Air Quality Regulation of Agriculture - A Legal

Perspective

David E.CranstonGreenberg Glusker LLP

Dcranston@ggfirm.com

Animal Feeding Operations in California

• 1500 dairies in San Joaquin Valley alone• Emissions of concern - VOCs and PM 10• Permitting commenced in 2004• Understanding of emissions sources and

volume continuing to develop • Operations vary considerably• Need for flexibility in controls

Pre-2004 Permitting Authority of California Air Districts

• Authority to permit “any article, machine, equipment, or other contrivance” (H&SC § 42300)

• Agricultural Equipment Exemption (former H&SC § 42310(e))– Historical interpretation by regulators was very

broad

Challenge to Ag Exemption

• 2002: Suits challenging EPA approval of SIP

• 2003: EPA finding that SIP deficient and calling for repeal of Ag exemption (68 FR 37746)

• 2003: Enactment of SB 700

SB 700: Effective 1/1/2004• Eliminated agricultural exemption

• Requires permitting of “Agricultural Sources” as required under Title I and Title V

• Requires rulemaking and then permitting of Large Confined Animal Facilities (“LCAF”)– Rulemaking to be completed by July 2006 for

SJVAPCD (H&SC § 40724.6)– LCAF later defined by CARB as 1000+ milk-

producing cows

San Joaquin Valley APCD

• Interpreted SB 700 to require all existing and new dairies above statutory threshold (50% of major source = 12.5 tons/yr for VOCs) to be permitted

• If above threshold, then NSR would be triggered for new or expanding dairies

• Not what dairy industry thought they were getting under SB 700

2004: Very limited science available for permitting dairies

• Only emission factor (used by CARB for inventory purposes) based on discredited 1938 Study of total organic gases.

• 2004 Emission Factor viewed as unreliable by Industry, Scientists and even CARB.

Litigation against District WUD/AWMP v. SJVAPCD

• Grounds for Dairy Industry Suit

– Challenged authority to require dairy permits until § 40724.6 rulemaking completed

– Challenged application of EF based on 1938 study to permitting thresholds

Settlement of WUD/AWMP v. SJVAPCD

• Creation of Dairy Permitting Advisory Group

• Analysis and research into dairy emissions

• Collaborative evaluation of best available control technology

Emission Factors• Source of VOC emissions

– Waste (manure and urine)– Waste handling areas including lagoons and

corrals– Feed– Enteric Emissions

• Source of emissions more important than volume

• EPA study & Consent Decree• Studies ongoing• Impact on BACT

Need for Flexible Regulation

• EPA: “[f]lexibility is needed in any program controlling agricultural sources.”

71 FR 7683, 7684 (February 14, 2006)

• “Agricultural sources are unlike other stationary sources and are unlike sources such as automobiles that have common design features and may be subjected to a common or uniform control measure.” Vigil v. Leavitt, 381 F.3d 826, 838 (9th Cir. 2004).

Rule 4550 - PM 10 Rule for Agriculture

• Driven by 2003 PM-10 Plan Commitment • CAA: Best Available Control Measures (BACM)

42 U.S.C. § 7513a(b)(1)(B)• Menu of choices• Approved into SIP• Petition for Review before 9th Cir. (LIF v. EPA)

– Cafeteria Plan does not meet BACM

• Valley now in attainment of PM-10 Standard (but finding challenged by Earth Justice)

Rule 4570 - VOC rule for LCAFs

• Required by SB 700 (Health & Safety Code § 40724.6)

• Best Available Retrofit Control Technology (BARCT)

• Menu of Choices • Dairies with less than 1000 milking cows exempt• Writ of Mandate in Fresno Superior Court (AIR v.

SJVUAPCD) – Does flexible Menu Plan meet BARCT?

CAA Suits against Individual Operators

• AIR v. Schakel and AIR v. Vanderham (E.D. Cal.)

• Commencement of construction without ATC permit and NSR

Future Challenges to Authority to Construct Permits

• First LCAF ATC permit issued to Foster Farms – permit challenged in CAA suit.

• ATC permits issued to dairies may suffer same fate.

• Emission Reduction Credits and BACT will be key issues:– ERCs and SB 700: If can’t sell them, Districts can’t make

you buy them– Environmental groups have challenged this position

– BACT: achieved in practice?

Other Issues on Horizon

• For the first time – permitting and regulating emissions from living things – District’s definition of air contaminant –

“release, discharge...caused by man.”–  If enteric emissions from animals can be

regulated - are VOC emissions from crops next?

• Ammonia Emissions• Greenhouse Gases (AB 32)

New Ozone plan

• Where will the VOC reductions come from?

• Does agriculture present regulators with perception of low hanging fruit from which to obtain reductions?

Conclusion