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Epa v. Pollution Control Bd.

OPINION FILED SEPTEMBER 30, 1981.

THE ENVIRONMENTAL PROTECTION AGENCY, PETITIONER,

v.

THE POLLUTION CONTROL BOARD ET AL., RESPONDENTS.



PETITION for review of order of Pollution Control Board.

MR. JUSTICE ALLOY DELIVERED THE OPINION OF THE COURT:

Another chapter in the continuing saga of the Environmental Protection Agency's attempts to enforce invalid Air Pollution Control Rule 204 is before us on this appeal.

Bemis Company, Inc. (hereinafter Bemis) on April 22, 1980, sought from the Illinois EPA an operating permit for its coal-fired boilers at the company's paper manufacturing plant in Peoria. The application for a permit was made pursuant to the requirements of the Illinois Environmental Protection Act (Ill. Rev. Stat. 1977, ch. 111 1/2, par. 1001 et seq.) and applicable regulations. The Illinois EPA denied Bemis' application for an operating permit, basing that denial, in pertinent part, upon an alleged violation of Rule 204(c)(1)(A) of the Pollution Control Board's Rules and Regulations. Rule 204(c)(1)(A) set limitations on sulfur dioxide emissions from existing sources in the Peoria area. Rule 204(c)(1)(A) had been declared invalid by the State courts> on several occasions, as being arbitrary and capricious. Commonwealth Edison Co. v. Pollution Control Board (1974), 25 Ill. App.3d 271, 323 N.E.2d 84, aff'd in relevant part (1976), 62 Ill.2d 494, 343 N.E.2d 459; Ashland Chemical Co. v. Pollution Control Board (1978), 64 Ill. App.3d 169, 381 N.E.2d 56; Illinois State Chamber of Commerce v. Pollution Control Board (1978), 67 Ill. App.3d 839, 384 N.E.2d 922, appeal dismissed (1979), 78 Ill.2d 1, 398 N.E.2d 9.

As a result of the action respecting Rule 204 taken by the State courts>, the United States EPA issued notices of deficiency in 1976 and again in 1979 (41 Fed. Reg. 32,302, 32,303-04; 44 Fed. Reg. 40,723-24) with respect to Illinois' State Implementation Plan (hereinafter SIP). The United States EPA in those notices found that because of the action by the State courts> vacating Rule 204, the SIP for Illinois was deficient in that it did not contain enforceable regulations governing SO

emissions. The United States EPA in the notices requested that a revision of the Illinois SIP be submitted, so as to correct the deficiencies. No action submitting a revision of the vacated regulation was taken. Despite the fact that the Illinois courts> had vacated Rule 204 under the State law which provided for its promulgation, and despite the fact that the United States EPA had twice made findings that the SIP for Illinois was deficient for failing to have a validated rule governing SO

emissions, the Illinois EPA based its denial of the Bemis permit on Rule 204(c)(1)(A). The Illinois EPA position in this administrative action was that, even though the Rule has been invalidated by the State courts>, it remained, nevertheless, a part of the SIP, which itself had the force of Federal regulation by virtue of the approval of the Illinois SIP in 1972 by the administrator of the United States EPA. Therefore, the EPA argued, Rule 204(c)(1)(A) remains valid and enforceable, by it, in permit proceedings such as those present in the instant case.

Bemis appealed the denial of the permit to the Illinois PCB, and the PCB reversed the denial by the EPA, finding that it had only to make the determination based upon State law, and not upon the SIP, whatever its status was with respect to Rule 204. The Illinois EPA has appealed the decision of the PCB granting the permit to Bemis, and the EPA argues that Federal law prohibits the permit to issue, and that the PCB must follow that Federal law. Before addressing the EPA argument, it is necessary to set forth the history behind Rule 204 and its treatment by the administrative agencies and the courts>.

The Clean Air Act Amendments of 1970 "represented a drastic revision of earlier Federal air quality standards." (Appalachian Power Co. v. Environmental Protection Agency (4th Cir. 1973), 477 F.2d 495, 497, cited in Indiana & Michigan Electric Co. v. Environmental Protection Agency (7th Cir. 1975), 509 F.2d 839, 841.) Both in 1970, and again in 1977, when the Act was amended, Congress recognized "that the prevention and control of air pollution at its source is the primary responsibility of the States and local governments." (42 U.S.C.S. § 7401(a)(3) (1981 Supp.).) To achieve this goal, each State was required to develop and submit to the United States EPA a State implementation plan which provided for the implementation, maintenance, and enforcement of national primary and secondary ambient air quality standards. (42 U.S.C.S. § 7410(a) (1981 Supp.).) Illinois developed and submitted its plan, included in which was Rule 204 of the Air Pollution Rules and Regulations, and Illinois' SIP was approved by the United States EPA on May 31, 1972. Approval by the United States EPA was challenged, but it was upheld by the Seventh Circuit Court of Appeals in Indiana & Michigan Electric Co. v. Environmental Protection Agency (7th Cir. 1975), 509 F.2d 839. The challengers in that case, among other things, argued that to the extent that the Clean Air Act permitted approval of SIPs without considering challenges based upon technological feasibility and economic impact, the Act violated due process. The Seventh Circuit rejected the due process argument, concluding that challenges on that basis could be made in enforcement proceedings or through the State courts>. It stated:

"In addition, petitioners have a right to challenge the reasonableness of state plans in the state courts>, and as the respondent concedes, if `part of a state implementation plan is held invalid by a state court, the state would have to revise that part. Should the state fail to do so, the Administrator must propose and promulgate a revision * * *.'" (509 F.2d 839, 847.)

Thereafter, in Illinois, Rules 203 and 204 of the Air Pollution Rules and Regulations were challenged in the State courts>, based upon the PCB's failure to take into account technical feasibility and economic reasonableness in the promulgation of the rules. (Ill. Rev. Stat. 1977, ch. 111 1/2, par. 1027(a).) The State court challenges were successful, and the rules were vacated as being arbitrary and capricious. (Commonwealth Edison Co. v. Pollution Control Board (1974), 25 Ill. App.3d 271, 323 N.E.2d 84, aff'd in relevant part (1976), 62 Ill.2d 494, 343 N.E.2d 459.) As a result, as previously mentioned, the United States EPA issued a notice of deficiency (41 Fed. Reg. 32,302 (Aug. 2, 1976)), based upon the lack of valid rules in the SIP.

The PCB, on July 7, 1977, attempted to revalidate the stricken rules by order, without complying with the Illinois Supreme Court's directive in the previous case. This attempted revalidation was challenged and the rules were again vacated. (Ashland Chemical Co. v. Pollution Control Board (1978), 64 Ill. App.3d 169, 381 N.E.2d 56; Illinois State Chamber of Commerce v. Pollution Control Board (1978), 67 Ill. App.3d 839, 384 N.E.2d 922, appeal dismissed (1979), 78 Ill.2d 1, 398 N.E.2d 9.) Again a notice of deficiency was issued by the United States EPA (44 Fed. Reg. 40,723 (July 12, 1979), which stated:

"The cumulative effect of these actions [State court decisions] is that at the present time the Illinois SIP does not contain validated rules for the following:

(1) * * *

(2) * ...


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