Regional Reports: Region 10

EPA Regional Office Issues

Region-issued Permits

On August 11, 2017, EPA approved requests by the Wheeler Pit facility on the Yakima Indian Reservation for coverage under two general permits for air emissions sources. These include the General Air Quality Permit for New or Modified Minor Source Stone Quarrying, Crushing and Screening Facilities in Indian Country and the General Air Quality Permit for New or Modified Minor Source Concrete Batch Plants in Indian Country.

Enforcement Issues

EPA Region 10 entered into several minor settlements for allegations regarding violations of the Risk Management Plan requirements in section 112(r) of the Clean Air Act in administrative enforcement actions. These include expedited settlement agreements with RainSweet, Inc. (East Plant) in Salem, Oregon, on May 31, 2017 (Dkt. No. CAA-10-2017-0071); Pendleton Flour Mills LLC in Pendleton, Oregon, on May 1, 2017 (Dkt. No. CAA-10-2017-0057); and Mill Creek Water Treatment Plant in Walla Walla, Washington, on April 26, 2017 (Dkt. No. CAA-10-2017-0085).

State Implementation Plans

Alaska

On August 28, 2017, EPA issued a final rule approving SIP revisions submitted by the Alaska Department of Environmental Conservation (ADEC) on September 15, 2016. These revisions primarily update adoptions of federal regulations in the Alaska SIP. The revisions also strengthen Alaska’s minor source permitting requirements and remove obsolete source-category specific regulations. In addition, EPA approved SIP revisions to Alaska’s general and transportation conformity regulations submitted by ADEC on March 10, 2016. This final rule is effective September 27, 2017. 82 Fed. Reg. 40,712 (Aug. 28, 2017).

On May 10, 2017, EPA issued a final rule determining that the Fairbanks North Star Borough (FNSB) failed to attain the 2006 24-hour PM2.5 NAAQS by the applicable attainment date of December 21, 2015. 82 Fed. Reg. 21,711, 27,712 (May 10, 2017). As a result of this rulemaking, the FNSB was automatically reclassified from a moderate nonattainment area to a serious nonattainment area. Id. EPA’s final rule—and the corresponding reclassification of the FNSB— became effective on June 9, 2017. Id. The rule likely moots still-pending litigation filed by the Sierra Club against EPA in October 2017. See Dkt. No. 2:16-cv-01594-RAJ (W.D. Wash.). Alaska is now required to submit a serious nonattainment air quality plan for the FNSB by December 21, 2017, in which best available control measures (BACM) and best available control technology (BACT) are established. Alaska must demonstrate compliance with the NAAQS by the end of 2019.

On July 18, 2017, Alaska proposed rule changes that would incorporate elements of local FNSB ordinances into the state’s SIP. Public comments on the rule changes were due August 30.

On June 13, EPA proposed to approve several SIP submissions from Alaska designed, among other things, to ensure consistency between the state’s PSD program and corresponding federal requirements, to revise routine permitting requirements, to remove obsolete source-specific regulations, and to revise the state’s transportation conformity criteria and procedures. 82 Fed. Reg. 27,031 (June 13, 2017).

On August 10, EPA issued a final rule approving Alaska’s SIP submission for addressing the infrastructure requirements of the lead NAAQS promulgated by EPA in 2008. 82 Fed. Reg. 37,307 (Aug. 10, 2017). The rule was effective as of September 11. Id.

On September 8, 2017, EPA issued a final rule approving Alaska’s SIP submissions addressing CAA requirements for the 2006 24-hour PM2.5 NAAQS in the FNSB moderate nonattainment area. 82 Fed. Reg. 42,457 (Sept. 8, 2017). These submissions, along with submissions in 2015, 2016, and earlier in 2017, constitute the FNSB Moderate Plan. As noted above, on May 10, 2017, the FNSB was reclassified from moderate to serious nonattainment for the 2006 24-hour PM2.5 NAAQS.

Idaho

In a final rule published on May 10, 2017, EPA deferred a finding that the Logan, Utah-Idaho nonattainment area, which includes Idaho’s Cache Valley region, failed to achieve attainment with the 2006 PM2.5 NAAQS by the required date of December 31, 2015. 82 Fed. Reg. 21,711, 21,712 n.4 (May 10, 2017). In late 2016, EPA had proposed to make that finding and thereby downgrade the area from moderate to serious nonattainment status. 81 Fed. Reg. 91,088 (Dec. 16, 2016). But EPA later received new information from Utah requiring further consideration. 82 Fed. Reg. at 21,712 n.4. On the basis of that new data, EPA proposed on June 1 to approve Idaho’s attainment demonstration for its portion of the Cache Valley nonattainment area. 82 Fed. Reg. 25,208, 25,209 (June 1, 2017). EPA later finalized that determination on August 8. 82 Fed. Reg. 37,205 (Aug. 8, 2017). Relatedly, EPA proposed on June 8, 2017, to grant Idaho two one-year extensions of the compliance date for the 2006 PM2.5 NAAQS. 82 Fed. Reg. 26,638 (June 8, 2017). Idaho must comply with that NAAQS by the end of 2017. Id. For the time being, the Cache Valley region will remain designated as a moderate nonattainment area. Id. The decision to grant Idaho two one-year extensions of the compliance date for the 2006 PM2.5 NAAQS was made final on September 8, 2017. 82 Fed. Reg. 42,447 (Sept. 8, 2017).

Idaho, presumably in an effort to improve data collection in the Cache Valley portion of the nonattainment area, recently proposed to operate the Federal Reference Method monitor in the city of Franklin on a daily basis rather than every third day. Comments on this proposal were due on September 5, 2017.

The state also held a public hearing on September 14, 2017, to discuss a SIP revision that would allow crop residue burning whenever ozone levels do not exceed 90 percent of the ozone NAAQS. Under the state’s prior regulation, crop residue burning was prohibited when ozone levels exceeded 75 percent of the NAAQS.

Oregon

On June 6, 2017, EPA filed a notice regarding its finding that the motor vehicle emissions budgets (MVEB) for PM 2.5 in the Oakridge-Westfi r PM 2.5 SIP attainment plan are adequate for transportation conformity purposes. The attainment plan was submitted to EPA by the Oregon Department of Environmental Quality (ODEQ) on January 20, 2017. As a result of this adequacy finding, ODEQ, the Oregon Department of Transportation, and the U.S. Department of Transportation will be required to use these MVEBs for future transportation conformity determinations. This finding was effective on June 21, 2017. 82 Fed. Reg. 26,090 (June 6, 2017).

Washington

On April 10, 2017, EPA approved revisions to the Washington SIP incorporating updated air quality regulations from the Southwest Clean Air Agency (SWCAA). 82 Fed. Reg. 17,136 (Apr. 10, 2017). The regulations address minor and nonattainment New Source Review (NSR) permitting programs. Id. The SIP revisions also incorporate certain Department of Ecology (Ecology) regulations for facilities subject to major nonattainment NSR that the SWCAA applies in its jurisdiction. Id. at 17,138–39.

On May 30, EPA approved updates to the Energy Facility Site Evaluation Council (EFSEC) regulations in the Washington SIP. 82 Fed. Reg. 24,531 (May 30, 2017). The EFSEC regulations generally adopt by reference Ecology regulations previously approved by EPA. EPA also approved the transfer of the PSD permitting program to EFSEC for major energy facilities. Id. Previously, PSD permits for these facilities had been issued under a federal implementation plan. Id.

State Regulations

Alaska

In response to EPA’s anticipated May 10, 2017, rule resulting in the reclassification of the FNSB from moderate to serious nonattainment, Alaska finalized a rule on June 9, 2017, requiring the removal or replacement of older wood-fi re home heating devices at the time of any real estate transaction. In addition, the state finalized a separate rule on August 15, 2017, requiring wood sellers to register with the state for purposes of encouraging the sale and use of dry wood to reduce wood heat emissions. The wood seller registration rule was first adopted by the state in 2014 as a voluntary program, but the August 2017 rule made registration mandatory.

Oregon

On July 12, 2017, the Oregon Environmental Quality Commission adopted rules to update Oregon’s regulations by incorporating new and amended federal standards and emission guidelines. The rulemaking included:

• New rules to incorporate by reference the new federal New Source Performance Standards for Kraft pulp mills for which construction, reconstruction, or modification commenced after May 23, 2013; Crude oil and natural gas facilities for which construction, modification, or reconstruction commenced after September 18, 2015; and, greenhouse gas emissions for electric generating units.
• New rules to incorporate by reference the new federal area source National Emission Standards for Hazardous Air Pollutants (NESHAPs) for wool fiberglass manufacturing.
• Updates to existing rules to incorporate amended federal area source NESHAPs, amended federal major source NESHAPs, and amended federal New Source Performance Standards; and • An update to an existing rule and the state plan to implement federal changes to the emission guidelines for commercial and industrial solid waste incineration units.

Oregon DEQ is proposing changes to OAR 340, division number 246, which will make revisions to 23 standing ambient benchmark concentrations, and add new benchmarks for phosgene, n-propyl bromide, and styrene. ODEQ is also proposing some minor plain language edits and to add which statutes are being implemented by the rules. The public comment period for the Air Toxics Benchmarks Review rulemaking ends in early October. According to ODEQ, of the 23 revisions to benchmarks and recommendations for 3 new benchmarks being proposed, only 4 garnered substantial attention during the committee meetings. These include diesel particulate matter, lead, polycyclic aromatic hydrocarbons, and trichloroethylene.

Washington

Ecology is moving forward with implementation of the Clean Air Rule, Washington’s statewide multisector program to reduce greenhouse gas emissions (GHGs). The rule is subject to multiple ongoing state court challenges, which are discussed below. Currently, Ecology is seeking comments, due October 13, 2017, on external carbon markets that would generate emissions allowances that parties could obtain to satisfy their compliance obligations under the Clean Air Rule. The first compliance period for the rule, which applies to parties with at least 100,000 metric tons CO2 e/year, is 2017–2019.

In February 2017, Ecology announced a rulemaking to establish GHG emissions performance standards for power plants based on a 970 pounds of GHGs per megawatt hour standard specified by the Washington Department of Commerce as required by RCW 80.80.050. Ecology has been conducting related stakeholder meetings and intends to issue a proposed rule in October 2017.

In February 2017, Ecology also announced its intent to commence rulemaking related to fees for air emissions sources. The proposed rule was supposed to be released in August 2017, but, as of this writing, the proposed rule had not been issued.

In June 2015, Ecology announced a plan to revise state regulations concerning emissions standards during start-up, shutdown, and malfunction (SSM) events in response to an EPA SIP call. This rulemaking process was revised in December 2016 after EPA clarified that the emissions standards for SSM events should also apply in the title V permit program. Ecology held meetings with stakeholders between November 2016 and March 2017 concerning the scope of the rulemaking. Ecology is also contemplating regulatory changes related to public notice requirements and regulation of certain small non-road engines as part of the rulemaking package. However, as of this writing, no proposed rule has been released, despite announcements that the proposed rule would be completed last spring.

Legislation

Alaska

A citizens’ advocacy group is pursuing a local ballot initiative that, if passed, would prohibit the FNSB from regulating solid and other combustible fuel-fired home heating devices. Similar initiatives have passed—and others have been defeated— since 2010. If enough signatures in support of the initiative are approved by September 21, 2017, the Home Heating Reclamation Act will be placed on municipal ballots in the 2018 FNSB election. Even if passed, the state will retain authority to regulate home heating devices—as it has increasingly done in recent years—for air quality purposes.

Oregon

Senate Bill (SB) 1008, signed into law by Governor Brown on August 16, 2017, authorizes the state of Oregon to receive moneys pursuant to the Volkswagen Environmental Mitigation Trust Agreement (Agreement). It allows the state to deposit Agreement moneys in the Clean Diesel Engine Fund, and to the extent authorized by the Agreement, SB 1008 directs ODEQ to allocate funds among school buses powered by diesel engines for 30 percent of replacement costs beginning with oldest buses in the state and continuing until 450 buses have been replaced and specified categories of vehicles powered by diesel engines. SB 1008 prohibits ODEQ from awarding grants from the Agreement moneys for any other purpose without prior approval from the Legislative Assembly.

House Bill (HB) 2462, signed into law by Governor Brown on May 25, 2017, increases the amount by which a vehicle equipped with a fully functional idle reduction system designed to reduce fuel use and emissions from engine idling may exceed maximum weight limitations. HB 2462 provides a limited exemption from maximum weight limitations for a vehicle that uses natural gas as its fuel source.

Proposed Senate Bill (SB) 197, a highly controversial bill targeting emissions from dairies, was defeated during the 2017 Oregon state legislative session. Proposed SB 197 would have enacted requirements for regulating air contaminant emissions from dairy confined animal feeding operations (CAFOs). SB 197 was backed by environmental interests and opposed by the Oregon Farm Bureau and the Oregon Dairy Farmers Association. SB 197 would have directed the Oregon Environmental Quality Commission (EQC) to adopt by rule a program for regulating air emissions from dairy CAFOs.

Proposed House Bill (HB) 2269 sought to amend the fee schedule for sources subject to a federal operating permit program under title V of the CAA to include a specific activity fee to fund the Cleaner Air Oregon program. HB 2269 was defeated, dealing a setback to a key initiative backed by Governor Brown. HB 2269 was designed to provide Cleaner Air Oregon program funding for ODEQ. As proposed, it would have charged major sources an average of $1456.

Washington

Several climate change bills were previously proposed in the Washington legislature (SB 5509, HB 1646, SB 5421, and HB 1144). These bills, which would reduce state GHG emission targets and enact a carbon tax, have been stalled in committee since at least March 2017. HB 2230, which would also implement a carbon tax regime, was introduced in June.

A bill addressing the local regulation of emissions from asphalt plants in urban areas was introduced in January 2017 (HB 1028). This bill also remains in committee.

A bill, SB 5658, curtailing the ability of Ecology and local air pollution control authorities to call for burn bans when temperatures fall below 32 degrees, was introduced in February 2017.

Administrative Rulings

Washington

On June 5, 2017, the Pollution Control Hearing Board affirmed a penalty issued by the Spokane Regional Clean Air Agency to a marijuana production and processing facility for causing an odor violation. Bang’s Original Company, LLC v. Spokane Regional Clean Air Agency, PCHB No. 16-129 (June 5, 2017 Findings of Fact, Conclusions of Law, and Order). A key issue was whether the facility qualified for an exemption from the state Clean Air Act at RCW 70.94.640 for odors caused by an “agricultural activity consistent with good agricultural practices on agricultural land.” Ultimately, the board was unable to determine that the facility met the exemption under the facts of the case. However, the decision raises the possibility that other rural marijuana facilities will be able to take advantage of this exemption in future enforcement proceedings.

Case Decisions

Oregon

The Ninth Circuit Court of Appeals is considering an appeal regarding challenges to the Oregon Clean Fuels Program (the Program). The Program is modeled, in part, after California’s low carbon fuel standards (LCFS) regulations, and provides an economic incentive for fuels that emit less greenhouse gas over the course of their entire life cycles. American Fuel & Petrochemical Manufacturers, et al. v. O’Keeffe et al., No. 15- 35834. Oral argument is scheduled for November 2017. The Program requires regulated parties to demonstrate compliance by calculating credits and deficits generated by the fuels they produce or import and to balance those credits and deficits. Or. Admin. R. § 340-253-1030. Deficits are created by importing or producing fuels with carbon intensities that exceed the annual standard, while credits are created by producing or importing fuels that have carbon intensity below the annual standard. Or. Admin. R. § 340-253-1000(5).

Producers and importers are not required to sell only fuels that meet the standards. Rather, if they sell fuel with a carbon intensity above the annual standard, they generate a deficit that they must offset with a credit generated by a fuel with a carbon intensity below the annual standard. After Oregon adopted its Phase II rules, the American Fuel & Petrochemical Manufacturers, American Trucking Associations Inc., and the Consumer Energy Alliance filed a complaint for declaratory and injunctive relief against various Oregon officials. The complaint alleged that the Oregon Program, Or. Admin. R. § 340-253-0000 et seq., violates the Commerce Clause of the U.S. Constitution because it discriminates against transportation fuels imported into Oregon with the intended purpose and effect of promoting the development of in-state economic interests.

The complaint also alleged that the Oregon program violates the Commerce Clause by attempting to regulate and control economic conduct occurring outside of Oregon’s boundaries. Finally, the complaint alleged that the Oregon program was preempted by a provision of the CAA by attempting to regulate a fuel or fuel additive (methane) where EPA has found that no control is necessary. The California Air Resources Board and Washington state sought, and were granted, intervenor status, as did the Oregon Environmental Council, Climate Solutions, Environmental Defense Fund, Natural Resources Defense Council, and Sierra Club. The district court granted the motions to dismiss and for judgment on the pleadings on the ground that the complaint stated no claim on which relief could be granted, and entered judgment for the Oregon defendants, state intervenors, and conservation intervenors. The Ninth Circuit appeal followed.

Washington

Washington courts are home to a clutch of climate change-related cases. None of the ongoing state court legal challenges to Washington’s Clean Air Rule have been resolved. In Association of Washington Business v. Department of Ecology, No. 16-2-03023-34 (Thurston Cty. Super. Ct.), the parties have completed merits briefing. However, the court rescheduled a hearing in the case originally planned for June 30, 2017, and as of this writing, a decision on the merits has not been reached. Federal litigation filed by a group of utilities that also challenged the rule in state court remains on hold.

On April 18, in Foster v. Department of Ecology, No. 14-2-25295-1 (King Cty. Super. Ct.), the court granted youth plaintiffs’ request to file an amended petition for review naming the state of Washington and Governor Jay Inslee as additional defendants and expanding the claims to allege specific violations of the state constitution and public trust doctrine. In light of the related appeal, the court ordered the plaintiffs to seek approval to amend the petition from the court of appeals.

The court of appeals is currently hearing challenges to the superior court’s orders from November 2015 and May 2016, which required Ecology to promulgate regulations addressing climate change. No. 75374-6-1 (Wash. Ct. App. Div. I). A hearing was held on the case on July 18. As of this writing, no decision had been rendered.

On July 14, 2017, the court in Holmquist v. United States, No. 2:17-cv-0046-TOR (E.D. Wash.), granted the United States’ motion to dismiss. The court found that the plaintiffs’ claims regarding the Interstate Commerce Commission Termination Act (ICCTA) of 1995, which may preempt local bans on the transit of coal and oil by rail through Spokane, were not ripe. The court also determined that plaintiffs lacked standing and that any relief requested would “amount to an advisory opinion.” Importantly, certain proposed local ordinances, which formed the heart of the plaintiffs’ complaint, had never been enacted, and so the preemptive effect of the ICCTA had never been applied to any actual legislation before the court.

Enforcement Issues

Alaska

On June 13, the U.S. Department of Justice issued a notice extending the public comment period regarding a proposed consent decree resolving alleged CAA violations by Westward Seafoods at its processing plant in Dutch Harbor. 82 Fed. Reg. 27,079 (June 13, 2017). The consent decree, first proposed in April 2017, would require Westward to pay $1.3 million in penalties and undertake both air quality compliance upgrades and mitigation projects. Id.

Oregon

In July 2017, ODEQ began a new round of air quality monitoring related to the AmeriTiesWest operation in The Dalles. AmeriTies-West is an 83-acre wood-preserving and railroad tie production facility that has operated in The Dalles since the 1920s. AmeriTies uses the coal tar by-product creosote. After receiving complaints about bad smells, the Oregon DEQ initiated an odor nuisance investigation of the facility in 2014. In April 2016, an enforceable agreement was signed with AmeriTies to reduce odors, requiring AmeriTies to try alternative solutions. The sampling objective is to determine if emissions associated with tie treatment plant facilities are present above human health risk-based concentrations or, in the case where risk-based concentrations are below naturally occurring background concentrations, where those emissions exceed background levels.

On August 25, 2017, ODEQ made available air toxics facility data on the agency’s website. The information includes facility air toxics emissions estimates in a searchable format in order to streamline public records requests for this information. These data were submitted to ODEQ as part of the Cleaner Air Oregon regulatory program. ODEQ required simple and standard air contaminant discharge permit and title V permit holders to submit emissions inventory data on 187 EPA hazardous air pollutants, as well as other air toxics. The data are preliminary and represent estimates only. The database does not estimate health risk estimates and does not represent estimates of the potential risk posed from a facility’s emissions, and will go through many steps of refinement and is subject to change. 

Tribes

On June 29, 2017, EPA announced an award of over half a million dollars in Diesel Emission Reduction Act funding to federally recognized tribes in Alaska and Washington. Funds awarded to the Native village of Chalkyitsik in Alaska will be used to replace two older diesel generators that are the village’s sole source of electricity. Funds awarded to the Lummi Tribe in Washington will be used to replace outdated diesel engines

©2017. Published in Air Quality Committee Newsletter, Vol. 21, No. 1, November 2017, by the American Bar Association Section of Environment, Energy, and Resources. Reproduced with permission. All rights reserved.