When does a business in North Carolina need to have an air-pollution permit in hand: when it finishes building a new pollution source, or when it starts construction?
Plain-English summary
Air quality permits in North Carolina sit at the intersection of state and federal regulation. The federal Prevention of Significant Deterioration ("PSD") program and the federal New Source Review framework impose pre-construction permitting obligations on major sources of air emissions. North Carolina implements those obligations through Chapter 143, Article 21B of the General Statutes (the Water and Air Resources Act), with the Environmental Management Commission ("EMC") writing implementing rules at 15A NCAC Chapter 2Q.
In early 2001 the Division of Air Quality asked the AG when exactly the permit requirement attaches. Section 143-215.108(a)(2) prohibits a person, "without a permit," from "[b]uild[ing], erect[ing], us[ing] or operat[ing] any equipment which may result in the emission of air contaminants or which is likely to cause air pollution." If a developer breaks ground and starts pouring foundations for a new emission source, has the developer triggered the permit requirement? Or does the requirement only kick in when the source is complete and ready to emit?
The AG said the requirement attaches at the start of construction, not at completion. The reasoning had three pieces.
First, statutory interpretation. The General Assembly used four verbs in § 143-215.108(a)(2): build, erect, use, operate. Under the North Carolina rule from State v. Wiggins, undefined terms in a statute take their ordinary meanings. "Build" means "to form by combining materials or parts," and "erect" is defined similarly. If "build" and "erect" were read to refer to the completed act, those terms would mean essentially the same thing as "use" and "operate," because there is no permit-relevant period between finishing construction and starting operation. State v. Coffey forbids statutory readings that render terms superfluous. So "build" and "erect" must refer to the process of building, not the completed act. They apply to new sources during creation; "use" and "operate" apply to existing sources.
Second, the EMC's own regulations support this reading. 15A NCAC § 2Q.0301 says facility owners and operators "shall not begin construction or operation without first obtaining a construction and operation permit." § 2Q.0103(8) defines "construction" to include any "on-site fabrication, erection, installation, replacement, demolition, or modification of a source" that results in a change in emissions or affects compliance status. The regulatory definition treats construction and source-building as the same thing for permit-timing purposes.
Third, federal PSD program parallels. 40 C.F.R. § 51.166(b)(11) defines "begin actual construction" as "initiation of physical on-site construction activities . . . which are of a permanent nature." Such activities include, but are not limited to, installation of building supports and foundations, laying of underground pipework, and construction of permanent storage structures. North Carolina's regulatory definition tracks the federal one closely. Federal practice has been to require a permit before any of those permanent on-site construction activities begin, and the North Carolina statute reads the same way.
The opinion drew a sensible line between activities that trigger the permit and activities that do not. Pre-construction land preparation (clearing, grading) generally does not constitute "begin actual construction" because those activities are not permanent assembly of source-building components. The permit requirement attaches when permanent on-site construction begins: pouring foundations, installing supports, laying underground utility pipework, building permanent storage tanks or structures. A developer who plans early can complete site preparation while the permit application is pending; what the developer cannot do is begin permanent construction of the emission source itself.
The opinion also noted a useful parallel from the water quality side. The Division of Water Quality has consistently applied N.C.G.S. § 143-215.1 (which requires permits before one may "[c]onstruct or operate any sewer system, treatment works, or disposal system") to require permits before construction commences. "Build" is a synonym for "construct," so § 143-215.108 should be applied the same way: permit before construction starts, not after it ends.
Currency note
This opinion was issued in 2001. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. The federal PSD program has been amended multiple times since 2001, including significant revisions in 2002 and major regulatory updates throughout the 2010s. North Carolina's implementing rules at 15A NCAC Chapter 2Q have also been updated. Anyone planning a new air emission source in North Carolina should consult current federal PSD/NSR rules, current Division of Air Quality guidance, and current 15A NCAC Chapter 2Q provisions before scheduling site work. The core principle this opinion identifies (permit required at the start of permanent on-site construction, not at completion) has been stable, but the precise definition of triggering activities has evolved.
Background and statutory framework
Why the timing question matters in air permitting. Air permits typically take months to a year or more to obtain, especially for major sources subject to PSD or non-attainment area New Source Review. If the permit requirement attached only at the completion of construction, developers could build the entire facility while the permit application was pending and only need the permit before flipping the switch. That outcome would defeat the regulatory purpose. Pre-construction permitting is designed to force the regulatory analysis (best available control technology assessment, source impact analysis, public notice and comment) before construction commits the developer to a particular emission profile. If construction can proceed before the permit issues, the regulator's leverage to require pollution controls or to reject the project is much reduced.
Section 143-215.108(a)(2)'s four-verb structure. The statute, in full, prohibits a person without a permit from:
(2) Build[ing], erect[ing], use[ing] or operat[ing] any equipment which may result in the emission of air contaminants or which is likely to cause air pollution.
Under the Wiggins ordinary-meaning rule, "build" is to form by combining materials or parts; "erect" is similar; "use" and "operate" are different concepts that apply to facilities already constructed. The opinion's reading gives effect to all four verbs by partitioning them: "build" and "erect" cover new construction, "use" and "operate" cover existing facilities. Without this partition, the build/erect language would either duplicate use/operate (collapsing the statute) or describe a moment of completion so brief that the regulator could not meaningfully intervene.
The EMC regulations and the regulatory definition of "construction." 15A NCAC § 2Q.0301 is the operative trigger: facility owners and operators "shall not begin construction or operation without first obtaining a construction and operation permit." § 2Q.0103(8) then defines "construction":
"Construction" means change in the method of operation or any physical change (including on-site fabrication, erection, installation, replacement, demolition, or modification of a source) that results in a change in emissions or affects the compliance status.
The definition is broad enough that it reaches not only initial source construction but also modifications and replacements of existing sources, so long as the change "results in a change in emissions or affects the compliance status." The opinion noted a sensible reading of the "results" language: read literally, "results" would require actual emission before the permit requirement triggered, which is impossible to square with the rest of the statutory and regulatory scheme. So "results" must be read prospectively (a change that will or may result in changed emissions), not retrospectively (a change that has already resulted in changed emissions).
The federal PSD parallel. The Prevention of Significant Deterioration program in 40 C.F.R. Part 51 is the federal precursor for state air permitting and provides interpretive guidance on shared terminology. 40 C.F.R. § 51.166(b)(11) defines "begin actual construction":
Begin actual construction means, in general, initiation of physical on-site construction activities . . . which are of a permanent nature. Such activities include, but are not limited to, installation of building supports and foundations, laying of underground pipework, and construction of permanent storage structures.
This federal definition has been settled federal law since the modern PSD program took shape in the late 1970s and early 1980s. North Carolina's regulatory definition was modeled on the federal one. Federal courts have consistently interpreted "begin actual construction" to mean permanent on-site activities, not preparatory site work. The opinion borrows that consensus.
The line between site preparation and "begin actual construction." The opinion specifically says that the interpretation "does not necessarily require a permit for activities that precede the emplacement or assembling of materials at the facility site, such as land clearing or grading." This is consistent with EPA's longstanding position. Site preparation activities (clearing trees, grading the lot, building access roads, doing geotechnical investigations) are generally allowed without an air permit, because they are not "physical on-site construction activities . . . which are of a permanent nature" with respect to the emission source itself.
The dividing line in practice can be subtle. A foundation or building support is clearly permanent; access-road grading is generally not. Underground pipework specifically dedicated to the emission source is permanent; general utility trenching may not be. Developers planning a new facility typically coordinate the permit timeline with the construction timeline so that site preparation is complete before the permit issues, and then permanent construction begins immediately after.
Why the water quality precedent reinforces the air quality reading. The opinion drew on the Division of Water Quality's consistent application of N.C.G.S. § 143-215.1, which requires permits before "construct[ing] or operat[ing]" sewer systems, treatment works, or disposal systems. DWQ has long required permits before construction commences. "Build" and "construct" are synonyms; the General Assembly used parallel statutory structures for air and water permitting; the same interpretation should apply to both. The opinion's invocation of the water quality precedent is not just rhetorical; it is a useful sign that the AG's reading is consistent with how the state has actually been administering parallel programs.
The penalty consequence of getting the timing wrong. A facility that begins permanent on-site construction without a permit is operating in violation of § 143-215.108. The regulator can issue a stop-work order, assess civil penalties, and (in serious cases) refer the matter for criminal enforcement under Article 21B's penalty provisions. The economic consequences of stopping construction mid-stream are usually much more severe than the inconvenience of delaying construction until after the permit issues. The 2001 opinion's reading is, from the developer's perspective, an instruction to plan ahead and not break ground until the permit is in hand.
Common questions
Q: When exactly does the air permit have to be in hand?
A: Before permanent on-site construction of the emission source begins. The trigger is activities like installing building supports and foundations, laying underground pipework dedicated to the source, or constructing permanent storage structures. Site preparation activities like land clearing or grading generally do not trigger the requirement.
Q: Can I do anything on the site before I have the permit?
A: Yes, typically. Geotechnical surveys, environmental site assessments, land clearing, grading, access road work, and utility tap planning generally proceed without an air permit. The constraint kicks in when permanent on-site construction of the emission source itself begins. Verify the line with the Division of Air Quality (now part of the NC Department of Environmental Quality) for the specific activities you plan.
Q: What happens if I start construction without a permit?
A: You are in violation of N.C.G.S. § 143-215.108(a)(2). The regulator can issue a stop-work order, assess civil penalties (which can run into the thousands of dollars per day per violation under the air quality penalty schedules), and, in serious or willful cases, refer the matter for criminal enforcement. You will also generally have to obtain the permit before resuming, and the violation can affect the permit terms and conditions.
Q: Does this apply to modifications of existing sources, too?
A: Yes. The regulatory definition of "construction" reaches "on-site fabrication, erection, installation, replacement, demolition, or modification of a source" that results in a change in emissions or affects compliance status. So a modification of an existing source that changes emissions or compliance status requires a permit (or a permit modification) before the on-site work begins.
Q: Where can I get definitive guidance for my specific project?
A: The NC Division of Air Quality, part of the NC Department of Environmental Quality, is the regulator. The Division publishes guidance documents and offers pre-application meetings for major sources. For activities at the line between site preparation and "begin actual construction," ask the Division for a determination in writing before breaking ground. The cost of a pre-construction inquiry is much lower than the cost of stopping construction mid-project.
Q: How does this interact with federal Clean Air Act requirements?
A: For major sources, federal PSD or non-attainment area New Source Review requirements apply on top of state permitting. The state-implemented program is generally written to satisfy federal SIP requirements. North Carolina's "begin actual construction" interpretation tracks the federal one, so the timing of the permit requirement is the same under both state and federal law for sources subject to both regimes.
Q: Did this opinion settle the question for North Carolina?
A: For 2001-era statutory and regulatory text, yes. AG opinions are persuasive but not binding on courts, and the question could be relitigated. But the opinion's reading aligns with the regulatory text, with EPA practice, and with the analogous water quality precedent, so it has been the operative reading for the Division of Air Quality. The current Division of Air Quality continues to apply the pre-construction permit requirement on this same understanding, with refinements that have evolved with the federal PSD rules.
Citations
State statutes
- N.C.G.S. § 143-215.108(a)(2) — prohibition on building, erecting, using, or operating equipment that may result in emission of air contaminants or is likely to cause air pollution without a permit.
- N.C.G.S. § 143-215.1 — water quality permitting; prohibition on constructing or operating sewer systems, treatment works, or disposal systems without a permit; cited as parallel water-side precedent.
State regulations
- 15A NCAC § 2Q.0101(a)(1), (b)(1) — air permitting general scope provisions.
- 15A NCAC § 2Q.0103(8) — definition of "construction" for air permitting purposes.
- 15A NCAC § 2Q.0103(31) — definition of "source" for air permitting purposes.
- 15A NCAC § 2Q.0301 — owner/operator of new, modified, or existing facility or source shall not begin construction or operation without a construction and operation permit.
Federal regulations
- 40 C.F.R. § 51.166(b)(8) — federal PSD program definition of "construction."
- 40 C.F.R. § 51.166(b)(11) — federal PSD program definition of "begin actual construction" (initiation of physical on-site construction activities of a permanent nature, including installation of building supports and foundations, laying of underground pipework, and construction of permanent storage structures).
Cases
- State v. Wiggins, 272 N.C. 147, 158 S.E.2d 37 (1967), cert. denied, 390 U.S. 1028 (1968) — North Carolina rule that undefined terms in a statute take their ordinary meanings.
- State v. Coffey, 336 N.C. 412, 444 S.E.2d 431 (1994) — North Carolina rule that statutes should not be interpreted to render any of their words superfluous.
Source
Original opinion text
[Earlier portion of the opinion describing the statutory question and the four prohibited verbs is referenced but the scraped body begins mid-analysis.]
(2) Build, erect, use or operate any equipment which may result in the emission of air contaminants or which is likely to cause air pollution;
(3) Alter or change the construction or method of operation of any equipment or process from which air contaminants are or may be emitted;
(4) Enter into an irrevocable contract for the construction and installation of any air-cleaning device, or allow or cause such device to be constructed, installed, or operated.
Paragraph (a)(2) of § 143-215.108 states that a person may not, without a permit, "[b]uild, erect, use or operate any equipment which may result in the emission of air contaminants or which is likely to cause air pollution …." The terms "[b]uild, erect, use [and] operate" are not defined by statute and therefore have their ordinary meanings. State v. Wiggins, 272 N.C. 147, 153, 158 S.E.2d 37, 42 (1967), cert. denied, 390 U.S. 1028, 88 S. Ct. 1418, 20 L. Ed. 2d 285 (1968). "Build" means "[t]o form by combining materials or parts." Webster's II New College Dictionary 145 (1999). "Erect" is defined similarly. Id. at 381. Your inquiry raises the question whether these terms refer to the process of building or erecting or the completed act of building or erecting.
The legislature juxtaposed the terms "build" and "erect" with "use" and "operate." If "build" and "erect" were interpreted to refer to the completed act of building, there would be little if any practical difference between those terms and "use" or "operate." "[A] statute should not be interpreted in a manner which would render any of its words superfluous." State v. Coffey, 336 N.C. 412, 417-18, 444 S.E.2d 431-34 (1994). The more logical interpretation is that "build" and "erect" apply to the creation of new sources, and therefore to the entire process of building, whereas "use" and "operate" apply to existing sources.
The EMC's regulations support and confirm this distinction and show the Commission's understanding that permits are required at the commencement of construction, and not only near its completion. "[T]he owner or operator of a new, modified, or existing facility or source shall not begin construction or operation without first obtaining a construction and operation permit …." 15A NCAC § 2Q.0301 (emphasis added); see also id. § 2Q.0101(b)(1). These regulations use the term "construction" as a surrogate for "build" and "erect." "'Construction' means change in the method of operation or any physical change (including on-site fabrication, erection, installation, replacement, demolition, or modification of a source) that results in a change in emissions or affects the compliance status." Id. § 2Q.0103(8).
Thus, a person "shall not begin" "on-site fabrication, erection [or] installation" of a source if that activity "results in a change in emissions or affects the compliance status." Clearly the construction of a new facility results in a "change in emissions" from zero to some amount. Construction also affects compliance status because a person does not need an air permit to own an empty lot but does need a permit to maintain a constructed air contaminant source on that lot.
The definition of "construction" in § 2Q.0103 does not differ materially from that in the federal regulations regarding the Prevention of Significant Deterioration ("PSD") program. See 40 CFR § 51.166(b)(8). The State program does not define "begin" but the federal program does, and so reference to that program provides further clarification. Under the PSD program, "[b]egin actual construction means, in general, initiation of physical on-site construction activities … which are of a permanent nature. Such activities include, but are not limited to, installation of building supports and foundations, laying of underground pipework, and construction of permanent storage structures." 40 CFR § 51.166(b)(11) (italics in original). This definition comports with the intent of § 143-215.108(a)(2), described above, and with the State's regulatory language.
This interpretation of § 143-215.108(a)(2) is also consistent with the Division of Water Quality's ("DWQ") permitting activities under G.S. § 143-215.1. The latter statute requires permits before one may "[c]onstruct or operate any sewer system, treatment works, or disposal system …." DWQ consistently has required permits before construction commences. Because "build" is a synonym of "construct," § 143-215.108 should be applied similarly and require a permit at the outset of construction.
To summarize: Section 143-215.108(a)(2), as implemented by the EMC, requires that a person secure a permit prior to the actual on-site assembling of materials that will constitute a "source." See 15A NCAC § 2Q.0101(a)(1), .0103(31). This does not necessarily require a permit for activities that precede the emplacement or assembling of materials at the facility site, such as land clearing or grading. Some activities that trigger this permit requirement are described in the PSD regulations.
Sincerely,
J. Allen Jernigan
Special Deputy Attorney General
Marc Bernstein
Assistant Attorney General
c: Robin W. Smith
ep-46384
Note: The scraped body begins mid-opinion; the introductory paragraphs (signature line, recipient identification, and statement of the inquiry) are not included in the official source content extracted by the scraper. See the linked landing page above for the complete text.