Friends of Buckingham v. State Air Pollution Control

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 19-1152
FRIENDS OF BUCKINGHAM; CHESAPEAKE BAY FOUNDATION,
INCORPORATED,
Petitioners,
v.
STATE AIR POLLUTION CONTROL BOARD; RICHARD D. LANGFORD,
Chair of the State Air Pollution Control Board; VIRGINIA DEPARTMENT OF
ENVIRONMENTAL QUALITY; DAVID K. PAYLOR, Director, Virginia
Department of Environmental Quality,
Respondents,
ATLANTIC COAST PIPELINE LLC,
Intervenor.
------------------------------
LAWYERS’ COMMITTEE FOR CIVIL RIGHTS UNDER LAW; DELEGATE
DAWN ADAMS; DELEGATE LASHRECSE AIRD; DELEGATE HALA
ALAYA; DELEGATE JOHN BELL; SENATOR JENNIFER BOYSKO;
DELEGATE JENNIFER CARROLL FOY; DELEGATE LEE CARTER;
DELEGATE KELLY CONVIRS-FOWLER; SENATOR CREIGH DEEDS;
DELEGATE KARRIE DELANEY; DELEGATE WENDY GOODITIS;
DELEGATE ELIZABETH GUZMAN; DELEGATE PATRICK ALAN HOPE;
DELEGATE CHRIS HURST; DELEGATE JAY JONES; DELEGATE MARK
KEAM; DELEGATE KAYE KORY; DELEGATE PAUL KRIZEK; DELEGATE
MARK LEVINE; DELEGATE ALFONSO LOPEZ; DELEGATE KENNETH R.
PLUM; DELEGATE SAM RASOUL; DELEGATE MARCUS SIMON;
DELEGATE KATHY TRAN; DELEGATE CHERYL TURPIN; DELEGATE
DEBRA RODMAN; DELEGATE IBRAHEEM SAMIRAH; DELEGATE
LIONELL SPRUILL; VIRGINIA CONFERENCE NAACP; THE CENTER FOR
EARTH ETHICS; VIRGINIA STATE CONFERENCE OF NAACP BRANCHES;
UNION GROVE MISSIONARY BAPTIST CHURCH; SIERRA CLUB;
VIRGINIA INTERFAITH POWER AND LIGHT; KAIROS CENTER FOR
RELIGIONS, RIGHTS, AND SOCIAL JUSTICE,
Amici Supporting Petitioners.
------------------------------
JOSEPH SCRUGGS; GERALD WASHINGTON; CRAIG WHITE,
Amici Supporting Respondents/Intervenor.
On Petition for Review of a Decision of the State Air Pollution Control Board and the
Virginia Department of Environmental Quality. (Permit No. 21599)
Argued: October 29, 2019 Decided: January 7, 2020
Before GREGORY, Chief Judge, and WYNN and THACKER, Circuit Judges.
Petition for review granted; vacated and remanded by published opinion. Judge Thacker
wrote the opinion, in which Chief Judge Gregory and Judge Wynn joined.
ARGUED: David L. Neal, SOUTHERN ENVIRONMENTAL LAW CENTER, Chapel
Hill, North Carolina; Jon Alan Mueller, CHESAPEAKE BAY FOUNDATION, INC.,
Annapolis, Maryland, for Petitioners. Martine Elizabeth Cicconi, OFFICE OF THE
ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Respondents. Elbert
Lin, HUNTON ANDREWS KURTH LLP, Richmond, Virginia, for Intervenor. ON
BRIEF: Gregory Buppert, Charmayne G. Staloff, SOUTHERN ENVIRONMENTAL
LAW CENTER, Charlottesville, Virginia, for Petitioner Friends of Buckingham. Margaret
L. Sanner, CHESAPEAKE BAY FOUNDATION, INC., Annapolis, Maryland, for
Petitioner Chesapeake Bay Foundation, Inc. Mark R. Herring, Attorney General, Donald
D. Anderson, Deputy Attorney General, Paul Kugelman, Senior Assistant Attorney
General, Toby J. Heytens, Solicitor General, Michelle S. Kallen, Deputy Solicitor General,
Brittany M. Jones, John Marshall Fellow, OFFICE OF THE ATTORNEY GENERAL OF
VIRGINIA, Richmond, Virginia, for Respondents. Harry M. Johnson, III, Timothy L.
McHugh, Aaron C. Alderman, Richmond, Virginia, Stuart A. Raphael, HUNTON
2
ANDREWS KURTH LLP, Washington, D.C., for Intervenor Atlantic Coast Pipeline,
LLC. Kristen Clarke, Jon Greenbaum, Dorian L. Spence, Maryum Jordan, LAWYERS’
COMMITTEE FOR CIVIL RIGHTS UNDER LAW, Washington, D.C., for Amicus
Lawyers’ Committee for Civil Rights Under Law. Elizabeth F. Benson, SIERRA CLUB,
Oakland, California, for Amici Virginia State Conference NAACP, Union Grove
Missionary Baptist Church, Sierra Club, Virginia Interfaith Power & Light, and Kairos
Center for Religions, Rights, and Social Justice. Aderson B. Francois, Taylor Blatz, Civil
Rights Clinic, GEORGETOWN UNIVERSITY LAW CENTER, Washington, D.C., for
Amici 28 Members of the Virginia General Assembly, Virginia State Conference NAACP,
and the Center for Earth Ethics. Andrew P. Sherrod, Jaime B. Wisegarver, HIRSCHLER
FLEISCHER, P.C., Richmond, Virginia, for Amici Joseph Scruggs, Gerald Washington,
and Craig White.
3
THACKER, Circuit Judge:
Friends of Buckingham and the Chesapeake Bay Foundation, Inc. (collectively,
“Petitioners”) challenge the Virginia Air Pollution Control Board (“Board”)’s award of a
permit for construction of a compressor station on behalf of Intervenor Atlantic Coast
Pipeline, LLC (“ACP”) in the historic community of Union Hill in Buckingham County,
Virginia (the “Compressor Station”). The Compressor Station is one of three such stations
planned to support the transmission of natural gas through the ACP’s 600-mile pipeline
(the “Pipeline”), which is projected to stretch from West Virginia to North Carolina.
Petitioners filed this petition for review against the Board and its chairman, and the
Virginia Department of Environmental Quality (“DEQ”) and its director (collectively,
“Respondents”), raising two assignments of error. First, Petitioners contend the Board
erred in failing to consider electric turbines as zero-emission alternatives to gas-fired
turbines in the Compressor Station. Second, they contend the Board erred in failing to
assess the Compressor Station’s potential for disproportionate health impacts on the
predominantly African-American community of Union Hill, and in failing to
independently evaluate the suitability of that site.
As explained below, we agree with Petitioners and vacate and remand to the Board.
4
I.
A.
Legal Background
This petition for review is governed by a complex intertwining of local, state, and
federal laws and regulations. Therefore, we first set forth the law at play before turning to
the facts at hand.
1.
The Clean Air Act
a.
National Air Quality Standards
Pursuant to the Clean Air Act (“CAA”), 42 U.S.C. §§ 7401–7671q, the
Environmental Protection Agency (“EPA”) is tasked with establishing national ambient 1
air quality standards (“NAAQS”) for certain “criteria” pollutants. 42 U.S.C. § 7409.
Criteria pollutants are pollutants which EPA has determined may endanger the public
health or welfare, and they include: sulfur dioxide, carbon monoxide, nitrogen dioxide
(referred to herein as “NOx”), ozone, particulate matter, and lead. See generally 40 C.F.R.
Part 50.
There are both primary and secondary NAAQS. The primary NAAQS for a given
pollutant are the acceptable concentrations of pollutants in the ambient air required to
1
“Ambient air” means “that portion of the atmosphere, external to buildings, to
which the general public has access.” 40 C.F.R. § 50.1(e).
5
“protect the public health,” allowing an “adequate margin for safety.” 42 U.S.C.
§ 7409(b)(1). The secondary NAAQS are the levels set to “protect the public welfare,”
including environmental and economic interests such as “soils, water, crops,” “manmade
materials,” “visibility,” and “climate,” in addition to “effects on economic values and on
personal comfort.” Id. § 7409(b)(2), 7602(h).
Once set by the EPA, the NAAQS are then implemented by nationwide limitations
on mobile sources like vehicles, and on new or modified stationary sources; and, relevant
here, by state implementation plans (“SIP”s), which implement the NAAQS through
emission limitations on stationary and mobile sources. See 42 U.S.C. §§ 7409–10.
There are two types of stationary sources: major emitting sources and minor
emitting sources. A major source is one that has the “potential to emit two hundred and
fifty tons per year or more of any air pollutant,” and a minor source is one that falls below
that benchmark. 42 U.S.C. § 7479(1). The Compressor Station is indisputably a minor
source, as it has the potential to emit 43 tons per year.
b.
Best Available Control Technology (“BACT”)
The CAA also requires major source facilities (but not minor ones) to be subject to
“the best available control technology [BACT] for each pollutant subject to regulation
under this chapter emitted from, or which results from, such facility.” 42 U.S.C.
§ 7475(a)(4). BACT is a guarantee that the emitting source is using the best available
technology to limit emissions of regulated pollutants. It is defined in the CAA as:
6
an emission limitation based on the maximum degree of
reduction of each [regulated] pollutant . . . emitted from or
which results from any major emitting facility, which the
permitting authority, on a case-by-case basis, taking into
account energy, environmental, and economic impacts and
other costs, determines is achievable for such facility through
application of production processes and available methods,
systems, and techniques, including fuel cleaning, clean fuels,
or treatment or innovative fuel combustion techniques for
control of each such pollutant.
42 U.S.C. § 7479(3).
c.
“Redefining the Source”
Control technologies “are those technologies that have ‘a practical potential for
application to the emissions unit and the regulated pollutant under evaluation.’” Helping
Hand Tools v. U.S. Envtl. Prot. Agency, 848 F.3d 1185, 1190 (9th Cir. 2016) (quoting EPA,
New Source Review Workshop Manual, at B.5 (1990)). Generally, under federal law the
failure to consider available alternative control technologies (also referred to as “control
alternatives”) in BACT analysis “constitutes clear error.” Id. at 1194. However, the EPA
“does not have to consider [a] control alternative[]” -- even if it is effective at reducing
emissions -- if it “redefines the source.” Id. “[A] control alternative redefines the source
if it requires a complete redesign of the facility. In a classic and simple example, a coal-
burning power plant need not consider a nuclear fuel option as a ‘cleaner’ fuel because it
would require a complete redesign of the coal-burning power-plant.” Id.
“Redefining the source” in the federal administrative world is applicable to projects
certified under the prevention of significant deterioration (“PSD”) program. The PSD
7
provisions were added to the CAA in 1977 to focus on “facilities which, due to their size,
are financially able to bear . . . substantial regulatory costs . . . and which, as a group, are
primarily responsible for emissions of the deleterious pollutants that befoul our nation’s
air.” Ala. Power Co. v. Costle, 636 F.2d 323, 353 (D.C. Cir. 1980). The purpose of the
PSD program is to “protect public health and welfare from any actual or potential adverse
effect which in [EPA’s] judgment may reasonably be anticipate[d] to occur from air
pollution . . . notwithstanding attainment and maintenance of all [NAAQS].” 42 U.S.C.
§ 7470(1). The PSD program was designed to “combat incumbency by ensuring that, in
addition to new facilities, existing facilities will eventually have to satisfy stringent
technology-based requirements when they make major modifications.” Sage Ertman,
Climate Change and the PSD Program: Using BACT to Combat the Incumbency of Fossil
Fuels, 47 Envtl. L. 995, 1006 (2017).
The “redefining the source” doctrine was developed by the EPA to resolve an
ambiguity in the CAA. Specifically, some hearing officers and courts had recognized the
“tension between” two CAA requirements in the PSD program. In re Prairie State
Generating Co., 13 E.A.D. 1, 2006 WL 2847225, at *16 n.15 (Aug. 24, 2006), aff’d sub
nom. Sierra Club v. Envtl. Prot. Agency, 499 F.3d 653 (7th Cir. 2007) (citing § 7475(a)(1)).
First, there is an “obligation to conduct the BACT analysis on the ‘proposed facility.’” Id.
Second, there is a “concurrent obligation to consider as BACT ‘application of production
processes and available methods, systems, and techniques,’ including lower-emitting
fuels.” Id. (citing § 7479(3)). According to the EPA’s Office of Air and Radiation, the
redefining the source doctrine “reasonably harmonizes” these competing obligations in that
8
the entity issuing the permit “review[s] the project as proposed -- not something
fundamentally different,” but also “review[s] all elements of the proposed project’s design
and, in particular, consider[s] whether lower emissions are achievable through application
of production processes and available methods, systems, and techniques.” Id. at *16
(internal quotation marks omitted).
The EPA has clarified that, under the redefining the source doctrine, BACT review
depends on a company’s proposed plans and purpose. Thus, for the PSD program, a
permitting agency must consider all means of lowering emissions, as long as those means
would not “regulate the applicant’s objective or purpose for the proposed facility” or
require a redesign of a proposed facility. Helping Hand, 848 F.3d at 1195; see also Sierra
Club, 499 F.3d at 654 (“EPA’s position is that [BACT] does not include redesigning the
plant proposed by the permit applicant” (citing EPA, New Source Review Workshop
Manual: Prevention of Significant Deterioration and Nonattainment Area Permitting B.13
(1990))); John-Mark Stensvaag, Preventing Significant Deterioration Under the Clean Air
Act: The BACT Determination – Part I, 41 Envtl. L. Rep. News & Analysis 11101, 11112
(2011) (“EPA will not insist on a BACT technology that would redefine the permit
applicant’s facility.”). For example, “[w]hen a fuel source is co-located with a facility,
EPA need not consider in the BACT analysis fuel sources that are not readily available,
because it would redefine the source.” Helping Hand, 848 F.3d at 1195. Therefore, in the
context of major source PSD permits, the EPA does not have to consider control
alternatives that would “redefine the source” in a given project.
9
To our knowledge, this federal redefining the source doctrine has never been applied
to a non-PSD, minor source by a state pollution board, which is what we have here. 2
2.
Virginia Law
a.
Virginia’s State Implementation Plan
The CAA “establishes a program of cooperative federalism that allows the [s]tates,
within limits established by federal minimum standards, to enact and administer their own
regulatory programs, structured to meet their own particular needs.” Virginia v. Browner,
80 F.3d 869, 883 (4th Cir. 1996) (internal quotation marks omitted). The federal NAAQS
are merely “[pollutant] concentration ceilings,” In re Prairie, 2006 WL 2847225, at *5,
that “allow[] an adequate margin of safety,” 42 U.S.C. § 7409(b)(1), and “protect not only
average healthy individuals, but also ‘sensitive citizens’ -- children, for example, or people
with asthma, emphysema, or other conditions rendering them particularly vulnerable to air
pollution,” North Carolina v. TVA, 615 F.3d 291, 310 (4th Cir. 2010) (internal quotation
marks omitted). However, the CAA makes clear that “air pollution control at its source is
the primary responsibility of States and local governments.” 42 U.S.C. § 7401(a)(3).
2
Snyder v. Pa. Department of Environmental Protection, cited by all parties here,
does not apply the federal redefining the source doctrine to a non-PSD state permitting
procedure. See 2015 WL 9590755 (Pa. Envtl. Hrg. Bd. Dec. 21, 2015). There, the state
Environmental Hearing Board merely explained, “Whether Pennsylvania law permits the
[BACT] analysis to look at the design elements of a facility is a separate inquiry from what
the federal program allows . . . .” Id. at *7.
10
Therefore, states are tasked with adopting a SIP “which provides for implementation,
maintenance, and enforcement of [primary and secondary NAAQS] in each air quality
control region (or portion thereof) within such State.” Id. § 7410(a)(1).
Virginia’s SIP is set forth predominantly in Title 9 of the Virginia Administrative
Code. New minor stationary sources with emissions above a certain level must receive an
air permit issued pursuant to Article 6 of Chapter 80 of the Virginia Administrative Code
(“Permit” or “Article 6 Permit”) by DEQ or the Board. See 9 Va. Admin. Code § 5-80-
1120(A). ACP applied for an Article 6 Permit on September 17, 2015. DEQ took ACP’s
application and elevated it to the Board for approval.
Pursuant to Virginia’s SIP, all new stationary sources, whether major or minor, are
subject to BACT review. See 9 Va. Admin. Code § 5-50-260(B) (“A new stationary source
shall apply best available control technology for each regulated pollutant for which there
would be an uncontrolled emission rate equal to or greater than the levels in 9 Va. Admin.
Code § 5-80-1105 [providing charts of exemption levels in tons per year for various
pollutants].”). This is so even though federal law does not require a BACT analysis of
minor sources.
Virginia’s BACT relies on emission reduction per emissions unit via production
processes, methods, or techniques. See 9 Va. Admin. Code § 5-50-260(C) (“This [BACT]
requirement applies to each affected emissions unit in the project.” (emphasis supplied)).
Specifically, Virginia’s BACT analysis requires the development of “an emissions
limitation . . . based on the maximum degree of emission reduction . . . which the [B]oard,
on a case-by-case basis, . . . determines is achievable for the new stationary source . . .
11
through the application of production processes or available methods, systems and
techniques, including fuel cleaning or treatment or innovative fuel combustion techniques.”
Id. § 5-50-250(C). Of note, there is no reference to the “redefining the source” doctrine in
Virginia law or regulations.
b.
The Commonwealth Energy Policy
In addition to the SIP, Virginia law also contains a Commonwealth Energy Policy,
which “[e]nsure[s] that development of new, or expansion of existing, energy resources or
facilities does not have a disproportionate adverse impact on economically disadvantaged
or minority communities.” Va. Code Ann. § 67-102(A)(11). Likewise, one of the
“[e]nergy objectives” of the Commonwealth Energy Policy is to “[d]evelop[] energy
resources and facilities in a manner that does not impose a disproportionate adverse impact
on economically disadvantaged or minority communities.” Id. § 67-101(12).
c.
Virginia’s Regulatory Structure
The Board is a seven-member citizen board selected by the Governor “from the
Commonwealth at large on the basis of merit without regard to political affiliation.” Va.
Code Ann. § 10.1-1302; see id. § 10.1-1301. The Board is empowered to “make, or cause
to be made, such investigations and inspections and do such other things as are reasonably
necessary” to discharge its duties. Id. § 10.1-1306. For example, the Board may “call upon
any state department or agency for technical assistance” in performing its duties. Id.
§ 10.1-1303.
12
The Board often calls upon DEQ to provide technical support and help the Board to
fulfill its obligations. In general, DEQ can review permit applications, prepare draft
permits and related documents, review and respond to comments from the public, and hold
public hearings. See Aegis Waste Sols., Inc. v. Concerned Taxpayers of Brunswick Cty.,
544 S.E.2d 660, 663 (Va. 2001); see generally 9 Va. Admin. Code § 5-170-180 (delegating
Board’s administrative functions to DEQ). Either the Board or DEQ can issue minor
source Article 6 Permits, but when the Board does so, as in this case, it must consider:
(i) the verbal and written comments received during the public
comment period made part of the record, (ii) any explanation
of comments previously received during the public comment
period made at the Board meeting, (iii) the comments and
recommendation of [DEQ], and (iv) the agency files.
Va. Code Ann. § 10.1-1322.01(P). If the Board adopts the recommendation of DEQ, it
“shall provide in writing a clear and concise statement of the legal basis and justification
for the decision reached.” Va. Code Ann. § 10.1-1322.01(P). Likewise, if the Board’s
decision varies from DEQ’s recommendation, the Board must “provide a clear and concise
statement explaining the reason for the variation and how the Board’s decision is in
compliance with applicable laws and regulations.” Id.
3.
Local Permitting
Finally, before ACP can construct a compressor station in Buckingham County, it
is required to obtain a separate special use permit (“SUP”) from the Buckingham County
Board of Supervisors. See Va. Code Ann. § 10.1-1321.1(A) (“No application for a permit
for a new or major modified stationary air pollution source shall be considered complete
13
unless the applicant has provided the Director [of DEQ] with notification from the
governing body of the county . . . in which the source is to be located that the location and
operation of the source are consistent with all [local] ordinances.”). The Board of
Supervisors issued the SUP in February 2017, and it contained 41 conditions for the
Compressor Station. These conditions included emergency response requirements, a
notification process for planned natural gas venting events, noise mitigation measures, light
regulations, and zoning setbacks. Based on the SUP, Buckingham County certified to DEQ
that the Compressor Station “is fully consistent with all applicable local ordinances.” J.A.
323 (bolding omitted). 3
B.
Factual and Procedural History
Because natural gas transported through the Pipeline must remain pressurized, ACP
sought to construct three compressor stations in different locations along the Pipeline --
one in West Virginia, one in Virginia (the Buckingham County location at issue here), and
one in North Carolina.
ACP claims the Compressor Station site in Buckingham County is “the only feasible
location” because: (1) “it allows the ACP to interconnect with the existing Transco
3
Citations to the “J.A.” refer to the Joint Appendix filed by the parties in this appeal.
14
pipeline”; 4 (2) “it was available for [ACP] to purchase commercially”; and (3) “the Federal
Energy Regulatory Commission (‘FERC’) ruled out the only other site that met the
previous two criteria [the Midland Road Site, 5 which would require 1.1 miles of additional
pipeline].” ACP Br. 10–11.
As stated above, on September 17, 2015, ACP filed an application with DEQ for a
Permit to construct and operate the Compressor Station. DEQ deemed the application
complete in the summer of 2018.
1.
Public Comments and Hearings
After the Permit application was complete, DEQ provided several comment periods.
On August 16, 2018, at the beginning of the first 30-day comment period, DEQ held an
informational session for the residents of Buckingham County. DEQ representatives stated
that, before the Board would take final action on the permit application, it would consider
all comments. They also assured all public commenters that they could address the Board
at a public meeting. After the comment period closed, DEQ conducted a public hearing on
September 11, 2018, and heard proposed comments. Almost 200 people attended, and 60
people made oral comments. DEQ extended the comment period by 10 days. Over the 40
4
The “Transco Pipeline” is short for the Transcontinental Pipeline, a major north-
south natural gas line that is “located on the Buckingham Compressor Station site.” J.A.
1548, 1694.
5
The Midland Road site is a 147-acre tract located 1.9 miles southwest of the
Buckingham site.
15
day comment period, DEQ received more than 5,300 comments. “Many comments”
expressed “concerns about the potential for disproportionate impacts of the proposed
facility on the African American population in Union Hill.” J.A. 2174.
On November 8, 2018, the seven-member Board held its first public hearing. DEQ
presented its summary of public comments from the 40 day comment period for the
Board’s consideration. These comments included concerns such as whether the “[f]acility
should use electric turbines” instead of natural gas turbines, criticism that EPA’s “[a]ir
quality standards [are] not adequately protective,” and “[e]nvironmental [j]ustice” and
“[s]ite suitability issues.” J.A. 1584. More than 80 people spoke at the hearing, and the
Board made the following statements to and inquiries of DEQ officials:
• “[W]hat can you tell me about the demographics of
Union Hill? I’d like to know about the community. I’d
like to know about the race, the age distribution,
anything you know about the health status of the
community.” J.A. 2260.
• “I thought [DEQ presented] a very narrow construction
of what environmental justice means, and the reason I
feel it’s important for me to point that out is because I
do think that site suitability and environmental justice
are wrapped up together.” Id. at 2344.
• “[H]ow is it that DEQ interprets [the Commonwealth
Energy Plan] with respect to its obligations to consider
environmental justice?” Id. at 2285.
Based on these concerns, the Board deferred consideration of the Permit. One week later,
Governor Ralph Northam removed two Board members who had voiced concerns about
the disproportionate harm to Union Hill and replaced them with two new members. See
Patrick Wilson, Northam Removes 2 Members from Air Board Before Buckingham Project
16
Vote, Richmond Times-Dispatch (Nov. 15, 2018), https://bit.ly/2HvnsAU (saved as ECF
opinion attachment); Press Release, Gov. Ralph S. Northam, Governor Northam
Announces Administration Appointments (Nov. 16, 2018),
https://www.governor.virginia.gov/newsroom/all-releases/2018/november/headline-
836509-en.html (saved as ECF opinion attachment). A third Board member identified a
“conflict of interest in the action” and removed himself from consideration of the Permit.
J.A. 2481. The Board, with only the four original members present, reconvened on
December 19, 2018. It once again deferred a decision on the Permit and ordered a limited
period of public comment on documents pertaining to demographics and site suitability.
2.
DEQ’s Recommendations and Responses
Throughout the permitting process, and relevant to the issues presented here, DEQ
provided the following recommendations and responses to the public and the Board:
• Email from Southern Environmental Law Center to Patrick
Corbett at DEQ (September 6 and 10, 2018):
Question: “In the course of its BACT analysis, did DEQ
consider electric motor turbines (which would have zero
emissions at the Compressor Station) as an alternative to gas-
fired turbines[?]”
DEQ Answer: “No, electric compressors were not considered
as they would redefine the source.” J.A. 1381.
• Comment and Response (Oct. 24, 2018):
Comment: “Electric turbines must be considered as an
alternative to natural gas combustion turbines to ensure the
‘maximum degree of emission reduction for any pollutant.’”
DEQ Response: “The application of BACT for Article 6
reviews the affected emission unit(s) that is part of the facility
proposed by the source. DEQ has determined that wholesale
17
replacement of a natural gas turbine (the affected emission
unit) for an electric turbine (a completely different process unit
with a different energy source) constitutes redefinition of the
source and is not considered in Virginia’s BACT
determination for [the Compressor Station]. DEQ reviewed
permits for this industry type and has determined that the
BACT limits for NOx in the draft permit are the most stringent
limits for natural gas compression turbines. The draft BACT
determination for NOx remains unchanged.” J.A. 2178
(emphasis supplied) (footnote omitted). In a footnote, DEQ
states, “Natural gas also provides a consistent source of fuel as
the pipeline operation provides the fuel needed. Electricity
would be subject to grid issues such as power outages and other
similar interruptions that would hamper operations at the site.”
Id. n.17.
• DEQ recommendation on site suitability (October 2018): “On
January 5, 2017, the Buckingham County Board of Supervisors
held a public hearing and then approved a Special Use Permit
for the construction and operation of the compressor station.
ACP must operate in compliance with the County’s approval
as well as any other ordinances or regulations related to land
use.
A DEQ site evaluation was conducted on October 31, 2017.
The land around the site is forested, with rolling terrain. The
area is sparsely populated. No other existing air pollution
sources were noted within one mile of the proposed site. The
nearest school is approximately 9 miles from the site, with the
closest hospital/nursing home located approximately 17 miles
away.
Based on a review of the application, the air quality analysis,
and resulting draft permit, the proposed facility complies with
all regulatory requirements. Air Quality modeling results
indicate compliance with all applicable ambient air quality
standards. Therefore, the site is deemed suitable from an air
quality perspective.” J.A. 1794.
• DEQ Official Presenting to Board (Nov. 9, 2018): “Electric
turbines. Our response to electric turbines is that we view the
proposed emission, there’s a concept called redefining the
source.
18
Businesses have to be able to determine the activity that they’re
doing and how they’re going to do it.
And DEQ doesn’t determine how people make widgits. We
look at their proposed emissions and emission units to
determine how we can reduce those emissions.
So we can require them to make alterations to their system,
like, say, adding catalytic reduction.
So selective catalytic reduction requires a different design than,
you know, the straight compression turbine controls, but it’s a
minor change to the design.
Replacing a natural gas-fired turbine with an electric turbine is
a wholesale replacement, and it’s inappropriate in redefining in
the source.” J.A. 2237–38 (emphasis supplied).
• Conclusions reached by DEQ, as presented to the Board at
December 19, 2018 meeting:
o “Air modeling indicated emissions from [the
Compressor Station] will not harm human health.”
o “Area surrounding [the Compressor Station] contains
fewer existing air pollution sources and far fewer than
Virginia average.”
o “Data indicate environmental risks faced by residents of
area surrounding [the Compressor Station] overall are
lower than those faced by residents of Virginia as a
whole.”
o “No data indicate [the Compressor Station] would
impose any disproportionate adverse environmental or
health impacts on surrounding area when compared to
Virginia as a whole.” J.A. 2455.
o DEQ official, noting the disparity in the demographic
data regarding environmental justice, stated, “regardless
of the percentage of the minority population, air
modeling indicates that emissions from the proposed
Buckingham Compressor Station will not harm human
health.” J.A. 2546.
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3.
The Board’s Decision
On January 8, 2019, the Board held its final meeting. A DEQ official made a brief
presentation, again stating that “[r]egardless of the demographics of the area surrounding
the compressor station, [it] will not cause a disproportionate adverse impact to the
community” for two reasons: first, the residents surrounding the Compressor Station site
“are already breathing air that is cleaner than the air breathed by 90% of the residents of
Virginia”; and second, although “air modeling does indicate . . . a slight increase in air
pollution concentration [from the Compressor Station], the increase is slight.” J.A. 2905–
06.
The same four members present at the December meeting 6 voted unanimously on
January 8, 2019, to adopt DEQ’s recommendation and approve the Permit. In doing so,
individual Board members made statements on the record. Specifically, the Board
Chairman stated, “For purpose of my review, I have assumed that [the community around
the Compressor Station] may be an E[nvironmental] J[ustice] community.” J.A. 2923.
Another member said the same. See id. at 2947 (“I . . . have assumed that the community
at issue is an environmental justice community.”).
6
Although the Governor appointed two new Board members in place of the ones he
removed, they did not participate in the vote on the Permit. Nor did the Board member
who had identified a conflict.
20
The Board as a whole issued a one-page Decision Statement the same day, stating
simply that the Permit was “prepared in conformance with all applicable statutes,
regulations, and agency practices”; the limits and conditions in the permit “have been
established to protect public health and the environment”; and “all public comments
relevant to the permit [were] considered.” J.A. 2999. The Board’s Decision Statement
specifically incorporated a November 2018 memorandum to the Board from DEQ; a permit
engineering analysis from DEQ; 7 DEQ’s October 24, 2018 response to comments; and
DEQ’s December 2018 outline of possible amendments to the draft permit. Id. However,
in a handwritten notation, the Decision Statement also stated, “[T]he Board does not adopt
any legal views expressed by DEQ regarding the Board’s authority under Va. Code Section
10.1-1307.E.” Id. The Permit was issued the following day. See id. at 2955–80.
Petitioners filed this timely petition for review of the grant of the Permit. We
possess jurisdiction pursuant to the Natural Gas Act, 15 U.S.C. § 717r(d)(1) (providing the
“United States Court of Appeals for the circuit in which a [natural gas] facility . . . is
proposed to be constructed . . . or operated shall have original and exclusive jurisdiction
over any civil action for the review of an order or action of a . . . State administrative agency
acting pursuant to Federal law to issue . . . any permit . . . required under Federal law”).
7
The record also contains a final permit analysis -- an updated version of the permit
engineering analysis from January 2019. The Decision Statement appears to refer to the
original version. In any event, the two versions are essentially identical.
21
II.
The parties dispute the proper standard of review. Petitioners believe we should
review the Board’s decision under the arbitrary and capricious standard of review that we
normally employ when reviewing federal administrative agency actions. 8
Agency action is arbitrary and capricious if the agency relies
on factors that Congress did not intend for it to consider,
entirely ignores important aspects of the problem, explains its
decision in a manner contrary to the evidence before it, or
reaches a decision that is so implausible that it cannot be
ascribed to a difference in view.
Appalachian Voices v. State Water Control Bd., 912 F.3d 746, 753 (4th Cir. 2019) (internal
quotation marks omitted). Further,
[i]n determining whether agency action was arbitrary or
capricious, the court must consider whether the agency
considered the relevant factors and whether a clear error of
judgment was made. Although this inquiry into the facts is to
be searching and careful, the ultimate standard of review is a
narrow one. The court is not empowered to substitute its
judgment for that of the agency. Deference is due where the
agency has examined the relevant data and provided an
explanation of its decision that includes a rational connection
between the facts found and the choice made.
Id. (internal quotation marks omitted).
8
In briefing, Respondents disagreed that the arbitrary and capricious standard
applies but suggested that the distinction is immaterial for purposes of resolving this
appeal, arguing that Petitioners’ “claims fail even under their preferred standard.” Resp’ts’
Br. 36 n.9. At oral argument, however, Respondents conceded that the Court’s review is
under the arbitrary and capricious standard. See Oral Arg. 34:48–52 (“[T]he question for
this Court is whether the Board’s decision was arbitrary.”); see also id. at 33:26–33, 36:15–
23.
22
ACP, however, believes we should look to Virginia law to determine the standard
of review because “by its . . . terms, the federal APA does not apply to state agencies.”
ACP Br. 26–28. ACP notes that under Virginia’s version of the APA, “[f]or factual issues,
the question is ‘whether there was substantial evidence in the agency record to support the
agency decision.’” ACP Br. 27–28 (quoting Va. Code Ann. § 2.2-4207). But the same is
true for findings of fact under the federal APA, at least in formal proceedings like the one
at issue here. Northrop Grumman Sys. Corp. v. U.S. Dep’t of Labor, Admin. Review Bd.,
927 F.3d 226, 232 (4th Cir. 2019) (“The agency’s findings of fact are upheld if supported
by substantial evidence.”).
ACP does not articulate how the standard for review of the agency’s decision arising
out of its findings of fact would be different under Virginia law, and we do not believe it
would be.
If the decision under review involves an interpretation within
the specialized knowledge of the agency and if the General
Assembly has vested the agency with broad discretion to
interpret and apply the relevant regulations, the agency’s
decision will be reversed only for arbitrary or capricious
action that constitutes a clear abuse of the agency’s delegated
discretion.
Frederick Cty. Bus. Park, LLC v. Va. Dep’t of Envtl. Quality, 677 S.E.2d 42, 44–45 (Va.
2009) (emphasis supplied); see also Northrop Grumman, 927 F.3d at 232 (“Under the
[federal APA], an appellate court may only disturb the [agency]’s decision if it was
arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”
(internal quotation marks omitted)). Both the federal and Virginia standards require courts
to act where the agency’s action was not “in accordance with law.” See 5 U.S.C. § 706
23
(reviewing courts must “hold unlawful and set aside [such] agency action”); Va. Code Ann.
§ 2.2-4029 (reviewing courts must “suspend or set [such action] aside and remand the
matter to the agency for further proceedings”). And Virginia law, like federal law, provides
that in reviewing an agency determination, “issues of law shall be . . . review[ed] . . . de
novo.” Va. Code Ann. § 2.2-4027; see South Carolina v. United States, 907 F.3d 742, 756
(4th Cir. 2018). Accordingly, it is not surprising that the Virginia Supreme Court has
suggested that “the scope of court review under” the federal and Virginia APAs “is
‘virtually identical.’” State Bd. of Health of Va. v. Godfrey, 290 S.E.2d 875, 881 n.6 (Va.
1982) (quoting Annual Survey of Virginia Law, 61 Va. L. Rev. 1632, 1639 (1975)); see
also id. at 881 (citing approvingly the discussion of the federal APA in Citizens to Preserve
Overton Park, Inc. v. Volpe, 401 U.S. 402 (1971)).
In our prior decisions reviewing Virginia Water Control Board permitting decisions,
Appalachian Voices v. State Water Control Board and Sierra Club v. State Water Control
Board, the state agency argued for a substantial evidence standard of review. Nevertheless,
we applied an arbitrary and capricious standard of review, noting that even under a
substantial evidence standard, the result would be the same. See Appalachian Voices, 912
F.3d at 753 n.1; Sierra Club, 898 F.3d 383, 403 n.13 (4th Cir. 2018). We are content to do
the same here, especially because under Virginia law, a “reviewing court may set [an]
agency action aside, even if it is supported by substantial evidence, if the court’s review
discloses that the agency failed to comply with a substantive statutory directive.”
Browning-Ferris Indus. v. Residents Involved in Saving the Env’t, Inc., 492 S.E.2d 431,
24
434 (Va. 1997); see also Envtl. Def. Fund, Inc. v. Va. State Water Control Bd., 422 S.E.2d
608, 612 (Va. Ct. App. 1992).
III.
A.
The Board’s Failure to Consider Electric Motors
Petitioners assert that under Virginia’s SIP, the Compressor Station is subject to
BACT review because it is a minor emitting source and Virginia law requires such review
of minor sources, even though the CAA does not. Respondents do not disagree with this
statement. Then, Petitioners contend that the Board was required to evaluate BACT for
each regulated pollutant emitted from the Compressor Station, but it failed to even consider
a control technology that would eliminate almost all on-site pollution: electric motors.
Specifically, Petitioners submit:
Electric motors, in place of gas-fired turbines, are an available
control technology that would eliminate almost all of the on-
site air pollution from the Compressor Station. [DEQ and the
Board] refused to consider these zero-emission alternatives
based on a misapplication of EPA’s “redefinition of the
source” doctrine, which EPA developed to address a specific
statutory ambiguity in a section of the Clean Air Act that does
not apply to this Permit.
Pet’rs’ Br. 21–22. Even if the redefining the source doctrine applied, say Petitioners, the
Board “made no effort” to determine if using electric motors would constitute such a
redefinition of the source. Id. at 22.
25
1.
Redefinition of the Source
The only rationale the Board could have ostensibly relied upon (via the Decision
Statement’s incorporation of DEQ’s response to comments) for refusing to consider
electric motors in its BACT analysis was that replacing gas-fired turbines with electric
motors would constitute an impermissible “redefinition of the source.” J.A. 2178 (Resp. to
Comments 33) (“DEQ has determined that wholesale replacement of a natural gas turbine
(the affected emission unit) for an electric turbine (a completely different process unit with
a different energy source) constitutes redefinition of the source and is not considered in
Virginia’s BACT determination” (emphasis supplied)). Review of the “whole record,” 5
U.S.C. § 706; see also Va. Code Ann. § 2.2-4027, does not suggest any additional
justification. See J.A. 1381 (Corbett Email) (DEQ did not consider electric compressors
because “they would redefine the source” (emphasis supplied)); id. at; id. at 2237–38 (Nov.
9, 2018 Hearing Transcript 36:22-37:17) (“Our response to electric turbines is that . . .
there’s a concept called redefining the source. Businesses have to be able to determine
the activity that they’re doing and how they’re going to do it. . . . [W]e can require them to
make alterations to their system, like, say, adding catalytic reduction [which is] a minor
change to the design . . . . Replacing a natural gas-fired turbine with an electric turbine is a
wholesale replacement, and it’s inappropriate in redefining the source.” (emphases
supplied)).
Petitioners make three arguments on this point: first, if DEQ was referring to the
federal EPA redefining the source doctrine, it is not applicable to the Compressor Station
26
project, which is a minor source outside of the PSD program; second, even if the federal
doctrine were applicable here, it would not satisfy the EPA’s two part test for redefining
the source; 9 and third, if DEQ was referring to a Virginia redefining the source doctrine, it
does not exist, and neither DEQ nor the Board explained what that doctrine is or how it
works. Through briefing and oral argument, Respondents conceded that they were not
relying on any federal redefinition of the source doctrine. E.g., Oral Arg. at 16:59–17:12,
Friends of Buckingham v. State Air Pollution Control Bd., No. 19-1152 (4th Cir. Oct. 29,
2019) (hereinafter “Oral Arg.”). Therefore, Petitioners’ first and second arguments cited
above are of no moment. We are left to address the third argument: DEQ was referring to
a Virginia-specific doctrine. Indeed, ACP refers to “Virginia’s redefining the source
doctrine” several times in its response brief. See, e.g., ACP Br. 34, 36; see also id. at 35
(referring to a “Virginia-specific” version of the doctrine (emphasis omitted)).
2.
A state agency action survives our review if it “examined the relevant data and
articulated a satisfactory explanation for its action including a rational connection between
the facts found and the choice made.” Appalachian Voices, 912 F.3d at 753 (alterations
and internal quotation marks omitted); see also Frederick Cty. Bus. Park, 677 S.E.2d at
9
To determine whether a control alternative redefines the source under federal law,
EPA engages in a two-step inquiry: (1) “the permit applicant . . . defines the proposed
facility’s end, object, aim or purpose -- that is the facility’s basic design.” In re Prairie,
2006 WL 2847225, at *18; and (2) EPA takes a “hard look” at the proposed definition to
determine which design elements are inherent to the applicant’s purpose and which
elements can be changed to reduce pollutant emissions without disrupting the applicant’s
basic business purpose. Helping Hand, 848 F.3d at 1194.
27
44–45. Having considered the entire record, we are not satisfied that the Board provided a
sufficient and rational explanation of its failure to consider electric turbines in place of gas-
fired turbines, and DEQ’s responses to the public are likewise insufficient.
a.
Nowhere in DEQ’s comments, recommendations, or the Board’s Decision
Statement can we find a reference to a case, regulation, other project, or common practice
that would sufficiently explain what “redefining of the source” means under Virginia law.
The EPA cautions that, even when applying the federal doctrine (which is actually laid out
in regulations and case law, unlike the purported Virginia doctrine), “any decision to
exclude an option on ‘redefining the source’ grounds must be explained and documented
in the permit record, especially where such an option has been identified as significant in
public comments.” PSD AND TITLE V PERMITTING GUIDANCE FOR GREENHOUSE
GASES, EPA Manual at 27, https://www.epa.gov/sites/production/files/2015-
07/documents/ghgguid.pdf (saved as ECF opinion attachment). There was no such
explanation here. We -- and most importantly, the citizens of Virginia -- do not know what
the Virginia redefining the source doctrine is, how it works, and how this project meets its
requirements.
b.
Respondents and ACP have marshaled a host of post hoc justifications in an attempt
to explain what DEQ meant when repeatedly using the phrase “redefinition of the source.”
But “courts may not accept appellate counsel’s post hoc rationalizations for agency action.
It is well-established that an agency’s action must be upheld, if at all, on the basis
28
articulated by the agency itself.” Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut.
Auto. Ins. Co., 463 U.S. 29, 50 (1983) (citation omitted); see Va. Ret. Sys. v. Cirillo, 676
S.E.2d 368, 372 (Va. Ct. App. 2009) (citing Motor Vehicle Mfrs. Ass’n, 463 U.S. at 48);
see also Va. Code Ann. § 10.1-1322.01(P) (requiring the Board to articulate its reasoning
when making a decision about a permit). Respondents and ACP claim that DEQ’s use of
this phrase was merely an exercise in “semantics” or “shorthand.” Oral Arg. at 18:24–59
(Respondents), 37:10–37 (ACP). Indeed, at oral argument Respondents completely
disavowed the notion that the redefining the source doctrine exists under Virginia law. See
id. at 18:05–40 (“There is not a specific doctrine for minor source permits that we would
call the redefining the source doctrine.”). At oral argument, ACP, for its part, threw out
four citations to Virginia regulations and Regulatory Town Hall guidance -- never
mentioned in DEQ’s response to public comments or the Board’s decision -- to attempt to
explain what DEQ meant. See id. at 39:03–40:32. But none of these arguments or
regulations support the decision made by DEQ during the permitting process to decline to
even consider electric turbines.
ACP also contends that, buried in a footnote in DEQ’s response to public comments
(adopted by the Board in its Decision Statement), DEQ provides a separate and sufficient
reason for rejecting the electric turbines. There, DEQ states, “Natural gas also provides a
consistent source of fuel as the pipeline operation provides the fuel needed. Electricity
would be subject to grid issues such as power outages and other similar interruptions that
would hamper operations at the site.” J.A. 2178 n.17. Respondents also cite to FERC’s
environmental impact statement (“EIS”), which states that an electric turbine would require
29
the construction of 12 miles of overhead power lines and a new substation. See Resp’s’
Br. 47.
These arguments fail. We have held that a permitting agency “may adopt FERC’s
EIS only if it undertakes ‘an independent review of the EIS’ and ‘concludes that its
comments and suggestions have been satisfied.’” Cowpasture River Pres. Ass’n v. Forest
Serv., 911 F.3d 150, 170 (4th Cir. 2018) (quoting 40 C.F.R. § 1506.3(c) (alteration
omitted)). There is no evidence that such review happened here with regard to electric
turbines. Relatedly, because DEQ relied on a nonexistent redefining the source doctrine,
DEQ effectively relieved the Board from even considering the alternative energy source at
all, so the Board could not have sufficiently and independently considered the impacts of
electric turbines. As a result, we have no idea how much of an impact the Board thinks the
electric turbines would make.
Finally, Respondents contend that we should essentially overlook any mention of
redefining the source, and rather place emphasis on DEQ’s statement that the natural gas
turbines were the applicable “emission unit” under state law and that Virginia’s BACT
determination does not require “wholesale replacement” of an emission unit. See Resp’ts’
Br. 40–41 (citing J.A. 2178). Further, they argue electric turbines are not “processes,
methods, or techniques” and therefore, they are not considered “control technology” for
purposes of BACT. Id. We decline to adopt these arguments.
In explaining its decision, an agency must be “clear enough that its path may be
reasonably discerned.” Encino Motorcars, LLC v. Navarro, 136 S. Ct. 2117, 2125 (2016)
(internal quotation marks omitted); see also Cirillo, 676 S.E.2d at 371–72. In analyzing
30
the “path” the Board took here, we cannot simply ignore that by way of explanation, DEQ
invoked the term of art “redefining the source.” Even if DEQ understood that the turbine
is an emission unit, and wholesale replacement of an emission unit is not required because
it would redefine the source, DEQ did not explain why or how. Is it because, as under
federal law, replacement of an emission unit would change the purpose of the Compressor
Station, and natural gas turbines are inherent to that purpose? And in using this phrase,
does DEQ believe the “source” is the same as an “emission unit” such that the turbine
would be “redefined”? See J.A. 2177 (DEQ referring to “source type” by the kind of energy
a compressor station uses). But see 9 Va. Admin. Code § 5-80-1110(C) (Virginia
regulations defining “emissions unit” as “part of a stationary source which emits . . . any
regulated air pollutant” (emphasis supplied)). DEQ itself admits that a “minor change to
the design” of a source would not constitute redefinition of the source, but what constitutes
a “minor” change? J.A. 2238. Clearly, DEQ’s responses raise more questions than they
answer. Thus, it has not “articulated a satisfactory explanation for its action including a
rational connection between the facts found and the choice made.” Appalachian Voices,
912 F.3d at 753. And, we cannot simply guess.
For these reasons, the Board’s decision was arbitrary and capricious and
unsupported by substantial evidence. As Petitioners point out, ACP’s and Respondents’
arguments on appeal read as “convenient litigation position[s].” Pet’rs’ Reply Br. 8.
Nothing more. We vacate and remand for further explanation of reliance on the redefining
the source doctrine, and/or why electric turbines are not required to be considered in
Virginia’s BACT analysis of the Compressor Station.
31
B.
The Board’s Health Risk and Site Suitability Assessment
Petitioners’ second argument is that the Board arbitrarily and capriciously decided
issues of health risk and site suitability.
1.
Background
Union Hill is a historic community with a high population of African-Americans
whose ancestors established the community in the aftermath of the Civil War. Community
members founded the Union Hill Baptist Church, as well as the Union Grove Missionary
Church, and have buried their dead there for generations. In 2015, ACP bought a
neighboring 68.5-acre plot of land and chose that site for the placement of the Compressor
Station.
According to the ACP permit application, the Compressor Station’s four turbines,
with a combined 58,162 horsepower, would burn gas 24 hours a day, 365 days a year.
Together, the turbines’ combustion of gas accounts for 83% of the facility’s projected
nitrogen oxide emissions and 95% of its emissions of particulate matter (PM, PM 2.5 , and
PM 10 ), and also generates emissions of toxic materials such as formaldehyde and hexane.
FERC determined that the Compressor Station will increase the area’s amount of nitrogen
oxide pollution and fine particle (PM 2.5 ) pollution, and emit known carcinogens into the
community. FERC likewise recognized that pollutants from compressor stations “are
known to increase the effects of asthma and may increase the risk of lung cancer.” J.A.
2601 (footnote omitted).
32
Friends of Buckingham, Inc., a group of Buckingham County citizens, conducted a
demographic survey (the “Friends of Buckingham Survey”). According to Petitioners:
The study indicated that about 84% of [Union Hill] residents
are nonwhite, most of African-American descent -- a
percentage far higher than the county-wide percentage of
African Americans (34.7%). Of the 67 households for which
a full set of responses exists, 42 (or 62.6%) are known
descendants of formerly enslaved people from area plantations.
Eight households reported unmarked slave and Freedmen
graves on their property or nearby. An independent analysis
found that the area within one mile of the proposed
Compressor Station has a population density 51% higher than
the county average -- and 77% higher than either A[CP] or
DEQ identified in community profiles they prepared during the
Compressor Station permitting process.
The Friends of Buckingham study also revealed a prevalence
of health conditions consistent with national data showing
higher rates of respiratory sickness among the African-
American population. Thirty-five households reported pre-
existing medical diagnoses, chiefly respiratory and heart
conditions. Residents of Union Hill, including many elderly
residents, reported suffering from chronic ailments including
asthma, chronic obstructive pulmonary disease, chronic
bronchitis and pneumonia, heart disease, and other conditions
that would make them particularly susceptible to air pollution
from the Compressor Station.
Pet’rs’ Br. 10–11 (citations omitted).
2.
Health Impacts and Site Suitability
Petitioners contend that the Board (and to the extent its recommendations were
adopted, DEQ), violated Virginia law by “failing to assess the Compressor Station’s
disproportionate health impacts on the predominantly African-American Union Hill
33
community and the suitability of the site.” Pet’rs’ Br. 38 (capitalization omitted). These
arguments are grounded in a Virginia statute, which provides:
The Board in . . . approving . . . permits . . . , shall consider
facts and circumstances relevant to the reasonableness of the
activity involved and the regulations proposed to control it,
including:
1. The character and degree of injury to, or interference with,
safety, health, or the reasonable use of property which is
caused or threatened to be caused;
2. The social and economic value of the activity involved;
3. The suitability of the activity to the area in which it is
located; and
4. The scientific and economic practicality of reducing or
eliminating the discharge resulting from such activity.
Va. Code Ann. § 10.1–1307(E). Petitioners argue the Board failed to consider the potential
for disproportionate health impacts under (E)(1), and made an incomplete and misinformed
site suitability determination under (E)(3).
We conclude that the Board thrice erred in performing its statutory duty under
sections 10.1–1307(E)(1) and (E)(3): (1) it failed to make any findings regarding the
character of the local population at Union Hill, in the face of conflicting evidence; (2) it
failed to individually consider the potential degree of injury to the local population
independent of NAAQS and state emission standards; and (3) DEQ’s final permit analysis,
ostensibly adopted by the Board, relied on evidence in the record that was incomplete or
discounted by subsequent evidence.
34
Before delving into these issues, we begin with a discussion of environmental justice
(“EJ”).
a.
Environmental Justice
“As Justice Douglas pointed out nearly [fifty] years ago, ‘[a]s often happens with
interstate highways, the route selected was through the poor area of town, not through the
area where the politically powerful people live.’” Jersey Heights Neighborhood Ass’n v.
Glendening, 174 F.3d 180, 195 (4th Cir. 1999) (King, J., concurring) (quoting Triangle
Improvement Council v. Ritchie, 402 U.S. 497, 502 (1971) (Douglas, J., dissenting)); see
also Nicky Sheats, Achieving Emissions Reductions for Environmental Justice
Communities Through Climate Change Mitigation Policy, 41 Wm. & Mary Envtl. L. &
Pol’y Rev. 377, 382 (2017) (“There is evidence that a disproportionate number of
environmental hazards, polluting facilities, and other unwanted land uses are located in
communities of color and low-income communities.”). “The purpose of an environmental
justice analysis is to determine whether a project will have a disproportionately adverse
effect on minority and low income populations.” Mid States Coal. for Progress v. Surface
Transp. Bd., 345 F.3d 520, 541 (8th Cir. 2003). “Although the term ‘environmental justice’
is of fairly recent vintage, the concept is not.” Jersey Heights, 174 F.3d at 195 (King, J.,
concurring).
Of note, on August 16, 2018, Governor Northam’s own Advisory Council on
Environmental Justice recommended suspending the permitting decision for the
35
Compressor Station “pending further review of the station’s impacts on the health and the
lives of those living in close proximity.” J.A. 2791.
Indeed, under Virginia law, the Board is required to consider “character and degree
of injury to . . . health,” and “suitability of the activity to the area.” Va. Code Ann. § 10.1–
1307(E). Both Respondents and ACP acknowledge that Virginia law -- including the
Commonwealth Energy Policy and factors outlined in § 10.1-1307(E)(3) – “require[s] the
Board to consider the potential for disproportionate impacts to minority and low income
communities.” Resp’ts’ Br. 53; see also ACP Br. 19 n.6 (“Environmental justice is a
component of the Commonwealth Energy Policy.”). In fact, no party argues that the Board
was excused from considering EJ in its analysis. Therefore, we accept that the Board was
required to consider EJ in the Compressor Station Permit approval process. Underpinning
Petitioners’ arguments here is the idea that not only did the Board consider EJ separate and
apart from site suitability, it did not give this point enough consideration.
As explained below, it is clear to us that the Board’s EJ review was insufficient,
which undermines the Board’s statutory duties and renders the Board’s Permit decision
arbitrary and capricious, and unsupported by substantial evidence.
b.
No Findings Regarding the Character of Local Population
To begin, Petitioners contend, “Despite access to a wealth of information, the Board
failed to make any findings regarding the demographics of Union Hill that would have
allowed for a meaningful assessment of the likelihood of disproportionate harm.” Pet’rs’
Br. 51. We agree. The Board was presented with conflicting evidence about whether and
36
how Union Hill was a “minority” EJ population, and it made no finding as to its resolution
of this conflict. This is improper under both federal law, and Virginia administrative law.
i.
Throughout the public comment period and public meetings, one of the main points
of dispute was whether the Union Hill community could be deemed a “minority” EJ
community. As noted by the Board and ACP, the Board deferred its vote twice in order to
obtain more information on this issue. Yet in the end, it did not even bother to make a
finding on this issue. Rather, at least two Board members “assumed” that Union Hill was
an EJ minority community without performing further analysis on what that means.
The minority EJ community designation is important because, if Union Hill is
considered a minority EJ community, then information about “African American
populations hav[ing] a greater prevalence of asthma” and other health issues is an important
consideration. J.A. 2373 (FERC analysis, relied upon by DEQ). For example, FERC’s
analysis in the EIS -- upon which DEQ originally relied -- outlined all the risks to African
Americans from the Compressor Station, e.g., increased risk of asthma and lung cancer,
and even noted that African Americans were an “especially sensitive” community for these
conditions. Id. at 2372–73. But because the African American population around the
Compressor Station did not “exceed the threshold[] for environmental justice populations,”
it was of no moment. Id. at 2373; see also id. at 2372 (“None of the three census tracts
within 1 mile of the [Compressor Station] are designated minority [EJ] populations [based
on a methodology involving 2013 census data].”).
37
ii.
There are multiple pieces of conflicting evidence about the minority population of
Union Hill in this record, presented to DEQ and the Board:
• FERC’s analysis, which is based on 2013 census data, states
that in Virginia, “minorities comprise 30.8 percent of the total
population.” J.A. 2371. However, on December 9, 2018,
DEQ told the Board that Virginia has an average 37% minority.
See id. at 2536.
• FERC stated that “[n]one of the three census tracts within 1
mile of the [Compressor Station] are designated minority
environmental justice populations.” J.A. 2372. But the
Friends of Buckingham Study (also called the Fjord Study or
Household Study) demonstrates that “the area surrounding the
[Compressor Station] is clearly an environmental justice area
for minority population.” Id. at 2545 (DEQ comments to the
Board). 10 Indeed, a September 2018 version of this Study
found that, in an actual door-to-door household survey,
minorities make up 83% of residents, with African Americans
comprising around 62%. See id. at 2618. After more
households were reached, in January 2019, the percentage of
minorities increased to 83.5%. See id. at 2733 (77% of
households responding).
• DEQ also presented an “EJSCREEN” study from the EPA that
“found the minority population around the compressor station
to be in the range of 37 to 39%.” J.A. 2545–46. Yet at an
earlier presentation, a DEQ staff member had told the Board,
“I wouldn’t really rely on” EJSCREEN. Id. at 2261.
• There is yet another study called the “Environmental Systems
Research Institute’s Demographic and Income Profile Report”
10
Interestingly, counsel for Respondents conceded at oral argument that the Friends
of Buckingham Study contained accurate results as to the percentage of minorities around
the Compressor Station. See Oral Arg. 31:40–57 (conceding that “84–85% of the people
who live in the 1.1 [mile] band of the Compressor [Station] are people of color
predominantly African Americans,” explaining, “I have no reason to doubt the validity of
the door-to-door study”).
38
(the “ESRI Report”), which ACP “recommended the [Board]
utilize . . . as the best available information to determine the
environmental justice components of the proposed Site.” J.A.
2853. This study, however, finds that minorities make up only
22–30% of the population “surrounding the proposed Site”
with African Americans composing between 22–25%, but it
compares this to a County percentage of 38% and 34%,
respectively. J.A. 2854.
DEQ’s final permit analysis submission to the Board says nothing further about EJ.
And of course, the Board’s decision is only one page long, says nothing about EJ or which
stud(ies) it relied on, and even adds a provision in handwriting, professing that “[T]he
Board does not adopt any legal views expressed by DEQ regarding the Board’s authority
under Va. Code Ann. Section 10.1–1307.E,” without further explanation. J.A. 2999.
The Board acted arbitrarily in failing to provide any explanation regarding the EJ
issue, which makes its extensions of public comments and additional meetings ring hollow.
Moreover, under Virginia law, the Board’s factfinding would fail under a substantial
evidence standard of review because there is conflicting evidence in the record that the
Board did not resolve. Virginia law is clear: “It is not unusual for there to be conflicting
evidence in contested cases, and it is the job of the agency, as factfinder, to resolve those
conflicts.” Virginia Ret. Sys. v. Blair, 772 S.E.2d 26, 32 (Va. Ct. App. 2015) (emphasis in
original); see also Levine v. Arlington Med. Imaging, LLC, No. 0145-18-4, 2018 WL
5259252, at *5 (Va. Ct. App. Oct. 23, 2018) (“It is the job of the agency, as factfinder, to
resolve th[e] conflicts [in the evidence].” (alterations and internal quotation marks
omitted)); cf. All. to Save the Mattaponi v. Dep't of Envtl. Quality ex rel. State Water
Control Bd., 621 S.E.2d 78, 91 (Va. 2005) (“When there are conflicting expert opinions,
39
the administrative agency, not the courts, must resolve the factual conflicts.” (citing Webb
v. Gorsuch, 699 F.2d 157, 160 (4th Cir. 1983)).
ACP responds to this deficiency in the Board’s decision by downplaying the role of
the Board, asserting that they must only provide a “short, concise statement in writing” in
issuing the Permit. ACP Br. 3 (emphasis supplied). First of all, this is a misquote of
Virginia Code section 10.1-1322.01(P), which provides, “When the decision of the Board
is to adopt the recommendation of [DEQ], the Board shall provide in writing a clear and
concise” -- not a “short, concise” -- “statement of the legal basis and justification for the
decision reached.” Va. Code Ann. § 10.1-1322.01(P) (emphasis supplied). A “short”
statement is a far cry from a “clear” statement. In any event, here, to the extent the Board
stated that it was not relying on DEQ, the Board was required to “provide a clear and
concise statement explaining the reason for the variation [from DEQ] and how the Board’s
decision is in compliance with applicable laws and regulations.” Id. (emphasis supplied). 11
The Board failed to do so.
At bottom, there is no evidence the Board “considered the conflicting views
presented” and “made a reasonable decision supported by substantial evidence.”
11
We are bewildered by the handwritten notation in the Board’s Decision Statement
stating, “[T]he Board does not adopt any legal views expressed by DEQ regarding the
Board’s authority under Va. Code Section 10.1-1307.E.” J.A. 2999. There was some
intimation in briefing and oral argument that this was the Board’s attempt to disavow
DEQ’s scant site suitability analysis described herein, in favor of more robust consideration
of EJ. See, e.g., Oral Arg. at 28:25–52. Without more in this record, however, we cannot
accept that suggestion. And even if we did, more explanation would be required of the
Board pursuant to §10.1-1322.01(P).
40
Mattaponi, 621 S.E.2d at 91. ACP correctly states, “As long as the record contains
substantial evidence that the Board took into account the relevant facts and circumstances,
the Board’s decision must be upheld.” ACP Br. 41 (citing Mattaponi, 621 S.E.2d at 92-
93). Unfortunately, there is no such evidence in the record before us here.
iii.
Two of the Board members and DEQ assumed for the purpose of argument that
Union Hill was an EJ community, and Respondents suggest we should impute that
reasoning to the rest of the Board. See Resp’ts’ Br. 30–31, 55–56; Oral Arg. at 25:30–
26:50. We decline to do so. Cf. Flickinger v. Sch. Bd. of City of Norfolk, Va., 799 F. Supp.
586, 594–95 (E.D. Va. 1992) (imputing motive of three school board members to the whole
board improper). In any event, the Board cannot assume away what it is required to decide.
Even if the entire Board made this assumption, it did not properly carry this
assumption through its analysis. See Va. Code Ann. § 10.1–1307(E) (requiring Board to
consider “character and degree of injury to, or interference with, safety, health, or the
reasonable use of property which is caused or threatened to be caused”); id. § 67-102
(Board must “ensur[e] that development of new” energy facilities “does not have a
disproportionate adverse impact on economically disadvantaged or minority
communities”). If the area around the Compressor Station is indeed an EJ minority
community, the demographic and statistics change regarding whether this is a “especially
sensitive” community for certain conditions. J.A. 2372. Rather than take this into account
in its assumption, the Board merely falls back on NAAQS and state air quality standards
41
not tailored to this specific EJ community. The record is replete with such reliance, up to
and including the very last Board meeting:
• DEQ draft permit approval submitted to the Board (October
2018) and final permit approval (January 9, 2019): As to site
suitability, “[a]ir quality modeling results indicate compliance
with all applicable ambient air quality standards. Therefore,
the site is deemed suitable from an air quality perspective.”
J.A. 1794, 2993.
• DEQ response to comments (incorporated into the Decision
Statement) (Oct. 24, 2018): “In reviewing the application for
this draft permit, DEQ performed a comprehensive regulatory
review with respect to Virginia and federal air quality
regulations. This includes the health-based standards
promulgated by the [EPA] as [NAAQS], as well as Virginia’s
own health-based standards for toxic pollutants. . . . [T]he draft
air permit requirements are designed to ensure protection of
public health and the environment in accordance with the state
and federal ambient air quality standards and regulations.”
J.A. 2147.
In response to comments “stat[ing] concerns about the
NAAQS and whether these standards were adequately
protective of human health and the environment,” DEQ stated
that the CAA “requires EPA to set NAAQS for pollutants
considered harmful to public health and the environment” and
sets “limits to protect public health, including the health of
‘sensitive’ populations such as asthmatics, children, and the
elderly.” J.A. 2150–51.
• DEQ presentation to Board (Nov. 9, 2018): “[W]hat we strive
to do and what we’ve done in this case, is to assure that
pollution, air pollution from this source, does not harm public
health.
And we do that by doing the modeling and making sure it
complies with all health-based standards.
Our view is that if . . . all the health based standards are being
complied with, then there really is no disproportionate impact,
42
because everyone is being subjected to the same air pollution
but well below health-based standards.” J.A. 2286.
When asked by the Board about the standard, DEQ official
responded, “[T]he NAAQS protect human health including
sensitive populations with an ample margin of safety.” J.A.
2288.
• DEQ presentation to the Board (Jan. 8, 2019): “The air
modeling shows that emissions from the Buckingham
Compressor Station will not cause an exceedance . . . of any
[NAAQS] and will not violate any Virginia State air toxic
standards for formaldehyde and hexane.” J.A. 2902.
• DEQ presentation to the Board (Jan. 8, 2019): “[T]he highest
emission limits . . . allowed under the [P]ermit for the
[C]ompressor [S]tation will result in highest concentrations of
PM 2.5 well below the [NAAQS].” J.A. 2912.
• Board Chairman before his vote on January 8, 2019: “The
fence line maximum concentrations were below the [NAAQS]
or the State toxic standard[s] as applicable.
The exposure to PM 2.5 is considered safe by the EPA max,
that’s the [NAAQS], if concentrations in the ambient air are
below those standards.” J.A. 2927.
Then, recognizing that concentrations of PM 2.5 at the fence line
of the property will “increase by . . . 20 to 40%,” and that there
may be a sensitive population that will breathe the air, those
concentrations are still “30 to 40% below that standard that was
set to protect sensitive populations.” J.A. 2928.
This “sensitive” standard, however, appears to simply be the
NAAQS themselves. See North Carolina v. TVA, 615 F.3d
291, 310 (4th Cir. 2010) (explaining that NAAQS protect
“sensitive citizens -- children, for example, or people with
asthma, emphysema, or other conditions rendering them
particularly vulnerable to air pollution.” (internal quotation
marks omitted)).
43
The Board’s reliance on air quality standards led it to dismiss EJ concerns. Even if
all pollutants within the county remain below state and national air quality standards, the
Board failed to grapple with the likelihood that those living closest to the Compressor
Station -- an overwhelmingly minority population according to the Friends of Buckingham
Survey -- will be affected more than those living in other parts of the same county. The
Board rejected the idea of disproportionate impact on the basis that air quality standards
were met. But environmental justice is not merely a box to be checked, and the Board’s
failure to consider the disproportionate impact on those closest to the Compressor Station
resulted in a flawed analysis.
iv.
By all accounts, PM 2.5 is the most harmful particulate matter to be emitted from the
Compressor Station. 12 A report in the record from George Thurston, a Doctor of Science
and Director of the Program in Exposure Assessment and Human Health Effects at the
NYU School of Medicine, explains that even short-term exposures to PM 2.5 are causally
connected to heart trouble and “increased risk of mortality.” See J.A. 1454. A comment
from Dr. Larysa Dyrszka stated that PM 2.5 is one of the deadliest air pollutants in part due
to its ability to “lodge deep in the lungs” and “pass easily into the blood stream.” Id. at
1407. Indeed, any amount of PM 2.5 in the system is harmful. See Am. Trucking Ass’ns v.
EPA, 283 F.3d 355, 360 (D.C. Cir. 2002) (recognizing the “lack of a threshold
12
PM2.5 describes fine inhalable particles, with diameters that are generally 2.5
micrometers and smaller.
44
concentration below which [particulate matter is] known to be harmless”). Thus, even
when NAAQS are not violated as to this particulate matter, the record reflects that exposure
to PM 2.5 will increase the risk of asthma, heart attacks, and death. See, e.g., J.A. 1454–62.
We have yet to find -- and the Board and ACP do not indicate -- where the Board
analyzed the risk of PM 2.5 emissions to this specific EJ community, without simply falling
back on NAAQS. Even in the section of its brief responding to this issue, ACP merely
noted, “PM 2.5 is addressed by the NAAQS.” ACP Br. 48; see also Resp’ts’ Br. 24
(comparing PM 2.5 “worst case” concentrations to NAAQS).
This strikingly limited analysis goes hand in hand with the EJ error analyzed above,
making the health risk and site suitability analysis all the more important. Instead, the
Board accepts without deciding that this area may be an EJ minority community with a
high risk for asthma complications, and then does not properly recognize the localized risk
of the very particulate matter that exacerbates asthma.
c.
Final Permit Analysis
Because the Board’s written statement provides scant analysis, we look to “the
comments and recommendation of [DEQ],” and “the agency files,” which the Board is
required to consider in making its permitting decision. Va. Code Ann. § 10.1-1322.01(P).
But, in the final permit analysis, signed by DEQ officials on January 9, 2019, the only
issues that DEQ considered as relevant to “Site Suitability” were: (1) an October 2017 site
evaluation, which ignored the local residential population; (2) the SUP issued by
Buckingham County; and (3) projected compliance with ambient air quality standards. J.A.
45
2993. This evidence was incomplete, improper, and rendered unreasonable by subsequent
evidence presented to the Board throughout the permitting process.
First, as the myriad studies and comments presented to the Board throughout the
permitting process made clear, the single-page October 2017 site evaluation was woefully
inadequate to represent the true nature of the area surrounding the Compressor Station. A
DEQ environmental inspector deemed the site “Sparsely Populated” and checked only
“Forest” (not “Residential”) as a land use of the “area around the proposed site.” J.A. 861.
DEQ listed the approximate distance to the nearest “School” and “Hospital/Nursing
Home,” but left blank the space on the form for “Other Buildings” -- ignoring that there
are around 60 homes within one mile of the proposed site boundary. Id.; see id. at 2396
(Dec. 7, 2018 SELC Comments Attach. B (map showing Union Hill residences)).
Second, it is improper to rely upon a SUP as a substitute for an independent
determination of site suitability under section 10.1–1307(E). See 9 Va. Admin. Code § 5-
80-1230 “[C]ompliance [with zoning ordinances] does not relieve the board of its duty
under . . . § 10.1-1307[(]E[)] . . . to independently consider relevant facts and
circumstances.”).
And for the reasons mentioned above, see supra III.B.2.b.iii., blindly relying on
ambient air standards is not a sufficiently searching analysis of air quality standards for an
EJ community. Otherwise, § 10.1–1307(E) is rendered meaningless.
The Board’s failure to expand on and correct this erroneous DEQ site suitability
analysis -- which remained unchanged from October 2018 to January 2019 -- was arbitrary,
capricious, and unsupported by substantial evidence in the record.
46
d.
Conclusion
For these reasons, we conclude that the Board failed in its statutory duty to
determine the character and degree of injury to the health of the Union Hill residents, and
the suitability of the activity to the area. We vacate and remand for the Board to make
findings with regard to conflicting evidence in the record, the particular stud(ies) it relied
on, and the corresponding local character and degree of injury from particulate matter and
toxic substances threatened by construction and operation of the Compressor Station.
To be clear, if true, it is admirable that the Compressor Station “has more stringent
requirements than any similar compressor station anywhere in the United States,” J.A.
2920, and that residents of Union Hill “will be breathing cleaner air than the vast majority
of Virginia residents even after the Compressor Station goes into operation,” ACP Br. 49.
But these mantras do not carry the day. What matters is whether the Board has performed
its statutory duty to determine whether this facility is suitable for this site, in light of EJ
and potential health risks for the people of Union Hill. It has not.
IV.
For the foregoing reasons, we vacate the Permit and remand to the Board for further
proceedings consistent with this opinion.
PETITION FOR REVIEW GRANTED; VACATED AND REMANDED
47