On August 22, 2007, the Louisiana First Circuit Court of Appeal rendered a decision – In the Matter of Waste Management of Louisiana, L.L.C. (Docket No. 2006 CA 1011) – that may affect the Louisiana Department of Environmental Quality’s approval of previous pollution control projects under PSD/NNSR provisions. Appellants LEAN and Concerned Citizens of Livingston Parish asked the court to reverse the lower court’s affirmation of LDEQ’s issuance of a Title V air permit issued to Woodside Landfill in 2004. In 2003, LDEQ exempted from PSD review a pollution control project to install a gas collection and control system and bioremediation area at the landfill. The later-issued Title V permit included conditions for the flare that was installed as part of the project. It is unclear from the facts stated in the opinion whether the original 2003 authorization-to-construct the project or the 2004 permit also authorized an expansion of the landfill. EPA issued a letter of no objection to the Title V permit.

Appellants in the case asserted that that the permit was invalid because the Department failed to conduct a review pursuant to the Prevention of Significant Deterioration (PSD) program per LAC 33:III.509. In vacating the title V permit, the First Circuit noted that “LDEQ exempted Woodside Landfill from PSD review based upon an EPA rule provided in a 1994 internal agency memorandum and subsequently codified, which excluded from New Source Review (NSR) proposed constructions meeting the definition of Pollution Control Projects (PCP) … Louisiana never formally adopted in its SIP the exemption herein relied upon by LDEQ and Waste Management.” The court further noted that “LDEQ did in fact attempt to adopt the PCP exemption, but the proposal was withdrawn after the federal regulation upon which it was based was vacated by New York v. EPA, 413 F.3d (D.C. Cir. 2005).”

In short, the court ruled that the LDEQ and Woodside Landfill could not apply the PCP exemption as a federal standard term or condition simply because the title V program requires the inclusion of all “federally applicable requirements” in Part 70 operating permits, including the requirement to undergo PSD review. The court indicated that the “landfill expansion and the flare installation at issue” qualified as a major modification to a major source, that required PSD review. The court, however, supplied no facts to indicate that it was a “major modification;” rather, the decision implies that it could have been and thus needed PSD review. In addition, the court noted that because Louisiana already had an approved state implementation plan (SIP) which included an approved PSD program, any rule exempting pollution control projects would not be effective until properly approved by EPA as part of the SIP. LDEQ never adopted such PCP exemption, nor was it approved in the Louisiana SIP. Because the Part 70 permit issued by LDEQ to Woodside Landfill failed to include the necessary PSD review, the First Circuit vacated its issuance, meaning that it is null and void. (The decision may be appealed to the Louisiana Supreme Court.)

The decision could retroactively affect other permit actions that were based upon the pollution control project exemption. It is unclear at this point whether the LDEQ will require prior permit actions or projects to be reevaluated based on the Waste Management decision. One example would be a project required to reduce hazardous air pollutant (HAP) emissions pursuant to a MACT standard that may have had incidental increases in criteria pollutants. At the time of this writing, the LDEQ has not provided a written response to the judicial decision, but one may be forthcoming in the near future.