Select Steel Corporation of America (Board decision, September 10, 1998)

Plain-English summary

The St. Francis Prayer Center sought review of a PSD permit for Select Steel Corporation of America's proposed specialty-steel mini-mill in Flint, Michigan. The petition raised seven issues, including lead, dioxin, and volatile-organic-compound monitoring, blood lead levels, environmental and cumulative impacts, slag handling, and alleged Title VI discrimination. The Board found no clear error or reviewable policy issue on the permit claims and held that it had no jurisdiction over the Title VI complaint assigned to EPA's Office of Civil Rights. The Board denied review of every issue, leaving the permit in place.

Decision snapshot

• Cited authorities: 42 U.S.C. § 7475; 40 C.F.R. §§ 52.21, 124.9, 124.19, and 124.41.
• Outcome: Review was denied on all seven issues raised in the petition.
• Key point: Permit review requires a showing of clear error or an important policy consideration, and the Board could not resolve the separate Title VI complaint.

Full text (EPA EAB public release)

BEFORE THE ENVIRONMENTAL APPEALS BOARD
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY WASHINGTON, D.C.

)
In re: )
)
Select Steel Corporation )
of America
) Docket No. PSD 98-21
)
Permit No. 579-97
)
)

ORDER DENYING REVIEW

On June 9, 1998, the St. Francis Prayer Center of Flint,

Michigan filed a petition for review of a federal Prevention of

Significant Deterioration ("PSD") permit issued to Select Steel

Corporation of America by the Michigan Department of Environmental

Quality ("MDEQ").1 The permit provides preconstruction authoriz-

ation under the federal PSD program, see Clean Air Act § 165, 42

U.S.C. § 7475; 40 C.F.R. § 52.21, for Select Steel’s proposed steel

"mini-mill," which is expected to produce 43 tons per hour of

specialty steels when operational.

1
On September 10, 1979, the Regional Administrator of EPA Region V delegated authority to the State of Michigan to implement and enforce the federal PSD program. See 45 Fed. Reg. 8348 (1980). The permits MDEQ issues in accordance with that program are considered federal permits. See 40 C.F.R. § 124.41 (terms "EPA" and "Regional Administrator" mean the delegate agency when a state exercises delegated authority to administer PSD permit program); 45 Fed. Reg. 33,290, 33,413 (1980) ("For the purposes of Part 124, a delegate State stands in the shoes of the Regional Administrator. Like the Regional Administrator, the delegate must follow the procedural requirements of part 124.
. . . A permit issued by a delegate is still an ‘EPA-issued permit.’"). The Prayer Center seeks review of seven aspects of Select

Steel’s permit. See Letter from Fr. Phil Schmitter & Sr. Joanne

Chiaverini, St. Francis Prayer Center, to Eurika Stubbs, Clerk,

U.S. EPA Appeals Board (June 9, 1998) [hereinafter Petition for

Review]. Upon receipt of the Petition for Review, the

Environmental Appeals Board ("Board") requested a response from

MDEQ, which the State filed on August 19, 1998. See Response of

the Michigan Department of Environmental Quality to the Petition of

the St. Francis Prayer Center (Aug. 19, 1998) [hereinafter MDEQ

Response].

To obtain Board review of a PSD permit decision, a petitioner

must, as a threshold matter, have standing to challenge the permit

and must appeal issues that have been properly preserved for

review. 40 C.F.R. § 124.19(a). The St. Francis Prayer Center

clearly has standing to appeal the permit decision in this case

because it filed comments on the draft permit and participated in

the public hearing. See id.; MDEQ Response at 2. Reviewability,

however, is less clear: we cannot determine, on the record before

us, whether all the issues the Prayer Center raises on appeal were

previously raised in comments to MDEQ on the draft permit. See

MDEQ, Select Steel Corporation of America: Response to Comments

Document (May 27, 1998) [hereinafter Response to Comments]

(summarizing "significant" comments only and providing responses).

The Prayer Center does not refer us to written comments or portions

of the hearing transcript to prove that the issues it raises on

• 2 - appeal were raised before MDEQ. Nor does MDEQ allege that the

Prayer Center’s issues were not raised during the comment period.

Instead, MDEQ asserts that "[t]he petitioner in this case has not

demonstrated that [MDEQ’s] previous responses to [petitioner’s]

objections were clearly erroneous or otherwise warrant review."

MDEQ Response at 4 (emphasis added). In light of this statement

and MDEQ’s failure to challenge reviewability, we will assume for

purposes of this appeal that the issues raised here were raised

below and, thus, are properly before us.

To obtain review on the merits, a petitioner must demonstrate

that the permit, or, more precisely, a permit condition, is based

on:

(1) A finding of fact or conclusion of law [that] is clearly erroneous; or

(2) An exercise of discretion or an important policy consideration [that] the Environmental Appeals Board should, in its discretion, review.

40 C.F.R. § 124.19(a). We address each of the Prayer Center’s

seven contentions, and MDEQ’s responses, in the paragraphs below.

1. Lead Monitoring

First, the Prayer Center alleges that Select Steel’s permit is

deficient because it lacks a monitoring requirement for lead.

Petition for Review at 1. In response, MDEQ contends that at

present, the technology that would allow continuous monitoring of

lead emissions does not exist. MDEQ Response at 4. In the absence

of such technology, MDEQ chose to ensure Select Steel’s compliance

• 3 - with the lead emissions limit by requiring the company to install

a baghouse for the melt-shop that MDEQ determined satisfies Best

Available Control Technology ("BACT").2 MDEQ, Supplement to Permit

No. 579-97, Select Steel Corp. of America, Flint, MI ¶ 18 (May 27,

1998) [hereinafter PSD Permit]. The permit also mandates

monitoring of baghouse operating parameters to ensure proper

functioning, performance of a stack test to verify that lead

emissions do not exceed the permit limit, visible emissions

monitoring, and several maintenance and contingency measures.
See

PSD Permit ¶¶ 22-24, 28, 32, 34, 36, 40, 49-50. In light of these

factors, we cannot find that MDEQ erred by failing to impose on

Select Steel a monitoring requirement for lead. Accordingly, we

deny review of this issue.

2. Dioxin Monitoring

Second, the Prayer Center alleges that the permit allows

dioxin emissions to be unmonitored for the first eighteen months of

the mill’s operation. Petition for Review at 1. In fact, the

permit contains no monitoring or any other requirement for dioxin.

MDEQ explains that it did not require dioxin monitoring because

2
The Clean Air Act and the PSD regulations require, among other things, that new major stationary sources, such as the proposed Select Steel facility, employ the "best available control technology," or BACT, to minimize emissions of regulated pollutants. 42 U.S.C. § 7475(a)(4); 40 C.F.R. § 52.21(j)(2). BACT is determined by the permitting authority on a pollutant-by- pollutant basis, "taking into account energy, environmental, and economic impacts and other costs." 40 C.F.R. § 52.21(b)(12). In its Petition for Review, the Prayer Center has not disputed MDEQ’s BACT determination for lead.

• 4 - continuous emissions monitoring systems for this chemical do not

exist. MDEQ Response at 6. Moreover, MDEQ notes that EPA

conducted research on American electric arc furnaces ("EAFs") --

presumably of the type to be used by Select Steel (although MDEQ

fails to make this clear) -- and concluded that dioxin emissions

are not a concern in the operation of such furnaces. EPA

reportedly found that American EAFs do not use chlorinated solvents

in the melting process, that the EAFs are operated at very high

temperatures, and that radiant heat from electricity (rather than

coke combustion) is used to melt the scrap metal. MDEQ Response at

7; Response to Comments at 8.
It is clear that MDEQ, after

considering these factors, made a judgment that dioxin monitoring

is not necessary in this case. The Prayer Center makes no argument

and points out no data to refute MDEQ’s judgment. In these

circumstances, MDEQ’s decision is not clearly erroneous. Thus, we

deny review of this issue.

3. VOC Monitoring

Third, the Prayer Center alleges that the permit allows

volatile organic compound ("VOC") emissions to go unmonitored for

the first eighteen months of the mill’s operation. This is

somewhat of a misreading of the permit: as explained below, Select

Steel may operate for one and possibly up to two years before it

must begin VOC monitoring. See PSD Permit ¶ 33. More to the point

for present purposes, MDEQ notes that Select Steel’s potential to

emit VOCs is 38 tons per year and that this level of emissions is

• 5 - not considered "significant" under the PSD regulations. MDEQ

Response at 7; see 40 C.F.R. § 52.21(b)(23)(i) (potential to emit

40 tons per year or more of VOCs is "significant" under PSD

regulations). MDEQ asserts that because Select Steel’s potential

to emit VOCs is not significant, "VOC emissions monitoring is not

required under federal law." MDEQ Response at 7.

 This      statement,      while    technically   true,     is     somewhat

misleading. In fact, pre-application monitoring of VOCs is not

mandatory because Select Steel’s potential to emit is less than the

significance level, but MDEQ nonetheless retains authority under

the federal PSD program to require post-construction monitoring of

VOCs. See 40 C.F.R. § 52.21(m)(1)(i)(a), (m)(2). Such monitoring

can be required if the permitting authority determines it necessary

to track the effect VOC emissions may have or are having on air

quality.3 40 C.F.R. § 52.21(m)(2).

The permit issued by MDEQ gives Select Steel one year from

plant start-up to implement a continuous emissions monitoring

system ("CEMS") for VOCs. PSD Permit ¶ 33. Select Steel may

choose to install an alternative monitoring system, called

"parametric monitoring," instead of the CEMS, but if it does so

MDEQ must first review, test, and accept the system. Id. If MDEQ

3
MDEQ states, in its response to the Prayer Center’s petition, that the VOC emissions monitoring required in the permit is based on state law. MDEQ Response at 7. While that may be true, the relevant permit condition makes no reference to state law and, instead, cites various federal regulations and guidance documents. See PSD Permit ¶ 33.

• 6 - rejects the parametric system, the CEMS must be installed within

two years of plant start-up. Id.

MDEQ does not explain why Select Steel is given up to two

years to bring VOC emissions monitoring on-line. However, the

regulations give the permitting authority discretion in

implementation, 40 C.F.R. § 52.21(m)(2), and the Prayer Center does

not explain why it believes MDEQ’s exercise of this discretion by

allowing this monitoring delay is problematic. We deny review of

this issue because the petition identifies neither clear error in

MDEQ’s decisionmaking processes nor an important policy

consideration that justifies Board review.

4. Blood Lead Levels

Fourth, the Prayer Center raises the issue of blood lead

levels ("BLLs") in children living in the vicinity of the proposed

steel mill. The Prayer Center quotes Dr. Rebecca Bascomb, M.D. as

stating that "the children of Flint are already ‘maxed out’ on lead

and are 50% above the national average of lead blood levels for

children." Petition for Review at 1. The Prayer Center does not

explain what is meant by "‘maxed out’ on lead." See id. MDEQ,

however, cites a BLL study it conducted that indicates the "level

of concern" for lead is 10 micrograms per deciliter ("Fg/dL").

MDEQ, Air Quality Div., Evaluation of the Potential Dry Deposition

and Children’s Exposures to Lead Emissions from the Proposed Select

Steel Facility, at 2 (May 15, 1998) [hereinafter BLL Study]. At

• 7 -
  BLLs above this threshold, children’s development and behavior may

be adversely affected. Id. It may be that the Prayer Center

meant, in its use of the term "maxed out," that children in Flint

are currently at or near the lead level of concern. MDEQ contends

otherwise, based on its interpretation of the results of the BLL

study.4

MDEQ conducted the BLL study to estimate the potential for air

deposition of lead from Select Steel into soil around the proposed

facility. MDEQ estimated background levels of lead in air and

soils and combined those figures with three different estimates of

the amount of lead present in house dust (high, medium, and low).

MDEQ then analyzed the differences between children’s environmental

lead exposure under these three scenarios, in each instance

comparing current estimated background BLLs (alternative "a") to

estimated BLLs after adding in Select Steel’s projected emissions

(alternative "b"). MDEQ’s findings are presented in Table 4 of the

study, which is reproduced below.

TABLE 4. Modeled Blood Lead Levels for the Three Scenarios, With and Without the Potential Incremental Impacts of the [Select Steel] Facility

4
MDEQ also determined that "even with the addition of the lead proposed to be emitted by Select Steel, the lead concentrations would be more than ten times lower than the National Ambient Air Quality Standards." MDEQ Response at 2.

• 8 -
  Scenario Description of Average BLL Percentage
  the Scenario in the of
  Population Children of Children with BLL >
  (Fg/dL) 10 Fg/dL
  1a background lead in soil and 2.1 0.04
  air; zero house dust lead
  1b emission’s impacts to soil 2.2 0.05
  and air added to scenario 1a
  2a background lead in soil and 3.3 0.87
  air; moderate house dust lead (200 Fg/g)
  2b emission’s impacts to soil 3.4 0.97
  and air added to scenario 2a
  3a background lead in soil and 11.8 61.13
  air; high house dust lead
  (2000 Fg/g)
  3b emission’s impacts to soil 11.8 61.13
  and air added to scenario 3a

MDEQ’s study reveals that in the first two scenarios

involving low and medium levels of house dust lead, the addition

of Select Steel’s projected emissions causes a 0.01% and 0.1%

increase, respectively, in the percentage of children with BLLs

greater than 10 Fg/dL. Id. at 8 & tbl. 4. Children’s BLLs, on

average, increased 0.1 Fg/dL in both of those scenarios, although

in both cases the average BLLs already were below the 10 Fg/dL

level of concern. Id. The study also reveals that in the third

scenario involving a high level of house dust lead, the addition

of Select Steel’s emissions has no discernible impact on the

percentage of children with BLLs in excess of the level of

concern or on the average BLL of affected children. See id.

• 9 -
  MDEQ characterizes these figures as indicating "at most a very

small shift" in children’s BLLs attributable to Select Steel.5

Response to Comments at 3.

The Prayer Center’s petition identifies no clear error in

MDEQ’s analysis or conclusions regarding BLLs in the vicinity of

the proposed facility. Thus, we deny review of this issue.

5. EIS and Cumulative Impacts

Fifth, the Prayer Center contends that MDEQ failed to

prepare an Environmental Impact Statement ("EIS") for the

proposed project and failed to assess the cumulative impacts of

all sources of pollution in the area. MDEQ did not err by

failing to prepare an EIS: as MDEQ rightly points out, PSD

permits are not subject to the EIS provisions of the National

Environmental Policy Act. MDEQ Response at 7; see 40 C.F.R. §

5
Viewed differently, an increase of 0.01% -- from 0.04% to 0.05% -- is actually a 25% increase, and an increase of 0.1% -

• from 0.87% to 0.97% -- is an 11.5% increase. As noted in the
  text, MDEQ has characterized the difference between 0.04 and 0.05 as "very small." In the underlying BLL study, MDEQ stated that "[t]here is a lack of criteria for judging what level of incremental increase in blood lead levels is small enough to be considered ‘de minimis’ for a preventative regulatory program." BLL Study at 9. MDEQ noted further that, while the impacts might be very small and were based on "conservative" assumptions, this called for "risk management decisions." Id. at 1, 9.

  Based on the BLL data and the fact that both the ambient air
  quality standard for lead and any relevant ambient air quality increments (e.g., particulate matter) are satisfied, MDEQ concluded that "the negligible potential impact on blood lead levels did not merit denial of the permit application." MDEQ Response at 6. Petitioners have not shown, at least as to the PSD requirements, that this exercise of judgment by MDEQ is clearly erroneous.

                         - 10 -
  

  124.9(b)(6). In addition, MDEQ states that its Air Quality

Division conducted an "additional impact analysis" pursuant to

the federal PSD regulations. See 40 C.F.R. § 52.21(o) ("[t]he

owner or operator shall provide an analysis of the impairment to

visibility, soils and vegetation that would occur as a result of

the source . . . and general commercial, residential, industrial

and other growth associated with the source"). According to

MDEQ, the additional impact analysis "showed that the facility

emissions were well below federal and state ambient air quality

standards and screening levels, and that no adverse impact on

soils and vegetation from the facility is expected." MDEQ

Response at 7-8.

Although we have not had the opportunity to review the

additional impact analysis for ourselves, we cannot find clear

error on MDEQ’s part when the the Prayer Center has stated only,

in the most general of terms, that the cumulative impact of

pollution is "not known." It appears that at least some relevant

information about cumulative impacts is, in fact, known. See

MDEQ Response at 7-8; Response to Comments at 3. Moreover, the

Prayer Center has failed to explain why it believes MDEQ’s

responses to comments on these issues are not adequate. See,

e.g., In re Puerto Rico Elec. Power Auth., 6 E.A.D. 253, 255 (EAB

1995) ("[T]o establish that review of a permit is warranted, [40

C.F.R.] § 124.19(a) requires a petitioner to both state the

objections to the permit that are being raised for review, and to

• 11 - explain why the [permitting authority’s] previous response to

those objections . . . is clearly erroneous or otherwise warrants

review."). Thus, we deny review of the EIS and cumulative impact

issues.

6. Slag Handling Process

Sixth, the Prayer Center asserts that "no real process to

handle the slag has been developed either on site or elsewhere."

Petition for Review at 1. MDEQ counters by referencing Paragraph

45 of the permit, which states:

Applicant shall not operate the facility unless a fugitive dust control program, as approved by the District Supervisor, is implemented and maintained. This program must be designed to limit all fugitive dust emissions from . . . all of the slag material operations throughout the plant.

PSD Permit ¶ 45. In addition, the permit establishes a visible

emissions limit for slag handling operations and requires testing

to verify that the visible emissions limit is met. PSD Permit ¶¶

43-44. In light of these provisions, it is plain that MDEQ has

considered and addressed the air impacts of slag handling

operations. In our view, MDEQ’s approach is not clearly

erroneous, and the Prayer Center has raised no specific facts

suggesting otherwise. Accordingly, we deny review of this issue.

7. Title VI

Finally, the Prayer Center claims that MDEQ’s decision to

grant this permit violates Title VI of the Civil Rights Act

because "the vast majority of the people within 3 miles of the

• 12 - proposed site are minority Americans and will be burdened with a

disparate impact of pollution in an already deeply polluted

area." Petition for Review at 1. The Prayer Center raised this

same Title VI claim in a separate complaint, which it filed with

EPA’s Office of Civil Rights ("OCR") on the same day as the PSD

petition. See Letter from Fr. Phil Schmitter & Sr. Joanne

Chiaverini, St. Francis Prayer Center, to Diane E. Goode,

Director, U.S. EPA Office of Civil Rights (June 9, 1998). OCR

accepted the Prayer Center’s complaint for further processing on

August 17, 1998, and provided MDEQ 30 days in which to respond to

the allegations raised therein. See Letter from Ann E. Goode,

Director, EPA-OCR, to Dennis Drake, Chief, Air Quality Division,

MDEQ (Aug. 17, 1998). After receipt of MDEQ’s response, OCR will

continue its process for investigating the Title VI allegations.

See 40 C.F.R. § 7.120(d).

We must deny review of this claim on jurisdictional grounds.

EPA has chosen to assign to OCR -- and not to the Board --

responsibility for ensuring Agency compliance with Title VI. OCR

will therefore address the Prayer Center’s Title VI concerns on

behalf of the Agency in accordance with its own procedures. See

40 C.F.R. Part 7. The Board, for its part, has no jurisdiction

to evaluate and resolve Title VI complaints.

• 13 -
   In sum, we deny review of all the elements of the Prayer

Center’s petition.

So ordered.

ENVIRONMENTAL APPEALS BOARD

Dated: 9/11/98 By: /s/

Ronald L. McCallum
Environmental Appeals Judge

• 14 -
   CERTIFICATE OF SERVICE

I hereby certify that copies of the foregoing Order Denying

Review in the matter of Select Steel Corporation of America, Docket

No. PSD 98-21, were sent to the following persons in the manner

indicated:

By Certified Mail,
Return Receipt Requested:

Father Phil Schmitter, Co-Director
Sister Joanne Chiaverini, Co-Director
St. Francis Prayer Center
G-2381 East Carpenter Road
Flint, Michigan 48505

Neil D. Gordon, Assistant Attorney General State of Michigan, Department of Attorney General Natural Resources Division
300 South Washington Square, Suite 315
Lansing, Michigan 48913

Date: 9/11/98
/s/
Annette Duncan
Secretary