Rosenberg, Ernest S.

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Pace Environmental Law Review Volume 14 Issue 1 Fall 1996 Article 13 September 1996 Clean Air Act Reform: A Necessity for the Act's Survival Ernest S. Rosenberg Follow this and additional works at: https://digitalcommons.pace.edu/pelr Recommended Citation Ernest S. Rosenberg, Clean Air Act Reform: A Necessity for the Act's Survival, 14 Pace Envtl. L. Rev. 115 (1996) Available at: https://digitalcommons.pace.edu/pelr/vol14/iss1/13 This Article is brought to you for free and open access by the School of Law at DigitalCommons@Pace. It has been accepted for inclusion in Pace Environmental Law Review by an authorized administrator of DigitalCommons@Pace. For more information, please contact dheller2@law.pace.edu. Clean Air Act Reform: A Necessity for theAct's SurvivalERNEST S. ROSENBERG*This past year has probably been the most unpleasant inmany years for those working on environmental regulationand legislation. Everything was very polarized, ranging fromlegislation that would start by repealing the 1990 Clean AirAct Amendments (CAAA),' to positions taken by some of mycolleagues in the environmental community. The Environ-mental Protection Agency (EPA) characterized every changethat might be made in the rules in the Clean Air Act (CAA)2as the complete destruction of air pollution control in theUnited States. It is very difficult to deal with reform whenevery change is characterized as a retreat.My thesis today is that, ultimately, unless we fix theCAA, it will be seriously damaged in the not too distant fu-ture. A number of the control requirements mandated by the1990 CAAA have not yet started to bite. When they do startto bite, there will be a whole new community of peoplebrought into the debate. Members of this community will notbe acquainted with, or interested in, the overall policy goalsof the CAAA, only its immediate effect on them. They willonly know that pain is being inflicted and they will want it togo away. Because of this, you will see legislation introducedremoving many of the those requirements of the CAAA.* Mr. Rosenberg (J.D., New York University School of Law, 1971) is VicePresident, Health, Environment and Safety of Occidental International Corpo-ration. Occidental is a major chemical manufacturer, operator of natural gaspipelines, and developer of oil and gas resources. He has concentrated on envi-ronmental law and management both at EPA (1975-1981) and in the privatesector for the past twenty years.1. Clean Air Act Amendments of 1990 (CAAA), Pub. L. No. 101-549, 104Stat. 2399 (1990).2. Clean Air Act (CAA) §§ 101-618, 42 U.S.C. §§ 7401-7671q (1994).1151116 PACE ENVIRONMENTAL LAW REVIEW [Vol. 14There will be little opportunity to fine tune the currentprogram.There is an old Polish fable about a farmer walking alongthe road on a freezing winter day, when he sees a crow freez-ing to death on the side of the road. Being a kindheartedman, he picks the crow up and holds it, but he cannot staythere because he has to get into town. As he is trying to fig-ure out what to do, he sees a cow patty lying in the pasturestill steaming from having been left there by a cow. Hethinks a little and says "I will wrap the crow in this and itwill warm the crow." Well, he does that and he walks ondown the road. After a little while, the warmth of the cowpatty starts to revive the crow. The crow, seeing what condi-tion it is in, starts cawing loudly and complaining. A wolfhears the crow and comes over and eats the crow.The moral of this story is: the guy that got you into it isnot necessarily your enemy and the guy that got you out of itis not necessarily your friend. But, if you are up to your neckin it you should not crow about it. The analogy here is thatsome of us are actually in loyal opposition to some of the poli-cies that have been promulgated under the CAA. In fact,although we have a genuine belief that the CAA has to beamended, we do not really have any problems with the degreeof control that is required by it. The loyal opposition wants tosave the CAA from itself.If you want to see the kind of process that I am afraidwill happen, look at what has been happening with employercommuting options (ECO) and inspection and maintenance(I&M) centers. Both programs would have been extremelycost effective. The employer commuting option program wasbasically a down payment on the ultimate requirement of at-tainment under the CAA, which is to get people out of theircars. If we do not get people out of their cars, we might aswell forget about attainment, our constant promise to thepublic on which we never deliver. If we leave the CAAA's per-mit program for the toxins requirement in place, allowing itto grind along, a cry will come up from the small businesscommunity.2https://digitalcommons.pace.edu/pelr/vol14/iss1/13CLEAN AIR ACT REFORMIronically, the greatest hardship will be imposed uponthose companies that are actually trying to comply with theCAAA, because the companies avoiding compliance will notsuffer any hardship. And the problem with many programsin the CAA is that they try to use paperwork to assure com-pliance. Ultimately, you must inspect each plant, examine itsprocesses and compare the results to other information, suchas fuel use, emissions reporting data, and maintenance data.In other words, you must really find out what each plant hasbeen doing. The front end processes, such as permitting andpaperwork, will never find the true culprits. If a facility isreally trying to avoid the requirements of the CAA, it willsubmit false paperwork whether there is a tight paperworkprocess or a loose paperwork process. Yet, the program is be-ing designed as if it relies totally on paperwork.The new paradigm that needs to be created in the CAA isthat the EPA and the states are co-administrators of its pro-grams. This is just starting to be understood at the EPA.The Agency cannot be sitting on the state's shoulders in everydecision that is made. The system must be changed so thatthe EPA is looking for the true bad actors out there andbringing enforcement actions against them, not checking tosee if the states are making decisions with which the agencyhas marginal disagreements. The EPA should, therefore, au-dit the states' performance overall, not routinely look at indi-vidual decisions.Assume that at the top of this chart3 is one hundred per-cent of the control that you would get from a nominal controlrequirement. Pick anything, for example, a new toxics con-trol requirement for refineries. At the bottom of the chart isno improvement. Assume then that you have set a standardand that you have all enforcement authorities that are in theCAA: field citations, civil penalties, fines, whistleblowers,etc., some of which existed before the 1990 CAAA. How muchcontrol will you actually achieve? The short answer, fromcompanies that have an intention to comply, is that a sub-stantial part of this new requirement will be achieved.3. On file with speaker.1996] 1173118 PACE ENVIRONMENTAL LAW REVIEW [Vol. 14Who would you miss? You would miss the people who arenot on the enforcement agencies' radar screens. You wouldmiss the people that are not going to comply because there isconfusion over the control requirements or their applicabilityof the standard. You can fix these shortfalls by having a per-mit program. That would force everyone to be on the radarscreen, instead of the agencies first having to go out there andsay: (a) I am going to prove that you are subject to this re-quirement, and (b) I am going to prove that you did not meetthe requirement. Thus, if you have a permit program thatsays for each facility, "this is a rule that you are subject to,"then you are going to get a substantial piece of the ultimategoal. However, you are still not going to get the guys who arehiding under the rocks.If you add to that a system in which you must have aprior approval method for major modifications or constructionof a new source, you will make further progress towardsachieving nominal control - the one hundred percent line.Now, if you add on top of that the authority of the EPA torevoke a permit, modify a permit, or bring an enforcementaction, you are going to get even more compliance. The argu-ment that we have heard until now is that unless you add tothe process public participation, prior review, and prior ap-proval for every minor change, you are not going to get signif-icant improvements.I submit to you that this argument is nonsense. Youhave to look at the incremental benefit that you will gaincompared to the enormous incremental pain that you will in-flict by requiring a substantial administrative process foreven minor changes. That is at the core of most of the amend-ments to the CAA on which I have been working.The CAAA expanded the geographic scope of the non-at-tainment program. In the past, the non-attainment programwas the principle mechanism by which existing facilities werebrought under federal control. It expanded the controls forsources of hazardous air pollutants (HAPs) enormously, bothin the number of sources and the number of pollutants regu-lated. It also lowered the control threshold. For air toxics, amajor source is one which has the potential to emit just two4https://digitalcommons.pace.edu/pelr/vol14/iss1/13CLEAN AIR ACT REFORMand one-third pounds per hour of a toxic substance. Thus, afacility using the amount of solvent from one can of paintcould be viewed as a major source under the CAA.The CAAA added whistleblower provisions and also pro-vided for citizen suits directly against violating sources.Field citations were added which are, for all intents and pur-poses, $5,000 traffic tickets to be written against facilitiesthat have no real means of challenging them. The CAAA alsoincreased criminal penalty exposure for facilities that wereviolating the CAA, and it added permits. But, permits arenot the only things that were added to achieve the ends of theCAA.Beyond these additional compliance assurance toolsgiven to the agencies by the 1990 CAAA, and the expansion ofthe applicability of the Act's control and procedural require-ments, a number of policies also reduce flexibility facilitiessubject to the Act's several programs. First, we have the is-sue of the potential to emit, which you have already heardabout from a previous speaker. I am talking about this onlyfrom the standpoint of what it does to flexibility under theCAA. The CAA, unlike other environmental laws, regulatesand exposes you to penalties based on your potential to addpollutants to the environment. You are not regulated underthe Resource Conservation and Recovery Act (RCRA)4 or theClean Water Act (CWA) 5 on your potential to releaseanything.Under those laws, you are only subject to penalties forwhat you actually release or for what you actually generateand mismanage. The CAA assumes emissions. Even if youfeel that you have no leaks anywhere in your facility, it as-sumes that you have fugitive emissions from all your tanks,valves, and pumps, etc., with all the points in your facilityhaving the potential to release. The cost of demonstratingthat you do not have those assumed leaks would be higherthan controlling them. Thus, effectively, you are controlled4. Resource Conservation and Recovery Act (RCRA) §§ 1002-11012, 42U.S.C. §§ 6901-6992k (1994).5. Federal Water Pollution Control (Clean Water) Act §§ 101-607, 33U.S.C. §§ 1251-1387 (1994).19961 1195120 PACE ENVIRONMENTAL LAW REVIEW [Vol. 14on assumed emissions from thousands of different points inyour facility.What that all boils down to is the regulatory significanceand importance of the very small change that you wouldmake on a daily basis just to stay competitive and keep yourfacility running. These changes trigger regulatory require-ments under the CAA that would have no consequencesunder RCRA or CWA. Importantly, you cannot simply re-strain production until you get your paperwork completed,because you are controlled on your potential to release. So,the fact that you might never actually reach the thresholdpoint, in terms of emissions at which controls would be re-quired, does not matter. As soon as you make a change, it isassumed that you are going to be operating that way twenty-four hours a day, three hundred sixty-five days a year, unlessyou have a federally enforceable limit. To get a federally en-forceable limit, you must deal with the process. This meansthat you are controlled throughout your facility with regardto what you do and what you make, not just what your wastesor releases are, and there is nothing you can do in terms ofproduction limits or controls to avoid the delays associatedwith meeting the federal permitting requirements.Beyond "potential-to-emit" and the unnecessary permit-ting it triggers, there are additional CAAA requirementswhich impose unnecessary prior review and approval. Emis-sion monitoring requirements trigger their own process re-quirements for prior review and approval. Thus, theypresent an additional source of inflexibility and delayproblems that will make it difficult to maintain support forthe CAAA. There is a serious problem when the cost of dem-onstrating compliance costs more than the cost of actual com-pliance. A continuous emissions monitor costs over $100,000to install, and over $100,000 a year to operate. That is thecost to monitor a single emission point for one pollutant.What is worse is that these procedural requirements re-duce the utility of one of the main tools under the CAA foravoiding control and procedural delays. Everyone has talkedabout the use of emissions trading under the CAAA in orderto build some flexibility into the process. Emissions trading6https://digitalcommons.pace.edu/pelr/vol14/iss1/13CLEAN AIR ACT REFORMis killed by excessive procedural burdens. Most control rulesrely upon rate-based controls. These require that, on anongoing basis, you are not allowed to emit more than X unitsof emissions per hour or per unit of heat input or production.However, when you want to trade, you have to come up witha mass limit; otherwise, you do not know how many tons youare trading. In other words, you have to know and controlnot only the rate, but also how many hours you are going tobe employing the emitting production process. Thus, yousuddenly have to change from a system that has been moni-tored for rate-based control to a system that has to be moni-tored for mass-based control.Until now, EPA has required such a change in monitor-ing to go through a "significant" operating permit modifica-tion. That imposes a nondiscretionary requirement on thestate to provide time for public participation and EPA reviewof the proposed decision before the source can do anything.This means that one of the principle mechanisms under theCAAA that allows you to make a fast change without havingto wait for the permitting process has been killed by a re-quirement that makes you wait around for 18 months to getapproval for a modification. The amendments to the Act thatthe manufacturing community has been focusing on areamendments to process needed to address this situation, notrollback amendments.There is a fundamental inconsistency here between flexi-bility and public participation, and between flexibility andcertainty on the part of the enforcement authorities. Unlessyou start looking at the CAA as a whole, and unless you ac-cept that something is going to slip through the net initially,then the whole thing is going to collapse, at least as far as thetoxins and permitting process is concerned - not because ofthe degree of emission control required, but because of exces-sive and unproductive process burdens. In a reformed sys-tem, the cases that do slip by because the public and EPA arenot reviewing decisions before the fact would still be subjectto enforcement, which in turn is buttressed by the new whis-tle-blower and citizen suit authorities. Unfortunately, a sig-nificant portion of the CAA relies on the procedural199617122 PACE ENVIRONMENTAL LAW REVIEW [Vol. 14provisions that I have been criticizing. You will notice that Ihave not mentioned the non-attainment requirements andthe air quality standards or the basic levels of control re-quired for air toxics and the rest of the controls under theCAA. I will save that for another discussion.For now, let me conclude by saying simply that the CAAis necessary. It is good law. However, some of the CAAAneed to be rethought and restructured in order for the CAA tosurvive in the future.8https://digitalcommons.pace.edu/pelr/vol14/iss1/13

Clean Air Act Reform: A Necessity for the Act\u27s Survival

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Clean Air Act Reform: A Necessity for the Act\u27s Survival

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