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Idaho Conservation League v. Wheeler

United States Court of Appeals, District of Columbia Circuit

July 19, 2019

Idaho Conservation League, et al., Petitioners
v.
Andrew Wheeler, Administrator, U.S. Environmental Protection Agency and Environmental Protection Agency, Respondents Albemarle Corporation, et al., Intervenors

          Argued March 13, 2019

          On Petition for Review of Final Action by the United States Environmental Protection Agency

          Amanda W. Goodin argued the cause for the petitioners. Jan E. Hasselman and Jaimini Parekh were with her on brief. Patti A. Goldman entered an appearance.

          Jeffrey Bossert Clark, Assistant Attorney General, United States Department of Justice, argued the cause for the respondents. Jonathan Brightbill, Deputy Assistant Attorney General, and John E. Sullivan, Attorney, were with him on brief.

          Brian T. Burgess argued the cause for the Industry Intervenors. Michael S. Giannotto, Andrew Kim, Kevin P. Martin, Keith Bradley, Carolyn L. McIntosh, Kevin A. Gaynor, Jeremy C. Marwell, Joshua S. Johnson, George A. Tsiolis, Chris S. Leason, Andrew E. Dudley, Thomas A. Lorenzen and Preetha Chakrabarti were with him on brief.

          Mark Brnovich, Attorney General, Office of the Attorney General for the State of Arizona, Dominic E. Draye, Solicitor General at the time the brief was filed, Andrew G. Pappas and Keith Miller, Associate Solicitors General, Leslie C. Rutledge, Attorney General, Office of the Attorney General for the State of Arkansas, Nicholas J. Bronni, Solicitor General, Jeff Landry, Attorney General, Office of the Attorney General for the State of Louisiana, Elizabeth B. Murrill, Solicitor General, Michelle White, Assistant Attorney General, Timothy C. Fox, Attorney General, Office of the Attorney General for the State of Montana, Dale Schowengerdt, Solicitor General, Jahna Lindemuth, Attorney General, Office of the Attorney General for the State of Alaska, Ashley Brown, Assistant Attorney General, Cynthia H. Coffman, Attorney General, Office of the Attorney General for the State of Colorado, Bill Schuette, Attorney General, Office of the Attorney General for the State of Michigan, Matthias Sayer, Special Assistant Attorney General, Office of the Attorney General for the State of New Mexico, Alan Wilson, Attorney General, Office of the Attorney General for the State of South Carolina, James Emory Smith, Jr., Deputy Solicitor General, Sean Reyes, Attorney General, Office of the Attorney General for the State of Utah, Tyler Green, Solicitor General, Lara Katz, Special Assistant Attorney General, Office of the Attorney General for the State of New Mexico, Adam Paul Laxalt, Attorney General, Office of the Attorney General for the State of Nevada, Lawrence VanDyke, Solicitor General, Marty J. Jackley, Attorney General, Office of the Attorney General for the State of South Dakota, Steven R. Blair, Assistant Attorney General, Erik E. Petersen and Michael M. Robinson, Senior Assistant Attorneys General, Office of the Attorney General for the State of Wyoming, Brad D. Schimel, Attorney General at the time the brief was filed, Office of the Attorney General for the State of Wisconsin, Misha Tseytlin, Solicitor General at the time the brief was filed, and Luke N. Berg, Deputy Solicitor General at the time the brief was filed, were on joint brief for State Intervenors' in support of the respondents. Lee P. Rudofsky, Solicitor, and Jamie L. Ewing, Assistant Attorney General, Office of the Attorney General for the State of Arkansas, Oramel H. Skinner, III, Solicitor, Office of the Attorney General for the State of Arizona, and Steven C. Kilpatrick, Assistant Attorney General, Office of the Attorney General for the State of Wisconsin, entered appearances.

          Steven G. Barringer was on brief for the amici curiae Alaska Miners Association, et al. in support of the respondents.

          Before: Henderson and Griffith, Circuit Judges, and Sentelle, Senior Circuit Judge.

          OPINION

          Karen LeCraft Henderson, Circuit Judge.

         In January 2017, acting pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), 42 U.S.C. § 9608(b), the Environmental Protection Agency (EPA) proposed setting financial responsibility requirements for the hardrock mining industry. Financial Responsibility

         Requirements Under CERCLA § 108(b) for Classes of Facilities in the Hardrock Mining Industry (Proposed Rule), 82 Fed. Reg. 3388 (Jan. 11, 2017). Other federal agencies, state agencies and industry representatives submitted comments opposing the EPA's proposal as unnecessary due to existing federal and state programs and modern mining practices. The EPA ultimately agreed with the comments and announced in February 2018 that it decided not to issue financial responsibility requirements for the hardrock mining industry. Financial Responsibility Requirements Under CERCLA Section 108(b) for Classes of Facilities in the Hardrock Mining Industry (Final Action), 83 Fed. Reg. 7556, 7556 (Feb. 21, 2018). Following the EPA's announcement, six environmental organizations-the Idaho Conservation League, Earthworks, Sierra Club, Amigos Bravos, Great Basin Resource Watch and Communities for a Better Environment (collectively, "Environmental Groups")-jointly petitioned for review of the EPA's decision, arguing that it is contrary to CERCLA, arbitrary and capricious and procedurally defective. For the reasons set forth infra, we deny the petition.

         I. Background

         The Congress enacted CERCLA as a "response to the serious environmental and health risks posed by industrial pollution." Burlington N. & Santa Fe Ry. Co. v. United States, 556 U.S. 599, 602 (2009). CERCLA mitigates the harm caused by industrial pollution by "promot[ing] the 'timely cleanup of hazardous waste sites'" and by "ensur[ing] that the costs of such cleanup efforts [are] borne by those responsible for the contamination." Id. (quoting Consol. Edison Co. v. UGI Utils., Inc., 423 F.3d 90, 94 (2d Cir. 2005)). Specifically, CERCLA provides the EPA with two mechanisms for doing so. First, the EPA can take "response actions" to address past or impending releases of hazardous substances. 42 U.S.C. § 9604. The EPA initially finances these response actions with CERCLA's Hazardous Substance Superfund (Superfund), id. § 9611, after which the EPA can initiate cost-recovery actions against responsible parties, id. § 9607(a). Second, the EPA can compel responsible parties, via administrative or court order, to undertake and finance response actions directly. Id. § 9606(a).

         To ensure that responsible parties have the wherewithal either to reimburse the Superfund or to finance their own response actions, CERCLA mandates that the EPA require certain classes of facilities identified by the EPA to "establish and maintain evidence of financial responsibility" by obtaining, inter alia, insurance, surety bonds or letters of credit. Id. § 9608(b). [1] The financial responsibility requirements must be "consistent with the degree and duration of risk associated with the production, transportation, treatment, storage, or disposal of hazardous substances." Id. § 9608(b)(1). Moreover, "[t]he level of financial responsibility shall be initially established, and, when necessary, adjusted to protect against the level of risk which the [EPA] in [its] discretion believes is appropriate based on the payment experience of the Fund, commercial insurers, court[] settlements and judgments, and voluntary claims satisfaction." Id. § 9608(b)(2). CERCLA instructed the EPA to "identify those classes [of facilities] for which requirements will be first developed" by 1983, prioritizing "those classes of facilities, owners, and operators which the [EPA] determines present the highest level of risk of injury." Id. § 9608(b)(1).

         Twenty-six years after CERCLA's mandated deadline, the EPA finally announced in 2009, in response to litigation, its decision to prioritize financial responsibility requirements for the hardrock mining industry. Identification of Priority Classes of Facilities for Development of CERCLA Section 108(b) Financial Responsibility Requirements, 74 Fed. Reg. 37, 213, 37, 213 (July 28, 2009); see Sierra Club v. Johnson, No. C 08-01409, 2009 WL 482248, at *10 (N.D. Cal. Feb. 25, 2009). It did not act on its announcement, however, until the Environmental Groups petitioned for a writ of mandamus from this Court directing the EPA to issue financial responsibility requirements for the hardrock mining industry among others. See In re Idaho Conservation League, 811 F.3d 502, 506 (D.C. Cir. 2016). While the petition was pending, the parties agreed to a schedule requiring the EPA to issue a proposed rule for the hardrock mining industry by December 1, 2016 and to take final action by December 1, 2017. Id. at 506-07. In approving the proposed schedule, this Court emphasized that the EPA "retains 'discretion to promulgate a rule or decline to do so.'" Id. at 514 (quoting Defs. of Wildlife v. Perciasepe, 714 F.3d 1317, 1325 n.7 (D.C. Cir. 2013)).

         The EPA published its Proposed Rule on January 11, 2017. 82 Fed. Reg. at 3388. In the Proposed Rule, the EPA reviewed three reports that examined past and present mining practices, evidence of exposure to hazardous substances at mining sites and releases at several recently or currently operating mines. Id. at 3471-75. Based on the reports, the EPA found "abundant evidence that hardrock mining facilities continue to pose risks associated with the management of hazardous substances at their sites," id. at 3470, and accordingly proposed issuing financial responsibility requirements for the industry, id. at 3388.

         The United States Department of the Interior's Bureau of Land Management, the United States Forest Service, several state agencies and industry representatives submitted comments opposing the Proposed Rule. See Final Action, 83 Fed. Reg. at 7560, 7566. The comments focused on two alleged deficiencies in the Proposed Rule. First, the commenters argued that the Proposed Rule "[r]elied on inappropriate evidence, such as data that did not demonstrate risk, and evidence not relevant to the facilities to be regulated under the rule." Id. at 7560. Second, the commenters urged that the Proposed Rule "failed to consider relevant evidence," including "the role of federal and state mining programs and voluntary protective mining practices in reducing risks at current hardrock mining operations" as well as "the reduced costs to ...


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