THACKER, Circuit Judge:
Friends of Buckingham and the Chesapeake Bay Foundation, Inc. (collectively, "Petitioners") challenge the Virginia Air Pollution Control Board ("Board")'s award of a permit for construction of a compressor station on behalf of Intervenor Atlantic Coast Pipeline, LLC ("ACP") in the historic community of Union Hill in Buckingham County, Virginia (the "Compressor Station"). The Compressor Station is one of three such stations planned to support the transmission of natural gas through the ACP's 600-mile pipeline (the "Pipeline"), which is projected to stretch from West Virginia to North Carolina.
Petitioners filed this petition for review against the Board and its chairman, and the Virginia Department of Environmental Quality ("DEQ") and its director (collectively, "Respondents"), raising two assignments of error. First, Petitioners contend the Board erred in failing to consider electric turbines as zero-emission alternatives to gas-fired turbines in the Compressor Station. Second, they contend the Board erred in failing to assess the Compressor Station's potential for disproportionate health impacts on the predominantly African-American community of Union Hill, and in failing to independently evaluate the suitability of that site.
This petition for review is governed by a complex intertwining of local, state, and federal laws and regulations. Therefore, we first set forth the law at play before turning to the facts at hand.
Pursuant to the Clean Air Act ("CAA"), 42 U.S.C. §§ 7401-7671q, the Environmental Protection Agency ("EPA") is tasked with establishing national ambient
There are both primary and secondary NAAQS. The primary NAAQS for a given pollutant are the acceptable concentrations of pollutants in the ambient air required to "protect the public health," allowing an "adequate margin for safety." 42 U.S.C. § 7409(b)(1). The secondary NAAQS are the levels set to "protect the public welfare," including environmental and economic interests such as "soils, water, crops," "manmade materials," "visibility," and "climate," in addition to "effects on economic values and on personal comfort." Id. § 7409(b)(2), 7602(h).
Once set by the EPA, the NAAQS are then implemented by nationwide limitations on mobile sources like vehicles, and on new or modified stationary sources; and, relevant here, by state implementation plans ("SIP"s), which implement the NAAQS through emission limitations on stationary and mobile sources. See 42 U.S.C. §§ 7409-10.
There are two types of stationary sources: major emitting sources and minor emitting sources. A major source is one that has the "potential to emit two hundred and fifty tons per year or more of any air pollutant," and a minor source is one that falls below that benchmark. 42 U.S.C. § 7479(1). The Compressor Station is indisputably a minor source, as it has the potential to emit 43 tons per year.
The CAA also requires major source facilities (but not minor ones) to be subject to "the best available control technology [BACT] for each pollutant subject to regulation under this chapter emitted from, or which results from, such facility." 42 U.S.C. § 7475(a)(4). BACT is a guarantee that the emitting source is using the best available technology to limit emissions of regulated pollutants. It is defined in the CAA as:
42 U.S.C. § 7479(3).
Control technologies "are those technologies that have `a practical potential for application to the emissions unit and the regulated pollutant under evaluation.'" Helping Hand Tools v. U.S. Envtl. Prot. Agency, 848 F.3d 1185, 1190 (9th Cir. 2016) (quoting EPA, New Source Review Workshop Manual, at B.5 (1990)). Generally, under federal law the failure to consider available alternative control technologies (also referred to as "control alternatives") in BACT analysis "constitutes clear error." Id. at 1194. However, the EPA "does not have to consider [a] control alternative[]" — even if it is effective at reducing emissions — if it "redefines the source." Id. "[A] control alternative redefines the source if it requires a complete redesign of the facility. In a classic and simple example, a coal-burning power plant need not consider a nuclear fuel option as a `cleaner' fuel because it would require a complete redesign of the coal-burning power-plant." Id.
"Redefining the source" in the federal administrative world is applicable to projects certified under the prevention of significant deterioration ("PSD") program. The PSD provisions were added to the CAA in 1977 to focus on "facilities which, due to their size, are financially able to bear . . . substantial regulatory costs . . . and which, as a group, are primarily responsible for emissions of the deleterious pollutants that befoul our nation's air." Ala. Power Co. v. Costle, 636 F.2d 323, 353 (D.C. Cir. 1980). The purpose of the PSD program is to "protect public health and welfare from any actual or potential adverse effect which in [EPA's] judgment may reasonably be anticipate[d] to occur from air pollution . . . notwithstanding attainment and maintenance of all [NAAQS]." 42 U.S.C. § 7470(1). The PSD program was designed to "combat incumbency by ensuring that, in addition to new facilities, existing facilities will eventually have to satisfy stringent technology-based requirements when they make major modifications." Sage Ertman, Climate Change and the PSD Program: Using BACT to Combat the Incumbency of Fossil Fuels, 47 Envtl. L. 995, 1006 (2017).
The "redefining the source" doctrine was developed by the EPA to resolve an ambiguity in the CAA. Specifically, some hearing officers and courts had recognized the "tension between" two CAA requirements in the PSD program. In re Prairie State Generating Co., 13 E.A.D. 1, 2006 WL 2847225, at *16 n.15 (Aug. 24, 2006), aff'd sub nom. Sierra Club v. Envtl. Prot. Agency, 499 F.3d 653 (7th Cir. 2007) (citing § 7475(a)(1)). First, there is an "obligation to conduct the BACT analysis on the `proposed facility.'" Id. Second, there is a "concurrent obligation to consider as BACT `application of production processes and available methods, systems, and techniques,' including lower-emitting fuels." Id. (citing § 7479(3)). According to the EPA's Office of Air and Radiation, the redefining the source doctrine "reasonably harmonizes" these competing obligations in that the entity issuing the permit "review[s] the project as proposed — not something fundamentally different," but also "review[s] all elements of the proposed project's design and, in particular, consider[s] whether
The EPA has clarified that, under the redefining the source doctrine, BACT review depends on a company's proposed plans and purpose. Thus, for the PSD program, a permitting agency must consider all means of lowering emissions, as long as those means would not "regulate the applicant's objective or purpose for the proposed facility" or require a redesign of a proposed facility. Helping Hand, 848 F.3d at 1195; see also Sierra Club, 499 F.3d at 654 ("EPA's position is that [BACT] does not include redesigning the plant proposed by the permit applicant" (citing EPA, New Source Review Workshop Manual: Prevention of Significant Deterioration and Nonattainment Area Permitting B.13 (1990))); John-Mark Stensvaag, Preventing Significant Deterioration Under the Clean Air Act: The BACT Determination — Part I, 41 Envtl. L. Rep. News & Analysis 11101, 11112 (2011) ("EPA will not insist on a BACT technology that would redefine the permit applicant's facility."). For example, "[w]hen a fuel source is co-located with a facility, EPA need not consider in the BACT analysis fuel sources that are not readily available, because it would redefine the source." Helping Hand, 848 F.3d at 1195. Therefore, in the context of major source PSD permits, the EPA does not have to consider control alternatives that would "redefine the source" in a given project.
To our knowledge, this federal redefining the source doctrine has never been applied to a non-PSD, minor source by a state pollution board, which is what we have here.
The CAA "establishes a program of cooperative federalism that allows the [s]tates, within limits established by federal minimum standards, to enact and administer their own regulatory programs, structured to meet their own particular needs." Virginia v. Browner, 80 F.3d 869, 883 (4th Cir. 1996) (internal quotation marks omitted). The federal NAAQS are merely "[pollutant] concentration ceilings," In re Prairie, 2006 WL 2847225, at *5, that "allow[] an adequate margin of safety," 42 U.S.C. § 7409(b)(1), and "protect not only average healthy individuals, but also `sensitive citizens' — children, for example, or people with asthma, emphysema, or other conditions rendering them particularly vulnerable to air pollution," North Carolina v. TVA, 615 F.3d 291, 310 (4th Cir. 2010) (internal quotation marks omitted). However, the CAA makes clear that "air pollution control at its source is the primary responsibility of States and local governments." 42 U.S.C. § 7401(a)(3). Therefore, states are tasked with adopting a SIP "which provides for implementation, maintenance, and enforcement of [primary and secondary NAAQS] in each air quality control region (or portion thereof) within such State." Id. § 7410(a)(1).
Pursuant to Virginia's SIP, all new stationary sources, whether major or minor, are subject to BACT review. See 9 Va. Admin. Code § 5-50-260(B) ("A new stationary source shall apply best available control technology for each regulated pollutant for which there would be an uncontrolled emission rate equal to or greater than the levels in 9 Va. Admin. Code § 5-80-1105 [providing charts of exemption levels in tons per year for various pollutants]."). This is so even though federal law does not require a BACT analysis of minor sources.
Virginia's BACT relies on emission reduction per emissions unit via production processes, methods, or techniques. See 9 Va. Admin. Code § 5-50-260(C) ("This [BACT] requirement applies to each affected emissions unit in the project." (emphasis supplied)). Specifically, Virginia's BACT analysis requires the development of "an emissions limitation . . . based on the maximum degree of emission reduction. . . which the [B]oard, on a case-by-case basis, . . . determines is achievable for the new stationary source . . . through the application of production processes or available methods, systems and techniques, including fuel cleaning or treatment or innovative fuel combustion techniques." Id. § 5-50-250(C). Of note, there is no reference to the "redefining the source" doctrine in Virginia law or regulations.
In addition to the SIP, Virginia law also contains a Commonwealth Energy Policy, which "[e]nsure[s] that development of new, or expansion of existing, energy resources or facilities does not have a disproportionate adverse impact on economically disadvantaged or minority communities." Va. Code Ann. § 67-102(A)(11). Likewise, one of the "[e]nergy objectives" of the Commonwealth Energy Policy is to "[d]evelop [] energy resources and facilities in a manner that does not impose a disproportionate adverse impact on economically disadvantaged or minority communities." Id. § 67-101(12).
The Board is a seven-member citizen board selected by the Governor "from the Commonwealth at large on the basis of merit without regard to political affiliation." Va. Code Ann. § 10.1-1302; see id. § 10.1-1301. The Board is empowered to "make, or cause to be made, such investigations and inspections and do such other things as are reasonably necessary" to discharge its duties. Id. § 10.1-1306. For example, the Board may "call upon any state department or agency for technical assistance" in performing its duties. Id. § 10.1-1303.
The Board often calls upon DEQ to provide technical support and help the Board to fulfill its obligations. In general, DEQ can review permit applications, prepare draft permits and related documents, review and respond to comments from the public, and hold public hearings. See Aegis Waste Sols., Inc. v. Concerned Taxpayers
Va. Code Ann. § 10.1-1322.01(P). If the Board adopts the recommendation of DEQ, it "shall provide in writing a clear and concise statement of the legal basis and justification for the decision reached." Va. Code Ann. § 10.1-1322.01(P). Likewise, if the Board's decision varies from DEQ's recommendation, the Board must "provide a clear and concise statement explaining the reason for the variation and how the Board's decision is in compliance with applicable laws and regulations." Id.
Finally, before ACP can construct a compressor station in Buckingham County, it is required to obtain a separate special use permit ("SUP") from the Buckingham County Board of Supervisors. See Va. Code Ann. § 10.1-1321.1(A) ("No application for a permit for a new or major modified stationary air pollution source shall be considered complete unless the applicant has provided the Director [of DEQ] with notification from the governing body of the county . . . in which the source is to be located that the location and operation of the source are consistent with all [local] ordinances."). The Board of Supervisors issued the SUP in February 2017, and it contained 41 conditions for the Compressor Station. These conditions included emergency response requirements, a notification process for planned natural gas venting events, noise mitigation measures, light regulations, and zoning setbacks. Based on the SUP, Buckingham County certified to DEQ that the Compressor Station "is fully consistent with all applicable local ordinances." J.A. 323 (bolding omitted).
Because natural gas transported through the Pipeline must remain pressurized, ACP sought to construct three compressor stations in different locations along the Pipeline — one in West Virginia, one in Virginia (the Buckingham County location at issue here), and one in North Carolina.
ACP claims the Compressor Station site in Buckingham County is "the only feasible location" because: (1) "it allows the ACP to interconnect with the existing Transco pipeline";
After the Permit application was complete, DEQ provided several comment periods. On August 16, 2018, at the beginning of the first 30-day comment period, DEQ held an informational session for the residents of Buckingham County. DEQ representatives stated that, before the Board would take final action on the permit application, it would consider all comments. They also assured all public commenters that they could address the Board at a public meeting. After the comment period closed, DEQ conducted a public hearing on September 11, 2018, and heard proposed comments. Almost 200 people attended, and 60 people made oral comments. DEQ extended the comment period by 10 days. Over the 40 day comment period, DEQ received more than 5,300 comments. "Many comments" expressed "concerns about the potential for disproportionate impacts of the proposed facility on the African American population in Union Hill." J.A. 2174.
On November 8, 2018, the seven-member Board held its first public hearing. DEQ presented its summary of public comments from the 40 day comment period for the Board's consideration. These comments included concerns such as whether the "[f]acility should use electric turbines" instead of natural gas turbines, criticism that EPA's "[a]ir quality standards [are] not adequately protective," and "[e]nvironmental [j]ustice" and "[s]ite suitability issues." J.A. 1584. More than 80 people spoke at the hearing, and the Board made the following statements to and inquiries of DEQ officials:
Based on these concerns, the Board deferred consideration of the Permit. One week later, Governor Ralph Northam removed two Board members who had voiced concerns about the disproportionate harm to Union Hill and replaced them with two new members. See Patrick Wilson, Northam Removes 2 Members from Air Board Before Buckingham Project Vote, Richmond Times-Dispatch (Nov. 15, 2018), https://bit.ly/2HvnsAU (saved as ECF opinion attachment); Press Release, Gov. Ralph S. Northam, Governor Northam Announces Administration Appointments (Nov. 16, 2018), https://www.governor. virginia.gov/newsroom/all-releases/2018/ november/headline-836509-en.html (saved as ECF opinion attachment). A third Board member identified a "conflict of interest in the action" and removed himself from consideration of the Permit. J.A. 2481. The Board, with only the four original members present, reconvened on December 19, 2018. It once again deferred a decision on the Permit and ordered a limited
Throughout the permitting process, and relevant to the issues presented here, DEQ provided the following recommendations and responses to the public and the Board:
On January 8, 2019, the Board held its final meeting. A DEQ official made a brief presentation, again stating that "[r]egardless of the demographics of the area surrounding the compressor station, [it] will not cause a disproportionate adverse impact to the community" for two reasons: first, the residents surrounding the Compressor Station site "are already breathing air that is cleaner than the air breathed by 90% of the residents of Virginia"; and second, although "air modeling does indicate. . . a slight increase in air pollution concentration [from the Compressor Station], the increase is slight." J.A. 2905-06.
The same four members present at the December meeting
The Board as a whole issued a one-page Decision Statement the same day, stating simply that the Permit was "prepared in conformance with all applicable statutes, regulations, and agency practices"; the limits and conditions in the permit "have been established to protect public health and the environment"; and "all public comments relevant to the permit [were] considered." J.A. 2999. The Board's Decision Statement specifically incorporated a November 2018 memorandum to the Board from DEQ; a permit engineering analysis from DEQ;
Petitioners filed this timely petition for review of the grant of the Permit. We possess jurisdiction pursuant to the Natural Gas Act, 15 U.S.C. § 717r(d)(1) (providing the "United States Court of Appeals for the circuit in which a [natural gas] facility . . . is proposed to be constructed. . . or operated shall have original and exclusive jurisdiction over any civil action for the review of an order or action of a. . . State administrative agency acting pursuant to Federal law to issue . . . any permit . . . required under Federal law").
The parties dispute the proper standard of review. Petitioners believe we should review the Board's decision under the arbitrary and capricious standard of review that we normally employ when reviewing federal administrative agency actions.
Appalachian Voices v. State Water Control Bd., 912 F.3d 746, 753 (4th Cir. 2019) (internal quotation marks omitted). Further,
Id. (internal quotation marks omitted).
ACP, however, believes we should look to Virginia law to determine the standard of review because "by its . . . terms, the federal APA does not apply to state agencies." ACP Br. 26-28. ACP notes that under Virginia's version of the APA, "[f]or factual issues, the question is `whether there was substantial evidence in the agency record to support the agency decision.'" ACP Br. 27-28 (quoting Va. Code Ann. § 2.2-4207). But the same is true for findings of fact under the federal APA, at least in formal proceedings like the one at issue here. Northrop Grumman Sys. Corp. v. U.S. Dep't of Labor, Admin. Review Bd., 927 F.3d 226, 232 (4th Cir. 2019) ("The agency's findings of fact are upheld if supported by substantial evidence.").
ACP does not articulate how the standard for review of the agency's decision arising out of its findings of fact would be different under Virginia law, and we do not believe it would be.
Frederick Cty. Bus. Park, LLC v. Va. Dep't of Envtl. Quality, 278 Va. 207, 677 S.E.2d 42, 44-45 (2009) (emphasis supplied); see also Northrop Grumman, 927 F.3d at 232 ("Under the [federal APA], an appellate court may only disturb the [agency]'s decision if it was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." (internal quotation marks omitted)). Both the federal and Virginia standards require courts to act where the agency's action was not "in accordance with law." See 5 U.S.C. § 706 (reviewing courts must "hold unlawful and set aside [such] agency action"); Va. Code Ann. § 2.2-4029 (reviewing courts must "suspend or set [such action] aside and remand the matter to the agency for further proceedings"). And Virginia law, like federal law, provides that in reviewing an agency determination, "issues of law shall be . . . review[ed] . . . de novo." Va. Code Ann. § 2.2-4027; see South Carolina v. United States, 907 F.3d 742, 756 (4th Cir. 2018). Accordingly, it is not surprising that the Virginia Supreme Court has suggested that "the scope of court review under" the federal and Virginia APAs "is `virtually identical.'" State Bd. of Health of Va. v. Godfrey, 223 Va. 423, 290 S.E.2d 875, 881 n.6 (1982) (quoting Annual Survey of Virginia Law, 61 Va. L. Rev. 1632, 1639 (1975)); see also id. at 881 (citing approvingly the discussion of the federal APA in Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 91 S.Ct. 814, 28 L.Ed.2d 136 (1971)).
In our prior decisions reviewing Virginia Water Control Board permitting decisions, Appalachian Voices v. State Water Control Board and Sierra Club v. State Water Control Board, the state agency argued for a substantial evidence standard of review. Nevertheless, we applied an arbitrary and capricious standard of review, noting that even under a substantial evidence standard, the result would be the same. See Appalachian Voices, 912 F.3d at 753 n.1; Sierra Club, 898 F.3d 383, 403 n.13 (4th Cir. 2018). We are content to do the same here, especially because under Virginia law, a "reviewing court may set [an] agency action aside, even if it is supported by substantial evidence, if the
Petitioners assert that under Virginia's SIP, the Compressor Station is subject to BACT review because it is a minor emitting source and Virginia law requires such review of minor sources, even though the CAA does not. Respondents do not disagree with this statement. Then, Petitioners contend that the Board was required to evaluate BACT for each regulated pollutant emitted from the Compressor Station, but it failed to even consider a control technology that would eliminate almost all on-site pollution: electric motors. Specifically, Petitioners submit:
Pet'rs' Br. 21-22. Even if the redefining the source doctrine applied, say Petitioners, the Board "made no effort" to determine if using electric motors would constitute such a redefinition of the source. Id. at 22.
The only rationale the Board could have ostensibly relied upon (via the Decision Statement's incorporation of DEQ's response to comments) for refusing to consider electric motors in its BACT analysis was that replacing gas-fired turbines with electric motors would constitute an impermissible "redefinition of the source." J.A. 2178 (Resp. to Comments 33) ("DEQ has determined that wholesale replacement of a natural gas turbine (the affected emission unit) for an electric turbine (a completely different process unit with a different energy source) constitutes redefinition of the source and is not considered in Virginia's BACT determination" (emphasis supplied)). Review of the "whole record," 5 U.S.C. § 706; see also Va. Code Ann. § 2.2-4027, does not suggest any additional justification. See J.A. 1381 (Corbett Email) (DEQ did not consider electric compressors because "they would redefine the source" (emphasis supplied)); id. at; id. at 2237-38 (Nov. 9, 2018 Hearing Transcript 36:22-37:17) ("Our response to electric turbines is that . . . there's a concept called redefining the source. Businesses have to be able to determine the activity that they're doing and how they're going to do it. . . . [W]e can require them to make alterations to their system, like, say, adding catalytic reduction [which is] a minor change to the design . . . . Replacing a natural gas-fired turbine with an electric turbine is a wholesale replacement, and it's inappropriate in redefining the source." (emphases supplied)).
Petitioners make three arguments on this point: first, if DEQ was referring to the federal EPA redefining the source doctrine, it is not applicable to the Compressor Station project, which is a minor
A state agency action survives our review if it "examined the relevant data and articulated a satisfactory explanation for its action including a rational connection between the facts found and the choice made." Appalachian Voices, 912 F.3d at 753 (alterations and internal quotation marks omitted); see also Frederick Cty. Bus. Park, 677 S.E.2d at 44-45. Having considered the entire record, we are not satisfied that the Board provided a sufficient and rational explanation of its failure to consider electric turbines in place of gas-fired turbines, and DEQ's responses to the public are likewise insufficient.
Nowhere in DEQ's comments, recommendations, or the Board's Decision Statement can we find a reference to a case, regulation, other project, or common practice that would sufficiently explain what "redefining of the source" means under Virginia law. The EPA cautions that, even when applying the federal doctrine (which is actually laid out in regulations and case law, unlike the purported Virginia doctrine), "any decision to exclude an option on `redefining the source' grounds must be explained and documented in the permit record, especially where such an option has been identified as significant in public comments." PSD AND TITLE V PERMITTING GUIDANCE FOR GREENHOUSE GASES, EPA Manual at 27, https://www.epa.gov/sites/production/files/201507/documents/ghgguid.pdf (saved as ECF opinion attachment). There was no such explanation here. We — and most importantly, the citizens of Virginia — do not know what the Virginia redefining the source doctrine is, how it works, and how this project meets its requirements.
Respondents and ACP have marshaled a host of post hoc justifications in an attempt to explain what DEQ meant when repeatedly using the phrase "redefinition of the source." But "courts may not
ACP also contends that, buried in a footnote in DEQ's response to public comments (adopted by the Board in its Decision Statement), DEQ provides a separate and sufficient reason for rejecting the electric turbines. There, DEQ states, "Natural gas also provides a consistent source of fuel as the pipeline operation provides the fuel needed. Electricity would be subject to grid issues such as power outages and other similar interruptions that would hamper operations at the site." J.A. 2178 n.17. Respondents also cite to FERC's environmental impact statement ("EIS"), which states that an electric turbine would require the construction of 12 miles of overhead power lines and a new substation. See Resp's' Br. 47.
These arguments fail. We have held that a permitting agency "may adopt FERC's EIS only if it undertakes `an independent review of the EIS' and `concludes that its comments and suggestions have been satisfied.'" Cowpasture River Pres. Ass'n v. Forest Serv., 911 F.3d 150, 170 (4th Cir. 2018) (quoting 40 C.F.R. § 1506.3(c) (alteration omitted)). There is no evidence that such review happened here with regard to electric turbines. Relatedly, because DEQ relied on a nonexistent redefining the source doctrine, DEQ effectively relieved the Board from even considering the alternative energy source at all, so the Board could not have sufficiently and independently considered the impacts of electric turbines. As a result, we have no idea how much of an impact the Board thinks the electric turbines would make.
Finally, Respondents contend that we should essentially overlook any mention of redefining the source, and rather place emphasis on DEQ's statement that the natural gas turbines were the applicable "emission unit" under state law and that Virginia's BACT determination does not require "wholesale replacement" of an emission unit. See Resp'ts' Br. 40-41 (citing J.A. 2178). Further, they argue electric turbines are not "processes, methods, or techniques" and therefore, they are not considered "control technology" for purposes of BACT. Id. We decline to adopt these arguments.
In explaining its decision, an agency must be "clear enough that its path may be reasonably discerned." Encino Motorcars,
For these reasons, the Board's decision was arbitrary and capricious and unsupported by substantial evidence. As Petitioners point out, ACP's and Respondents' arguments on appeal read as "convenient litigation position[s]." Pet'rs' Reply Br. 8. Nothing more. We vacate and remand for further explanation of reliance on the redefining the source doctrine, and/or why electric turbines are not required to be considered in Virginia's BACT analysis of the Compressor Station.
Petitioners' second argument is that the Board arbitrarily and capriciously decided issues of health risk and site suitability.
Union Hill is a historic community with a high population of African-Americans whose ancestors established the community in the aftermath of the Civil War. Community members founded the Union Hill Baptist Church, as well as the Union Grove Missionary Church, and have buried their dead there for generations. In 2015, ACP bought a neighboring 68.5-acre plot of land and chose that site for the placement of the Compressor Station.
According to the ACP permit application, the Compressor Station's four turbines, with a combined 58,162 horsepower, would burn gas 24 hours a day, 365 days a year. Together, the turbines' combustion of gas accounts for 83% of the facility's projected nitrogen oxide emissions and 95% of its emissions of particulate matter (PM, PM2.5, and PM10), and also generates emissions of toxic materials such as formaldehyde and hexane. FERC determined that the Compressor Station will increase the area's amount of nitrogen oxide pollution and fine particle (PM2.5) pollution, and emit known carcinogens into the community. FERC likewise recognized that pollutants from compressor stations "are known to increase the effects of asthma and may increase the risk of lung cancer." J.A. 2601 (footnote omitted).
Pet'rs' Br. 10-11 (citations omitted).
Petitioners contend that the Board (and to the extent its recommendations were adopted, DEQ), violated Virginia law by "failing to assess the Compressor Station's disproportionate health impacts on the predominantly African-American Union Hill community and the suitability of the site." Pet'rs' Br. 38 (capitalization omitted). These arguments are grounded in a Virginia statute, which provides:
Va. Code Ann. § 10.1-1307(E). Petitioners argue the Board failed to consider the potential for disproportionate health impacts under (E)(1), and made an incomplete and misinformed site suitability determination under (E)(3).
We conclude that the Board thrice erred in performing its statutory duty under sections 10.1-1307(E)(1) and (E)(3): (1) it failed to make any findings regarding the character of the local population at Union Hill, in the face of conflicting evidence; (2) it failed to individually consider the potential degree of injury to the local population independent of NAAQS and state emission standards; and (3) DEQ's final permit analysis, ostensibly adopted by the Board, relied on evidence in the record that was incomplete or discounted by subsequent evidence.
"As Justice Douglas pointed out nearly [fifty] years ago, `[a]s often happens with interstate highways, the route selected was through the poor area of town, not through the area where the politically powerful people live.'" Jersey Heights Neighborhood Ass'n v. Glendening, 174 F.3d 180, 195 (4th Cir. 1999) (King, J., concurring) (quoting Triangle Improvement Council v. Ritchie, 402 U.S. 497, 502, 91 S.Ct. 1650, 29 L.Ed.2d 61 (1971) (Douglas, J., dissenting)); see also Nicky Sheats, Achieving Emissions Reductions for Environmental Justice Communities Through Climate Change Mitigation Policy, 41 Wm. & Mary Envtl. L. & Pol'y Rev. 377, 382 (2017) ("There is evidence that a disproportionate number of environmental hazards, polluting facilities, and other unwanted land uses are located in communities of color and low-income communities."). "The purpose of an environmental justice analysis is to determine whether a project will have a disproportionately adverse effect on minority and low income populations." Mid States Coal. for Progress v. Surface Transp. Bd., 345 F.3d 520, 541 (8th Cir. 2003). "Although the term `environmental justice' is of fairly recent vintage, the concept is not." Jersey Heights, 174 F.3d at 195 (King, J., concurring).
Of note, on August 16, 2018, Governor Northam's own Advisory Council on Environmental Justice recommended suspending the permitting decision for the Compressor Station "pending further review of the station's impacts on the health and the lives of those living in close proximity." J.A. 2791.
Indeed, under Virginia law, the Board is required to consider "character and degree of injury to . . . health," and "suitability of the activity to the area." Va. Code Ann. § 10.1-1307(E). Both Respondents and ACP acknowledge that Virginia law — including the Commonwealth Energy Policy and factors outlined in § 10.1-1307(E)(3) — "require[s] the Board to consider the potential for disproportionate impacts to minority and low income communities." Resp'ts' Br. 53; see also ACP Br. 19 n.6 ("Environmental justice is a component of the Commonwealth Energy Policy."). In fact, no party argues that the Board was excused from considering EJ in its analysis. Therefore, we accept that the Board was required to consider EJ in the Compressor Station Permit approval process. Underpinning Petitioners' arguments here is the idea that not only did the Board consider EJ separate and apart from site suitability, it did not give this point enough consideration.
As explained below, it is clear to us that the Board's EJ review was insufficient, which undermines the Board's statutory duties and renders the Board's Permit decision arbitrary and capricious, and unsupported by substantial evidence.
To begin, Petitioners contend, "Despite access to a wealth of information, the Board failed to make any findings regarding the demographics of Union Hill that would have allowed for a meaningful assessment of the likelihood of disproportionate harm." Pet'rs' Br. 51. We agree. The Board was presented with conflicting evidence about whether and how Union Hill was a "minority" EJ population, and it made no finding as to its resolution of this
Throughout the public comment period and public meetings, one of the main points of dispute was whether the Union Hill community could be deemed a "minority" EJ community. As noted by the Board and ACP, the Board deferred its vote twice in order to obtain more information on this issue. Yet in the end, it did not even bother to make a finding on this issue. Rather, at least two Board members "assumed" that Union Hill was an EJ minority community without performing further analysis on what that means.
The minority EJ community designation is important because, if Union Hill is considered a minority EJ community, then information about "African American populations hav[ing] a greater prevalence of asthma" and other health issues is an important consideration. J.A. 2373 (FERC analysis, relied upon by DEQ). For example, FERC's analysis in the EIS — upon which DEQ originally relied — outlined all the risks to African Americans from the Compressor Station, e.g., increased risk of asthma and lung cancer, and even noted that African Americans were an "especially sensitive" community for these conditions. Id. at 2372-73. But because the African American population around the Compressor Station did not "exceed the threshold[] for environmental justice populations," it was of no moment. Id. at 2373; see also id. at 2372 ("None of the three census tracts within 1 mile of the [Compressor Station] are designated minority [EJ] populations [based on a methodology involving 2013 census data].").
There are multiple pieces of conflicting evidence about the minority population of Union Hill in this record, presented to DEQ and the Board:
DEQ's final permit analysis submission to the Board says nothing further about EJ. And of course, the Board's decision is only one page long, says nothing about EJ or which stud(ies) it relied on, and even adds a provision in handwriting, professing that "[T]he Board does not adopt any legal views expressed by DEQ regarding the Board's authority under Va. Code Ann. Section 10.1-1307.E," without further explanation. J.A. 2999.
The Board acted arbitrarily in failing to provide any explanation regarding the EJ issue, which makes its extensions of public comments and additional meetings ring hollow.
Moreover, under Virginia law, the Board's factfinding would fail under a substantial evidence standard of review because there is conflicting evidence in the record that the Board did not resolve. Virginia law is clear: "It is not unusual for there to be conflicting evidence in contested cases, and it is the job of the agency, as factfinder, to resolve those conflicts." Virginia Ret. Sys. v. Blair, 64 Va.App. 756, 772 S.E.2d 26, 32 (2015) (emphasis in original); see also Levine v. Arlington Med. Imaging, LLC, No. 0145-18-4, 2018 WL 5259252, at *5 (Va. Ct. App. Oct. 23, 2018) ("It is the job of the agency, as factfinder, to resolve th[e] conflicts [in the evidence]." (alterations and internal quotation marks omitted)); cf. All. to Save the Mattaponi v. Dep't of Envtl. Quality ex rel. State Water Control Bd., 270 Va. 423, 621 S.E.2d 78, 91 (2005) ("When there are conflicting expert opinions, the administrative agency, not the courts, must resolve the factual conflicts." (citing Webb v. Gorsuch, 699 F.2d 157, 160 (4th Cir. 1983)).
ACP responds to this deficiency in the Board's decision by downplaying the role of the Board, asserting that they must only provide a "short, concise statement in writing" in issuing the Permit. ACP Br. 3 (emphasis supplied). First of all, this is a misquote of Virginia Code section 10.1-1322.01(P), which provides, "When the decision of the Board is to adopt the recommendation of [DEQ], the Board shall provide in writing a clear and concise" — not a "short, concise" — "statement of the legal basis and justification for the decision reached." Va. Code Ann. § 10.1-1322.01(P) (emphasis supplied). A "short" statement is a far cry from a "clear" statement. In any event, here, to the extent the Board stated that it was not relying on DEQ, the Board was required to "provide a clear and concise statement explaining the reason for the variation [from DEQ] and how the Board's decision is in compliance with applicable laws and regulations." Id. (emphasis
At bottom, there is no evidence the Board "considered the conflicting views presented" and "made a reasonable decision supported by substantial evidence." Mattaponi, 621 S.E.2d at 91. ACP correctly states, "As long as the record contains substantial evidence that the Board took into account the relevant facts and circumstances, the Board's decision must be upheld." ACP Br. 41 (citing Mattaponi, 621 S.E.2d at 92-93). Unfortunately, there is no such evidence in the record before us here.
Two of the Board members and DEQ assumed for the purpose of argument that Union Hill was an EJ community, and Respondents suggest we should impute that reasoning to the rest of the Board. See Resp'ts' Br. 30-31, 55-56; Oral Arg. at 25:30-26:50. We decline to do so. Cf. Flickinger v. Sch. Bd. of City of Norfolk, Va., 799 F.Supp. 586, 594-95 (E.D. Va. 1992) (imputing motive of three school board members to the whole board improper). In any event, the Board cannot assume away what it is required to decide.
Even if the entire Board made this assumption, it did not properly carry this assumption through its analysis. See Va. Code Ann. § 10.1-1307(E) (requiring Board to consider "character and degree of injury to, or interference with, safety, health, or the reasonable use of property which is caused or threatened to be caused"); id. § 67-102 (Board must "ensur[e] that development of new" energy facilities "does not have a disproportionate adverse impact on economically disadvantaged or minority communities"). If the area around the Compressor Station is indeed an EJ minority community, the demographic and statistics change regarding whether this is a "especially sensitive" community for certain conditions. J.A. 2372. Rather than take this into account in its assumption, the Board merely falls back on NAAQS and state air quality standards not tailored to this specific EJ community. The record is replete with such reliance, up to and including the very last Board meeting:
The Board's reliance on air quality standards led it to dismiss EJ concerns. Even if all pollutants within the county remain below state and national air quality standards, the Board failed to grapple with the likelihood that those living closest to the Compressor Station — an overwhelmingly minority population according to the
By all accounts, PM2.5 is the most harmful particulate matter to be emitted from the Compressor Station.
We have yet to find — and the Board and ACP do not indicate — where the Board analyzed the risk of PM
This strikingly limited analysis goes hand in hand with the EJ error analyzed above, making the health risk and site suitability analysis all the more important. Instead, the Board accepts without deciding that this area may be an EJ minority community with a high risk for asthma complications, and then does not properly recognize the localized risk of the very particulate matter that exacerbates asthma.
Because the Board's written statement provides scant analysis, we look to "the comments and recommendation of [DEQ]," and "the agency files," which the Board is required to consider in making its permitting decision. Va. Code Ann. § 10.1-1322.01(P). But, in the final permit analysis, signed by DEQ officials on January 9, 2019, the only issues that DEQ considered as relevant to "Site Suitability" were: (1) an October 2017 site evaluation, which ignored the local residential population; (2) the SUP issued by Buckingham County; and (3) projected compliance with ambient air quality standards. J.A. 2993. This evidence was incomplete, improper, and rendered unreasonable by subsequent evidence presented to the Board throughout the permitting process.
First, as the myriad studies and comments presented to the Board throughout the permitting process made clear, the single-page
Second, it is improper to rely upon a SUP as a substitute for an independent determination of site suitability under section 10.1-1307(E). See 9 Va. Admin. Code § 5-80-1230 "[C]ompliance [with zoning ordinances] does not relieve the board of its duty under . . . § 10.1-1307[(]E[)] . . . to independently consider relevant facts and circumstances.").
And for the reasons mentioned above, see supra III.B.2.b.iii., blindly relying on ambient air standards is not a sufficiently searching analysis of air quality standards for an EJ community. Otherwise, § 10.1-1307(E) is rendered meaningless.
The Board's failure to expand on and correct this erroneous DEQ site suitability analysis — which remained unchanged from October 2018 to January 2019 — was arbitrary, capricious, and unsupported by substantial evidence in the record.
For these reasons, we conclude that the Board failed in its statutory duty to determine the character and degree of injury to the health of the Union Hill residents, and the suitability of the activity to the area. We vacate and remand for the Board to make findings with regard to conflicting evidence in the record, the particular stud(ies) it relied on, and the corresponding local character and degree of injury from particulate matter and toxic substances threatened by construction and operation of the Compressor Station.
To be clear, if true, it is admirable that the Compressor Station "has more stringent requirements than any similar compressor station anywhere in the United States," J.A. 2920, and that residents of Union Hill "will be breathing cleaner air than the vast majority of Virginia residents even after the Compressor Station goes into operation," ACP Br. 49. But these mantras do not carry the day. What matters is whether the Board has performed its statutory duty to determine whether this facility is suitable for this site, in light of EJ and potential health risks for the people of Union Hill. It has not.
For the foregoing reasons, we vacate the Permit and remand to the Board for further proceedings consistent with this opinion.
PETITION FOR REVIEW GRANTED; VACATED AND REMANDED