In the Matter of: )
West Suburban Recycling and ) PSD Appeal Nos. 95-1 & 96-1
Energy Center, L.P. )
PSD Permit No. 94100001 )


Pursuant to 40 CFR  124.19(c) the U.S. Environmental
Protection Agency's Office of General Counsel, on behalf of the
Office of Air and Radiation, and Office of Regional Counsel for
Region V, on behalf of the Region, respectfully submit this
amicus brief in response to the Environmental Appeals Board's
April 26, 1996 Order to Show Cause in the above-captioned matter
regarding the application of the West Suburban Recycling and
Energy Center (WSREC) to the Illinois Environmental Protection
Agency (IEPA) for a Prevention of Significant Deterioration (PSD)
We urge the Board not to order issuance of a PSD permit at
this time. Issuance of the permit in the current circumstances
would leave at least one significant issue unresolved, would
prematurely dismiss public comments, and would be based upon an
incomplete administrative record.
In the briefing of this matter, WSREC and IEPA (EPA's
permitting delegate), have vigorously debated the intent and
effect of IEPA's denial of a construction permit to WSREC under

state law. Irrespective of the merits of that debate, we believe
the record before the Board is clear on the one point that is
critical to resolving the present controversy: IEPA's denial
decisions under state law made no affirmative determination about
whether the permit application satisfies federal PSD
Accordingly, if IEPA's denial under state law is viewed as a
final state decision encompassing denial of the permit
application for purposes of federal PSD requirements, we believe
that remand is warranted because the record compiled by IEPA is
incomplete, and does not provide an adequate basis to enable the
Board to determine in the first instance whether PSD requirements
have in fact been met. Alternatively, if the IEPA action is
viewed as failing to dispose of the federal PSD application,
remand is likewise warranted because a complete administrative
record is still lacking.
Specifically, 40 CFR Part 124 contains procedures to ensure
a reasoned, complete administrative record, and to protect the

public's right to participation in permit proceedings. Those
provisions require that any final PSD permit decision be
accompanied by documents that briefly describe and address all
significant public comments. The regulations also require that
these documents and any materials cited therein be included in
the administrative record, and that the permitting authority
determine whether any provisions of the draft permit should be
revised and, if so, explain the basis for the revisions. 40 CFR
 124.17 & 124.18. These necessary steps have not been taken in
this case. Thus, no matter how the Board views the permit
denials, a decision to issue the permit at this time would be
inconsistent with the procedures under 40 CFR Part 124 by
truncating consideration of public comments and directing action
before final permit terms are determined and explained.
Further, the excerpts from the state administrative appeal
do not provide a sufficient basis upon which to make a PSD permit
decision. The Board's Show Cause Order states that IEPA produced

testimony in which a subordinate IEPA official testified that no
federal PSD deficiencies were found in WSREC's first permit
application. The testimony refers to a review that preceded, and
therefore did not consider, public comments. Such testimony is
inadequate as a matter of law to support any final permit
decision. In any event, the testimony in question taken as a
whole would not support a finding that IEPA has made a firm
decision on the permit application.
The record before the Board discloses one issue in
particular that must be resolved before a properly considered PSD
permit decision can be made. We refer to the dispute between the
parties regarding the actual capacity of the proposed source. In
our view, it is clear that a PSD permitting authority is obliged
to ensure that the source for which the applicant is seeking a
permit is the same as the source to be constructed. A remand to
IEPA is the appropriate course for resolving this issue.
Finally, we are concerned that statements made during the

briefing and in the Board's Show Cause Order misconstrue the
breadth of PSD requirements and the broad discretion of a
permitting authority to condition or deny a permit application in
order to fulfill the air quality protection goals of the PSD
program. We have also addressed these issues below to help
ensure that they are properly considered on remand.
WSREC is entitled to a timely permit decision. At the same
time, that permit decision, whether it is a decision to grant or
to deny the permit, must abide by the procedures in 40 CFR Part
124. A decision by the Board to summarily grant the permit in
the current circumstances would compound, not remedy, the
confusion, discord and error that has affected the PSD permit
proceeding to date.
For these reasons, which are discussed in detail below, we
respectfully request that the Board remand the PSD permit to IEPA
for timely completion of its administrative review consistent
with 40 CFR Part 124. The Board should further order IEPA, in
its final decision, to delineate the PSD bases for granting or

denying the permit. As part of its assessment, IEPA should
explain clearly whether deficiencies identified under state law
also constitute deficiencies under federal PSD requirements. If
IEPA fails to act with dispatch, the proper recourse is for the
Regional Administrator of Region V to revoke the delegation for
the instant permit and make a final decision consistent with 40
CFR  52.21 and 40 CFR Part 124.
Pursuant to 40 CFR  52.21(u), IEPA has been delegated
authority by the Regional Administrator for Region V to
administer the federal PSD program. See "USEPA-IEPA Agreement
for Delegation of Authority of the Regulations for Prevention of
Significant Deterioration of Air Quality" (40 CFR 52.21),
reprinted in 46 Fed. Reg. 9580 at 9582 (Jan. 29, 1981) (hereafter
Del. Agt.). For efficiency, IEPA administers the federal PSD
permit program in conjunction with permit requirements under
state law.
WSREC seeks to construct a municipal waste processing and

incineration facility in the Villages of Summit and McCook west
of Chicago. The proposed facility includes two stoker fired
combustors designed to burn processed refuse fuel. The facility
is subject to PSD because it has the potential to emit more than
100 tons annually of carbon monoxide, sulfur dioxide and nitrogen
On July 5, 1994, WSREC submitted an air construction permit
application to IEPA which has been revised and resubmitted on
several occasions in response to deficiencies identified by IEPA.
Most notably, IEPA denied the permit application on February 27,
1995 and again on December 22, 1995. Prior to the latter denial,
IEPA on September 26, 1995 proposed to find the application
satisfactory under federal PSD requirements and held a public
comment period and public hearing to receive public input on its
preliminary determination.
IEPA's stated basis for both denials was deficiencies under
state law (and in one instance nonattainment new source review).
Neither denial addressed in any manner whether or not the permit

met federal PSD requirements. WSREC filed appeals with EPA's
Environmental Appeals Board, now consolidated by the Board's
April 26, 1996 order, and has filed a separate administrative
appeal with the state. IEPA indicates that the deficiencies that
prompted the first denial under state law have been
satisfactorily addressed by WSREC, rendering the first PSD permit
appeal moot. IEPA Resp. to Show Cause Order at 3 & 39, n. 32.
WSREC challenges the denials as inconsistent with the
procedures governing review of PSD permit applications under 40
CFR Part 124 and/or impermissibly depriving it of a PSD permit.
In response, IEPA argued initially that the permit denials were
issued under state law and therefore the Board lacks authority to
review its determinations. The Board has stated that because the
state and federal permits are consolidated, IEPA's denial under
state law has operated to deny the permit applications in their
entirety. EAB Show Cause Order at 8. Thus, the Board reasons
that its review is appropriate under the provisions of 40 CFR

Part 124 authorizing Board review of PSD permit denials.
Further, the Board indicates that because IEPA proposed to grant
the permit, and because a subordinate IEPA official testified in
the pending state administrative appeal proceeding that no PSD
deficiencies were found in a pre-proposal review of the permit
application, then the Board will grant the permit unless IEPA
shows cause why the PSD permit should not be issued. EAB Show
Cause Order at 9.
Faced with a potential decision by the Board to grant the
PSD permit, IEPA asks the Board to refrain from review on
prudential grounds pending resolution of the state administrative
appeal and now suggests that the bases for denying the permit
under state law also present potential deficiencies under federal
law. IEPA Resp. to Show Cause Order at 4-5, 47-55. WSREC
objects that IEPA's newly proffered PSD concerns represent an
"about-face" of its position that its denials were based on state
law. WSREC Reply to IEPA's Response to Show Cause Order
(hereafter "WSREC Reply to Show Cause Order") at 18.


A. While the Permit Applicant is Unquestionably Entitled
to a Timely Permit Decision, IEPA Has Not Made a Final,
Affirmative Determination that the PSD Requirements
Have Been Met.

The PSD program addresses the permit applicant's interest in
getting a prompt permit decision from the permitting authority.
The Clean Air Act calls for the permitting authority to grant or
deny a permit no later than one year after a complete application
is filed. See CAA  165(c), 42 U.S.C.  7475(c). The conditions
of EPA's delegation agreement with IEPA further constrain the
statutory time limit, calling for IEPA to approve or disapprove a
complete application within six months of receipt. See Del. Agt.
A consolidated state and federal permit proceeding like the
one at issue here can provide benefits for the applicant, public,
and permitting authority by streamlining processes and
comprehensively addressing related issues. Indeed, recognizing
that because of these benefits an applicant may support exceeding
the limited review period, the Delegation Agreement provides that
the applicant may waive the right to action within the 180 day
limit. Id. However, we are unaware that WSREC waived its right

to a decision within 180 days of filing a complete application.
Thus, IEPA appears to have exceeded the time allowed under the
delegation agreement for making a permit decision. While EPA is
responsible for ensuring compliance with temporal limitations for
a PSD permit decision, this is materially different from
dictating a particular decision. Accordingly, the Board should
not direct that a PSD permit be issued to WSREC. See EAB April
26, 1996 Show Cause Order at 2, 8 & 10-11.
To date, IEPA has not made an affirmative final decision of
any kind regarding federal PSD requirements, let alone a decision
that the permit meets PSD requirements. In the contested
December 22, 1995 denial letter, IEPA addressed only its concern
about potential deficiencies under state law. WSREC, PSD Appeal
No. 96-1 (January 8, 1996 petition for review), Exh. C. The
Board notes that "IEPA has made manifestly clear that it did not
deny the permit requested by WSREC on the basis of WSREC's
failure to comply with federal PSD regulation." EAB April 26,

1996 Order at 9 (citation omitted). We agree that, as the Board
has concluded, IEPA plainly did not identify PSD deficiencies.
But neither did IEPA determine that the PSD requirements had been
satisfied. IEPA simply did not address the merits of the permit
application relative to PSD requirements. The Board should
decline to infer that IEPA reached conclusions about PSD
compliance based on IEPA's findings about state law compliance.
The Board states that IEPA's denial of the permit
applications on state law grounds "operated to deny the permit
applications in their entirety, including the federal PSD
portion." EAB Order of April 26, 1996 at 8. IEPA's response
could be read as conceding this point. See IEPA Resp. to Show
Cause Order at 4-5. However, even viewed as a decision to deny
the PSD permit, IEPA's decision is incomplete and without
adequate basis because of its failure to explain on a complete
administrative record, addressing all significant comments, the
PSD reasons for such action. Conversely, the final state

decisionmakers have not determined, on the basis of a complete
administrative record, that the application meets PSD
requirements. Thus, as elaborated below, a Board decision to
grant the permit at this time would improperly shortcut the
administrative process, inconsistent with the procedures in 40
CFR Part 124 and the PSD requirements of the Clean Air Act.
B. An Order Directing Issuance of the Permit Would be
Inconsistent With the Procedures in 40 CFR Part 124,
Would Insufficiently Consider Public Comments, and
Would Be Based on an Inadequate Administrative Record.
To ensure that public comments are fully considered, 40 CFR
 124.17 directs the permit decisionmaker to produce a publicly
available response to comments document when the final permit is
issued. The regulations specifically require the permitting
authority to briefly describe and address all significant public
comments presented during the comment period and public hearing
on the draft permit. 40 CFR  124.17(a)(2). To ensure that the

grounds for the final permit decision are explained to the
public, the response must also identify any changes to the draft
permit and the reasons for the change. 40 CFR  124.17(a)(1).
Further, both the response and any documents cited therein must
be included in the administrative record. 40 CFR  124.17(b),
(c) & 124.18. The administrative record must also include other
documents informing the permit review and, ultimately, the final
permit. 40 CFR  124.18. Because IEPA has not made a final
decision about the permit's compliance with PSD requirements,
IEPA has not produced, and the Board has not reviewed, a response
to comments document or a full administrative record. These
steps must be taken prior to any decision that a permit should be
In support of its order to show cause why the permit should
not be issued, the Board notes that IEPA proposed to find that
the permit met PSD requirements and that an IEPA official
testified in the state administrative challenge to the permit
denial under state law that no PSD-related deficiencies were

found in WSREC's first permit application. The Board reasons
that in light of these developments and absent an explanation
from IEPA why the PSD permit has been denied, the Board is
inclined to order that the PSD permit be granted. EAB April 26,
1996 Show Cause Order at 9. However, the developments cited by
the Board could not cure the record deficiencies noted above. In
addition, as detailed below, those developments do not in fact
merit a finding that federal PSD requirements have been met.
The Board should not have drawn any conclusion from IEPA's
proposed decision to grant a PSD permit or its testimony in
support of that proposed decision for the simple reason that
proposed permit decisions under 40 CFR  124.6 ("Draft permits")
are by definition preliminary. The IEPA notice of proposed
permit issuance referred to by the Board was a routine
announcement of IEPA's provisional determination that the PSD
requirements had been satisfied. In accordance with standard
administrative procedures, IEPA solicited public comments,

announced a public hearing, and made no commitment regarding the
substance of a final decision:
Written comments may be received beginning September
30, 1995 and will be accepted through December 14, 1955.

* * * * *

The Division of Air has made a preliminary decision
that the facility is entitled to a permit. However, due to
the degree of public interest in this facility, the Agency
is holding an informational public hearing on the draft
permit, as provided for by the Untied [sic] States
Environmental Protection Agency's `Procedures for Decision
Making,' 40 CFR 124.12, to receive comment on its proposed
See WSREC Jan. 8, 1996 Pet., Exh. B.
Relying on a preliminary judgment to issue a final permit
would inappropriately disregard public comments. See IEPA June
15, 1996 Resp. at 38, n. 31. Public comments may present serious
concerns about overlooked deficiencies under the PSD
requirements. This is not merely an academic concern. Rather,
public comments in this case raising disparities between the
source described in local siting proceedings and the permit
application informed IEPA's December 22, 1995 denial of the
permit under state law. Id. at 4. Moreover, as discussed below

(see infra at part II), these alleged discrepancies are also
highly relevant under federal PSD requirements. A
congressionally-prescribed purpose of the PSD program is to
ensure adequate opportunities for informed public participation
in any decision to increase air pollution. CAA  160(5), 42
U.S.C.  7470(5); see also CAA  165(a)(2), 42 U.S.C. 
7475(a)(2), discussed infra at part III.C. Accordingly, the PSD
permit review procedures require that all significant public
comments be considered and addressed. This important task must
be completed.
Further, the selective excerpts presented to the Board from
the state administrative appeal do not by their own terms provide
a sound basis upon which to make a PSD permit decision. The
Board's Order states that IEPA produced testimony in which an
IEPA official testified that no federal PSD deficiencies were
found in WSREC's first permit application. EAB Show Cause Order
at 9. WSREC similarly argues that the testimony of IEPA
officials during the state administrative appeal of the permit

shows that IEPA has internally approved the permit. WSREC March
4, 1996 Supp. Resp. to IEPA's Mot. to Dismiss (PSD Appeal No.
95-1). WSREC asserts that IEPA has "admitted approval of the PSD
permit." WSREC Reply to Show Cause Order at 18; see also id. at
26 ("[h]aving admitted to approving WSREC's PSD permit") & 31
("IEPA has admitted to `approving' WSREC's PSD permit"). In
fact, the testimony proffered by WSREC indicates that no final
decision has been made about the permit's sufficiency under PSD,
only that some favorable internal review has been conducted. See
WSREC March 4, 1996 Suppl. Resp. at Exh. A.
Moreover, the testimony conflicts with contemporaneous
testimony produced by IEPA in reply that no final decision about
the approvability of the PSD permit has been made. See IEPA
April 9, 1996 Reply to WSREC's Resp. to IEPA's Mot. to Dismiss,
Exh. A at 640 ("[W]e have not taken any final action on [the PSD
portion of the application] and that is still pending. As to
what that final action might be, I can't say.") (testimony of Mr.

Cobb). Without fully delving into the issues and testimony in
the state proceeding, it is difficult to know the weight and
meaning to ascribe these selective, conflicting and inconclusory
statements. It is clear, however, that IEPA's decisionmakers
have not finally announced whether the permit is consistent with
PSD requirements, have not issued an accompanying response to
comments document or the bases for a decision to grant or deny
the permit. In short, IEPA has not made a reliable decision
about PSD compliance and has not produced a complete
administrative record.
IEPA received over 300 public comments in response to its
proposed decision to grant the PSD permit. IEPA June 15, 1996
Response to Show Cause Order at 3. Several parties have alleged
that an order to issue the permit now would deny consideration of
those views, and thereby seriously frustrate public
participation. See Amicus Brief of Lyons Incinerator Opponent
Network at 2 ("since the denial was based solely on state law
grounds, there was only incomplete public participation because

IEPA never reached the PSD issues in its review of the
application"); id. at 3 ("As a result of the IEPA's failure to
reach the merits of the PSD application, the IEPA did not
consider the public comments which were submitted with regard to
WSREC's PSD application") (citation omitted); Letter from
Congressman William O. Lipinski, Third Dist. of Illinois, to
Eurika Stubbs, Clerk, EPA Environmental Appeals Board (July 9,
1996) ("to uphold this appeal would effectively deny [my
constituents] the opportunity for public comment on WSREC's PSD
permit application").
Although we express no view on the merits of the underlying
public comments, we agree that a Board decision at this juncture
to grant the permit would insufficiently consider those comments.
Likewise, the Board's call for IEPA to explain the basis for its
disapproval or risk a decision by the Board to grant the permit
places IEPA in the awkward position of speculating about
potential deficiencies before reaching a final administrative
decision. This is an inadequate substitute for full

consideration of public comments and a decision based on a
complete administrative record. A decision by the Board to grant
the permit, considering the concerns raised in response to the
show cause order, would truncate the PSD process and make the
Board the permit issuer of first instance. Such a course of
action would be inappropriate in this case.
Instead, the proper recourse is immediate remand of the
permit proceeding to IEPA for a timely decision about whether the
WSREC permit should be granted or denied for PSD purposes. As
noted, WSREC is entitled to a timely final permit determination.
Further, whatever decision is reached by IEPA must be made
consistent with the applicable procedures in 40 CFR Part 124.
In the event IEPA fails to act with due dispatch, the proper
recourse is for the Regional Administrator of EPA Region V to
revoke the delegation for the pending permit and make a final,
expeditious determination fully considering public comments and
in accordance with the other applicable procedures in Part 124. We do not express a view on what would constitute timely

action on remand. We note in this regard that IEPA has urged the
Board to stay the federal proceedings on prudential grounds.
Despite the time limits on PSD permit processing, we believe that
the Board has equitable authority to grant such a request when
circumstances warrant. Such circumstances may exist where
pending, parallel state proceedings addressing the same or
similar issues are expected to be completed in the near term.
See also supra n. 2.
In response to the Board's order to show cause why the WSREC
PSD permit should not be issued, IEPA asserts that there are
significant discrepancies between the waste processing and
combustion capacity of the facility described in the local siting
applications and the air construction permit. IEPA Resp. to Show
Cause Order at 47-55. IEPA contends that these discrepancies
represent deficiencies under state law and now asserts also that

they call into question compliance with PSD requirements. Id. at
5, 48. WSREC contends that the discrepancy is not significant
and, in any event, harmless. WSREC Reply at 22-23 n. 11. WSREC
argues that even if it seeks in its PSD permit to build a
facility larger than that approved under local siting
requirements, the discrepancy means that its modeling of PSD air
quality impacts was more conservative than necessary (i.e., if
anything, WSREC modeled greater air quality impacts) and the only
injury is holding itself to too stringent a standard. Id.
We do not express a view regarding the merits of this
dispute. However, for the reasons set forth below, we believe
that it plainly is an issue that is cognizable under the federal
PSD program. It follows that this issue must be resolved before
a lawful permit decision can be made.
The PSD requirements direct the applicant to produce
detailed source information necessary to determine compliance
with PSD requirements and to ensure that the permit that is

granted is consistent with the source as it will genuinely be
constructed. The PSD provisions generally require the applicant
to submit:
all information necessary to perform any analysis or make
any determination required under [the PSD regulations].
40 CFR  52.21(n). Some of the specific source information
required under the PSD program includes:
(i) A description of the nature, location, design
capacity, and typical operating schedule of the source or
modification, including specifications and drawings showing
its design and plant layout.
40 CFR  52.21(n)(1). If requested, the applicant must also
provide the following:
(i) The air quality impact of the source or
modification, including meteorological and topographical
data necessary to estimate such impact; and

(ii) The air quality impacts, and the nature and extent
of any or all general commercial, residential, industrial,
and other growth which has occurred since August 7, 1977, in
the area the source or modification would affect.
40 CFR  52.21(n)(2).
Statements in local siting approvals that are inconsistent
with those in a PSD permit application are highly relevant in
assessing whether a proposed source will actually be constructed
consistent with its PSD permit, and are not merely harmless
error. Among other concerns, such overestimates undermine the
permitting authority's ability to ensure effective increment
management. The overestimates would reserve for the proposed new
source a portion of the available air quality increment that the
permitting authority might otherwise allocate to other economic
activity, or reserve for the benefit of the public. Thus,
unresolved discrepancies about a source's design are
independently reviewable under the PSD program. See also infra
part III.B.

The Board has recognized the importance of these issues. In
Inter-Power of New York, Inc., PSD Appeal Nos. 92-8 & 92-9, slip
op. at 15-16 (EAB 1994), the Board ordered a PSD permit applicant
to affirm its intention to construct the proposed facility
consistent with its PSD permit because of design discrepancies
between the PSD permit application and filings with a state
siting board.
Accordingly, we believe that this matter should be remanded
to IEPA for resolution of the alleged discrepancy regarding the
actual capacity of the proposed facility.
The Board's order to show cause states that a PSD permitting
authority may not decline to issue a permit that complies with
PSD requirements. Order to Show Cause at 10. WSREC elaborates
in its reply, suggesting that PSD permit application review is
without discretion:
And the law is that when an applicant such as WSREC

demonstrates compliance with the PSD rules, the IEPA must
issue the federal PSD permit.
WSREC Reply at 20. That a source meeting PSD requirements
qualifies for a permit is, however, merely a truism. It
overlooks both the flexible and expansive nature of the
requirements that must be satisfied by a PSD applicant, and the
broad discretion the permitting authority exercises in evaluating
whether those requirements have actually been satisfied.
We are concerned that the Board's statement might be
interpreted as asserting that a permitting authority must issue a
PSD permit as an essentially ministerial matter whenever an
applicant meets some checklist of predetermined requirements.
Such an interpretation begs the question, and would misconstrue
the scope of the PSD permitting process and the breadth of the
permitting authority's discretion.
Plainly, a PSD applicant has a right to timely and reasoned
decisionmaking by the state. Ordinarily, the principal
requirements that a PSD applicant must meet are readily

determined at the outset of the permitting process. However, as
discussed below, the scope of PSD review under the Clean Air Act
is very broad, and the Act confers considerable discretion on the
permitting authority in reviewing a PSD permit application to
place conditions on, or reject altogether, a PSD application if
the state reasonably determines that the proposed source would
present undesirable air-quality related impacts. In particular
cases, the full range of relevant issues may not become apparent
until the permitting authority has reviewed a completed PSD
application, or possibly not until public comments have been
received. Thus, although IEPA must act promptly and reasonably
in response to WSREC's application, the state is entitled to
consider the full range of factors that may inform a decision on
a PSD permit application before it decides whether "PSD
requirements" have been met. In short, while a PSD applicant has
a clear right to reasoned decisionmaking in response to its
application, the decision to grant a permit is more properly

construed as the conferring of a privilege to emit air pollution.
As outlined below, the wide-ranging nature of PSD review is
derived from the bare terms of the law, the statutory context,
the legislative history, and the judicial, administrative and
legislative history preceding the congressional adoption of a PSD
program in 1977.
A. The Broad Purpose of the PSD Program Is to "Protect and
Enhance" the Nation's Air Resources by Preventing Air
Quality Degradation.
The genesis of the PSD program under the Clean Air Act was a
lawsuit brought by the Sierra Club to enjoin EPA's approval of
state implementation plans (SIPs) allowing air quality