[Federal Register Volume 85, Number 163 (Friday, August 21, 2020)]
[Rules and Regulations]
[Pages 51650-51657]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-16257]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 1, 49, 71, and 124

[EPA-HQ-OGC-2019-0406; FRL 10012-97-OGC]


Streamlining Procedures for Permit Appeals

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The action finalizes a procedural rule to streamline and 
modernize the Environmental Protection Agency's (EPA) permit appeal 
process and ensure that appeals are decided consistent with the 
authority delegated from the Administrator by modifying existing 
procedural requirements and realigning prior delegations. This final 
procedural rule applies to permits issued by or on behalf of EPA under 
the Clean Air Act, the Clean Water Act, the Safe Drinking Water Act, 
and the Resources Conservation and Recovery Act.

DATES: This final rule is effective on September 21, 2020.

ADDRESSES: The EPA has established a docket for this action under 
Docket ID No. EPA-HQ-OGC-2019-0406. All documents in the docket are 
listed on the https://www.regulations.gov website. Although listed in 
the index, some information is not publicly available, e.g., CBI or 
other information whose disclosure is restricted by statute. Certain 
other material, such as copyrighted material, is not placed on the 
internet and will be publicly available only in hard copy form. 
Publicly available docket materials are available electronically 
through https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Mark Talty, Office of General Counsel, 
Environmental Protection Agency, 1200 Pennsylvania Avenue NW, 
Washington, DC 20460; (202) 564-2751; email address: staff_ogc@epa.gov.

SUPPLEMENTARY INFORMATION: Organization of This Document. The following 
outline is provided to aid in locating information in this preamble.

I. General Information
    A. Does this action apply to me?
    B. What is the Agency's authority for taking this action?
II. Background
    A. What changes did the Agency propose in its December 3, 2019 
proposal?
    B. What action is the Agency taking today?
III. Summary of the Final Rule
    A. What are the key elements of this final rule?
    1. Clarifying the EAB's Scope of Review in Permit Appeals
    2. Reforming Amicus Curiae Participation
    3. Eliminating Sua Sponte Review
    4. Expediting the Appeal Process
    5. 12-Year Terms for EAB Judges
    6. Designating EAB Decisions for Publication
    7. Administrator's Legal Interpretations
    B. How does this final rule affect pending appeals?
    C. Why is EPA finalizing these reforms?
IV. Statutory and Executive Orders

I. General Information

A. Does this action apply to me?

    This rule modifies the rules of practice governing certain 
administrative appeals handled by the Environmental Appeals Board (EAB) 
under 40 CFR 124.19 and other regulations listed below. It applies to 
persons and entities that seek to challenge EPA permitting decisions 
under the National Pollutant Discharge Elimination System (NPDES) 
program of the Clean Water Act, the Safe Drinking Water Act's 
Underground Injection Control (UIC) program, and the Resources 
Conservation and Recovery Act (RCRA), including Remedial Action Plans, 
40 CFR 270.42(f) and 270.155. It also applies to persons or entities 
that seek to challenge the following EPA permitting decisions under the 
Clean Air Act: Prevention of Significant Deterioration permits, 40 CFR 
52.21(q), Outer Continental Shelf permits, 40 CFR 55.6(a)(3); Title V 
permits, 40 CFR 71.11(l); Tribal Major Non-Attainment NSR permits, 40 
CFR 49.172(d)(5); and Tribal Minor NSR permits, 40 CFR 49.159(d).
    With exception of section III.A.7 (Administrator's Legal 
Interpretations) of this preamble, nothing in this proposal affects the 
EAB's adjudication of enforcement appeals.

B. What is the Agency's authority for taking this action?

    EPA's authority to issue this procedural rule is contained in 
Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq.; Safe 
Drinking Water Act, 42 U.S.C. 300(f) et seq.; Clean Water Act, 33 
U.S.C. 1251 et seq.; and Clean Air Act, 42 U.S.C. 1857 et seq. EPA is 
also issuing this rule under its general housekeeping authority. The 
Federal Housekeeping Statute provides that ``[t]he head of an Executive 
department or military department may prescribe regulations for the 
government of his department, the conduct of its employees, the 
distribution and performance of its business, and the custody, use, and 
preservation of its records, papers, and property.'' EPA is not one of 
the 15 ``Executive Departments'' listed at 5 U.S.C. 301. However, EPA 
gained housekeeping authority through the Reorganization Plan No. 3 of 
1970, 84 Stat. 2086 (July 9, 1970). The Office of Legal Counsel has 
opined that the Reorganization Plan ``convey[s] to the [EPA] 
Administrator all of the housekeeping authority available to other 
department heads under section 301'' and demonstrates that ``Congress 
has vested the Administrator with the authority to run

[[Page 51651]]

EPA, to exercise its functions, and to issue regulations incidental to 
the performance of those functions.'' \1\
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    \1\ Authority of EPA to Hold Employees Liable for Negligent 
Loss, Damage, or Destruction of Government Personal Property, 32 
O.L.C. 79, 2008 WL 4422366 at *4 (May 28, 2008) (``OLC Opinion'').
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II. Background

A. What changes did the Agency propose in its December 3, 2019 
proposal?

    EPA proposed a rule of agency organization, procedure or practice 
that sought to change the administrative exhaustion requirements for 
permit appeals, revise existing appeal procedures and provide greater 
accountability for those exercising delegated authority over 
administrative appeals more generally. Although not subject to the 
notice and comment requirements of the Administrative Procedure Act, 
the Agency nonetheless voluntarily sought comment because it believes 
that the information and opinions supplied by the public would help 
inform the Agency's views.
    On December 3, 2019, EPA proposed the creation of a new, time-
limited alternative dispute resolution process (ADR process) as a 
precondition to judicial review. Under the proposal, the parties in the 
ADR process could have agreed by unanimous consent to either extend the 
ADR process or proceed with an appeal before the Environmental Appeals 
Board (EAB). If the parties did not agree to proceed with either the 
ADR process or an EAB appeal, the permit would have become final and 
could be challenged in federal court. EPA also proposed to amend the 
appeal process to clarify the scope and standard of EAB review, remove 
a provision authorizing participation in appeals by amicus curiae, and 
eliminate the EAB's authority to review Regional permit decisions on 
its own initiative, even absent an appeal. To promote internal 
efficiencies, EPA also proposed to establish a 60-day deadline for the 
EAB to issue a final decision once an appeal had been fully briefed and 
argued and to limit the length of EAB opinions to only as long as 
necessary to address the issues raised in an appeal; EPA also proposed 
to limit the availability of extensions to file briefs. The proposed 
rule would have applied to permits issued by or on behalf of EPA under 
the Clean Air Act, the Clean Water Act, the Safe Drinking Water Act, 
and the Resources Conservation and Recovery Act.
    In addition to these permit appeal reforms, EPA proposed several 
additional reforms designed to provide tools to better allow the 
Administrator to exercise his or her statutory authority together with 
appropriate checks and balances on how the Board exercises its 
delegated authority. In that vein, EPA proposed to set twelve-year 
terms for EAB Judges, which the Administrator could renew at the end of 
that twelve-year period or reassign the Judge to another position 
within EPA. EPA also proposed a new process to identify which EAB 
opinions would be considered precedential. Finally, EPA proposed a new 
mechanism by which the Administrator, by and through the General 
Counsel, could issue a dispositive legal interpretation in any matter 
pending before the EAB.

B. What action is the Agency taking today?

    EPA is not finalizing the new, time-limited ADR process from the 
December 3rd proposal, which would have served as a precondition to 
judicial review. EPA received several comments expressing the view that 
the proposed process violated the Alternative Dispute Resolution Act by 
mandating the use of ADR to resolve permit disputes and that the 
proposed process could, in some instances, lengthen the appeal process. 
While the comments are not dispositive of the issue, EPA is not 
finalizing that aspect of the proposal as a matter of its discretion in 
maintaining a familiar process with accelerated timelines. As a result, 
nothing in this action changes the current administrative exhaustion 
requirements, which require permittees and interested parties to file 
an appeal with the EAB before challenging a permitting decision in 
federal court. Moreover, nothing in this action changes the EAB's 
existing ADR program, which will remain available to interested 
parties. EPA is also not finalizing changes to the appeal process for 
ocean dumping permit decisions made by Regional Administrators under 
the Marine Protection, Research, and Sanctuaries Act in 40 CFR 222.12, 
which already contains expedited appeal procedures. Furthermore, EPA is 
not finalizing changes to the appeal process for acid rain permits 
under 40 CFR 78.3(b), which includes the opportunity for evidentiary 
hearings.
    EPA is finalizing each of the changes identified immediately below 
and described in Section III of this preamble. In addition to 
describing each of the changes in more detail, the Agency summarizes 
some of the more significant comments that it received on the proposal 
and EPA's responses in Section III of this preamble.
    First, EPA is clarifying the scope of the EAB's review authority by 
eliminating a prior provision that allowed the Board to review an 
exercise of discretion ``or an important policy consideration.'' Under 
this final rule, the EAB's scope is more aligned with that of federal 
courts and limited to findings of fact and conclusions of law that are 
clearly erroneous.
    Second, EPA is modifying the process for submission of amicus 
curiae briefs as part of the overall goal of streamlining the appeal 
process. Under this rule, parties will have 21 days from the filing of 
a notice of appeal to file amicus briefs and the length of such briefs 
is limited to no more than 15 pages.
    Third, EPA is eliminating the EAB's authority to review Regional 
permit decisions on its own initiative (sua sponte), even absent a 
private party appeal, which has rarely been invoked.
    Fourth, EPA is establishing a 60-day deadline for the EAB to issue 
a final decision once an appeal has been fully briefed and argued. The 
EAB may grant itself a one-time 60-day extension if it determines that 
the nature and complexity of the case requires additional time. EPA is 
also limiting the availability of filing extensions to one request per 
party, with a maximum extension of 30 days. While nothing in the final 
rule modifies the EAB's existing discretion to relax or suspend filing 
requirements for good cause, in keeping with the intent of the 
revisions, such discretion should be exercised in limited circumstances 
and based on an adequate finding of good cause.
    Fifth, EPA is setting twelve-year terms for EAB Judges, which the 
Administrator may renew at the end of that twelve-year period or 
reassign the Judge to another position within EPA consistent with the 
provisions in 5 CFR 317.901.
    Sixth, EPA is establishing a process for designating certain EAB 
decisions for publication.
    EPA is revising the EAB's existing delegation of authority by 
establishing a mechanism by which the Administrator, by and through the 
General Counsel, can issue a dispositive legal interpretation in any 
matter pending before the EAB or on any issue addressed by the EAB.
    The revised permit appeal procedures apply only to permitting 
decisions under:
     The National Pollutant Discharge Elimination System 
(NPDES) program of the Clean Water Act;
     The Safe Drinking Water Act's Underground Injection 
Control (UIC) program;
     The Resources Conservation and Recovery Act (RCRA), 
including

[[Page 51652]]

Remedial Action Plans, 40 CFR 270.42(f) and 270.155; and
     The Clean Air Act, including Prevention of Significant 
Deterioration (PSD) permits, 40 CFR 52.21(q); Outer Continental Shelf 
permits, 40 CFR 55.6(a)(3); Title V permits, 40 CFR 71.11(l); Tribal 
Major Non-Attainment NSR permits, 40 CFR 49.172(d)(5); and Tribal Minor 
NSR permits, 40 CFR 49.159(d).
    The procedural changes in this rule do not apply to other types of 
appeals not listed above. In addition, with the exception of the 
proposed revisions above, nothing in this rule alters the mechanics of 
permit appeals or the process by which parties interact with the EAB, 
e.g., service requirements.

III. Summary of the Final Rule

A. What are the key elements of this final rule?

1. Clarifying the EAB's Scope of Review in Permit Appeals
    EPA proposed to clarify the EAB's scope of review while leaving the 
standard of review applied by the EAB untouched. More specifically, EPA 
proposed to eliminate 40 CFR 124.19(a)(4)(i)(B), which had been viewed 
as establishing authority for the EAB to review the Agency's compliance 
with discretionary policies--issues that a federal court generally 
could not review. EPA is finalizing its proposal to clarify the EAB's 
scope of review. This final rule makes clear that the EAB's scope of 
review does not extend to the Agency's compliance with internal 
discretionary policies or Executive Orders.
    Several commenters stated that the proposal arbitrarily limits the 
EAB's scope of review and ignores the fact that federal courts 
regularly review exercises of agency discretion to ensure that agencies 
make such decisions in a rational way based on adequate consideration 
of all relevant factors. While the Agency agrees with the commenters 
that federal courts review discretionary policy decisions under an 
arbitrary and capricious standard of review, the Agency's strict 
compliance with Executive Orders or internal agency policy is generally 
outside the scope of review in federal courts. See Defs. of Wildlife v. 
Jackson, 791 F. Supp. 2d 96, 121 (D.D.C. 2011) (``Plaintiffs cannot use 
the review provisions of the APA to enforce an Executive Order that is 
not subject to judicial review.''). By eliminating 40 CFR 
124.19(a)(4)(i)(B), the Agency is making the scope of EAB's review more 
akin to that of federal courts.
2. Reforming Amicus Curiae Participation
    EPA proposed to eliminate the provision at 40 CFR 124.19(e) that 
authorizes interested persons to participate in a permit appeal as 
amicus curiae as a means of streamlining the appeal process. Many 
commenters opposed this proposal by explaining the various benefits 
that amicus participation provides to the appeal process, which include 
additional viewpoints on particularly complex matters and an avenue for 
boarder participation among groups with limited resources. In light of 
the benefits highlighted by the commenters, EPA is retaining the 
ability for amicus participation, but with certain limitations. All 
amicus briefs must be filed within 21 days after the filing of the 
petition for review and are limited to no more than 15 pages. The 21-
day window had previously been imposed on amicus participants in PSD 
and other New Source Review permit appeals under the Clean Air Act but 
will now apply in all permit appeals under other statutes. This 
approach preserves the benefits of amicus participation while also 
achieving the goal of streamlining the overall appeal process.
3. Eliminating Sua Sponte Review
    EPA is finalizing its proposal to eliminate the EAB's sua sponte 
review authority for permit decisions. As several commenters noted, the 
EAB has rarely exercised its sua sponte authority to review permits. 
Some commenters asked that EPA clarify that the Board retains its sua 
sponte authority over enforcement decisions. At least one commenter 
expressed concern that the EAB would no longer be able to review a 
permit no matter how blatant or how important a permit defect may be.
    First and foremost, it is the responsibility of the permit writers 
to draft permits that achieve the intended results and comply with all 
legal requirements. Over the course of the last fifty years of writing 
permits, the Agency has become much better at doing just that. Second, 
as the commenters suggested, the EAB has rarely used its sua sponte 
authority to review permit appeals, and this rule does not remove the 
EAB's authority in enforcement cases where it has traditionally 
exercised such authority.
4. Expediting the Appeal Process
    EPA proposed several measures to expedite the appeal process, 
including limiting filing extensions to one request per party, with a 
maximum extension of 30 days, establishing a 60-day deadline for the 
EAB to issue its decision (measured from the date of oral argument or 
the filing of the last brief, whichever is later) and limiting the 
length of EAB opinions to only as long as needed to address the 
specific issues raised in the appeal. EPA solicited comment on whether 
to set a numerical limit, either in words or pages, on EAB opinions.
    EPA received several comments opposed to these expediting reforms, 
most of which criticized the 60-day deadline for issuing decisions. 
Generally, the commenters felt the 60-day deadline is arbitrary and 
lacked justification. One commenter stated that the Agency failed to 
explain why the Board maintains its ability to adjust filing 
requirements for good cause but is inflexibly required to issue 
opinions within 60 days.
    EPA is finalizing the 60-day deadline for the EAB to issue a 
decision, with the deadline measured from the date of oral argument or 
the filing of the last brief, whichever is later. However, in light of 
the comments it received, the EAB may grant itself a one-time 60-day 
extension if the Board determines that the nature and complexity of the 
case requires additional time. While EPA concedes that any deadline 
assumes some amount of arbitrariness, such deadlines are routinely 
created in statutes and regulations based on policy choices that favor 
timely decision-making and resolution of issues in lieu of open-ended 
processes. EPA believes that a 60-day deadline, with the availability 
of an additional 60-day extension, is reasonable in light of the 
additional reforms contained in this rule.
    EPA is also finalizing the two additional expediting measures as 
proposed. The EAB is required to make its opinions only as long as 
needed to address the specific issues raised in the appeal. This reform 
is consistent with the deadline imposed on the Board for issuing 
decisions and should assist the EAB in achieving those deadlines. 
Additionally, this final rule limits filing extensions to one request 
per party, with a maximum extension of 30 days that the EAB, in the 
exercise of its discretion, may choose to grant. Nothing in this final 
rule eliminates the EAB's discretion to relax or suspend filing 
requirements for good cause.
5. 12-Year Terms for EAB Judges
    EPA proposed setting 12-year renewable terms for EAB judges. EPA 
sought comments on this proposed term limit and whether 8 years or 
another time period was more appropriate. At least one commenter 
supported the creation of renewable terms but thought

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shorter terms were more appropriate. The Agency also received comments 
opposed to any term for EAB judges. These commenters asserted there is 
no rationale for why EAB judges should be treated any differently from 
other career Senior Executive Service (SES) positions and that the 
proposal unnecessarily politicizes the EAB. One commenter argued that 
the proposal was illegal because SES positions are governed by a 
specific statute implemented by the Office of Personnel Management 
(OPM) and that OPM has the sole authority to determine conditions of 
service for SES employees.
    EPA disagrees with those commenters that opposed the proposed term 
limit. The EAB, and its individual judges, exercise authority expressly 
delegated to it from the Administrator by Title 40 of the Code of 
Federal Regulations. 40 CFR 1.25(e)(2). An EAB judge plays an important 
role in shaping the decisions of the Agency, and while that role has 
traditionally been viewed with a certain amount of independence, each 
judge is acting on the express delegation of the Administrator's 
authority. It is entirely consistent with that delegation that the 
Administrator have some express mechanism of accountability over those 
exercising such authority. The 12-year renewable terms routinize the 
review of the Board's composition. By setting the terms at 12 years and 
staggering their implementation in 3-year increments, any one 
Administrator is limited in the number appointments he or she could 
make (barring a vacancy due to resignation), provided the Administrator 
elected not to renew a given term.
    EPA also disagrees that the term limits are illegal. As members of 
the SES, an EAB judge is subject to reassignment to any other SES 
position in the Agency for which he or she qualifies. See 5 U.S.C. 3395 
(``Reassignment and transfer within the Senior Executive Service''); 5 
CFR 317.901 (``Reassignments''); see also Guide to the Senior Executive 
Service (March 2017), page 10.\2\ The 12-year term is not a separate 
condition applied to SES employees. It is simply a mechanism by which 
the Administrator can exercise his or her authority consistent with the 
applicable SES procedures. If the Administrator chooses not to renew an 
appointment, the Administrator can assign that judge to another SES 
position within EPA for which he or she qualifies, provided the 
Administrator reassigns the judge in compliance with all applicable SES 
procedures. See 5 CFR 317.901.
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    \2\ This document is published by the Office of Personnel 
Management at https://www.opm.gov/policy-data-oversight/senior-executive-service/reference-materials/guidesesservices.pdf.
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    For these reasons, EPA is setting fixed twelve-year terms for EAB 
Judges, which the Administrator may renew at the end of that twelve-
year period or reassign the Judge to another SES position within EPA. 
For purposes of clarity, the final rule includes additional regulatory 
text that explicitly requires the Administrator to follow the proper 
SES requirements when reassigning an EAB judge. To implement the 12-
year terms and ensure that they are on a staggered schedule, the 
Administrator will apply the twelve-year terms to the current EAB 
judges on a rolling basis over the next twelve years. Each seat on the 
EAB is designated a number based on the seniority of the Board's 
current members. The seat of the longest serving judge is designated as 
seat one, the second longest serving judge as seat two, the third 
longest serving judge as seat three, and the most recent judge as seat 
four. If any of the four seats are vacant as of the effective date of 
the final rule, any such seat will be designated a number based on the 
date on which it became vacant, after seats have been designated for 
current judges. The term for the newly designated seat one ends three 
years after the effective date of the final rule. The process then 
continues at three-year intervals, with seat two ending six years after 
the effective date, seat three ending nine years after the effective 
date, and seat four ending twelve years after the effective date. 
Thereafter, all terms will last for twelve years. If a judge vacates 
his or her position before the end of the judge's term, the 
Administrator will appoint a new judge to serve for the remainder of 
the vacated term. That new member could then be renewed at the end of 
the vacated term.
6. Designating EAB Decisions for Publication
    EPA sought comment on whether it should create a process to 
explicitly identify certain decisions of the EAB as precedential. The 
proposal noted that under such a process, only published decisions 
could be considered precedential and the determination of which 
decisions should be published would made by the Administrator.
    EPA is finalizing a process that maintains the EAB's existing 
practice of distinguishing between published decisions and unpublished 
final orders with one important change: The publication of any decision 
designated for publication by the EAB is delayed for 15 days. During 
this period, the Administrator may review the decision and change the 
designation to an unpublished final order. Moving forward, it is the 
express policy of the Agency that only published decisions of the EAB 
represent EPA's official, authoritative position with regard to the 
issues addressed in such decisions. This change is intended to indicate 
to reviewing courts that only published EAB decisions may warrant 
deference under Kisor v. Wilkie, 139 S. Ct. 2400 (2019) and Chevron 
U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 
(1984). This new process will therefore provide the Administrator, as 
the original source of authority for implementing and interpreting 
EPA's statutes and regulations, the ability to ensure EAB opinions 
reflect the Agency's official position concerning major policy or 
procedural issues, or other issues of exceptional importance in the 
situations where it is appropriate to create such positions through 
adjudication before the Board.
7. Administrator's Legal Interpretations
    EPA is finalizing the proposed mechanism by which the 
Administrator, by and through the General Counsel, can issue a 
dispositive legal interpretation in any matter before the EAB or on any 
issue addressed by the EAB. The Administrator may direct the General 
Counsel to file written notice to the EAB providing the Administrator's 
legal interpretation of an applicable Agency regulation or governing 
statute in any matter before the EAB. This Administrator's use of this 
mechanism applies to all actions before EAB--both permit and 
enforcement cases. This mechanism is distinguished from briefs filed by 
an EPA Region setting forth its position as the permit issuer. The 
intent of this proposal is to allow the Administrator, in specific 
cases, to retain authority as it pertains to legal interpretations in 
administrative appeals. Nothing in this rule limits the Administrator's 
existing authority (derived from his or her statutory authority to 
issue the permits in the first instance) to review or change any EAB 
decision.
    EPA received several comments opposing this new mechanism. Some 
commenters asserted that the Agency failed to provide any details on 
how the process would work and when it could be invoked. At least one 
commenter noted that existing processes should be enough to address any 
of the issues this mechanism sought to address. Other commenters 
asserted that its application to enforcement cases presented due 
process concerns related to ex parte communications and unfair notice.

[[Page 51654]]

    EPA believes it has sufficiently explained how the mechanism works 
and when it can be invoked. The Administrator will direct the General 
Counsel to file a written notice with the EAB that provides the 
Administrator's legal interpretation of the relevant statute or 
regulation. As explained in the proposal and reiterated in this final 
rule, the Administrator may utilize the mechanism in any matter before 
the EAB or on any issue addressed by the EAB, meaning it has no 
temporal limitation. EPA agrees with the comment that the Administrator 
does not need this mechanism to achieve the goals of this provision. 
However, the Agency believes that codifying this mechanism more 
directly and transparently reflects the Administrator's authority, and, 
as discussed in Section III.C below, mitigates any concerns over EAB 
judges acting as inferior officers. Lastly, EPA does not believe that 
this mechanism raises due process concerns. Any use of this mechanism 
will necessarily conform with EPA's ex parte rules in 40 CFR 22.8. In 
order to ensure such conformance, the General Counsel will issue a 
memorandum detailing specific measures that will be taken to create any 
necessary firewalls between attorneys litigating matters before the 
Board and those that may work on the Administrator's legal 
interpretation in a given case. With regard to unfair notice, the 
relevant inquiry is whether the regulated party had adequate notice of 
the relevant legal requirement at the time the alleged violation 
occurred. A binding legal interpretation issued by the Administrator 
during the enforcement appeal process does nothing to change whether 
there was adequate notice prior to bringing the enforcement action.

B. How does this final rule affect pending appeals?

    The provisions included in this final rule apply to any appeal 
filed with the EAB after the effective date of this final rule, 
including for permit decisions that were finalized before the effective 
date but for which the period for filing a petition for review has not 
expired. The final rule does not apply to any appeal that was filed 
before the effective date of this rule.

C. Why is EPA finalizing these reforms?

    Each statue implemented by EPA that requires the issuance of 
permits authorizes the Administrator to issue such permits. The 
Administrator retains discretion as to the procedural process of 
issuing such permits and may delegate his or her authority as he or she 
deems necessary to implement the statutory objectives. See Avenal Power 
Center, LLC v. EPA, 787 F. Supp. 2d 1, 3 (D.D.C. 2011). The EAB was 
created in 1992 by a delegation of the Administrator's authority over 
appellate proceedings, including, among other things, appeals from 
permit decisions made by Regional Administrators. That delegation of 
authority, along with the Board's rules of procedure and scope of 
responsibilities, was codified via a procedural rule. See 57 FR 5320 
(February 13, 1992). Having created the EAB through delegation, the 
Administrator may now alter the Board's role in the permitting process, 
particularly if he or she believes a different approach would better 
serve the purposes of the statutes he or she implements. This action 
does just that by modifying the prior rules of procedure and realigning 
the prior delegations in manner that ensures a proper level of 
accountability and consistency in decision-making, streamlines the 
permitting process, and ultimately results in better and more efficient 
outcomes.
    EPA received several comments asserting that its proposal did not 
constitute a procedural rule. Many of the same commenters asserted 
that, because the proposal sought to revise the process for appealing 
PSD and Acid Rain permits under the CAA, the Agency is required to 
follow that statute's rulemaking requirements in section 307(d), which 
include, among other things, a public hearing. EPA disagrees with both 
comments. This action is a rule of agency procedure and practice under 
the Administrative Procedure Act (APA). 5 U.S.C. 553(b)(A). This final 
rule simply amends certain aspects of the original procedural rule that 
established the EAB in 1992. Moreover, because it is a procedural rule 
under the APA, the final rule is exempt from section 307(d) of the CAA: 
``This subsection shall not apply in the case of any rule or 
circumstance referred to in subparagraphs (A) or (B) of subsection 
553(b) of title 5.'' 42 U.S.C. 7607(d)(1). Courts have affirmed that 
the CAA adopts the APA's notice and comment exceptions in 5 U.S.C. 
553(b). See EME Homer City Generation, L.P. v. EPA, 795 F.3d 118, 134 
(D.C. Cir. 2015) (``[T]he Clean Air Act permits EPA to conduct 
rulemaking without notice and comment when doing so would be 
appropriate under Subsection 553(b) of the Administrative Procedure 
Act. . . .''); see also Sierra Club v. Jackson, 833 F.Supp.2d 11 (D.C. 
Circuit 2012); Small Refiner Lead Phase-Down Task Force v. EPA, 705 
F.2d 506 (D.C. Cir. 1983).
    EPA also received one comment asserting that, in light of the 
Supreme Court's decision in Lucia v. SEC, 138 S. Ct. 2044 (2018), and 
the functions performed by the EAB, the appointment of EAB judges is 
unconstitutional. In Lucia, the Supreme Court held that SEC 
administrative law judges are constitutional officers of the United 
States and must be appointed in accordance with the Appointments Clause 
of the Constitution. The commenter suggests that EAB judges are 
constitutional officers that have not been appointed consistent with 
the Appointments Clause, which requires such officers be appointed by 
the President with the advice and consent of the Senate, unless 
``Congress . . . by law vest[s] the Appointment of such inferior 
Officers, as they think proper, in the President alone, in the Courts 
of Law, or in the Heads of Departments.'' U.S. CONST. art. II, Sec.  2, 
cl. 2.
    EPA disagrees that EAB service as the Board is currently comprised 
violates the Constitution. The Administrator derives his or her 
appointment authority from Reorganization Plan No. 3 of 1970, 84 Stat. 
2086 (July 9, 1970), which also ``convey[ed] to the [EPA] Administrator 
all of the housekeeping authority available to other department heads 
under [5 U.S.C. 301]'' and demonstrates that ``Congress has vested the 
Administrator with the authority to run EPA, to exercise its functions, 
and to issue regulations incidental to the performance of those 
functions.'' \3\ Courts have previously held that ``offices'' under the 
Appointments Clause can be created by Executive Branch officials 
invoking their general housekeeping and delegation authorities. See 
Willy v. Administrative Review Bd., 423 F.3d 483, 491 (5th Cir. 2005) 
(citing Reorg. Plan No. 6 of 1950, Sec.  2, 15 FR 3174 (1950), 64 Stat. 
1263, and 5 U.S.C. 301); see also Varnadore v. Secretary of Labor, 141 
F.3d 625, 631 (6th Cir. 1998); Com. of Pa., Dep't of Pub. Welfare v. 
U.S. Dep't of Health & Human Servs., 80 F.3d 796, 804-05 (3d Cir. 
1996). The Administrator is authorized to create the Board and appoint 
EAB judges. While EPA does not contest the commenter's characterization 
of EAB judges as inferior officers, the Agency disagrees with any 
suggestion that EAB decisions may only be made by principal officers. 
The EAB's authority is delegated from the Administrator, who adopts the 
procedural rules, such as this action, that govern the EAB, and the 
judges are

[[Page 51655]]

subject to removal or reassignment by the Administrator as explained in 
Section III.A.6. Moreover, having created the EAB via regulation, the 
Administrator is also free to abolish the EAB. See In re Grand Jury 
Investigation, 916 F.3d 1047, 1052 (D.C. Cir. 2019) (explaining that a 
principal officer's ability to completely abolish an office can render 
that officer inferior) (citing In re Sealed Case, 829 F.2d 50, 56 (D.C. 
Cir. 1987); Morrison v. Olson, 487 U.S. 654, 721 (1988) (Scalia, J., 
dissenting) (noting that an officer is inferior and subject to control 
``if by no other means than'' the principal's ability to ``amend[ ] or 
revok[e] the regulation defining his authority'')). While the creation 
of the EAB and the appointment of its judges meet constitutional 
requirements, Lucia does highlight the requirement that inferior 
officers are accountable to a principal officer. And that, while the 
EAB has been viewed with a measure of independence, it is ultimately 
accountable to the Administrator and the authority he or she has 
delegated to it. This action only strengthens the EAB's accountability 
to the Administrator by, among other things, confirming the 
Administrator's ability to provide legal interpretations on matters 
before the EAB.
---------------------------------------------------------------------------

    \3\ See supra n.1.
---------------------------------------------------------------------------

IV. Statutory and Executive Order Reviews

A. Executive Orders 12866: Regulatory Planning and Review and Executive 
Order 13563: Improving Regulation and Regulatory Review

    This action is exempt from review by the Office of Management and 
Budget (OMB) because it is limited to agency organization, management 
or personnel matters.

B. Executive Order 13771: Reducing Regulations and Controlling 
Regulatory Costs

    This action is not an Executive Order 13771 regulatory action 
because it relates to agency organization, management or personnel.

C. Paperwork Reduction Act (PRA)

    This action does not contain any information collection activities 
and therefore does not impose an information collection burden under 
the PRA.

D. Regulatory Flexibility Act (RFA)

    This action is not subject to the RFA. The RFA applies only to 
rules subject to notice and comment rulemaking requirements under the 
Administrative Procedure Act (APA), 5 U.S.C. 553, or any other statute. 
This rule pertains to agency management or personnel, which the EPA 
expressly exempts from notice and comment rulemaking requirements under 
5 U.S.C. 553(a)(2).

E. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded mandate as described in 
UMRA, 2 U.S.C. 1531-1536, and does not significantly or uniquely affect 
small governments. The action imposes no enforceable duty on any state, 
local or tribal governments or the private sector.

F. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have 
a substantial direct effect on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government.

G. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have tribal implications as specified in 
Executive Order 13175.

H. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    The EPA interprets Executive Order 13045 as applying only to those 
regulatory actions that concern environmental health or safety risks 
that EPA has reason to believe may disproportionately affect children, 
per the definition of ``covered regulatory action'' in section 2-202 of 
the Executive Order. This action is not subject to Executive Order 
13045 because it does not concern an environmental health risk or 
safety risk.

I. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution or Use

    This action is not a ``significant energy action'' because it is 
not likely to have a significant adverse effect on the supply, 
distribution or use of energy.

J. National Technology Transfer and Advancement Act (NTTAA)

    This rulemaking does not involve technical standards.

K. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    This action is not subject to Executive Order 12898 (59 FR 7629, 
Feb. 16, 1994) because it does not establish an environmental health or 
safety standard.

L. Congressional Review Act (CRA)

    This final rule is exempt because it is a rule of agency 
organization, procedure, or practice that does not substantially affect 
the rights or obligations of non-agency parties.

List of Subjects

40 CFR Part 1

    Environmental protection, Organization and functions (Government 
agencies).

40 CFR Part 49

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Indians, Intergovernmental relations, Reporting 
and Recordkeeping requirements.

40 CFR Part 71

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Reporting and recordkeeping requirements.

40 CFR Part 124

    Environmental protection, Administrative practice and procedures, 
Air pollution control, Hazardous waste, Indians-lands, Reporting and 
recordkeeping requirements, Water pollution control, Water supply.

Andrew Wheeler,
Administrator.

    For the reasons set forth in the preamble, EPA amends 40 CFR parts 
1, 49, 71, and 124 as follows:

PART 1--STATEMENT OF ORGANIZATION AND GENERAL INFORMATION

0
1. The authority citation for part 1 is revised to read as follows:

    Authority: 5 U.S.C. 552; Reorganization Plan No. 3 of 1970, 84 
Stat. 2086 (July 9, 1970).


0
2. Amend Sec.  1.25 by revising paragraphs (e)(2) and (3) and adding 
paragraphs (e)(4) and (5) to read as follows:


Sec.  1.25  Staff offices.

* * * * *
    (e) * * *
    (2) Functions. (i) The Environmental Appeals Board shall exercise 
only that authority expressly delegated to it in this title. The 
Environmental Appeals Board, may also, at the Administrator's express 
request, provide advice and consultation, make findings of fact and 
conclusions of law, prepare a recommended decision, or serve as the 
final decisionmaker, as the Administrator deems appropriate.

[[Page 51656]]

    (ii) In performing its functions, the Environmental Appeals Board 
may consult with any EPA employee concerning any matter governed by the 
rules set forth in this title, provided such consultation does not 
violate applicable ex parte rules in this title.
    (iii) The Administrator may limit the Environmental Appeals Board's 
authority to interpret statutes and regulations otherwise delegated to 
it in this title by issuing, through the General Counsel, a binding 
legal interpretation of any applicable statute or regulation. Nothing 
in this section limits the Administrator's authority to review or 
change any EAB decision.
    (3) Final Decisions and Orders. (i) Designation. The Environmental 
Appeals Board shall designate each final decision as either a published 
decision or an unpublished final order at the time such decision is 
issued.
    (ii) Published decisions. (A) Except as provided in paragraph 
(e)(3)(ii)(B) of this section, the Environmental Appeals Board may not 
publish a decision in the Environmental Appeals Decisions (E.A.D.) or 
on the Board's website under the heading ``Published Decisions'' until 
15 days after the date on which the decision is issued.
    (B) The Administrator may, within 15 days of the Environmental 
Appeals Board issuing a decision designated for publication, re-
designate the decision as an unpublished final order. Once re-
designated, the Environmental Appeals Board may not publish such 
decision in the Environmental Appeals Decisions (E.A.D.) or on the 
Board's website under the heading ``Published Decisions''.
    (4) Qualifications. Each member of the Environmental Appeals Board 
shall be a graduate of an accredited law school and a member in good 
standing of a recognized bar association of any State or the District 
of Columbia. Board Members shall not be employed by the Office of 
Enforcement, the Office of the General Counsel, a Regional Office, or 
any other office directly associated with matters that could come 
before the Environmental Appeals Board. A Board Member shall recuse 
himself or herself from deciding a particular case if that Board Member 
in previous employment performed prosecutorial or investigative 
functions with respect to the case, participated in the preparation or 
presentation of evidence in the case, or was otherwise personally 
involved in the case.
    (5) Term. (i) Initial terms. (A) The seat of the longest serving 
member is designated as seat one, the second longest serving member as 
seat two, the third longest serving member as seat three, and the most 
recent member as seat four. If any of the four seats are vacant as of 
September 21, 2020, any such seat is designated a number based on the 
date on which it became vacant, after seats have been designated for 
current members.
    (B) The initial term for seat one ends three years from September 
21, 2020. The initial term for seat two ends six years from September 
21, 2020. The initial term for seat three ends nine years from 
September 21, 2020. The initial term for seat four ends twelve years 
after September 21, 2020. The Administrator has the option of renewing 
these initial terms under paragraph (e)(5)(ii) of this section.
    (C) Nothing in this section prevents a member of the Environmental 
Appeals Board from resigning, retiring, or transferring before the 
expiration of the member's initial term. Similarly, nothing in this 
paragraph forecloses the Administrator from reassigning a member of the 
Environmental Appeals Board to another position, consistent with 
applicable requirements, prior to the expiration of the member's 
initial term. The Administrator shall follow the provisions in 5 CFR 
317.901 in making any reassignment under this section.
    (D) If a member of the Environmental Appeals Board resigns, 
retires, or transfers before the expiration of the member's initial 
term, the replacement member will serve for the remaining portion of 
the initial term, with an option for renewal at the end of the term. If 
the term of the replacement member is not renewed, the Administrator 
shall reassign the replacement member to another position, consistent 
with the provisions of 5 CFR 317.901.
    (ii) 12-year terms. (A) After the initial terms in paragraph 
(e)(5)(i) of this section, each member of the Environmental Appeals 
Board is appointed to a twelve-year term, with an option for renewal at 
the end of that twelve-year period. Nothing in this paragraph prevents 
a member of the Environmental Appeals Board from resigning, retiring, 
or transferring before the expiration of the member's twelve-year term. 
Similarly, nothing in this paragraph forecloses the Administrator from 
reassigning a member of the Environmental Appeals Board to another 
position, consistent with applicable requirements, prior to the 
expiration of the member's renewable twelve-year term. The 
Administrator shall follow the provisions in 5 CFR 317.901 in making 
any reassignment under this section.
    (B) If a member of the Environmental Appeals Board resigns, 
retires, or transfers before the expiration of the member's term, the 
replacement member will serve for the remaining portion of the term, 
with an option for renewal at the end of the term. If the term of the 
replacement member is not renewed, the Administrator shall reassign the 
replacement member to another position, consistent with the provisions 
of 5 CFR 317.901.

PART 49--INDIAN COUNTRY: AIR QUALITY PLANNING AND MANAGEMENT

0
3. The authority citation for part 49 continues to read as follows:

    Authority: 42 U.S.C. 7401, et seq.

Subpart C--General Federal Implementation Plan Provisions

0
4. Amend Sec.  49.159 by revising paragraph (d) to read as follows:


Sec.  49.159  Final permit issuance and administrative and judicial 
review.

* * * * *
    (d) Can permit decisions be appealed? (1) Permit decisions may be 
appealed under the permit appeal procedures of 40 CFR 124.19.
    (2) An appeal under paragraph (d)(1) of this section is, under 
section 307(b) of the Act, a prerequisite to seeking judicial review of 
the final agency action.
* * * * *

0
5. Amend Sec.  49.172 by revising paragraph (d) to read as follows:


Sec.  49.172  Final permit issuance and administrative and judicial 
review.

* * * * *
    (d) Can permit decisions be appealed? (1) Permit decisions may be 
appealed under the permit appeal procedures of 40 CFR 124.19.
    (2) An appeal under paragraph (d)(1) of this section is, under 
section 307(b) of the Act, a prerequisite to seeking judicial review of 
the final agency action.
* * * * *

PART 71--FEDERAL OPERATING PERMIT PROGRAMS

0
6. The authority citation for part 71 continues to read as follows:

    Authority: 42 U.S.C. 7401, et seq.

Subpart A--Operating Permits

0
7. Amend Sec.  71.11 by revising paragraph (l) to read as follows:


Sec.  71.11   Administrative record, public participation, and 
administrative review.

* * * * *

[[Page 51657]]

    (l) Appeal of permits. (1) Permit decisions may be appealed under 
the permit appeal procedures of 40 CFR 124.19.
    (2) An appeal under paragraph (l)(1) of this section is, under 
section 307(b) of the Act, a prerequisite to seeking judicial review of 
the final agency action.
* * * * *

Subpart B--Permits for Early Reductions Sources

0
8. Amend Sec.  71.27 by revising paragraph (l) to read as follows:


Sec.  71.27  Public participation and appeal.

* * * * *
    (l) Appeal of permits. (1) Permit decisions may be appealed under 
the permit appeal procedures of 40 CFR 124.19.
    (2) An appeal under paragraph (l)(1) of this section is, under 
section 307(b) of the Act, a prerequisite to seeking judicial review of 
the final agency action.
    (3) The filing of a petition for review of any condition of the 
permit or permit decision shall not stay the effect of any contested 
permit or permit condition.
* * * * *

PART 124--PROCEDURES FOR DECISIONMAKING

0
9. The authority citation for part 124 continues to read as follows:

    Authority: Resource Conservation and Recovery Act, 42 U.S.C. 
6901 et seq.; Safe Drinking Water Act, 42 U.S.C. 300f et seq.; Clean 
Water Act, 33 U.S.C. 1251 et seq.; Clean Air Act, 42 U.S.C. 7401 et 
seq.

Subpart A--General Program Requirements

0
10. Amend Sec.  124.19 by:
0
a. Revising paragraphs (a)(4)(i), (e), (g) and (l);
0
b. Removing paragraph (p); and
0
c. Redesignating paragraphs (m) through (o) as paragraphs (n) through 
(p) and adding a new paragraph (m).
    The revisions and additions read as follows:


Sec.  124.19  Appeal of RCRA, UIC, NPDES and PSD Permits.

    (a) * * *
    (4) * * * (i) In addition to meeting the requirements in paragraph 
(d) of this section, a petition for review must identify the contested 
permit condition or other specific challenge to the permit decision and 
clearly set forth, with legal and factual support, petitioner's 
contentions for why the permit decision should be reviewed. The 
petition must demonstrate that each challenge to the permit decision is 
based on a finding of fact or conclusion of law that is clearly 
erroneous.
* * * * *
    (e) Participation by amicus curiae. Any interested person may file 
an amicus brief in any appeal pending before the Environmental Appeals 
Board under this section. The deadline for filing such brief 21 days 
after the filing of the petition. Amicus briefs may not exceed 15 
pages.
* * * * *
    (g) Motions for extension of time. (1) Parties must file motions 
for extensions of time sufficiently in advance of the due date to allow 
other parties to have a reasonable opportunity to respond to the 
request for more time and to provide the Environmental Appeals Board 
with a reasonable opportunity to issue an order.
    (2) Each party may only file one motion for extension and the 
requested extension may not exceed 30 days.
* * * * *
    (l) Final disposition. (1) Except as provided in paragraph (l)(2), 
the Environmental Appeals Board shall issue its decision on a permit 
appeal by the later date occurring 60 days after the date on which:
    (i) The final brief has been submitted; or
    (ii) Oral argument is concluded.
    (2) The Environmental Appeals Board may, upon determining that the 
nature and complexity of the case requires additional time, grant 
itself an additional 60 days to issue its decision.
    (3) Any written opinion issued by the Environmental Appeals Board 
should only be as long as necessary to address the specific issues 
presented to the Board in the appeal.
    (m) Judicial review. (1) A petition to the Environmental Appeals 
Board under paragraph (a) of this section is, under 5 U.S.C. 704, a 
prerequisite to seeking judicial review of the final agency action.
    (2) For purposes of judicial review under the appropriate Act, 
final agency action on a permit occurs when agency review procedures 
under this section are exhausted and the Regional Administrator 
subsequently issues a final permit decision under this paragraph. A 
final permit decision must be issued by the Regional Administrator:
    (i) When the Environmental Appeals Board issues notice to the 
parties that the petition for review has been denied;
    (ii) When the Environmental Appeals Board issues a decision on the 
merits of the appeal and the decision does not include a remand of the 
proceedings; or
    (iii) Upon the completion of remand proceedings if the proceedings 
are remanded, unless the Environmental Appeals Board's remand order 
specifically provides that appeal of the remand decision will be 
required to exhaust administrative remedies.
    (3) The Regional Administrator must promptly publish notice of any 
final agency action in the Federal Register regarding the following 
permits:
    (i) PSD permits;
    (ii) Outer continental shelf permits issued under 40 CFR part 55;
    (iii) Federal Title V operating permits issued under 40 CFR part 
71;
    (iv) Acid Rain permits appealed under 40 CFR part 78;
    (v) Tribal Major Non-Attainment NSR permits issued under 40 CFR 
49.166 through 49.173; and
    (vi) Tribal Minor NSR permits issued under 40 CFR 49.151 through 
49.161.

[FR Doc. 2020-16257 Filed 8-20-20; 8:45 am]
BILLING CODE 6560-50-P


