Supreme Court Rejects Challenge to the Clean Air Act
Whitman v. American Trucking Association, Inc., 2001 U.S. LEXIS 1952.

Tammy L. Shaw, J.D.

In February, the Supreme Court rejected a challenge to the way in which the Clean Air Act (CAA) is implemented by the Environmental Protection Agency (EPA), ruling that the Agency does not have to consider economic impact when setting air-quality standards. The unanimous court also ruled against industry arguments that in setting these standards, the EPA took lawmaking powers away from Congress in violation of the U.S. Constitution. However, the court ordered the EPA to reconsider those same standards finding the Agency’s interpretation of certain CAA provisions unreasonable.

Considering the Cost
Section 109(a) of the Clean Air Act requires the EPA to set national ambient air quality standards (NAAQS) for a specified list of air pollutants and to review and make necessary revisions to those standards at five-year intervals. The statute instructs the Agency to set standards “the attainment of which...are requisite to protect the public health” with “an adequate margin of safety.”1 In 1997, the EPA Administrator revised the NAAQS for ozone and for particulate matter, significantly reducing allowable ozone levels and concentration of soot from cars, power plants and other sources. Industry groups challenged the reduction arguing that the cost of compliance would be staggering and that the Agency should be required to balance the cost of compliance with the public health benefit gained from the revised standards.
The EPA, then under the Clinton administration, argued that the language of Section 109 of the CAA is absolute, instructing the Agency to set air quality standards based on the protection of public health. The Agency points out that while there are other CAA provisions that allow consideration of economic factors, Congress did not intend compliance costs to be considered when establishing or revising NAAQS .

Industry plaintiffs counter that there are many factors other than air-quality standards that Congress intended the Agency to consider in protecting public health, not the least of which is the potential harm of bankrupting whole industries, putting jobs at risk and saddling consumers with increased prices. They argue that the health of the community was what Congress had in mind and that the language in Section 109, such as “adequate margin” and “requisite” indicates the legislature’s consent to consider not only health concerns but compliance cost and other economic issues in setting NAAQS.
The Supreme Court ruled, just as the courts below had, that economic considerations play no role in setting ambient air quality standards. The court cited other provisions of the CAA and subsequent amendments that explicitly describe economic factors that may be considered in administering the CAA, finding that a plain reading of Section 109(a) unambiguously bars cost considerations from the NAAQS process.

Delegation Challenge
The industry groups argue that Section 109 of the CAA lacks sufficient guidelines or criteria for setting air-quality standards and fails to limit the Agency’s discretion in implementing Section 109, raising the issue of unconstitutional delegation of legislative powers. Article I of the U.S. Constitution gives all legislative power to the Congress and prohibits any delegation of this power.2 The Supreme Court has repeatedly held that when Congress gives decision-making authority to agencies, it must “lay down by legislative act an intelligible principle to which the person or body authorized to act is directed to conform.”3 When Congress enacts legislation that gives an agency authority to carry out that legislation, it must provide sufficient guidelines or an “intelligible principle” for setting regulations and it must limit agency discretion in administering those laws. They argue that the statute, without sufficient guidelines, has been interpreted so broadly by the EPA that the Agency has effectively taken lawmaking decisions into its own hands.

The EPA Administrator argues that the CAA requires that the designation and standards for pollutants be based on the latest scientific knowledge and that those same standards must be at requisite levels to protect public health. This, the Administrator argues, provides the “intelligible principle” for setting pollution standards and sufficiently limits the Agency’s discretion in promulgating such regulations.

The court agreed, finding that limits on agency discretion and the provisions in the CAA provide adequate guidance and that the Agency’s standard-setting process falls well within the requirements for non-delegation. The court explained that in its history, improper delegation of power has only been found in two instances, one in which absolutely no limitation on agency discretion existed and another that conferred authority to regulate with essentially no guidelines at all. The court concluded that Section 109 of the CAA fits comfortably within the scope of discretion permitted by precedent and does not pose an unconstitutional delegation problem.

Statutory Construction
The final issue in this case raised questions of statutory construction, interpretation of the CAA and how various sub-parts of the statute interact with subsequent amendments. The industry groups argue that the revised ozone standards are improper because they were implemented under a combination of sub-parts of the CAA and that certain provisions in those sub-parts are contradictory and outdated. The EPA explains that the revised ozone standards were properly established under Sub-part 1 of Section 109 and do not conflict with other provisions or subsequent amendments.
The court found that the various CAA sub-parts in question are, in fact, unclear and ambiguous. The court cited longstanding precedent of deferring to agency interpretation when a statute is unclear or ambiguous, as long as the agency’s interpretation is reasonable. However, in this instance the court refused to defer to the Agency’s interpretation, finding the NAAQS setting process was unreasonable and instructed the EPA to reconsider the new ozone standards.

Conclusion
The court affirmed the Court of Appeals decision, finding in favor of the EPA on the issue of implementation cost, stating that consideration of compliance costs should play no role in setting air-quality standards under the CAA. The court overturned the lower court decision on the issue of delegation, holding that neither the Act itself nor the Agency’s interpretation poses a delegation problem because the statute provides sufficient guidelines and adequately limits EPA’s discretion in implementing the CAA. Finally, the court remanded the question of statutory construction, ruling that the implementation of the new ozone standards is unlawful in that it is based on an unreasonable interpretation of the varying sub-parts of the Act and should be reconsidered by the EPA.

Endnotes:
1. 42 U.S.C. § 7409(b)(1).
2. U.S. CONST. art. I § 1.
3. J.W. Hampton, Jr. & Co. v. United States, 276 U.S. 394, 409 (1928).