ALJDEC decisions subject to certification as final

08A-A025-DEQ · Department of Environmental Quality · 2009-03-13

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: By agreement of the parties, no evidentiary hearing was held; status conferences were held on July 7, August 7 and December 4, 2008 APPEARANCES: Attorneys Richard W. Tobin II and Albert H. Acken for California Portland Cement; Assistant Attorney General Joseph P. Mikitish for the Department of Environmental Quality ADMINISTRATIVE LAW JUDGE: Thomas Shedden _____________________________________________________________________ California Portland Cement filed an appeal challenging a significant permit revision to its Air Quality Control Permit. By agreement of the parties, no evidentiary hearing was held and the matter was submitted for resolution based on stipulated facts and written legal arguments. FINDINGS OF FACT On March 31, 2008, the Arizona Department of Environmental Quality (ADEQ) issued a Notice of Hearing setting the above-captioned matter for hearing on May 9, 2008. The Notice provided that the hearing was “to consider the issues concerning ADEQ’s Significant Permit Revision [“SPR”] to Air Quality Control Permit dated February 12, 2008”, which Permit is held by California Portland Cement, d.b.a. Arizona Portland Cement (referred to as APCC).

By agreement of the parties the hearing was continued and several status conferences were held, but no evidentiary hearing was held (also by agreement of the parties). APCC requested an opportunity to file a brief on legal issues related to the matter and on June 13, 2008, APCC filed “California Portland Cement’s Brief on Disputed Questions of Law and Motion for Summary Judgment.” On June 13, 2008, the parties filed “California Portland Cement’s and ADEQ’s Stipulated Statement of Facts”, which include: a. APCC operates a cement manufacturing plant in Pima County; b. The Plant operates under Air Quality Control Permit # M190310P- issued by ADEQ in October 2003; c. The Plant is in an area that is subject to a Clean Air Act State Implementation Plan (“SIP”); d. SIP Rule 343 applies to the Permit; e. There is no National Ambient Air Quality Standard (“NAAQS”) for Particulate Matter as defined in A.A.C. R18-2-101(82), but there is a NAAQS for PM10 and PM2.5; f. The Permit’s Attachment B has Condition I(D)(2)(a)(1) that required APCC to apply for a significant permit revision to photographically monitor its property boundary;[1] g. In December 2003, APCC applied for the required significant permit revision; h. In March 2004, ADEQ determined that the proposed permit revision was not adequate; i. APCC conducted a Demonstration Project and, on March 3, 2006, reported the results to ADEQ; j. On August 24, 2007, ADEQ published a draft SPR #31767; k. APCC filed timely public comment objecting to the issuance of the SPR; l. On February 15, 2008, ADEQ issued a final SPR #31767; m. In its Responsiveness Summary to Public Comments, ADEQ stated that the “proposed significant revision establishes a plan for engaging in monitoring that is already required, a step made necessary by APCC’s failure to submit an approvable plan under the existing condition”; n. SPR #31767 requires APCC to install and monitor two cameras to verify whether or not visible emissions are crossing the property boundary; o. APCC is required to monitor the photographs daily and to report to ADEQ any visible emissions; p. ADEQ cited R18-2-306(A)(3)(c) and R18-2-331(A)(3)(c) for the conditions in SPR # 31767. SIP Rule 343 prohibits airborne diffusion of visible emissions beyond the property line from which such emissions become airborne; SIP Rule 343 does not apply when wind speeds are greater than 25 miles per hour, but that exception can be waived. On June 27, 2008, ADEQ filed “ADEQ’s Response to California Portland Cement’s Brief on Disputed Questions of Law and Motion for Summary Judgment.” Oral argument on the issues presented by APCC was held on July 7, 2008. In an Order dated July 25, 2008, the Administrative Law Judge provided rulings on issues raised by California Portland Cement’s Brief on Disputed Issues[2], but declined to rule on APCC’s request that SPR #31767 should be set aside as a matter of law and concluded that the parties should present evidence on that issue. On August 7, 2008, APCC submitted a “Motion for Clarification, or In the Alternative, Reconsideration.” On August 15, 2008, ADEQ submitted “ADEQ’s Response to California Portland Cement’s Motion for Clarification, or In the Alternative, Reconsideration.” In an Order dated October 15, 2008, the ALJ provided clarification to the Order dated July 25, 2008.[3] At a status conference held December 4, 2008, the parties agreed to submit additional stipulated facts and Briefs on the issues remaining to be resolved. On January 30, 2009, APCC submitted its “Memorandum Concerning Remaining Legal Issues.” On January 30, 2009, ADEQ submitted “ADEQ’s Brief on Its Authority to Require Monitoring During High Wind Events.” The parties did not submit any additional stipulated facts, but rather, each party presented legal argument on whether or not ADEQ could require APCC to continue to take and monitor photographs of the property boundary when the wind speed is greater than 25 miles per hour. Monitoring When the Wind Speed Exceeds 25 Miles per Hour APCC argues that ADEQ does not have the authority to require monitoring when the underlying regulation (SIP Rule 343) is not in effect (i.e., when the wind speed is greater than 25 miles per hour) because the data obtained would provide no information related to APCC’s regulatory compliance. APCC argues that A.A.C. R18-2-306(A)(3)(c) does not apply when the wind speed is more than 25 miles per hour because that rule requires permit conditions to be consistent with the “applicable requirement”, which is SIP Rule 343. But because SIP Rule 343 is not applicable when the wind speed is more than 25 miles per hour, ADEQ’s reliance on R18-2-306(A)(3)(c) violates A.R.S. § 41-1030(B). APCC also argues that the required property-boundary monitoring places an unreasonable burden on APCC and that ADEQ has no way of knowing the cost of conducting the monitoring because ADEQ did not consider costs when it imposed the monitoring regime.[4] ADEQ argues that the monitoring is allowable under A.A.C. R18-2- 306(A)(3)(c) because that monitoring is required to ensure that there is sufficient reliable data to show that APCC is in compliance with SIP Rule 343. ADEQ also argues that the monitoring is required when the wind speed exceeds 25 miles per hour because it would be very difficult to ensure that monitoring began again as soon as the wind speed dropped back below 25 miles per hour and because the 25 miles per hour exception is subject to waiver. CONCLUSIONS OF LAW The burden of proof at an administrative hearing falls to the party asserting a claim, right or entitlement and the standard of proof on all issues in this matter is by a preponderance of the evidence. See A.A.C. R2- 19-119. APCC argued that ADEQ bears the burden of persuasion under A.R.S. § 41- 1092.07(G)(2) because, in APCC’s view, ADEQ issued SPR #31767 under its own initiative. In the Order dated October 15, 2008 the ALJ found that because the Permit required APCC to file for a permit revision, ADEQ was not acting on its own initiative and, consequently, A.R.S. § 41-1092.07(G)(2) was not applicable to the instant matter and APCC, as the party asserting a claim, bears the burden of proof. A preponderance of the evidence is “[e]vidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (6th ed. 1990). R18-2-306(A)(3)(c) provides that: A. Each permit issued by the Director shall include the following elements: * * * * 3. Each permit shall contain the following requirements with respect to monitoring: * * * * c. If the applicable requirement does not require periodic testing or instrumental or noninstrumental monitoring (which may consist of recordkeeping designed to serve as monitoring), periodic monitoring sufficient to yield reliable data from the relevant time period that are representative of the source's compliance with the permit as reported under subsection (A)(4). The monitoring requirements shall ensure use of terms, test methods, units, averaging periods, and other statistical conventions consistent with the applicable requirement, and as otherwise required under R18-2-306.01. Recordkeeping provisions may be sufficient to meet the requirements of this subsection;

SIP Rule 343 provides: Visibility Limiting Standard A. No person shall cause or permit the airborne diffusion of visible emissions, including fugitive dust, beyond the property boundary line within which the emissions become airborne. 1. Within actual practice, the airborne diffusion of visible emissions across property lines shall be prevented by appropriately controlling the emissions at the point of discharge, or ceasing entirely the activity or operation which is causing or contributing to the emissions. B. This RULE shall not apply when the naturally induced wind speed exceeds 25 miles per hour as estimated by a certified visible emissions evaluator using the Beaufort Scale of Wind- Speed equivalents, or as recorded by a U.S. weather Bureau Station or a U.S. government military installation. 1. This exception does not apply to the demolition, destruction, transport, or pulverization of structures containing friable asbestos materials, and all dust-producing activities associated with such sources shall be halted when the wind is causing or contributing visible emissions to cross beyond the property lines within which the emissions discharge. 2. Any disregard of, neglect of, or inattention to other controls required herein, during any time when this RULE is in effect, shall automatically waive the exception, and such relaxation of controls shall be a violation.

On the facts presented, ADEQ’s conclusion that the property-boundary monitoring is required to ensure that there is reliable data related to APCC’s compliance with SIP Rule 343 is a reasonable interpretation of A.A.C. R18-2-306(A)(3)(c). ADEQ’s interpretation of the regulation is entitled to deference. See Arizona Water Co. v. Arizona Dept. of Water Resources, 208 Ariz. 147 (2004); Daimlerchrysler v. Arizona Dep’t of Revenue, 210 Ariz. 297 (App. 2005). ADEQ’s position that monitoring when the wind exceeds 25 miles per hour is required to ensure that monitoring is conducted as soon as the wind speed drops below 25 miles per hour is not unreasonable, and there was no evidence adduced to the contrary. There was no evidence adduced to show that the required property-boundary monitoring imposes an unreasonable burden on APCC. Because APCC presents no substantial evidence to show that SPR #31767 is contrary to law or that SPR #31767 represents an unreasonable use of ADEQ’s discretion in interpreting the applicable regulations, APCC’s appeal should be dismissed. RECOMMENDED ORDER IT IS RECOMMENDED that the Director of the Arizona Department of Environmental Quality dismiss California Portland Cement’s appeal. Done this day, March 13, 2009 ______________________________________ Thomas Shedden Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2009, to:

Patrick Cunningham, Acting Director Department of Environmental Quality Attn: Judy Fought 1110 W. Washington, Sixth Floor Phoenix, AZ 85007

By ___________________________ ----------------------- [1] The parties generally refer to this as the “property boundary plan.” [2] Finding that APCC bears the burden of proof; that APCC did not demonstrate that A.R.S. § 49-422(B) requires ADEQ to conduct an analysis of cost and feasibility before requiring the property boundary monitoring; and that APCC did not demonstrate that SIP Rule 343 does not prohibit visible emissions at the property boundary if appropriate controls are used at the emissions source.

[3] Finding that it was not appropriate to issue a ruling as a matter of law on the validity of the modification to Permit Condition I(D)(1)(b) because ADEQ asserted that there were disputed facts; that A.R.S. § 49- 422(B) requires ADEQ’s Director to consider the cost of monitoring when rules are promulgated and does not address the Director’s obligations with respect to individual permits and consequently, this statute can not be read to require ADEQ to conduct cost analysis in the promulgation of permit conditions; and confirming that A.R.S. § 41-1092.07(G)(2) was not applicable to the instant matter because ADEQ was not acting on its own initiative in issuing SPR # 31767 because the Permit required APCC to file for a permit revision.

[4] APCC asserts that the ALJ ruled that “ADEQ need not consider costs and feasibility when imposing permit conditions.” This misstates the ALJ’s ruling, which was limited to the specific question of whether or not A.R.S. § 49-422(B) required ADEQ to conduct an analysis of cost and feasibility before requiring the property-boundary monitoring.

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826