility, the Board focused on the estimated costs of
compliance for each of the contemplated MCLs, assuming the use of granular activated
carbon as a treatment technology. For each possible MCL, the Board estimated the
number of water systems that would be affected, the aggregate annual costs of
compliance for all affected systems statewide, and the average annual costs for service
connections (e.g., households or customers) in large water systems (with 200 or more
service connections) and small water systems (with fewer than 200 service connections).
These estimates (which the Association does not challenge) are summarized in the table
below:
6
Contemplated Annual Number of Average Average
MCL aggregate systems annual cost annual cost
costs (in affected for service for service
millions) connections in connections in
small water large water
systems systems
5 $33.9 103 $609 $25
7 $26.9 89 $660 $24
15 $20.7 66 $600 $21
35 $11.3 45 $632 $14
70 $6.6 30 $501 $14
150 $3.2 12 $872 $10
As shown in the table, the Board estimated that aggregate, statewide annual costs
of compliance for the lowest and most protective MCL (5 parts per trillion) would be
$33.9 million, compared to $3.2 million for the highest and least protective MCL (150
parts per trillion). Customers in small water systems would pay more, the Board found,
due to the smaller number of customers bearing the costs of compliance. But the
estimated costs of compliance were not expected to increase significantly as the MCL
approached 5 parts per trillion. For example, customers in large water systems would be
expected to pay $25 per year for an MCL of 5 parts per trillion, and $21 per year for an
MCL of 15 parts per trillion, a difference of only $4 per year. Similarly, customers in
small water systems would be expected to pay an additional $609 per year for an MCL of
5 parts per trillion, and $600 per year for an MCL of 15 parts per trillion, a difference of
$9 per year.5 Thus, despite a wide range in aggregate costs, the Board anticipated that
5 We note that customers in small water systems would be expected to pay $872 per year
for an MCL of 150 parts per trillion, and $609 per year for an MCL of 5 parts per trillion.
We would ordinarily expect annual costs to increase as the MCL becomes more
protective, as is the case in the column showing costs for customers served by large water
systems. The parties do not discuss the nonlinear relationship between annual costs and
7
customers would be unlikely to realize significant cost savings from the selection of a
higher and less protective MCL.
The Board also considered the benefits of the contemplated MCLs, including the
“estimated annual cost per theoretical excess cancer cases reduced,” for large and small
water systems. By way of example, the Board estimated that the aggregate annual cost of
complying with an MCL of 5 parts per trillion would be $33.9 million and would result in
the avoidance of 2.36 cancer cases, while the aggregate annual cost of complying with an
MCL of 7 parts per trillion would be $26.9 million and would result in the avoidance of
2.32 cancer cases. As before, the Board anticipated that costs would be greater for small
water systems, as small water systems would be unlikely to realize the same economies
of scale as large water systems.
The Board identified other anticipated benefits of the proposed regulation,
including ensuring access to safe and clean drinking water, reducing exposure to a
chemical known to cause cancer, and reducing the use of bottled water and alternatives to
drinking water such as sweetened beverages and soda. The Board did not attempt to
assign dollar values to these benefits.
Turning to the ultimate question of economic feasibility, the Board concluded that
the proposed MCL of 5 parts per trillion would not place a significant economic burden
on the State of California as a whole. The Association does not challenge the Board’s
conclusion.
As noted, the Board also found the proposed MCL would raise rates for service
connections in large water systems by an estimated $25 per year, or $2.08 per month.
The Board implicitly found the increase to be economically feasible, and the Association
contemplated MCLs for customers served by small water systems, and the issue is
immaterial to the issues raised by this appeal.
8
does not suggest otherwise. But the estimated increase for service connections in small
water systems is another story.
As noted, the Board estimated the proposed MCL would raise rates for service
connections in small water systems by $609 per year, or $50.75 per month. The initial
statement of reasons “acknowledges that some [small water systems] are economically
disadvantaged and that the estimated annual cost of $609 per connection could represent
a significant financial burden to some California communities.”6 Nevertheless, the Board
found “the cost per connection of centralized treatment does not greatly decrease at
higher MCLs and therefore, an economically disadvantaged [small water system] would
likely not find a higher MCL to be more economically feasible.” Furthermore, the Board
observed that there might be alternatives to centralized treatment that would be less
costly for small water systems, including point-of-entry treatment, which involves
treating only the water entering a house or building, rather than all of the water sent to the
distribution center. The Board further observed that the regulatory process of qualifying
for point of entry treatment requires a showing of economic infeasibility (Cal. Code
Regs., tit. 22, §§ 64420-64420.1), and suggested that small water systems may be able to
make such a showing. The Board also observed that small water systems may be eligible
for grants and low interest loans through funding programs maintained by the Board.
Based on the foregoing, the Board concluded that, “although the estimated annual
cost of $609 may be economically infeasible for a [small water system], there may be
alternative, lower-cost treatment options and financing opportunities, such as grants and
low-interest loans from the State Water Board, which would make centralized treatment
economically feasible.” Accordingly, the Board concluded that the proposed MCL of 5
6The initial statement of reasons observes that the median household income for
California in 2014, as reported by the U.S. Census Bureau, was $61,489.
9
parts per trillion was economically feasible, notwithstanding the potential burden on
households and customers served by small water systems.
Having determined that the proposed MCL would satisfy the statutory criteria
required by section 116365, the Board next considered reasonable alternatives to the
regulation that would lessen any impact on small business, and the Board’s reasons for
rejecting them. (Gov. Code, § 11346.2, subd. (b)(4).) After recapitulating the above-
described discussion of economic feasibility, the Board concluded: “To the extent that
this regulation will have any impact on small businesses, the reasons for rejecting
alternatives that may reduce an impact on small businesses is the same above: a higher
MCL would be inconsistent with . . . section 116365, would be somewhat less protective
of public health, and would not result in significant cost savings.” (Fn. omitted.)
The Board acknowledged that “a small number of the identified public water
systems likely provide water solely to businesses, and that public water systems
identified as community water systems often provide water to businesses.” The Board
assumed that public water systems that would be required to incur costs to comply with
the proposed MCL would pass those costs on to their customers, including businesses.
The Board did not specifically consider the economic impact of the proposed MCL on
operators of nontransient noncommunity water systems, such as food processors and
agricultural businesses.7
Based on the foregoing, the Board concluded that, “any economic impact to
businesses statewide is not anticipated to be significant.” Accordingly, the Board
7 Nontransient noncommunity water systems are public water systems that are not
community water systems and that regularly serve at least 25 of the same persons over
six months per year. (§ 116275, subd. (k).) Community water systems are public water
systems that serve at least 15 service connections used by yearlong residents, or that
regularly serve at least 25 yearlong residents of the area served by the system. (§ 116275,
subd. (i).)
10
proposed setting the MCL at 5 parts per trillion, the lowest of the six possibilities under
consideration. Following a comment period and public hearing, the Board adopted a
regulation setting the MCL for TCP at 5 parts per trillion. (Cal. Code Regs., tit. 22, §
64444, Table 64444-A.)
C. The Petition
Kern County Taxpayers Association and the Association filed their petition for
writ of mandate on December 18, 2017. The petition alleges that the Board failed to
comply with the Act and the Administrative Procedure Act in setting the MCL for TCP.
Specifically, the petition alleged that the Board failed to determine the economic
feasibility of the new MCL and failed to analyze the economic impacts of the MCL on
businesses that operate their own water systems, such as nontransient, noncommunity
water systems, and mutual water systems. The petition sought an order requiring the
Board to withdraw the MCL for TCP and promulgate a new one.
The petition was set for hearing in December 2018. In anticipation of the hearing,
the Association and the Board each filed requests for judicial notice. The Association
requested judicial notice of a trial court order granting a petition for writ of mandate in
another action against the Board, this one arising out of a challenge to the MCL for
hexavalent chromium, designated by the parties as the “Chrome 6” case. (California
Manufacturers and Technology Association et al. v. State Water Resources Control
Board (Superior Ct. Sacramento County, 2017, No. 34-2014-80001850) (“Chrome 6”).)
The Board, for its part, sought judicial notice of the State of California Drinking Water
Annual Compliance Report for 2017, which shows that more than 95 percent of
Californians are served by large water systems, and less than two percent are served by
small water systems.
Following argument, the trial court denied the petition, finding that the
Association failed to show the Board abused its discretion in setting the MCL at 5 parts
per trillion. The trial court rejected the Association’s argument—renewed herein—that
11
the Act required the Board to conduct a cost-benefit analysis. The trial court also rejected
the Association’s argument—also renewed herein—that the Board failed to consider
economic impacts on businesses operating their own water systems. The trial court
denied the Association’s request for judicial notice and granted the Board’s.
The trial court entered judgment in the Board’s favor in March 2019. This appeal
timely followed.8
II. DISCUSSION
A. Compliance with the Act
The Association challenges the MCL as inconsistent with the Act. According to
the Association, the Board (1) misinterpreted the statutory requirement that the proposed
MCL be “economically feasible,” (2) failed to perform a cost-benefit analysis of the
contemplated MCLs, and (3) failed to apply any other discernible standard for
determining economic feasibility. We consider these contentions momentarily. Before
doing so, however, we address the Association’s arguments based on the order granting
the petition for writ of mandate in the Chrome 6 case. As the trial court correctly
observed, the Chrome 6 order has no precedential value (In re Molz (2005) 127
Cal.App.4th 836, 845), and cannot be considered under California Rules of Court, rule
8 We have received an amicus curiae brief from Arvin Community Services District and
Vaughn Water Company arguing, inter alia, that the Association lacks standing to
challenge the MCL. We decline to consider amicus curiae’s standing argument, which is
not among the contentions raised by the parties. (See Younger v. State of California
(1982) 137 Cal.App.3d 806, 813-814 [“ ‘ “an appellate court will consider only those
questions properly raised by the appealing parties. Amicus curiae must accept the issues
made and propositions urged by the appealing parties, and any additional questions
presented in a brief filed by an amicus curiae will not be considered” ’ ”]; and see
Conservatorship of Whitley (2007) 155 Cal.App.4th 1447, 1457, fn. 5 [declining to
consider standing argument raised by amicus curiae].) We have considered amicus
curiae’s other arguments.
12
8.1115, except in circumstances not present here.9 The Association does not suggest the
trial court erred in denying the request for judicial notice of the order and does not seek
judicial notice in this court. We therefore decline to consider any of the Association’s
arguments based on the Chrome 6 order.
1. Standard of Review
The establishment of an MCL by the Board constitutes a quasi-legislative act
subject to judicial review by ordinary mandate under Code of Civil Procedure section
1085. (Western States Petroleum Assn v. State Department of Health Services (2002) 99
Cal.App.4th 999, 1006; Carrancho v. California Air Resources Board (2003) 111
Cal.App.4th 1255, 1265-1266.)
Our review of an administrative agency’s quasi-legislative activity is limited. As
our Supreme Court has explained, “ ‘quasi-legislative rules . . . represent[] an authentic
form of substantive lawmaking: Within its jurisdiction, the agency has been delegated
the Legislature’s lawmaking power. [Citations.] Because agencies granted such
substantive rulemaking power are truly ‘making law,’ their quasi-legislative rules have
the dignity of statutes. When a court assesses the validity of such rules, the scope of its
review is narrow. If satisfied that the rule in question lay within the lawmaking authority
delegated by the Legislature, and that it is reasonably necessary to implement the purpose
of the statute, judicial review is at an end.’ [Citations.] When a regulation is challenged
on the ground that it is not ‘reasonably necessary to effectuate the purpose of the statute,’
our inquiry is confined to whether the rule is arbitrary, capricious, or without rational
basis [citation], and whether substantial evidence supports the agency’s determination
9 The Association argued in the trial court that the order was citable under California
Rule of Court, rule 8.1115, subdivision (b)(1), which establishes an exception for
opinions relevant under the doctrines of law of the case, res judicata, or collateral
estoppel. However, the trial court rejected this argument, and the Association does not
press the issue on appeal.
13
that the rule is reasonably necessary [citation].” (Western States Petroleum Assn. v.
Board of Equalization (2013) 57 Cal.4th 401, 415.)
But our review of an agency’s interpretation of a statute is not so limited. Where,
as here, “an implementing regulation is challenged on the ground that it is ‘in conflict
with the statute’ [citation] or does not ‘lay within the lawmaking authority delegated by
the Legislature’ [citation], the issue of statutory construction is a question of law on
which a court exercises independent judgment.” (Western States Petroleum Assn. v.
Board of Equalization, supra, 57 Cal.4th at p. 415.)
“In determining whether an agency has incorrectly interpreted the statute it
purports to implement, a court gives weight to the agency’s construction.” (Western
States Petroleum Assn. v. Board of Equalization, supra, 57 Cal.4th at p. 415.) “How
much weight to accord an agency’s construction is ‘situational,’ and greater weight may
be appropriate when an agency has a ‘ “comparative interpretative advantage over the
courts,” ’ as when ‘ “the legal text to be interpreted is technical, obscure, complex, open-
ended, or entwined with issues of fact, policy, and discretion.” ’ [Citation.] Moreover, a
court may find that ‘the Legislature has delegated the task of interpreting or elaborating
on a statute to an administrative agency,’ for example, when the Legislature ‘employs
open-ended statutory language that an agency is authorized to apply or “when an issue of
interpretation is heavily freighted with policy choices which the agency is empowered to
make.” ’ [Citations.] In other words, the delegation of legislative authority to an
administrative agency sometimes ‘includes the power to elaborate the meaning of key
statutory terms.’ [Citation.] Nevertheless, the proper interpretation of a statute is
ultimately the court’s responsibility.” (American Coatings Assn. v. South Coast Air
Quality Management Dist. (2012) 54 Cal.4th 446, 461-462.)
2. Principles of Statutory Interpretation
We review questions of statutory interpretation “seeking, as always, to ascertain
the Legislature’s intent so as to give effect to the law’s purpose.” (In re Corrine W.
14
(2009) 45 Cal.4th 522, 529; Elsner v. Uveges (2004) 34 Cal.4th 915, 927.) “We begin
with the statute’s plain language, as the words the Legislature chose to enact are the most
reliable indicator of its intent.” (In re Corrine W., supra, at p. 529.) “ ‘[I]f there is no
ambiguity, then we presume the lawmakers meant what they said, and the plain meaning
of the language governs.’ ” (Allen v. Sully-Miller Contracting Co. (2002) 28 Cal.4th 222,
227.) If, however, the statutory language is ambiguous or reasonably susceptible to more
“we will consider ‘ “a variety of extrinsic aids, including the ostensible objects to be
achieved, the evils to be remedied, the legislative history, public policy,
contemporaneous administrative construction, and the statutory scheme of which the
statute is a part.” ’ ” (Elsner v. Uveges, supra, at p. 929.) “Ultimately we choose the
construction that comports most closely with the apparent intent of the lawmakers, with a
view to promoting rather than defeating the general purpose of the statute.” (Allen v.
Sully-Miller Contracting Co., supra, at p. 227.)
3. “Economic Feasibility”
We begin with the Association’s argument that the Board misinterpreted the
requirement of “economic feasibility.” As noted, section 116365, subdivision (a) directs
the Board to set the MCL for a carcinogen “at a level that is as close as feasible to the
corresponding public health goal[,] placing primary emphasis on the protection of public
health, and that, to the extent technologically and economically feasible” avoids any
significant risk to public health. Section 116365, subdivision (b) directs the Board to
“consider” enumerated criteria, including “[t]he technological and economic feasibility of
compliance” with the proposed MCL. (§ 116365, subd. (b)(3).) Section 116365,
subdivision (b)(3) further provides: “For the purposes of determining economic
feasibility pursuant to this paragraph, the state board shall consider the costs of
compliance to public water systems, customers, and other affected parties with the
proposed primary drinking water standard, including the cost per customer and aggregate
15
cost of compliance, using best available technology.” The Act does not define the terms
“economically feasible” or “economic feasibility.”
“ ‘When a term goes undefined in a statute, we give the term its ordinary
meaning.’ ” (De Vries v. Regents of University of California (2016) 6 Cal.App.5th 574,
590-591.) “When attempting to ascertain the ordinary, usual meaning of a word, courts
appropriately refer to the dictionary definition of that word.” (Wasatch Property
Management v. Degrate (2005) 35 Cal.4th 1111, 1121-1122.)
The Association correctly observes that dictionaries offer alternative definitions of
the word, “feasible.” For example, Webster’s Third New International Dictionary defines
“feasible” to mean: (1) “capable of being done, executed, or effected: possible of
realization,” (2) “capable of being managed, utilized or dealt with successfully:
SUITABLE,” and (3) “REASONABLE, LIKELY.” (Webster’s 3d New Internat. Dict.
(1993) p. 831, col. 3.) The Oxford English Dictionary similarly defines “feasible” to
mean: (1) “Capable of being done, accomplished or carried out; possible, practicable,”
(2) “Capable of being dealt with successfully in any way, either in a material or
immaterial sense,” and (3) “Likely, probable.” (Oxford English Dict. (Online ed. 2021)
https://www.oed.com/view/Entry/68798?redirectedFrom=feasible#eid [as of May 12,
2021], archived at .) The Association argues the Board
misinterpreted the word “feasible” to mean “capable of being done” rather than
“reasonable.” We disagree.
We reiterate that the Act articulates a state policy to “reduce to the lowest level
feasible all concentrations of toxic chemicals that, when present in drinking water, may
cause cancer, birth defects, and other chronic diseases.” (§ 116270, subd. (d), italics
added.) It is unlikely that the Legislature, in adopting a statutory scheme expressly
designed to be “more protective of public health than the minimum federal
requirements,” (§ 116270, subd. (f)) intended nothing more than to reduce concentrations
of toxic chemicals in drinking water to “the lowest level reasonable.” It is far more
16
likely that the Legislature intended to articulate a state policy of reducing concentrations
of toxic chemicals in drinking water to the lowest level “capable of being done,” subject
to the limits of what is technically and economically possible.
Applying the principle that the same words or phrases should be given the same
meaning within interrelated provisions of the law, we conclude that the word “feasible,”
as used in section 116365, subdivision (a) means “capable of being done,” rather than
“reasonable.” (Winn v. Pioneer Medical Group, Inc. (2016) 63 Cal.4th 148, 161 [“We
generally presume that when the Legislature uses a word or phrase ‘in a particular sense
in one part of a statute,’ the word or phrase should be understood to carry the same
meaning when it arises elsewhere in that statutory scheme”].)10 We likewise conclude
that “economic feasibility,” as used in section 116365, subdivision (b), means
economically “capable of being done”; that is, capable of being done given “the
management of domestic or private income and expenditure.” (Oxford English Dict.
(Online ed. 2021)
10 We note that the Legislature has elsewhere defined the term “feasible” to mean
“capable of being accomplished in a successful manner within a reasonable period of
time, taking into account economic, environmental, social, and technological factors.”
(Pub. Resources Code, § 21061.1 [defining “feasible” for purposes of CEQA review];
Pub. Resources Code, § 30108 [defining “feasible” under the Coastal Act]; Gov. Code,
65590, subd. (g)(3) [defining “feasible” under the Mello Act].) We also note that the
U.S. Supreme Court and federal appellate courts have similarly defined “feasible” to
mean “capable of being done.” (American Textile Manufacturers Institute, Inc. v.
Donavan (1981) 452 U.S. 490, 509 (American Textile) [holding that the “plain meaning”
of the word “feasible,” as used in provision of the Occupational Safety and Health Act, is
“ ‘capable of being done, executed, or effected’ ” or “ ‘capable of being done,
accomplished[,] or carried out’ ”]; see also Friends of the Boundary Waters Wilderness v.
Robertson (8th Cir. 1992) 978 F.2d 1484, 1487-1488 [holding that “feasible,” in the
context of an environmental statute prohibiting motorized portage of canoes unless a non-
motorized alternative is not feasible, means “ ‘capable of being done’ ” or “ ‘physically
possible’ ”].)
17
[as of May 12, 2021], archived at [defining
“economic”].)
Taking a page from the trial court’s order, we affirm that regulations are not
“infeasible” because they impose financial burdens on businesses or consumers. (See,
e.g., United Steelworkers of America, AFL-CIO-CLC v. Marshall (D.C. Cir. 1980) 647
F.2d 1189, 1265 [considering the requirement of economic feasibility in the context of
regulations promulgated by the Occupational Health & Safety Administration, and
holding that: “A standard is not infeasible simply because it is financially burdensome
[citation], or even because it threatens the survival of some companies within an
industry”]; see also American Iron & Steel Institute v. Occupational Safety and Health
Admin. (D.C. Cir. 1991) 939 F.2d 975, 980 [“A standard is economically feasible if the
costs it imposes do not ‘threaten massive dislocation to, or imperil the existence of, the
industry’ ”].) We further conclude, as the trial court did, that the Board’s findings as to
economic feasibility have not been shown to have been arbitrary, capricious, or without
rational basis. (Western States Petroleum Assn. v. Board of Equalization, supra, 57
Cal.4th at p. 415.) We need not linger over these conclusions, however, as the
Association does not directly argue that the MCL for TCP was economically infeasible or
even unreasonable. Rather, the Association’s arguments concerning the meaning of the
words “economically feasible” and “economic feasibility” are stepping stones to another
argument, to which we now turn.
3. Cost-Benefit Analysis
Having concluded (erroneously, as we have shown) that “feasible” means
“reasonable,” the Association proceeds to the next phase of its argument; that section
116365 required the Board to conduct a cost-benefit analysis to determine the
reasonableness of the contemplated MCLs. The Association’s argument cannot be
squared with the statutory language or the purpose of the statute.
18
Before diving into the Association’s substantive arguments, we acknowledge some
uncertainty as to what type of cost-benefit analysis the Association believes the Board
should have done. The Act does not contain or define the term, and courts have long
recognized that cost-benefit analyses “can take many forms.” (Sierra Club v. Sigler (5th
Cir. 1983) 695 F.2d 957, 976, fn. 15; see also American Mining Congress v. Thomas
(10th Cir. 1985) 772 F.2d 617, 631 [“The label ‘cost-benefit analysis’ encompasses
everything from a strict mathematical balancing formula to a less strict standard that
merely requires the agency to recognize both the costs and benefits of specific proposed
alternatives and consider the differences in choosing an appropriate alternative”].) As
one federal appellate court has explained: “[Cost-benefit analysis] varies from a formal
analysis in which all costs and benefits are quantified in an identical unit of measurement,
usually dollars, and compared, to an informal analysis where costs and benefits are
identified, quantified if possible, and balanced.” (Sierra Club v. Sigler, supra, at p. 976,
fn. 15; see also Quivira Mining Company v. United States Nuclear Regulatory
Commission (10th Cir. 1989) 866 F.2d 1246, 1250 [describing differences between “cost-
benefit optimization,” the strictest type of cost-benefit analysis, and “cost-benefit
rationalization,” a looser approach].) The Association does not tell us what type of cost-
benefit analysis the Act supposedly requires.11
Federal courts have also recognized that administrative agencies commonly rely
on another form of economic analysis, one which the United States Supreme Court has
termed “feasibility analysis.” (American Textile, supra, 452 U.S. at p. 509.) Feasibility
analysis, in the environmental context, “requires an agency to protect public health to the
11 We note that the Board arguably conducted a form of cost-benefit analysis by
considering both the costs of the contemplated MCLs and their anticipated benefits,
including the “estimated annual costs for theoretical cancer cases reduced” and
nonmonetary benefits, such as ensuring access to safe and clean drinking water.
19
maximum extent possible, constrained solely by what is economically or technically
feasible.” (Quivira Mining Company v. United States Nuclear Regulatory Commission,
supra, 866 F.2d at p. 1250, fn. 4; see also American Mining Congress v. Thomas, supra,
772 F.2d at p. 631.) This approach places a lesser burden on an administrative agency
than a cost-benefit analysis, which would typically require the agency to “monetize the
costs and benefits of a regulation, balance the results, and then choose the regulation with
the greatest net benefits.” (Entergy Corp. v. Riverkeeper, Inc. (2009) 556 U.S. 208, 237
(dis. opn. of Stevens, J.) [observing that cost-benefit analyses are particularly
controversial in the environmental context in which a regulation’s financial costs are
often more obvious and easier to quantify than its environmental benefits].)
Significantly, for our purposes: “Feasibility analysis and cost-benefit analysis are
mutually exclusive approaches.” (American Mining Congress v. Thomas, supra, at p.
631, citing American Textile, supra, at p. 509; see also Quivira Mining Company v.
United States Nuclear Regulatory Commission, supra, at p. 1250, fn. 4 [same].) We
presume the Legislature was aware of these differing forms of economic analysis when it
passed the Act. (See Ramos v. Superior Court (2007) 146 Cal.App.4th 719, 727 [“We
presume the Legislature knew what it was saying and meant what it said”].)
Having defined our terms, we turn once more to the language of the statute. As
previously discussed, section 116365, subdivision (a) requires the Board to set the MCL
“at a level that is as close as feasible to the corresponding public health goal placing
primary emphasis on the protection of public health.” Section 116365, subdivision (b)
requires the Board to “consider” enumerated criteria; namely, the public health goal for
the contaminant, the national drinking water standard, if any, and the “technological and
economic feasibility of compliance.” “For purposes of determining economic
feasibility,” subdivision (b) continues, “the state board shall consider the costs of
compliance to public water systems, customers, and other affected parties with the
proposed primary drinking water standard, including the cost per customer and aggregate
20
cost of compliance, using best available technology.” (Ibid.) This language seems to
clearly contemplate a feasibility analysis, rather than a cost-benefit analysis.
The United States Supreme Court considered similar statutory language in
American Textile. There, representatives of the cotton industry challenged proposed
regulations limiting permissible exposure levels to cotton dust, an airborne particle
byproduct of cotton products that causes serious and disabling respiratory diseases.
(American Textile, supra, 452 U.S. at p. 494.) The regulations had been promulgated
pursuant to section 6(b)(5) of the Occupational Safety and Health Act of 1970 (29 U.S.C.
§ 655(b)(5)), which requires the Secretary of Labor to “set the standard which most
adequately assures, to the extent feasible . . . that no employee will suffer material
impairment of health.” (See American Textile, supra, at pp. 493-494.) The industry
representatives argued that the federal statute required a showing that the costs of the
proposed regulation bore a reasonable relationship to the anticipated benefits to
employees. (Id. at p. 494.) The high court rejected the industry representatives’ cost-
benefit argument. (Id. at p. 509.) The court explained, first, that the plain meaning of the
word “feasible” is “ ‘capable of being done.’ ” (Ibid.) The court then explained that,
effectively: “Congress itself defined the basic relationship between costs and benefits, by
placing the ‘benefit’ of worker health above all other considerations save those making
attainment of this ‘benefit’ unachievable. Any standard based on a balancing of costs and
benefits by the Secretary that strikes a different balance than that struck by Congress
would be inconsistent with the command set forth in § 6(b)(5)[ of the Occupational
Safety and Health Act]. Thus, cost-benefit analysis . . . is not required by the statute
because feasibility analysis is.” (Ibid., fn. omitted.) The Supreme Court’s analysis is
helpful to us here.
As the Board observes, the Legislature expressly recognized the benefits of safe
drinking water in passing the Act. (See § 116270, subds. (a) [declaring that every
resident of California has the right to safe drinking water] & (e) [stating a legislative
21
intent to “ensure that the water delivered by public water systems of this state shall at all
times be pure, wholesome, and potable”].) Just as Congress defined the relationship
between costs and benefits in the Occupational Safety and Health Act, so too has our
Legislature placed the public health benefits of safe drinking water above all other
considerations, save those that would make attaining those benefits unachievable. (§
116365, subd. (a) [directing Board to set MCLs “at a level that is as close as feasible to
the corresponding public health goal placing primary emphasis on the protection of
public health” (italics added)].) And just as a balancing of costs and benefits by the
Secretary would have undermined the legislative balance in American Textile, so too
would a cost-benefit analysis by the Board upset the legislative balance struck by the Act.
(American Textile, supra, 452 U.S. at p. 509.) Following the Supreme Court’s analysis in
American Textile, we conclude that section 116365 requires the Board to conduct a
feasibility analysis, not a cost-benefit analysis. (American Textile, supra, at p. 510[“Thus, cost-benefit analysis . . . is not required by the statute because feasibility analysis
is”].)
The Association’s arguments to the contrary are unconvincing. The Association
directs our attention to In re Groundwater Cases (2007) 154 Cal.App.4th 659, in which
the court offered an overview of the Act, stating in dicta that the “setting of primary
drinking water standards involves a balancing of public health concerns with questions of
technological feasibility and cost.” (Id. at p. 679.) But the Groundwater court was
concerned with the extent to which an MCL can serve as a basis for civil liability under
Hartwell Corporation v. Superior Court (2002) 27 Cal.4th 256 and the California Tort
Claims Act. (Groundwater, supra, at p. 680.) The court was not concerned with the
administrative process by which MCLs are set or the requirement that the Board
determine the economic feasibility of a proposed MCL. Groundwater cannot be said to
support the Association’s argument that section 116365 requires a cost-benefit analysis.
22
(See People v. Ault (2004) 33 Cal.4th 1250, 1268, fn. 10 [“It is axiomatic that cases are
not authority for propositions not considered”].)
The Association next purports to find support for a required cost-benefit in section
116365, subdivision (b)’s enumeration of statutory criteria. But subdivision (b) does not
say anything about quantifying the benefits of a proposed MCL, or balancing those
benefits against the costs of compliance. Subdivision (b) merely requires that the Board
“consider” the “economic feasibility of compliance,” which is defined as “the costs of
compliance to public water systems, customers, and other affected parties.” (§ 116365,
subd. (b).)12 Subdivision (b) does not, by its terms, require any type of cost-benefit
analysis.
The Association’s reliance on section 116365, subdivision (b)(2) is equally
unavailing. Subdivision (b)(2) directs the Board to consider any national primary
drinking water standard for the contaminant adopted by the federal EPA. (§ 116365,
subd. (b)(2).) The Association observes that national MCLs are themselves the product
of statutorily-mandated cost-benefit analyses and invites us to conclude that subdivision
(b)(2) incorporates by reference a requirement that the Board undertake s similar
analysis. (42 U.S.C.S. § 300g-1(b)(3)(C)(i) [requiring analysis of quantifiable and
nonquantifiable health risk reduction benefits and costs of compliance for each
alternative MCL under consideration].) We decline the invitation. As the Board
observes, the Legislature knows how to require a cost-benefit analysis when it chooses to
do so. (See, e.g., §§ 43018.8, subd. (b) [requiring cost-benefit analyses for state
programs affecting the adoption of zero-emission vehicles], 43630, subd. (c) [requiring
cost-benefit analyses for standards for certifying devices capable of reducing emissions
from motor vehicles].) Had the Legislature intended to require a cost-benefit analysis in
12 The Association does not suggest the Board failed to consider the costs of the
contemplated MCLs.
23
setting an MCL, it could have done so directly. The Legislature chose not to include any
such requirement in section 116365, and we cannot rewrite the statute to conform to an
intention that does not appear in its language. (California Teachers Assn. v. Governing
Bd. of Rialto Unified School Dist. (1997) 14 Cal.4th 627, 632-633.)
The Association’s reliance on section 116370 fails for similar reasons. Section
116370, which we have not yet discussed, directs the Board to “adopt a finding of the
best available technology for each contaminant for which a primary drinking water
standard has been adopted at the time the standard is adopted.” The statute further
requires that the finding “shall take into consideration the costs and benefits of best
available treatment technology that has been proven effective under full-scale field
applications.” (§ 116370.) Section 116370 only serves to underscore the absence of any
similar requirement in section 116365. Had the Legislature intended for the Board to
consider both costs and benefits in determining economic feasibility, it could have said as
much in section 116365. That the Legislature chose instead to focus on the “costs of
compliance,” omitting any mention of the anticipated benefits of the MCL, indicates that
the determination of economic feasibility does not require a balancing of costs and
benefits, at least not in the sense that the Association proposes. (Southern Pac.
Transportation Co. v. State Board of Equalization (1985) 175 Cal.App.3d 438, 443 [“ ‘It
is a well recognized principle of statutory construction that when the Legislature has
carefully employed a term in one place and has excluded it in another, it should not be
implied where excluded’ ”].) Section 116370 therefore fails to advance the Association’s
cause.
In the absence of any authority requiring a cost-benefit analysis, the Association
offers pages of public policy arguments, all steeped in dense economic jargon. We need
not consider these arguments, as we conclude the language of section 116365 is clear and
unambiguous, and “cannot be construed” to require a cost-benefit analysis. (American
24
Textile, supra, 452 U.S. at p. 511.) We therefore reject the Association’s argument that
the Board failed to discharge a statutory duty to conduct a cost-benefit analysis.
4. Other Discernible Standards
The Association next argues the Board failed to apply any discernible standard for
determining economic feasibility. We are not sure what the Association means. To the
extent the Association means the Board failed to comply with the standard required by
the statute, we disagree. As previously discussed, section 116365 required the Board to
“consider the costs of compliance to public water systems, customers, and other affected
parties with the proposed primary drinking water standard, including the cost per
customer and aggregate cost of compliance, using best available technology.” (§ 116365,
subd. (b)(3).) The Association does not suggest the Board failed to consider any of these
costs. Instead, the Association appears to suggest that the Board’s consideration of costs
was not guided by any discernible economic standard. But the Association does not say
what economic standard should have applied, or explain why the Board was not free to
conduct a feasibility analysis, or any other form of economic analysis that adequately
accounted for the costs of compliance with the proposed MCL, as the Board’s analysis
indisputably did. The Association merely repeats the mantra that the Board should have
conducted a cost-benefit analysis. As we have already established, no such analysis was
required.
B. Compliance with the Administrative Procedure Act
The Association argues the Board violated the Administrative Procedure Act by
failing to consider the potential for adverse economic impacts on operators of
nontransient noncommunity water systems. As previously discussed, the Board
recognized that “a small number of the identified public water systems likely provide
water solely to businesses, and that public water systems identified as community water
systems often provide water to businesses.” However, the Board did not specify how
many nontransient noncommunity water systems would be affected by the proposed
25
regulation or analyze how they would be affected. The Association argues the omission
constitutes a violation of Government Code sections 11346.3, subdivision (a), which
requires that agencies “assess the potential for adverse economic impact on California
business enterprises and individuals,” and 11346.2, subdivision (b)(4)(B), which requires
“description of reasonable alternatives to the regulation that would lessen any adverse
impact on small business and the agency’s reasons for rejecting those alternatives.” We
are not persuaded.
The Association argues the Board should have considered and discussed the fact
that more than 110 nontransient noncommunity water systems would be affected by the
proposed MCL.13 But the record reveals that most of the affected water systems were not
identified until after the MCL was adopted. At the time of the initial statement of
reasons, and throughout the rulemaking process, the data available to the Board indicated
that only 12 nontransient noncommunity water systems, including nine agricultural and
food operations, would be affected by the proposed MCL.
The trial court found the Board’s failure to consider the economic impact of the
proposed MCL on nine agricultural and food operations was not a “substantial failure to
comply” with the Administrative Procedure Act. (Gov. Code, § 11350, subd. (a); see
Sims v. Department of Corrections & Rehabilitation (2013) 216 Cal.App.4th 1059,
1073.) The Association does not challenge this finding. Instead, the Association argues
the Board should have anticipated that other nontransient noncommunity water systems
would be affected. The Association’s argument fails on the record before us.
13Of this number, approximately 25 nontransient noncommunity water systems appear to
be schools, which the Board was not required to consider under Government Code
sections 11346.3, subdivision (a) or 11346.2, subdivision (b)(4)(B) of the Administrative
Procedure Act.
26
Our Supreme Court has explained that an agency’s assessment of the economic
impact of a proposed regulation has three phases: “First, the agency makes an initial,
provisional determination of whether the proposed rule will have a significant adverse
economic impact on businesses. Second, during the public comment period, affected
parties may comment on the agency’s initial determination and supply additional
information relevant to the issue. Third, when the agency issues its final decision and
statement of reasons, it must respond to the public comments and either change its
proposal in response to the comments or explain why it has not.” (Western States
Petroleum Assn. v. Board of Equalization, supra, 57 Cal.4th at p. 429.) An agency’s
initial determination of economic impact “need not exhaustively examine the subject or
involve extensive data collection. The agency is required only to ‘make an initial
showing that there was some factual basis for [its] decision.’ [Citation.] Moreover,
inferences and projections that are ‘ “the product of logic and reason” ’ may provide a
valid basis for an initial determination of economic impact. [Citation.] And a regulation
will not be invalidated simply because of disagreement over the strict accuracy of cost
estimates on which the agency relied to support its initial determination.” (Ibid.)
The Board’s initial determination of the economic impact of the proposed MCL
was based on then available data, which indicated that only nine agricultural and food
operations would be affected. The Association argues the Board had an obligation to
“ask the right questions” and “be sufficiently proactive” in anticipating that other
nontransient noncommunity water systems would likely be affected, but the only
authorities the Association offers are inapposite.14 The Association does not offer any
14Community Youth Athletic Center v. City of National City (2013) 220 Cal.App.4th
1385 and Ellena v. Department of Insurance (2014) 230 Cal.App.4th 198, on which the
Association relies, do not involve the Administrative Procedure Act and are therefore no
help to the Association.
27
authority for the contention that the Board had an obligation to reject the data available at
the time of the initial determination or seek additional information that might contradict
that data. Nor does the Association suggest that the Board acted unreasonably in relying
on the available data, or ignored other information presented during the notice and
comment period. In the absence of any such authority or evidence, we conclude that the
Association has failed to establish a violation of the Administrative Procedure Act.
III. DISPOSITION
The judgment is affirmed. The Board shall recover its costs on appeal. (Cal.
Rules of Court, rule 8.278(a)(1) & (2).)
/S/
RENNER, J.
We concur:
/S/
RAYE, P. J.
/S/
HULL, J.
28