July 14, 2020Client Alert

Federal Appeals Court Sends Area Designations for 2015 Ozone Standards Back to EPA

Citing inconsistencies, a federal court has remanded attainment designations for several counties across the United States, including several Wisconsin counties, back to the U.S. Environmental Protection Agency (EPA) for further consideration and explanation.

The remand leaves the existing attainment designations in place for now, but the court directed EPA to complete its work on remand “as expeditiously as possible.” The court acknowledges that EPA could conceivably stand behind its previous designations and simply provide a more detailed justification for its decisions.

In its decision, the United States Court of Appeals for the D.C. Circuit remanded to EPA partial- or full-county attainment designations for:

  • Nine Wisconsin counties—Milwaukee, Ozaukee, Waukesha, Washington, Racine, Manitowoc, Kenosha, Sheboygan, and Door;
  • Weld County, Colorado;
  • Jefferson County, Missouri and Monroe County, Illinois, both located in the St. Louis region;
  • Ottawa County, Michigan;
  • McHenry County, Illinois and Porter County, Indiana, both near Chicago;
  • El Paso County, Texas.

The court upheld a partial attainment designation for Lake County, Indiana.

EPA made the designations in 2019 as part of the final round of area designations implementing the 2015 1-hour National Ambient Air Quality Standards (NAAQS) for ground-level ozone (the 2015 Ozone NAAQS). The 2015 Ozone NAAQS lowered the primary and secondary NAAQS for ozone to 70 parts per billion.

Under the Clean Air Act, once EPA promulgates a new NAAQS, it must designate all areas of the country as “attainment,” “nonattainment,” or “unclassifiable.” EPA must also designate as nonattainment any area that “contributes to” a NAAQS violation in a “nearby area.”

While air quality regulations in “attainment” areas need only ensure that air quality will not be seriously deteriorated, for nonattainment areas, states must submit implementation plans (SIPs) that will ensure the area will come into compliance by a date certain. Those plans may include requiring additional control technologies to limit emissions of ozone precursors (nitrous oxides (NOx) and volatile organic compounds (VOCs)) on existing sources and imposing more demanding standards on new sources, including requiring those sources to procure emission offsets from other sources. These stringent requirements effectively limit opportunity for economic growth and development in nonattainment areas.

Court Rejects Partial Attainment Designations for Sheboygan and Door Counties

Though inland monitoring data generally indicate compliance with the 2015 Ozone NAAQS, monitors placed along Wisconsin’s eastern border (i.e., along the Lake Michigan shoreline) have shown exceedances of the design value for the 2015 Ozone NAAQS.

The Wisconsin Department of Natural Resources argued in comments to EPA’s intended designations that shoreline exceedances “are not meaningfully impacted by in-state emissions,” but instead are the result of ozone-rich air masses that arrive at lakeshore monitors from over Lake Michigan.

For Sheboygan County, EPA designated an area extending 2.3 miles inland from the Lake Michigan shoreline as nonattainment (the “Shoreline Area”) and the balance of the county as attainment (the “Inland Area”). EPA based this determination on a “lake breeze” penetration analysis, which persuaded it that lake breeze effects caused for observed ozone violations, and a “zero-out” analysis, which predicted that ceasing all emissions in Sheboygan County would result in no improvements at the violating monitor.

The court found that EPA failed to explain how the lake breeze effects justified wholly “disregarding emissions from Sheboygan County” and concluded that such emissions could still contribute to a violation, even if they were not the necessary cause of an exceedance. With respect to the zero-out modeling, the court found that EPA had not verified the modeling or made clear in the final rule and supporting documentation that it had relied upon such modeling in making its conclusion. The court also critiqued the agencies apparent acceptance of the “zero-out” model, while it had discounted other data derived from the same model.

With respect to Door County, EPA designated a 3.7 square mile area (a state park where the offending monitor is located) as nonattainment, and the rest of the county as attainment. Challengers argued that EPA did not adequately explain why local pollution sources in Door County identified as contributing sources in the proposed designations were not accounted for in the final designations. The court found that EPA’s explanation for the more limited designation was inadequate and remanded the designation to EPA.

EPA Offers No Defense of Designations for Several Counties, Including Seven Wisconsin Counties

With respect to the other seven Wisconsin counties (identified by the court as six “Milwaukee-area” counties and Manitowoc County) and McHenry, Porter, and El Paso counties, EPA proffered no defense of its designations, instead asking the court to remand the designations back to it for further explanation. The court determined that it would treat EPA’s request “as a concession that [EPA’s] explanations fall short of the Clean Air Act’s requirement of reasoned decision making,” and as such are arbitrary and capricious. Consequently, EPA is directed to issue revised designations for these counties as “expeditiously as practicable.”

Other Designations

The court’s opinion included decisions on a number of other designations:

  • The court remanded EPA’s decision to designate the northern portion of Weld County, Colorado (north of Denver) as attainment. EPA concluded that the designation was inadequately supported. Specifically, EPA critiqued the agency’s decision to ignore emissions of VOCs and NOx from the northern half of Weld County as insignificant. EPA also found no support for EPA’s conclusion that “local topography and meteorology prevent northern Weld [county] from contributing to Denver exceedances.”
  • Challengers criticized EPA’s failure to conduct an analysis consistent with agency guidance to determine the appropriate designation for Ottawa County, which is sandwiched between two counties designation nonattainment. Here, the court observed that EPA offered plausible explanations in the litigation challenging the designation decisions but failed to do so in its final rule or supporting documentation. As a result, these explanations were merely impermissible “post hoc justifications offered by counsel” and could not be the basis of the agency’s decision. The designation was remanded to EPA.
  • Pointing to EPA’s inconsistent interpretations of relevant data and differential treatment similarly situated areas, the court remanded attainment designations for Jefferson County, Missouri and Monroe County, Illinois.
  • The court held that EPA adequately justified its partial attainment designation for Lake County, Indiana.

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