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The National Association v. the San Joaquin

December 7, 2010


Appeal from the United States District Court for the Eastern District of California Lawrence J. O'Neill, District Judge, Presiding

The opinion of the court was delivered by: Opinion by Judge B. Fletcher



Argued December 11, 2009 Submitted December 7, 2010 San Francisco, California

Before: Betty B. Fletcher, Sidney R. Thomas, and N. Randy Smith, Circuit Judges.

Partial Concurrence and Partial Dissent by Judge N.R. Smith 19529


Paul Cort and Gregory Cahill Loarie, Earthjustice, Oakland, California, for defendant-intervenor-appellee Environmental Defense and Sierra Club.

Lisa Trankley, Office of the Attorney General, Sacramento, California, for amicus curiae State of California.

Peter McVeigh, U.S. Department of Justice Environment and Natural Resources Division, Washington, DC, for amicus curiae Environmental Protection Agency.


B. FLETCHER, Circuit Judge:

In response to levels of pollution that violated national air quality standards, the San Joaquin Valley Unified Air Pollution District adopted "Rule 9510," which requires development sites to reduce the amount of pollutants they emit. The National Association of Home Builders (NAHB) sued the District, claiming that Rule 9510 is preempted by the Clean Air Act. The district court held that Rule 9510 is not preempted. We affirm.



The residents of the San Joaquin Valley breathe "an air that kills."*fn1 The air in the Valley contains dangerous levels of par-ticulate matter and ozone pollution, substances that every year cause the deaths of many Americans, not to mention much cardiorespiratory disease. See, e.g., National Ambient Air Quality Standards for Ozone, 73 Fed. Reg. 16,436, 16,448 (Mar. 27, 2008); National Ambient Air Quality Standards for Particulate Matter, 71 Fed. Reg. 61,144, 61,154 (Oct. 17, 2006).

Under the Clean Air Act (often "Act") and California law, Defendant San Joaquin Valley Unified Air Pollution Control District ("District") promulgates and enforces regulations to meet national air quality standards set by the Environmental Protection Agency (EPA). When the District began developing Rule 9510, the regulation at issue in this appeal, the District's air quality fell significantly short of federal standards in three areas: ozone, particulate matter under 10 microns in diameter ("PM10"), and particulate matter under 2.5 microns in diameter ("PM2.5."). Because the air in the District fell short of federal standards, the District had a duty under the Clean Air Act to develop implementation plans outlining how it would attain and maintain national standards. 42 U.S.C. § 7509(d) (2006). This duty is enforceable by sanctions. Id. § 7509(b).

In developing its implementation plans for PM10 and ozone, the District's studies found that construction and development sites contribute significantly to the Valley's emissions of PM10 and nitrogen oxides ("NOx"). NOx can be a chemical precursor to both ozone and particulate matter. The District found that due to the Valley's projected growth in population, emissions from construction and development would only grow. The District also projected that during the period from 2006 to 2010, construction equipment working on new development in the Valley would increase NOx emissions by 21.3 tons per day. That figure outstrips even the increase in motor vehicle emissions that the population growth was expected to cause. During this same 2006-2010 period, construction equipment was predicted to increase PM10 emissions by 1.4 tons per day. Vehicles associated with new development would stir up road dust, further increasing PM10 emissions by 5.2 tons per day. To forestall these projected increases, and to prevent "backsliding" once national air quality standards were satisfied, the District developed Rule 9510, which regulates emissions from development projects.

The Rule applies only to certain development projects.*fn2

When the developer of one of these projects applies for approval, the District or the developer makes an "Air Impact Assessment," using an approved computer model to determine how much NOx and PM10 the development will produce if its emissions are not mitigated. These "baseline" emissions are of two sorts. The first are "construction equipment emissions," emissions of NOx and PM10 that come from construction equipment of greater than 50 horsepower "used or associated with the development project." The second sort of emissions are "operational emissions," which, as the name suggests, are those emissions that come from a development once it is up and running. In this appeal NAHB challenges only the Rule's regulation of construction equipment emissions, not its regulation of operational emissions.

Rule 9510 requires the District's or developer's computer model to measure the baseline level of construction equipment emissions by assessing the emissions that average California construction equipment would emit if it were used to complete the development. This baseline level can be adjusted if the model's usual assumptions about the development site are shown to be incorrect - if, for example, the construction will take a shorter than usual time to complete or if the size of the construction itself is smaller than the model assumed.

From that baseline calculation, Rule 9510 requires a 20% reduction in NOx emissions and a 45% reduction in PM10 emissions. A developer can submit information to the District on the construction equipment it will use at the site in order to refine the estimate of how much pollutant the site's construction equipment will actually emit. If the estimate shows that the construction equipment the developer plans to use at the site will already reduce NOx emissions by 20% and PM10 emissions by 45% from the baseline calculation, the developer need do no more. If the development site, under the estimate, cannot meet the required emissions reductions, a development may reduce its emissions by using add-on controls, cleaner fuels, or more advanced equipment. Alternatively, instead of reducing emissions, a development may simply pay fees that the District then uses to fund emissions reductions elsewhere.*fn3


On June 6, 2007, NAHB filed a complaint in federal court asserting, among other claims, that the Clean Air Act preempts the provisions of Rule 9510 that address emissions from construction equipment. The district court allowed the Environmental Defense Fund and the Sierra Club ("Intervenors") to intervene to defend Rule 9510 along with the District. On cross-motions for summary judgment, the district court granted summary judgment to the District and Intervenors and denied it to NAHB.

NAHB timely appealed. The district court had original jurisdiction under 28 U.S.C. § 1331, see, e.g., Indep. Living Ctr. of S. Cal., Inc. v. Shewry, 543 F.3d 1047, 1048-49 (9th Cir. 2008), and we have appellate jurisdiction under 28 U.S.C. § 1291.



The Clean Air Act divides regulatory authority between the states and the federal government. The EPA sets national air quality standards, but the states have the responsibility to adopt state implementation plans, or SIPs, to achieve the national standards. SIPs are then submitted to the EPA for its approval. Generally speaking, the Act gives the states the job of regulating stationary sources of pollution, but the EPA, and with the EPA's permission California, are responsible for regulating emissions from motor vehicles and other mobile sources. See generally Engine Mfrs. Ass'n v. EPA, 88 F.3d 1075, 1078-80 (D.C. Cir. 1996).

The District adopted Rule 9510 under section 110(a)(5) of the Act, a provision addressing "indirect sources," which do not fit neatly into the categories of stationary source and mobile source. See Sierra Club v. Larson, 2 F.3d 462, 468 (1st Cir. 1993) (noting that "the 'indirect source' provision . . . blur[s]" the Act's general division of regulatory authority). Section 110(a)(5) authorizes the states to adopt "any indirect source review program."*fn4 42 U.S.C. § 7410(a)(5)(A)(i) 42 U.S.C. § 7410(a)(5)(A)(i) (2006). If the EPA approves the SIP, the indirect source review program takes on the status of federal law. Trs. for Alaska v. Fink, 17 F.3d 1209, 1210 n.3 (9th Cir. 1994).

Rule 9510 was submitted to the EPA for approval in December 2006. Remarkably, the EPA did not issue a notice of proposed rulemaking on Rule 9510 until May 2010. Revisions to the California State Implementa- (2006). An "indirect source review program" means "the facility-by-facility review of indirect sources of air pollution, including such measures as are necessary to assure, or assist in assuring, that a new or modified indirect source will not attract mobile sources of air pollution" that would contribute to the exceedance of national air quality standards or would prevent the maintenance of those standards. Id. ยง 7410(a)(5)(D). An "indirect source" is itself defined as a facility, building, structure, installation, real property, road, or highway which attracts, or may attract, mobile sources of pollution. Such term includes parking lots, parking garages, and other facilities subject to any measure for management of parking supply . . . , including regulation of ...

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