## Facts

- EPA promulgated national effluent limitation guidelines for the Organic Chemicals, Plastics, and Synthetic Fibers (OCPSF) industrial category under the Clean Water Act, covering direct dischargers and indirect dischargers to publicly owned treatment works.
- The rules set technology-based limits under multiple statutory standards, including BPT, BCT, BAT, and NSPS, with a statutory implementation deadline of March 31, 1989.
- The rulemaking record was exceptionally large, and the consolidated petitions presented extensive procedural and technical challenges.
- Industry petitioners alleged APA notice-and-comment defects and contended EPA’s technology-based limits were substantively unlawful and economically unreasonable for various plants and subcategories.
- An environmental intervenor challenged the regulations as insufficiently stringent, arguing EPA should have required stronger BAT/NSPS controls for new sources, including recycling and “zero discharge” approaches.

## Issues

1. Whether EPA violated the APA by relying on an updated economic-impact database in its analysis without placing the updated dataset in the public record for comment.
2. Whether EPA violated the APA by finalizing appendices setting toxic metals limits without separate publication and comment.
3. Whether the Clean Water Act required EPA, for BPT, to apply a “knee-of-the-curve” cost-effectiveness test rather than the statute’s “wholly disproportionate” cost standard.
4. Whether EPA lawfully based BPT limits on a broad set of “best-performing” plants rather than restricting the sample to plants using particular technologies.
5. Whether adoption of BCT standards or preexisting NPDES permits constrained EPA’s authority to impose or apply BPT limitations.
6. Whether EPA acted unlawfully in setting BAT and NSPS requirements for new sources by not requiring more advanced controls, including recycling/zero-discharge methods.

## Decision

- The Fifth Circuit largely upheld EPA’s OCPSF effluent guideline regulations against both industry and environmental challenges.
- The court held EPA did not violate APA notice-and-comment requirements by updating its economic data within the same analytical framework, treating the update as a logical outgrowth and finding no showing of prejudice.
- The court held EPA did not violate the APA by issuing toxic metals appendices without separate comment where prior notices encompassed the subject and the final approach fit within the proposal’s scope.
- The court rejected the argument that BPT required a knee-of-the-curve test and held the governing inquiry is whether costs are wholly disproportionate to benefits.
- The court upheld EPA’s use of a broad best-performer dataset to set BPT baselines and found EPA’s cost determinations supported by the record.
- The court rejected claims that BCT displaced BPT or that earlier permits exempted facilities from later-promulgated national limitations.
- The court generally sustained EPA’s BAT/NSPS choices, deferring to EPA’s judgment on what was demonstrated and broadly feasible for the category, though the disposition included only limited modifications or remands on particular technical points.

## Legal Principles

- Under the Clean Water Act, BPT does not require a knee-of-the-curve marginal cost test; the central question is whether total compliance costs are wholly disproportionate to pollution-reduction benefits.
- An agency may refine or update supporting data during rulemaking without reopening notice and comment when the change is a logical outgrowth of the proposal and the challengers do not show prejudice.
- Final technical materials may satisfy APA notice where the subject was adequately flagged in the proposal and the final rule remains within the scope created by earlier notices and comments.
- EPA may base technology-based limits on performance of a broad group of best-performing plants; it need not confine the baseline to plants using a single identified technology.
- BCT standards supplement rather than displace BPT; promulgation of more stringent standards does not strip EPA of authority to set and apply BPT limitations.
- For BAT and NSPS, EPA may focus on demonstrated, broadly feasible control approaches for the regulated category and is not compelled to set standards based solely on exceptional plant performance.

## Conclusion

The court sustained EPA’s OCPSF effluent limitations in substantial part, holding that EPA’s notice-and-comment process was adequate, BPT turns on the “wholly disproportionate” cost test rather than a knee-of-the-curve approach, and EPA had discretion to set technology-based standards using best-performer data and demonstrated controls for BAT and NSPS.


Chem. Mfrs. Ass’n v. U.S. EPA, 870 F.2d 177 (5th Cir. 1989)