ELR Citation: ELR 21021
No(s). EP-80-CA-265 (W.D. Tex. Sep 30, 1985)

The court holds that defendant is liable for $6,054,000 in civil penalties for past violations of the federal Clean Air Act, Texas Clean Air Act, and implementing regulations of both. Defendant contracted with the El Paso Acid Corporation (EPAC) to operate a fuel gas desulfurization facility, but EPAC ceased operations in 1977. Defendant did not have an effective replacement in operation until 1979.

The court first holds that Rule 201.06 of the Texas state implementation plan (SIP), which limits the concentration of sulfur dioxide emissions from "any liquid fuel fired . . . furnace," applies to the furnaces and boilers at defendant's refinery even though they are fired by a mixture of liquid and gaseous fuels. The plain language of the regulation, the Texas Air Control Board's consistent interpretation of the rule, defendant's own interpretation prior to the enforcement action, and the only reported case on the issue all support this conclusion.

The court holds that defendant violated Texas SIP Rule 201.09, governing the maximum ambient concentrations of sulfur dioxide, on 11 days, based on government and company air quality monitoring. The court also holds that defendant violated Rule 201.06, governing emission concentrations, on 991 days. The court next holds that defendant violated Texas Rule 601 by failing to obtain a state permit to modify before shutting down and bypassing the EPAC desulfurization facility. The court rules that defendant's action was a modification of an existing facility under the rule and that plaintiffs sustained their burden of proving that defendant operated the plant for 522 days in modified condition without the necessary permit. Although defendant notified the Texas Air Control Board of the emissions, the event does not qualify as an exculpating "major upset" under Texas rules, because it was neither unscheduled nor beyond defendant's immediate control. Defendant long knew that its contractor was having difficulty operating the desulfurization facility and chose not to build its own replacement facility. The court also holds that defendant violated the 1974 federal prevention of significant deterioration regulations, which required approval by the Environmental Protection Agency prior to modification of defendant's facility, for the same reasons it held the state permit requirement was violated.

Turning to the issue of penalties, the court first notes that §113(b) of the Clean Air Act authorizes penalties of up to $25,000 per day of violation and the Texas Clean Air Act authorizes penalties of $50 to $1,000 per day of violation. The later specifies no penalty criteria; the former directs the court to consider, in addition to other factors, the size of the business, the economic impact of the penalty on the business, and the seriousness of the violation. The court notes that the Clean Air Act criteria call for a substantial penalty, and that defendant is a large corporation upon which only a major penalty will have any economic impact. The violation was serious, because defendant long knew that its sulfur dioxide control strategy was flawed, but continued to rely on an ineffective outside firm. For the violations of air quality standards, the court levies penalties of $55,000: $4,000 per day to the federal government, $1,000 per day to the state. Using the same daily charge and allocation, the court imposes $4,955,000 in penalties for the 991 days of SIP emission limit violations. For defendant's failure to obtain state and federal permits for modifying the facility, the court imposes penalties of $1,000 per day, totalling $522,000, for each government. The penalties assessed in favor of the federal government total $4,530,000 and in favor of the state, $1,524,000.

Counsel for Plaintiff
Mark Greenberg, Ass't U.S. Attorney
353 U.S. Cthse., 511 San Antonio Ave., El Paso TX 79901
(915) 543-7550

Jan Horn
1201 Elm St., Dallas TX 75270
(214) 324-3827

Diane L. Donley, John C. Martin
Land and Natural Resources Division
Department of Justice, Washington DC 20530
(202) 633-2689

Counsel for Defendant
Charles R. Jones, Joe Hood
11th Floor, El Paso National Bank Bldg., El Paso TX 79901
(915) 533-2493

Counsel for Intervenors
Johnn R. Carter, Ass't Attorney General
P.O. Box 12548, Austin TX 78711
(512) 475-2501