D.C. Circuit Lets Toxic Pollution Loophole Stand on Procedural Grounds – But Says Loophole Has No Legal Effect

(Washington, D.C. – August 20, 2019) A dangerous loophole that could increase Americans’ exposure to toxic air pollution has survived a court challenge on a procedural technicality.

A three-judge panel of the U.S. Court of Appeals for the D.C. Circuit ruled 2-to-1 today that opponents of the loophole should have challenged it in a separate legal setting. The decision did not address the merits of the case.

“Today’s disappointing decision does not mean that the court agrees with EPA’s rationale for creating this toxic loophole – only with the agency’s argument that it should be challenged through a different legal forum. In fact, the court expressly said that EPA’s memo has no legal effect – that it is ‘all bark and no bite,’” said Tomás Carbonell, lead attorney for Environmental Defense Fund, which was a party to the case. “This loophole puts communities across America at risk of increased exposure to benzene and other dangerous or cancer-causing pollutants. We’ll keep fighting to close it.”

The court ruled today that EPA’s memo creating the loophole was not a formal regulation, so it cannot be challenged in court. However, the court’s opinion makes clear that the memo itself does not any legal force or effect, and thus cannot be relied on by EPA, industry or state permitting authorities. The court’s majority opinion says the memo is “all bark and no bite.” (Opinion, page 16).

The dissenting judge in the case would have vacated the loophole, saying “The Wehrum Memorandum … is a legislative rule that failed to conform to the [Administrative Procedure Act’s] notice and- comment requirement. Accordingly, I would grant the petitions for review.” (Opinion, page 37 and 38)

The case centers around “maximum achievable control technology” (MACT) standards for hazardous air pollutants under the Clean Air Act. These standards generally apply to large industrial facilities like refineries and chemical plants that emit high amounts of 187 dangerous or cancer-causing pollutants.

Until January 2018, those “major source” facilities had to comply with the MACT standards for as long as they operated. Then, former EPA Administrator Scott Pruitt created a loophole – in a memo issued without any opportunity for public comment or any analysis of air pollution and health impacts.

The loophole allows facilities to opt out of the MACT standards if their pollution levels drop below major source thresholds. EPA’s own analysis indicates that almost four thousand facilities across the country could ultimately use the loophole – potentially resulting in millions of pounds of additional hazardous air pollution.

EPA has been implementing the loophole ever since the memo was issued. EDF joined 10 other environmental, environmental justice, and public health organizations in the lawsuit challenging the loophole. The state of California also challenged it in court.

This June, a year and a half after it started implementing the loophole, EPA formally proposed to codify the change in policy. EPA just held its one and only planned hearing on the change this week. Yesterday, EDF and nine other groups formally asked EPA to hold at least three more public hearings, stating:

“EPA announced the sole public hearing for this rulemaking in Washington, D.C .with only slightly more than two weeks’ notice, a disturbing choice that reinforces the Agency’s troubling pattern of minimizing public input on actions that stand to harm the health and welfare of communities nationwide … a single hearing is clearly inadequate to afford the public a meaningful opportunity to comment.” (Letter to EPA, page 1 and 2)