Ohio Chemistry Technology Council 30 th Annual Conference

Ohio Chemistry Technology Council 30 th Annual Conference April 24, 2018 REGULATORY FORUM UPDATE ON STATE AND FEDERAL REGULATORY POLICIES ROBERT L. BRUBAKER, ESQ. 2018 Porter Wright Morris & Arthur LLP

Checks And Balances A Four Lane Highway 2018 Porter Wright Morris & Arthur LLP

CHECKS AND BALANCES A FOUR LANE HIGHWAY Justice Sotomayor, writing for a unanimous Court in National Association of Manufacturers v. Department of Defense, refused to “depart from the statute’s plain language” and rejected EPA’s statutory interpretation that challenges to the WOTUS rule must be brought in the Circuit Courts, not in the District Courts: “this Court is not free to ‘rewrite the statute’ to the Government’s liking” Legislative power is in Congress’s lane Statutory interpretation is in the Court’s lane 2018 Porter Wright Morris & Arthur LLP

An Intimidating Number The maximum civil penalty for violation of a CAA requirement: $97, 229 For each day of each violation If the violation continues for one week: $680, 603 If the violation continues for 5 years: $177, 540, 154 See: 2018 adjustments under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 83 Fed. Reg. 1190 (Jan. 10, 2018) 2018 Porter Wright Morris & Arthur LLP

REVERSALS OF PRIOR EPA POLICIES WILL THEY LAST? Criteria for NSR “Major Modifications”: • Enforceability and Use of the Actual-to-Projected -Actual Applicability Test in Determining Major Modification Applicability (Dec. 7, 2017) – EPA will no longer “second guess” pre-projections of post-project “actual emission” increases caused by the project, and operators may “actively manage” post-project actual emissions to prevent significant increases • Project Emissions Accounting Under the New Source Review Preconstruction Permitting Program (March 13, 2018); 83 Fed. Reg. 13745 (March 30, 2018) – EPA will consider project-related emission decreases as well as increases in NSR “step 1” baseline emission accounting 2018 Porter Wright Morris & Arthur LLP

REVERSALS OF PRIOR EPA POLICIES WILL THEY LAST? Distinguishing a “major source” from an “area source” of HAP emissions: • Reclassification of Major Sources as Area Sources Under Section 112 of the Clean Air Act (Jan. 12, 2018) – terminates the “Once in, Always in” policy 2018 Porter Wright Morris & Arthur LLP

LIMITS ON DOJ ENFORCEMENT OF AGENCY GUIDANCE DOCUMENTS Associate Attorney General Rachel Brand memo: Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases (Jan. 25, 2018): • Prohibits DOJ litigators from using “enforcement authority to effectively convert agency guidance documents into binding rules, ” and from using “noncompliance with guidance documents as a basis for proving violations of applicable law” • Guidance documents “do not have the effect of law and should not be used as a substitute for rulemaking” • “[T]his policy helps restore the appropriate role of guidance documents and avoids rulemaking by enforcement” 2018 Porter Wright Morris & Arthur LLP

OHIO AIR RULEMAKING PRIORITIES • Clarification of the “Malfunction” rule, OAC 3745 -15 -06 – The current rule requires “immediate” self-determination of noncompliance – The current rule is being interpreted to define all “malfunctions” as “violations” – A lightning strike, a squirrel in the transformer, sabotage, cyber attacks, or unavoidable, rare, and temporary equipment or technology glitches should not be deemed “violations” • Federal approval of the 10 ton per year Best Available Technology (BAT) exemption • Removal of Ohio’s Nuisance rule, OAC 3745 -15 -07, from the SIP – State nuisance rules are not required by the federal Clean Air Act, and do not implement any relevant provision of the Clean Air Act – Nuisance is an inherently subjective concept, determined case-by-case retrospectively – By being in the SIP, the Nuisance rule is made subject to citizen suits in federal courts, and complicates Title V deviation reporting and compliance certifications – Michigan and other States have successfully removed nuisance rules from their SIPs 2018 Porter Wright Morris & Arthur LLP

2018 Porter Wright Morris & Arthur LLP