National Environmental Enforcement Journal
Failure to Obtain Tennessee PSD Permit Constitutes a Series of Discrete Violations
National Parks Conservation Association, Inc. et al. v. Tennessee Valley Authority
No. 05-6329 (6th Cir. Mar. 2, 2007)
Three environmental organizations brought this lawsuit under the Clean Air Act (CAA) against the Tennessee Valley Authority (TVA). They alleged that TVA had failed to obtain the appropriate permits when it performed a major overhaul of a boiler used to produce electricity at the Bull Run power plant in Clinton, Tennessee, in 1988. Under the CAA?s New Source Review program, TVA was required to obtain a PSD permit from Tennessee under that state?s State Implementation Plan (SIP), which would have set forth emission limitations and mandated best available control technology (BACT). TVA failed to do so.
Tennessee?s SIP provides for separate permits for construction and operation of sources of air pollution. A source is not permitted to start any major modification without first obtaining a construction or modification permit. Tennessee?s SIP provides:
In the case where a source or modification was constructed without first obtaining a construction permit, a construction permit may be issued to the source or modification to establish[,] as conditions of the permit, the necessary emission limits and requirements to assure that these regulatory requirements are met. The appropriate enforcement action shall be pursued to insure that ambient air quality standards and other regulatory requirements will be met.
Tenn. Comp. R. & Regs. ¿ 1200-3-9.01(1)(e). According to the court, this provision imposes an ongoing duty on sources to ensure that they obtain the appropriate emissions limitations in their construction permits, even if they failed to do so before construction.
In regard to TVA?s modification at the Bull Run power plant, U.S. EPA issued an administrative compliance order (ACO) in 1999, requiring TVA to obtain all required permits and enter into a compliance agreement with the agency. After negotiations and a determination by the agency that TVA could not be sued in federal court, the agency decided to adjudicate the issue of whether TVA had violated the CAA before the Environmental Appeals Board (EAB). The EAB subsequently affirmed the ACO. TVA appealed the decision to the Eleventh Circuit. In TVA v. Whitman, 336 F.3d 1236, 1256?60 (11th Cir. 2003), cert. denied, 541 U.S. 1030 (2004), the court concluded that critical aspects of the ACO procedure violated due process. For that reason, the court held that ACOs lack legal consequence and cannot constitute final agency action. Still believing that it could not pursue legal action against TVA in federal court, the agency decided not to pursue the alleged violation.
The essence of this complaint brought by the plaintiffs is that TVA violated the CAA and the Tennessee SIP by failing to obtain a PSD permit and by continuing to operate the plant without such a permit without having performed the required air-quality analysis and without applying BACT. As a result, according to the complaint, TVA has violated limitations regarding sulfur dioxide and nitrogen oxides. They seek declaratory relief, an injunction, and civil penalties to be paid to EPA.
TVA moved for summary judgment, arguing both that the statute of limitations had expired and that it has sovereign immunity. The parties moved that the statute of limitations issue be decided prior to a ruling on the sovereign immunity defense. The district court, after hearing arguments, granted TVA?s motion for summary judgment, holding that the plaintiffs? had accrued in 1988 and was, thus, not timely. Because the claim for civil penalties had run, the concurrent-remedy rule also barred the plaintiffs? claim for injunctive relief. The plaintiffs appealed.
Federal law establishes a five-year statute of limitations for any action ?for the enforcement of any civil fine, penalty, or forfeiture.? 28 U.S.C. ¿ 2462. The plaintiffs acknowledged that, notwithstanding their request for civil penalties, TVA is immune from liability for civil penalties.
TVA argued that the CAA and Tennessee SIP prohibit only construction without a permit and construction had occurred in 1988, more than twelve years before the 2001 filing of the plaintiffs? complaint. The plaintiffs countered that TVA?s subsequent and continuing failure to apply BACT and to obtain a construction permit are continuing violations.
As an initial matter, the court noted that, although courts have been reluctant to apply the continuing violation doctrine outside the context of a Title VII case, other courts have considered the continuing violation doctrine in environmental disputes. In United States v. Duke Energy Corporation, 278 F. Supp. 2d 619 (M.D.N.C. 2003), the court concluded that violations of North and South Carolina PSD provisions are continuing violations. However, the courts in New York v. Niagara Mohawk Power Corporation, 263 F. Supp.2d 619 (M.D.N.C. 2003) and United States v. Westvaco Corporation, 144 F. Supp.2d 439, 442?44 (D. Md. 2001) concluded, in the first case, that federal PSD regulations are not continuing violations, and, in the second, that violations of Maryland PSD regulations are not continuing violations.
The court concluded it did not need to decide whether the continuing violation doctrine applies in environmental suits because it determined that this situation presented a series of discrete violations rather than a single violation that may or may not be continuing in nature. The court pointed to its decision in Gandy v. Sullivan County, 24 F.3d 861 (6th Cir. 1994), as analogous to the case before it. In that Equal Pay Act case, the court noted that each check that was issued based on a discriminatory method of calculation pay constituted a separate violation of the statute. Similarly, in a Title VII discrimination case, the Supreme Court instructed, ?Each discrete discriminatory act starts a new clock for filing charges alleging that act.? National R.R. Passenger Corporation v. Morgan, 536 U.S. 101, 113 (2002). Accordingly, the plaintiff could recover for all discrete acts of discrimination that occur within the limitations period.
In this case, the court determined that, for the plaintiffs to prevail, they must identify a standard or limitation that TVA violated or any required permit that it failed to obtain within five years of bringing this suit. One provision of the PSD regulations states, ?A Major modification shall apply best available control technology for any pollutant for which it would result in a significant net emissions increase at the source. Tenn. Comp.R. & Regs. 1200?3?9?.01(4)(j)(3) (emphasis added). According to the court, this provision creates an ongoing obligation to apply BACT. This is an absolute requirement that would be actionable if violated even if TVA had obtained a construction permit that did not contain BACT. The court concluded that the failure to apply BACT accrues each day that a plant operates without BACT limits. Therefore, the claim based on violations that occurred after February 13, 1996, are timely.
Under the Tennessee SIP, the obligation to obtain an appropriate construction permit is an ongoing violation; the duty to obtain a construction permit containing the proper emissions limits is ongoing both pre- and post-construction. TVA has never received a permit containing emissions limitations under Tennessee?s SIP PSD provisions. Therefore, TVA has been and remains in violation of the requirement. Therefore, claims based on violations postdating February 12, 1996, are timely.
The court did comment that the issue of whether TVA?s modification triggered the PSD requirements was not before it.
The court, thus, concluded that the plaintiffs? claims for civil penalties are timely insofar as they refer to violations that occurred within five years of the date they filed their initial complaint. Accordingly, it reversed the district court?s decision and remanded for further proceedings.
Published by the National Association of Attorneys General with the cooperation and support of the Office of Enforcement and Compliance Assurance of the U.S. Environmental Protection Agency.
Chief Counsel for Environment