---------------------------------------------------------------------------

    In enacting section 209(b)(1), Congress struck a deliberate balance
first in 1967 when it acknowledged California's serious air quality
problems as well as its role as a laboratory for emissions control
technology for the country,\249\ and again, in the 1977 Amendments that
allowed for California to seek and obtain waivers for standards that
are less stringent than the federal standards (by amending section
209(b)(1)(A)) and also added section 177 to acknowledge that states may
have air quality problems similar to California's by allowing states,
subject to certain conditions, to adopt California's new motor vehicle
standards once waived by EPA.\250\ These provisions struck a balance
between having only one national standard and having 51 different state
standards by settling on two standards--a federal one and a California
one that other states may also adopt. Since 1967, in various amendments
to section 209, Congress has also not disturbed this reading of section
209(b)(1)(B) as calling for the review of the standards as a whole
program. Likewise, Congress has also not placed any additional
constraints on California's ability to obtain waivers beyond those now
contained in section 209(b)(1). The Agency has thus viewed the text,
legislative history, and structure of section 209(b)(1) as support for
the program-level review of waiver requests as well for the conclusion
that California's air quality need not be worse than the rest of the
country for EPA to grant a waiver of preemption. In addition, to the
extent that SAFE 1 was intended to preclude California's regulation of
all greenhouse gases from light-duty vehicles, the SAFE 1
interpretation creates a structural conflict within the relevant CAA
provisions and could also create an inability for California to address
GHG emissions and its contribution to the serious air quality problems
within the State. There is a fundamental relationship between sections
209(a) and 209(b). Section 209(a) preempts states from adopting or
enforcing new motor vehicle emission standards, and section 209(b)
calls for EPA to waive that preemption for California vehicular
emission standards unless EPA finds that one or more of the waiver
criteria set out therein are not met. Nothing on the face of the CAA or
applicable legislative history indicates that the scope of section
209(b)--the pollutants for which California may obtain a waiver--is
more limited than the scope of section 209(a).\251\ The D.C. Circuit
has

already held as much as to section 209(a): ``whatever is preempted [by
section 209(a)] is subject to waiver under subsection (b).'' \252\ As
demonstrated by EPA's review of the record in this decision,
California's GHG emission standards at issue meet the SAFE 1
interpretation of the second waiver prong. Nevertheless, to the extent
that SAFE 1 was intended to preclude all California regulation of
greenhouse gases, EPA believes it improper to exclude entirely a
pollutant from a waiver under section 209(b) that is otherwise
preempted by section 209(a).
---------------------------------------------------------------------------

    \249\ The CAA has been a paradigmatic example of cooperative
federalism, under which ``States and the Federal Government [are]
partners in the struggle against air pollution.'' General Motors
Corp. v. United States, 496 U.S. 530, 532 (1990). Motor vehicles
``must be either `federal cars' designed to meet the EPA's standards
or `California cars' designed to meet California's standards.''
Engine Mfrs., 88 F.3d at 1079-80, 1088 (``Rather than being faced
with 51 different standards, as they had feared, or with only one,
as they had sought, manufacturers must cope with two regulatory
standards.''). See also MEMA II, 142 F.3d at 463.
    \250\ ``Sec.  177 . . . permitted other states to `piggyback'
onto California 's standards, if the state's standards `are
identical to the California standards for which a waiver has been
granted for such model year.''' Motor Vehicle Mfrs. Ass'n v. New
York State Dep't of Envtl. Conservation, 17 F.3d 521, 525 (2d Cir.
1994).
    \251\ EPA believes that, to the extent the SAFE 1 interpretation
has the practical effect of defining or implementing the scope of
section 209(b) differently depending on the pollutants involved, the
interpretation is contrary to legislative intent and the Agency's
historic practice given the criteria emission benefits of CARB's GHG
emission standards and ZEV sales requirements as well as the impacts
of climate change on California's local and regional air quality.
    \252\ MEMA I, 627 F.2d 1095, 1106-08 (D.C. Cir. 1979).
---------------------------------------------------------------------------

    In addition, Congress has cited California's GHG standards and ZEV
sales mandate in subsequent legislation. Federal procurement
regulations direct the EPA to issue guidance identifying the makes and
models numbers of vehicles that are low GHG emitting vehicles.\253\ In
a clear reference to California's motor vehicle GHG standards, Congress
has required EPA when identifying those vehicles to ``take into account
the most stringent standards for vehicle greenhouse gas emissions
applicable to and enforceable against motor vehicle manufacturers for
vehicles sold anywhere in the United States.'' \254\ And in its State
Implementation Plan provision regarding fleet programs required for
certain non-attainment areas relating to issuing credits for cleaner
vehicles, Congress stated that the ``standards established by the
Administrator under this paragraph . . . shall conform as closely as
possible to standards which are established for the State of California
for ULEV and ZEV vehicles in the same class.\255\ Congress would not
likely have adopted California's standards into its own legislation if
it believed those standards to be preempted.
---------------------------------------------------------------------------

    \253\ 42 U.S.C. 13212(f)(3).
    \254\ Id.
    \255\ 42 U.S.C. 7586(f)(4).
---------------------------------------------------------------------------

    EPA also disagrees with SAFE 1's related argument that the
statutory criteria must be interpreted in the context of the
constitutional doctrine of ``equal sovereignty.'' As explained in
detail in Section VIII, waiver requests should be reviewed based solely
on the criteria in section 209(b)(1) and the Agency should not consider
constitutional issues in evaluating waiver requests.\256\ The
constitutionality of section 209 is not one of the three statutory
criteria for reviewing waiver requests. However, because the Agency
asserted in SAFE 1 that the equal sovereignty doctrine formed a gloss
on its statutory interpretation of the three criteria, EPA addresses
that argument here briefly. In short, in SAFE 1, EPA stated that
because section 209(b)(1) provides ``extraordinary treatment'' to
California, the second waiver prong should be interpreted to require a
``state-specific'' and ``particularized'' pollution problem.\257\ But
section 177's grant of authority to other states to adopt California's
standards undermines the notion that the regulatory scheme treats
California in an extraordinary manner. Indeed, if section 209(b) is
interpreted to limit the types of air pollution that California may
regulate, it would diminish the sovereignty of California and the
states that adopt California's standards pursuant to section 177
without enhancing any other state's sovereignty. Nor does section
209(b) impose any burden on any state. For these reasons, EPA agrees
with commenters who argued that the Supreme Court's decision in Shelby
County is inapposite. In section 209(b), Congress did not authorize
``federal intrusion into sensitive areas of state and local
policymaking.'' \258\ Rather, it underscored a foundational principle
of federalism--allowing California to be a laboratory for innovation.
Nor is section 209(b) an ``extraordinary departure from the traditional
course of relations between the States and the Federal Government.''
\259\ To the contrary, it is just one of many laws Congress passes that
treat States differently, and where, as discussed more fully below,
Congress struck a reasonable balance between authorizing one standard
and authorizing 51 standards in deciding to authorize two. SAFE 1's
invocation of the rarely used equal sovereignty principle as an aid in
interpreting the second waiver prong simply does not fit section 209.
---------------------------------------------------------------------------

    \256\ 78 FR at 2145.
    \257\ 84 FR 51340, 51347.
    \258\ Shelby County v. Holder, 570 U.S. 529, 535, 545 (2013).
    \259\ Id.
---------------------------------------------------------------------------

    SAFE 1 dismissed the Agency's traditional interpretation of the
second waiver prong under which EPA reviews the same standards that
California considers in making its protectiveness determination,
asserting that the practical implications of reviewing standards in the
``aggregate'' compared to specific standards presented in a waiver
request meant that the Agency would never have the discretion to
determine that California did not need any subsequent standards. But
nothing in section 209(b)(1)(B) can be read as calling for scrutinizing
the specific California standards under the waiver.\260\ Under section
209(b)(1)(B), EPA is to grant a waiver unless California does not need
``such State standards'' (plural). EPA interprets section 209(b)(1)(B)
to refer back to the phrase ``in the aggregate'' in section 209(b)(1),
which was added in the 1977 CAA Amendments when Congress removed the
stringency requirements for waiver of California standards allowing
instead for standards that are not as stringent as comparable federal
standards, so long as the standards were ``in the aggregate, at least
as protective of public health and welfare as applicable Federal
standards.'' EPA believes that referring back to section 209(b)(1) is
appropriate given that it precedes the language prior to section
209(b)(1)(B) and is in accord with the deference Congress intended by
the 1977 Amendments.\261\ Conversely, EPA believes that under the SAFE
1 interpretation California would, of necessity, be required to make a
protectiveness finding for each of the specific standards, and the
Agency believes this would be an inappropriate outcome from SAFE 1.
Under the 1977 Amendments, California can ``include some less stringent
[standards] than the corresponding federal standards.'' \262\ As
previously explained, ``Congress could not have given this flexibility
to California and simultaneously assigned to the state the seemingly
impossible task of establishing that `extraordinary and compelling
conditions' exist for each standard.'' \263\
---------------------------------------------------------------------------

    \260\ In the 2009 GHG waiver, and again in the 2013 ACC program
waiver, EPA explained that the traditional approach does not make
section 209(b)(1)(B) a nullity, as EPA must still determine whether
California does not need its motor vehicle program to meet
compelling and extraordinary conditions as discussed in the
legislative history. Conditions in California may one day improve
such that it may no longer have a need for its motor vehicle
program, or a program designed for a particular type of air
pollution problem, if the underlying specific air pollutant is no
longer at issue.
    \261\ EPA had applied the traditional interpretation of the
second waiver prong prior to the 1977 Amendments.
    \262\ See H.R. Rep. No. 294, 95th Cong., 1st Sess. 302 (1977);
``In further amendments to the Act in 1977, Sec.  209 (formerly
Sec.  208) was amended to require the U.S. Environmental Protection
Agency (EPA) to consider California's standards as a package, so
that California could seek a waiver from preemption if its standards
`in the aggregate' protected public health at least as well as
federal standards.'' Motor Vehicle Mfrs. Ass'n v. NYS Dep't of Env't
Conservation, 17 F.3d at 525.
    \263\ 49 FR at 18890 n.24.
---------------------------------------------------------------------------

    SAFE 1 further argued that its interpretation read the use of
``such standards'' consistently between the second and third waiver
prongs,

sections 209(b)(1)(B) and (C).\264\ It is true that section
209(b)(1)(C) employs the same phrase ``such State standards'' as
employed in section 209(b)(1)(B), and it similarly uses that phrase to
refer to standards in the aggregate. Indeed, section 209(b)(1)(C)
involves an analysis of feasibility that can take more than the
feasibility and impacts of the new standards into account. The
feasibility assessment conducted for a new waiver request focuses on
the standards in that request but builds on the previous feasibility
assessments made for the standards already in the program and assesses
any new feasibility risks created by the interaction between the
standards in the petition and the existing standards.\265\
---------------------------------------------------------------------------

    \264\ Section 209(b)(1)(C) provides that no such waiver shall be
granted if the Administrator finds that ``such State standards and
accompanying enforcement procedures are not consistent with section
7521(a) [202(a)] of this title.''
    \265\ For example, in the 2013 ACC waiver that contains CARB's
LEV III criteria pollutant standards and GHG emission standards, as
well as the ZEV sales mandate, EPA assessed information submitted by
CARB regarding the technological feasibility, lead time available to
meet the requirements, and the cost of compliance and the technical
and resource challenges manufacturers face in complying with the
requirements to simultaneously reduce criteria and GHG emissions. 78
FR at 2131.
---------------------------------------------------------------------------

    In sum, EPA now views as inconsistent with congressional intent the
SAFE 1 interpretation, which was a flawed interpretation and also a
significant departure from the traditional interpretation under which
the Agency reviews California's need for the same standards as those
that the State determines are ``in the aggregate'' as protective of
public health and welfare, under section 209(b)(1).\266\ EPA believes
the traditional interpretation is, at least, the better reading of the
statute.
---------------------------------------------------------------------------

    \266\ 84 FR at 51345. EPA notes that in SAFE 1 the following
rationale was used to interpret both 209(b)(1)(C) and then connect
it with 209(b)(1)(B): ``[B]ecause both sections 209(b)(1)(B) and (C)
employ the term `such state standards,' it is appropriate for EPA to
read the term consistently between prongs (B) and (C). Under section
209(b)(1)(C), EPA conducts review of standards California has
submitted to EPA for the grant of a waiver to determine if they are
consistent with section 202(a). It follows then that EPA must read
`such state standards' in section 209(b)(1)(B) as a reference to the
same standards in subsection (C).'' Although the Agency has not
pointed to 209(b)(1)(C) as a basis of statutory construction to
support the traditional interpretation of 209(b)(1)(B), EPA
nevertheless believes it is supportive. EPA notes that the term
``such state standards'' in 209(b)(1)(C) allows the Agency, in
appropriate circumstances, to review the consistency of CARB's suite
of standards, for a particular vehicle category, with section
202(a). For example, EPA evaluated all of the standards (LEV III
criteria pollutant, ZEV sales mandate, and GHG standards) of the ACC
program in recognition of the aggregate costs and lead time
associated with CARB's standards as well as technologies that may be
employed to meet more than one standard. 78 FR 2131-45. EPA's
assessment under 209(b)(1)(C) is not in practice a standard-by-
standard review. EPA believes it appropriate to read the entirety of
209 together, along with its purposes, in order to properly
interpret its components such as 209(b)(1)(B).
---------------------------------------------------------------------------

    As previously explained, in reviewing waiver requests EPA has
applied the traditional interpretation in the same way for all air
pollutants, criteria and GHG pollutants alike.\267\ In SAFE 1, however,
EPA reinterpreted section 209(b)(1)(B) and further set out a
particularized nexus test and applied this test separately to GHG
standards at issue. SAFE 1 then concluded that no nexus exists for GHG
emissions in California.\268\ SAFE 1 further posited that California
must demonstrate ``compelling and extraordinary circumstances
sufficiently different from the nation as a whole to justify standards
on automobile emissions which may, from time to time, need to be more
stringent than national standards.'' \269\ This has resulted in
potentially different practical results depending on whether GHG
standards or criteria emission pollutants are at issue, a distinction
neither found in nor supported by the text of section 209(b)(1)(B) and
legislative history. Specifically, SAFE 1 would have the ACC program
MYs 2017-2025 criteria pollutants standards subject to review under the
traditional interpretation while GHG standards at issue would be
subject to review under the SAFE 1 particularized nexus test or
individualized scrutiny.\270\ This uneven application is even more
irreconcilable given that California's motor vehicle emission program
includes two GHG standards for highway heavy-duty vehicles that EPA
previously reviewed under the traditional approach.\271\ EPA
acknowledges that ascribing different meanings to the same statutory
text in the same provision here, depending on its application, ``would
render every statute a chameleon.'' \272\ Nothing in either section 209
or the relevant legislative history can be read as calling for a
distinction between criteria pollutants and GHG standards and thus, the
individualized scrutiny under the SAFE 1 particularized nexus
test.\273\ Nothing in section 209(b) can be read as calling for EPA to
waive preemption only if California seeks to enforce criteria pollutant
standards. The Administrator is required to waive the preemption in
section 209(a) unless California ``does not need such State standards
to meet compelling and extraordinary conditions.'' \274\ This is in
stark contrast to, for example, section 211(c)(4)(C), which calls for a
waiver of preemption only if a state demonstrates that a fuel program
is ``necessary'' to achieve the NAAQS.\275\ Moreover, as previously
noted, ``[I]f Congress had intended a review of the need for each
individual standard under (b)(1)(B), it is unlikely that it would have
used the phrase ``. . . does not need such state standards'' (emphasis
in original), which apparently refers back to the phrase ``State
standards . . . in the aggregate as used in the first sentence of
section 209(b)(1), rather than the particular standard being
considered.'' \276\ EPA has also explained that an individualized
review of standards would mean that Congress ``g[ave] flexibility to
California and simultaneously assigned to the state the seemingly
impossible tasks of establishing that `extraordinary and compelling
conditions' exist for each less stringent standard.'' \277\
---------------------------------------------------------------------------

    \267\ 74 FR at 32763-65; 76 FR at 34693; 79 FR at 46256; 81 FR
at 95982.
    \268\ SAFE 1 also relied on UARG v. EPA, 134 S. Ct. 2427 (2014),
where the Supreme Court disagreed with the Agency's decision to
regulate all sources of GHG under Titles I and V as the consequence
of the Agency's section 202(a) endangerment finding for motor
vehicle GHG emissions. In EPA's view upon reconsideration of SAFE 1,
UARG is distinguishable because here the Agency is acting under a
specific exemption to section 202(a) that allows for California to
set its own standards for motor vehicle GHG standards under
California state law, and thus, regulate major sources of GHG
emissions within the State. California's authority to promulgate
standards is neither contingent nor dependent on the Agency's
section 202(a) endangerment finding for GHG. See 74 FR at 32778-80;
79 FR at 46262. Moreover, as discussed above, EPA's waiver authority
under section 209(b) is coextensive with preemption under section
209(a). See MEMA I, 627 F.2d at 1107. UARG is inapplicable to the
scope of preemption under section 209(a).
    \269\ 84 FR at 51341.
    \270\ Id. at 51337.
    \271\ The first HD GHG emissions standard waiver related to
certain new 2011 and subsequent model year tractor-trailers. 79 FR
46256 (August 7, 2014). The second HD GHG emissions standard waiver
related to CARB's ``Phase I'' regulation for 2014 and subsequent
model year tractor-trailers. 81 FR 95982 (December 29, 2016).
    \272\ See States and Cities at 24 (quoting Clark v. Martinez,
543 U.S. 371, 382 (2005) and citing U.S. v. Santos, 553 U.S. 507,
522 (2008); U.S. Dep't of the Treasury v. FLRA, 739 F.3d 13, 21
(D.C. Cir. 2014)). The commenter notes that in the SAFE 1 brief, EPA
claimed that its new approach to section 209(b)(1)(B) would apply
``for all types of air pollutants'' but EPA could point to nowhere
in SAFE 1 decision where this was said. Id. at 25. And ``only two
sentences later,'' EPA acknowledged that its review under this
second prong would change ``depending upon which `air quality
concerns' were implicated.'' Id.
    \273\ H.R. Rep. No. 294, 95th Cong., 1st Sess. 302 (1977); 49 FR
at 18890 n.24.
    \274\ CAA section 209(b)(1)(B) (emphasis added).
    \275\ Section 211(c)(4)(C) allows EPA to waive preemption of a
state fuel program respecting a fuel characteristic or component
that EPA regulates through a demonstration that the state fuel
program is necessary to achieve a NAAQS.
    \276\ 49 FR at 18890.
    \277\ Id. at 18890 n.24.

---------------------------------------------------------------------------

    Similarly, nothing in either section 209 or legislative history can
be read as requiring EPA to grant GHG standards waiver requests only if
California's GHG pollution problem is the worst in the country.\278\
``There is no indication in either the statute or the legislative
history that . . . the Administrator is supposed to determine whether
California's standards are in fact sagacious and beneficial.'' \279\
And most certainly, nothing in either section 209 or the legislative
history can be read as calling for EPA to draw a comparison between
California's GHG pollution problem and the rest of the country (or
world) when reviewing California's need for GHG standards. Instead, the
crucial consequence of the 1977 Amendment was to require waiver grants
for California's specific standards that are part of the State's
overall approach to reducing vehicle emissions to address air pollution
even if those specific standards might not be needed to address
compelling and extraordinary conditions.\280\ Thus, ``even if it were
true that California's [GHG] problem is, . . . no worse than some other
areas of the country, this does not mean that [GHG] do not pose a
special problem in California.'' \281\ Rather, ``EPA's practice [is] to
leave the decisions on controversial matters of public policy, such as
whether to regulate [GHG] emissions, to California.'' \282\
---------------------------------------------------------------------------

    \278\ Id. at 18891.
    \279\ Ford Motor Co., v. EPA, 606 F.2d 1293, 1302 (D.C. Cir.
1979).
    \280\ 74 FR at 32761 (``Congress decided in 1977 to allow
California to promulgate individual standards that are not as
stringent as comparable federal standards, as long as the standards
are `in the aggregate, at least as protective of public health and
welfare as applicable federal standards.' ''); ``[T]he 1977
amendments significantly altered the California waiver provision.''
Ford Motor Co., 606 F.2d 1293, 1302 (D.C. Cir. 1979).
    \281\ 49 FR at 18891.
    \282\ 43 FR at 25735.
---------------------------------------------------------------------------

    In addition, in Title II, Congress established only two programs
for control of emissions from new motor vehicles: EPA emission
standards adopted under the Clean Air Act and California emission
standards adopted under its state law. And states other than California
may not ``tak[e] any action that has the effect of creating a car
different from those produced to meet either federal or California
emission standards, a so-called `third vehicle.' '' \283\
---------------------------------------------------------------------------

    \283\ Motor Vehicle Mfrs. Ass'n v. NYS Dep't of Env't
Conservation, 17 F.3d 521, 526, 528 (2d Cir. 1994).
---------------------------------------------------------------------------

    As previously explained, and noted in the Notice of
Reconsideration, since the grant of the initial GHG waiver request in
2009, the Agency has applied the traditional interpretation in granting
two additional waivers for CARB's Heavy-Duty Vehicle GHG emission
standards and these GHG standards are now part of California's motor
vehicle program, but EPA did not address these waivers in SAFE 1.\284\
It also bears note that, given the limited analysis and application of
the SAFE 1 interpretation of the second waiver prong, it is uncertain
whether the traditional interpretation remains otherwise applicable to
earlier model year GHG standards under prior waivers. Ambiguity also
applies to SAFE 1's interpretation of this prong in respect to all
criteria pollutant standards in the ACC program. While SAFE 1 stated it
was only applicable to the GHG standards at issue, in at least one
instance the Agency indicated that the SAFE 1 interpretation could also
be applicable to future evaluation of waiver requests for criteria
pollutant standards.\285\ This uncertainty between these statements in
SAFE 1 further highlights the inappropriateness of the new
interpretation of the second prong.
---------------------------------------------------------------------------

    \284\ 79 FR 46256 (August 7, 2014); 81 FR 95982 (December 29,
2016).
    \285\ 84 FR at 51341 n.263. ``EPA determines in this document
that GHG emissions, with regard to the lack of a nexus between their
State-specific sources and their State specific impacts, and
California's GHG standard program, are sufficiently distinct from
criteria pollutants and traditional, criteria pollutant standards,
that it is appropriate for EPA to consider whether California needs
its own GHG vehicle emissions program. EPA does not determine in
this document and does not need to determine today how this
determination may affect subsequent reviews of waiver applications
with regard to criteria pollutant control programs.'' (Emphasis
added). See also id. at 51344 n.268 (``EPA is adopting an
interpretation of CAA section 209(b)(1)(B), specifically its
provision that no waiver is appropriate if California does not need
standards ``to meet compelling and extraordinary conditions,''
similar to the interpretation that it adopted in the 2008 waiver
denial but abandoned in the 2009 and 2013 waiver grants, and
applying that interpretation to determine to withdraw the January
2013 waiver for California's GHG and ZEV program for model years
2021 through 2025''), and at 51346 (``EPA therefore views this
interpretation and application of CAA section 209(b)(1)(B) set forth
here as, at minimum, a reasonable one that gives appropriate meaning
and effect to this provision.'').
---------------------------------------------------------------------------

    In sum, for the reasons noted above, EPA is withdrawing the SAFE 1
interpretation and reinstating certain aspects of the ACC program
waiver that were earlier granted under the traditional interpretation
and approach. EPA concludes it erred by not properly evaluating the
statutory interpretation of section 209, the associated legislative
history including the policy deference that should be afforded to
California to address its serious air quality problems and to serve as
a laboratory for the country, and because the ``need'' for a motor
vehicle emission program and related standards within the program are
necessarily better viewed as a comprehensive and interrelated effort to
address the range of air quality problems facing California.\286\ At
the same time, EPA notes that the traditional interpretation is
reasonable and consistent with the text, structure and congressional
intent and purpose of section 209(b) and EPA is thus confirming that
the traditional interpretation of section 209(b)(1)(B) was appropriate
and is, at least, the better interpretation.\287\
---------------------------------------------------------------------------

    \286\ As noted previously, in the context of evaluating the
``need'' for California's motor vehicle emission standards the
Agency is informed by the legislative history from 1967 and 1977,
whereby California is properly viewed as a laboratory for the
country and that its policy decisions on how best to address its
serious air quality issues, and that deference on the question of
``need'' is in order. Therefore, EPA believes it misapplied the
concept of deference in the context of the second waiver prong
application in SAFE 1. See e.g., 84 FR at 51344 n.268. While EPA
believes it appropriate to not defer when it is interpreting its own
statute, the Agency nevertheless determines that California's policy
choices in term of its ``need'' in how best to address compelling
and extraordinary conditions in California requires deference by the
Agency. This is consistent with EPA's longstanding waiver practice
and its integration of the legislative history behind section 209.
In any event, EPA would reach the same conclusions regarding the
second waiver prong even if it did not defer to California regarding
the nature of its air quality problems. 86 FR at 74489 (``The 2009
Endangerment Finding further explained that compared with a future
without climate change, climate change is expected to increase
tropospheric ozone pollution over broad areas of the U.S., including
in the largest metropolitan areas with the worst tropospheric ozone
problems, and thereby increase the risk of adverse effects on public
health (74 FR 66525).''). See also 86 FR at 74492.
    \287\ ``The interpretation that my inquiry under (b)(1)(B) goes
to California's need for its own mobile source program is borne out
not only by the legislative history, but by the plain meaning of the
statue as well.'' 49 FR at 18890.
---------------------------------------------------------------------------

2. California Needs the GHG Standards and ZEV Sales Mandate Even Under
the SAFE 1 Interpretation
    Even if the SAFE 1 interpretation of section 209(b)(1)(B) was
appropriate, the record of both the ACC program waiver and SAFE 1
proceeding demonstrate that California has a need for the GHG standards
and ZEV sales mandate at issue under the SAFE 1 interpretation as well.
The opponents of the waiver (including EPA in SAFE 1) did not met their
burden of proof to demonstrate that California does not need its GHG
emission standards and ZEV sales mandate, whether individually or as
part of California's motor vehicle emission program, to meet compelling
and extraordinary conditions.\288\
---------------------------------------------------------------------------

    \288\ EPA notes that by this action it is rescinding the
interpretation of section 209(b)(1)(B) as set forth in SAFE 1.
Nevertheless, EPA believes it appropriate to address comments
received that suggest the SAFE 1 interpretation was not only
correct, but that the factual record supported the SAFE 1 withdrawal
of the ACC waiver based on this interpretation.

---------------------------------------------------------------------------

    As previously explained, the 1977 CAA Amendments allow California
to promulgate standards that might not be considered needed to meet
compelling and extraordinary circumstances but would nevertheless be
part of California's overall approach of reducing vehicle emissions to
address air pollution in California.\289\ Thus, CARB may now design
motor vehicle emission standards, individually, that might sometimes
not be as stringent as federal standards but collectively with other
standards would be best suited for California air quality problems
because under the 1977 Amendments, California can ``include some less
stringent [standards] than the corresponding federal standards.'' \290\
And EPA is ``required to give very substantial deference to
California's judgments on this score.'' \291\
---------------------------------------------------------------------------

    \289\ See Ford Motor Co., v. EPA, 606 F.2d 1293, 1296-97 (D.C.
Cir. 1979); See H.R. Rep. No. 294, 95th Cong., 1st Sess. 302 (1977).
    \290\ 43 FR 25729, 25735 (June 14, 1978). See Ford Motor Co.,
606 F.2d at 1296-97.
    \291\ 40 FR at 23104. See also LEV I (58 FR 4166 (January 13,
1993)) Decision Document at 64.
---------------------------------------------------------------------------

    Indeed, as EPA noted in the ACC program waiver, Congress
intentionally provided California the broadest possible discretion in
adopting the kind of standards in its motor vehicle program that
California determines are appropriate to address air pollution problems
that exist in California, whether or not those problems are only local
or regional in nature, and to protect the health and welfare of its
citizens:

    Congress did not intend this criterion to limit California's
discretion to a certain category of air pollution problems, to the
exclusion of others. In this context it is important to note that
air pollution problems, including local or regional air pollution
problems, do not occur in isolation. Ozone and PM air pollution,
traditionally seen as local or regional air pollution problems,
occur in a context that to some extent can involve long range
transport of this air pollution or its precursors. This long range
or global aspect of ozone and PM can have an impact on local or
regional levels, as part of the background in which the local or
regional air pollution problem occurs.\292\
---------------------------------------------------------------------------

    \292\ 78 FR at 2128-29. See ``Our Changing Climate 2012
Vulnerability & Adaptation to the Increasing Risks from Climate
Change in California.'' Publication # CEC-500-2012- 007. Posted:
July 31, 2012; available at https://ucanr.edu/sites/Jackson_Lab/files/155618.pdf at 4 (``Higher temperatures also increase ground-
level ozone levels. Furthermore, wildfires can increase particulate
air pollution in the major air basins of California. Together, these
consequences of climate change could offset air quality improvements
that have successfully reduced dangerous ozone concentrations. Given
this ``climate penalty,'' as it is commonly called, air quality
improvement efforts in many of California's air basins will need to
be strengthened as temperatures increase in order to reach existing
air quality goals.'').

    In the context of implementing section 209(b)(1)(B) and assessing
the ``need'' for California's standards even under the SAFE 1
interpretation, EPA sees no reason to distinguish between ``local or
regional'' air pollutants versus other pollutants that may be more
globally mixed. Rather, it is appropriate to acknowledge that all
pollutants and their effects may play a role in creating air pollution
problems in California and that EPA should provide deference to
California in its comprehensive policy choices for addressing them.
Again, even if a new interpretation of section 209(b)(1)(B) were
appropriate in SAFE 1, and EPA believes it is not, it is important to
note that historically, criteria pollutant reductions have been
relevant to section 209(b)(1)(B). As previously noted, nothing in
section 209(b) can be read as calling for EPA to waive preemption only
if California seeks to enforce criteria pollutant standards. The
Administrator is required to waive the preemption in section 209(a)
unless California ``does not need such State standards to meet
compelling and extraordinary conditions.'' \293\ As also previously
noted this is in stark contrast to, for example, section 211(c)(4)(C),
which calls for a waiver of preemption only if a state demonstrates
that a fuel program will result in criteria pollutant reductions that
will enable achievement of applicable NAAQS.
---------------------------------------------------------------------------

    \293\ CAA section 209(b)(1)(B) (emphasis added).
---------------------------------------------------------------------------

    The first section below focuses on criteria pollution reduction,
which has long been relevant to section 209(b)(1)(B). EPA has never put
in doubt that California's serious criteria air pollution problems
(such as NAAQS nonattainment and the factors that give rise to those
conditions, including the geographic and climate conditions in the
State, the number of motor vehicles in California, and local and
regional air quality) are ``compelling and extraordinary,'' or that
California ``needs'' regulations that address such emissions in order
to achieve every fraction of criteria pollutant emissions it can
achieve.\294\ The factual record before the Agency in 2013 and again in
2019 includes ample documentation of criteria emission reductions from
California's GHG standards and ZEV sales mandate.\295\ Nothing in the
record is sufficient to demonstrate that California does not need the
ACC program (or the motor vehicle emission program) or, in the context
of the SAFE 1 interpretation, the specific GHG emission standards and
the ZEV sales mandate to meet compelling needs related to criteria
pollution. These benefits have a clear connection to California's
``need'' for its specific GHG standards and ZEV sales mandate, at issue
under the waiver. The second section below focuses on the GHG reduction
benefits of California's GHG standards and ZEV sales mandate. EPA
acknowledges that California is particularly impacted by climate
change, including increasing risks from record-setting fires, heat
waves, storm surges, sea-level rise, water supply shortages and extreme
heat, and that climate-change impacts in California are therefore
``compelling and extraordinary conditions'' for which California needs
the GHG standards and ZEV sales mandate.
---------------------------------------------------------------------------

    \294\ In SAFE 1, EPA found that California's criteria pollution
conditions remain ``compelling and extraordinary and that California
needs standards to produce any and all reductions in criteria
pollutant emissions.'' 84 FR at 51344, 51346.
    \295\ When California originally adopted a ZEV sales mandate
into its regulations, a significant factor in support of its action
was addressing criteria pollutant emissions. In SAFE 1 EPA
acknowledged that California's ZEV mandate initially targeted only
criteria pollution. 84 FR at 51329. EPA's 2013 waiver grant
recognized that with California's ACC program California had shifted
to relying on the ZEV requirements to reduce both criteria and GHG
pollution. 78 FR at 2114.
---------------------------------------------------------------------------

a. GHG Standards and ZEV Sales Mandates Have Criteria Emission Benefits
    As shown below, criteria pollutant reductions are demonstrably
connected to California's ``need'' for its GHG standards and ZEV sales
mandate at issue under the waiver.\296\ EPA first concluded that there
is a ``logical link between the local air pollution problem

of ozone and GHGs'' in the 2009 California GHG waiver by explaining,
for instance, that ``the impacts of global climate change can
nevertheless exacerbate this local air pollution problem.'' \297\
Moreover, as previously explained, in two additional GHG waiver
requests and associated EPA waiver decisions since the 2009 GHG waiver,
EPA acknowledged that CARB had demonstrated the need for GHG standards
to address criteria pollutant concentrations in California. In the 2014
HD GHG waiver request, CARB projected, for example, ``reductions in
NOX emissions of 3.1 tons per day in 2014 and one ton per
day in 2020'' in California.\298\
---------------------------------------------------------------------------

    \296\ In response to comments arguing that upstream emission
benefits should not be considered in determining the criteria
pollutant benefits of CARB' standards or that it is inappropriate to
elevate stationary source criteria pollutant emissions into a make-
or-break factor in waivers for motor vehicle emission programs, EPA
believes it appropriate to reiterate the air quality problems facing
California, as evidenced by NAAQS attainment challenges. Waiver
practice and applicable case law, as previously noted, afford
California wide deference in its policy and regulatory approaches in
addressing these challenges. Therefore, EPA believes that to the
degree a nexus between CARB's standards and addressing its serious
air quality problems is required, that it is reasonable to base the
need on related criteria emission impacts. EPA notes that, in
setting its federal light-duty vehicle GHG standards, it is afforded
discretion under the CAA to consider upstream emission impacts and
does include such consideration in its own rulemakings. 77 FR 62624,
62819 (October 15, 2012) (taking fuel related upstream GHG emissions
into account in setting compliance values for vehicle GHG emissions
standards).
    \297\ 74 FR at 32763. According to California, ``California's
high ozone levels-clearly a condition Congress considered-will be
exacerbated by higher temperatures from global warming . . . [T]here
is general consensus that temperature increases from climate change
will exacerbate the historic climate, topography, and population
factors conducive to smog formation in California, which were the
driving forces behind Congress's inclusion of the waiver provision
in the Clean Air Act.'' Id. (quoting comments submitted by CARB
during the 2009 reconsideration). CARB also explained that ``the
factors that cause ozone are primarily local in nature and [ ] ozone
is a local or regional air pollution problem, the impacts of global
climate change can nevertheless exacerbate this local air pollution
problem. Whether or not local conditions are the primary cause of
elevated concentrations of greenhouse gases and climate change,
California has made a case that its greenhouse gas standards are
linked to amelioration of California's smog problems . . . . There
is a logical link between the local air pollution problem of ozone
and California's desire to reduce GHGs as one way to address the
adverse impact that climate change may have on local ozone
conditions.'' Id.
    \298\ 79 FR at 46261. See also 81 FR at 95985-86 n.27
(referencing Resolution 13-50's statements supporting California's
continued need for its own motor vehicle program in order to meet
serious ongoing pollution problems).
---------------------------------------------------------------------------

    In SAFE 1, EPA distinguished prior GHG waivers from the ACC program
GHG waiver solely on grounds of how CARB attributed the pollution
benefits in its waiver request. EPA explained that CARB had linked
those prior waived GHG standards to criteria pollutant benefits but had
not done so in the ACC program waiver request: ``California's approach
in its ACC program waiver request differed from the state's approach in
its waiver request for MY 2011 and subsequent heavy-duty tractor-
trailer GHG standards, where California quantified NOX
emissions reductions attributed to GHG standards and explained that
they would contribute to PM and ozone NAAQS attainment.'' \299\
Moreover, how CARB attributes the pollution reductions for accounting
purposes from its various standards does not reflect the reality of how
the standards deliver emissions reductions and should not drive whether
or not a waiver can be withdrawn. EPA believes, based on its historical
deference to CARB in waiver proceedings, that CARB is entitled to this
discretion.
---------------------------------------------------------------------------

    \299\ 84 FR at 51337 n.252 (citing 79 FR at 46256, 46257 n.15,
46261, 46262 n.75).
---------------------------------------------------------------------------

    EPA also believes that prior waiver decisions indicate that the
``approach'' taken by California in its waiver requests needs to be
carefully assessed and understood by the Agency before discounting the
benefits of its mobile source emission standards. The characterization
of CARB's ``approach,'' as not calling out criteria emissions benefits
(such as upstream criteria emission benefits) of GHG standards, was
incorrect and should not have undermined EPA's findings and grant of
the initial ACC program waiver request for the following reasons: (1)
As previously noted, the ACC program standards are interrelated and all
serve to reduce both criteria and GHG pollution; (2) CARB conducted a
combined emissions analysis of the elements of the ACC program because
the program was designed to work as an integrated whole; and (3) EPA
has always considered California's standards as a whole or ``in the
aggregate'' under the traditional interpretation of section
209(b)(1)(B).\300\ EPA noted the associated criteria pollutant and GHG
emissions benefits for the whole ACC program: ``the ACC program will
result in reductions of both criteria pollutants and GHG emissions
that, in the aggregate, are more protective than the pre-existing
federal standards.'' \301\ EPA also made the requisite finding that
California's protectiveness finding for the ACC program was not
arbitrary and capricious, under section 209(b)(1)(A), by explaining
that ``California's ZEV and GHG emission standards are an addition to
its LEV program.'' \302\
---------------------------------------------------------------------------

    \300\ ZEV ISOR, EPA-HQ-OAR-2012-0562-0008 at 72; CARB
Supplemental Comments, EPA-HQ-OAR-2012-0562-0373 at 3.
    \301\ 74 FR at 2122.
    \302\ Id. at 2125.
---------------------------------------------------------------------------

    In SAFE 1, EPA further asserted that ``California's responses to
the SAFE proposal do not rebut the Agency's views that the ZEV
standards for MY 2021-2025 are inextricably interconnected with the
design and purpose of California's overall GHG reduction strategy.''
\303\ For the following reasons, however, EPA was also incorrect in the
assessment of criteria emission benefits of CARB's ZEV sales mandate.
EPA focused on only the following snippet from one salient paragraph in
CARB's 2012 waiver request as support for the lack of criteria
emissions benefits: ``There is no criteria emissions benefit from
including the ZEV proposal in terms of vehicle (tank-to-wheel or TTW)
emissions. The LEV III criteria pollutant fleet standard is responsible
for those emission reductions in the fleet; the fleet would become
cleaner regardless of the ZEV regulation because manufacturers would
adjust their compliance response to the standard by making less
polluting conventional vehicles.'' \304\ But, as discussed above, that
was merely an attribution of benefits and did not reflect the practical
reality of how California's standards work. Moreover, the paragraph in
its entirety goes on to explain that CARB's ZEV sales mandate would
achieve criteria emission reductions: ``However, since upstream
criteria and PM emissions are not captured in the LEV III criteria
pollutant standard, net upstream emissions are reduced through the
increased use of electricity and concomitant reductions in fuel
production.'' \305\
---------------------------------------------------------------------------

    \303\ 84 FR at 51337.
    \304\ Id. at 51337, 51330, 51337, 51353-54, 51356, 51358.
    \305\ 2012 Waiver Request at 15-16. CARB also noted that
criteria and PM emission benefits will vary by region throughout the
State depending on the location of emission sources. Refinery
emission reductions will occur primarily in the east Bay Area and
South Coast region where existing refinery facilities operate. As
refinery operations reduce production and emissions, the input and
output activities, such as truck and ship deliveries, will also
decline. This includes crude oil imported through the Los Angeles
and Oakland ports, as well as pipeline and local gasoline truck
distribution statewide. EPA again notes that in its light-duty
vehicle GHG rulemaking in 2012 it also noted the upstream emission
impacts. 77 FR at 62819.
---------------------------------------------------------------------------

    It bears note that this attribution of criteria pollutant
reductions was similar to the one that CARB made almost a decade ago
for the 2009 GHG waiver request.\306\ For example, CARB provided
``extensive evidence of its current and serious air quality problems
and the increasingly stringent health-based air quality standards and
federally required state planning efforts to meet those standards
firmly.'' \307\ The States and Cities also commented that ``the
attribution CARB made as part of its waiver request was never intended
to, and did not, establish the absence of any

vehicular emission benefits from the ZEV standard.'' EPA believes that
CARB's statement was merely a ``simplification that distinguished the
standards based on the primary objectives of the two, complementary
standards.'' \308\ EPA agrees that the record from 2013, and 2019,
demonstrates that CARB's attribution of short-term emissions benefits
did not undercut the long-term vehicular emission benefits of the ZEV
standards. Thus, regardless of how the emissions reductions are
attributed, the GHG standards and ZEV sales mandate drive reductions in
criteria pollution.
---------------------------------------------------------------------------

    \306\ ``The establishment of greenhouse gas emission standards
will result in a reduction in upstream emissions (emission due to
the production and transportation of the fuel used by the vehicle)
of greenhouse gas, criteria and toxic pollutants due to reduced fuel
usage.'' EPA-HQ-OAR-2006-0173-0010.107 at 8.
    \307\ CARB, EPA-HQ-OAR-2012-0562-0371. CARB estimated benefits
of the ZEV and GHG standards for calendar years by which the South
Coast air basin must meeting increasingly stringent NAAQS for ozone:
2023, 2031, and 2037. States and Cities app. A at 2-4, app. C at 8-
9.
    \308\ States and Cities at 31 (original emphasis).
---------------------------------------------------------------------------

    EPA has also consistently explained that ``consideration of all the
evidence submitted concerning a waiver decision is circumscribed by its
relevance to those questions . . . consider[ed] under section 209(b).''
\309\ And so, as earlier noted, any reconsideration of a prior waiver
decision must comport with criteria in section 209(b)(1) as well as
have record support. Moreover, in prior waiver requests for ZEV sales
mandate requirements, CARB has discussed criteria pollutant emissions
reductions because of the mandate for sale of vehicles that have zero
emissions.\310\ CARB's 2012 waiver request also indicated the clear
intent regarding the evolution of the ZEV program and California's
decision to focus both on criteria pollutant and GHG reductions.\311\
EPA's reading of and reliance on the snippet from CARB's waiver request
describing the ZEV sales mandate requirements in the ACC program was
both incorrect and improper, as well as contrary to congressional
intent and EPA's historic practice of affording broad discretion to
California in selecting the best means for addressing the health and
welfare of its citizens.
---------------------------------------------------------------------------

    \309\ 74 FR at 32748. See also 78 FR at 2115.
    \310\ 71 FR 78190 (December 28, 2006); 75 FR 11878 (March 12,
2010) and 76 FR 61095 (October 3, 2011).
    \311\ See 2012 Waiver Request at 2. At the December 2009
hearing, the Board adopted Resolution 09-66, reaffirming its
commitment to meeting California's long term air quality and climate
change reduction goals through commercialization of ZEV
technologies. The Board further directed staff to consider shifting
the focus of the ZEV regulation to both GHG and criteria pollutant
emission reductions, commercializing ZEVs and PHEVs in order to meet
the 2050 goals, and to take into consideration the new LEV fleet
standards and propose revisions to the ZEV regulation accordingly.
---------------------------------------------------------------------------

b. California Needs Its Standards To Address the Impacts of Climate
Change in California
    Under section 209(b)(1)(B), EPA is to grant a waiver request unless
California does not need the standards at issue to address ``compelling
and extraordinary conditions.'' In applying the traditional approach,
EPA has consistently reasoned that ``compelling and extraordinary
conditions'' refers primarily to the factors that tend to produce
higher levels of pollution in California--geographical and climatic
conditions (like thermal inversions) that, when combined with large
numbers and high concentrations of automobiles, create serious air
pollution problems.\312\ These conditions continue to exist in
California and CARB, since the initial 2009 GHG waiver, has
consistently drawn attention to the existential crisis that California
faces from climate change and maintained that air quality issues
associated with GHG emissions have exacerbated this crisis and have yet
to attenuate.\313\
---------------------------------------------------------------------------

    \312\ 49 FR at 18890 (citing legislative history).
    \313\ 2012 Waiver Request at 1.
---------------------------------------------------------------------------

    EPA now recognizes that CARB, as part of its original waiver
request and in comments in response to SAFE 1, submitted ample evidence
of multiple ways California is particularly impacted by climate change,
including increasing risks from record-setting fires, heat waves, storm
surges, sea-level rise, water supply shortages and extreme heat; in
other words that GHG emissions contribute to local air pollution, and
that climate-change impacts in California are ``compelling and
extraordinary conditions.'' For example, CARB noted that ``[r]ecord-
setting fires, deadly heat waves, destructive storm surges, loss of
winter snowpack--California has experienced all of these in the past
decade and will experience more in the coming decades. California's
climate--much of what makes the State so unique and prosperous--is
already changing, and those changes will only accelerate and intensify
in the future. Extreme weather will be increasingly common as a result
of climate change. In California, extreme events such as floods, heat
waves, droughts and severe storms will increase in frequency and
intensity. Many of these extreme events have the potential to
dramatically affect human health and well-being, critical
infrastructure and natural systems.'' \314\ Within the ACC waiver
request, CARB provided a summary report on the third assessment from
the California Climate Change Center (2012), which described dramatic
sea level rises and increases in temperatures in California and
associated impacts on local air quality and other conditions in
California.\315\
---------------------------------------------------------------------------

    \314\ CARB supplemental comment at EPA-HQ-OAR-2012-0562-0371.
CARB notes that EPA's reasoning that the ``compelling and
extraordinary conditions'' criteria should be viewed as a ``program
as a whole'' was upheld as ``eminently reasonable'' in ATA v. EPA,
600 F.3d 624, 627-29 (D.C. Cir. 2010), and that the ACC program
appropriately integrates the passenger vehicle program to address
multiple pollutant types, which also reflects the intent of Congress
in 1977 to broaden California's discretion to adjust its program as
needed (Ford Motor Co. v. EPA, 606 F.2d at 1294). This comment
extensively lays out the compelling and extraordinary conditions
associated with California's air quality challenges and the need to
reduce criteria emissions and greenhouse gas emissions associated
with CARB's ZEV sale mandate and GHG standards. Id. at 5 (``The
critical nature of the LEV III regulation is also highlighted in the
recent effort to take a coordinated look at strategies to meet
California's multiple air quality and climate goals well into the
future. This coordinated planning effort, Vision for Clean Air: A
Framework for Air Quality and Climate Planning (Vision for Clean
Air) demonstrates the magnitude of the technology and energy
transformation needed from the transportation sector and associated
energy production to meet federal standards and the goals set forth
by California's climate change requirements.'').
    \315\ 78 FR at 2129 (``To the extent that it is appropriate to
examine the need for CARB's GHG standards to meet compelling and
extraordinary conditions, as EPA discussed at length in its 2009 GHG
waiver decision, California does have compelling and extraordinary
conditions directly related to regulations of GHG. EPA's prior GHG
waiver contained extensive discussion regarding the impacts of
climate change in California. In addition, CARB has submitted
additional evidence in comment on the ACC waiver request that
evidences sufficiently different circumstances in California. CARB
notes that `Record-setting fires, deadly heat waves, destructive
storm surges, loss of winter snowpack--California has experienced
all of these in the past decade and will experience more in the
coming decades. California's climate--much of what makes the state
so unique and prosperous--is already changing, and those changes
will only accelerate and intensify in the future. Extreme weather
will be increasingly common as a result of climate change. In
California, extreme events such as floods, heat waves, droughts and
severe storms will increase in frequency and intensity. Many of
these extreme events have the potential to dramatically affect human
health and well-being, critical infrastructure and natural
systems.'') (``Our Changing Climate 2012 Vulnerability & Adaptation
to the Increasing Risks from Climate Change in California.
Publication # CEC-500-2012- 007. Posted: July 31, 2012; available at
http://www.climatechange.ca.gov/adaptation/third-assessment''). EPA
also noted that ``the better interpretation of the text and
legislative history of this provision is that Congress did not
intend this criterion to limit California's discretion to a certain
category of air pollution problems, to the exclusion of others. In
this context it is important to note that air pollution problems,
including local or regional air pollution problems, do not occur in
isolation. Ozone and PM air pollution, traditionally seen as local
or regional air pollution problems, occur in a context that to some
extent can involve long range transport of this air pollution or its
precursors. This long-range or global aspect of ozone and PM can
have an impact on local or regional levels, as part of the
background in which the local or regional air pollution problem
occurs.'' 78 FR at 2128.
---------------------------------------------------------------------------

    To the extent that SAFE 1 relied on the premise that GHG emissions
from motor vehicles located in California become globally-mixed as part
of global climate change, and therefore do not pose a local air quality
issue (placing aside the impacts of heat on ozone as

well as air quality impacts from the dramatic increase in wildfires),
EPA notes that in addition to the record from the ACC waiver proceeding
noted above, the SAFE 1 record contains sufficient and unrefuted
evidence that there can be locally elevated carbon dioxide
concentrations resulting from nearby carbon dioxide emissions.\316\
This can have local impacts on, for instance, the extent of ocean
acidification.\317\ Thus, like criteria pollution, emissions of GHGs
can lead to locally elevated concentrations with local impacts, in
addition to the longer-term global impacts resulting from global
increases in GHG concentrations.
---------------------------------------------------------------------------

    \316\ CARB comment at EPA-HQ-OAR-2018-0283-5054 at 305-06
(California's Fourth Climate Assessment; https://www.energy.ca.gov/sites/default/files/2019-12/Governance_External_Ekstrom_ada.pdf).
    \317\ See, for example, reports from California's Fourth Climate
Change Assessment, ``California Mussels as Bio-indicators of Ocean
Acidification,'' available at https://www.energy.ca.gov/sites/default/files/2019-12/Oceans_CCCA4-CNRA-2018-003_ada.pdf (``Because
of the coupling between natural (upwelling-driven) and anthropogenic
(CO2 emission-driven) processes, California waters are already
experiencing declines in pH that are not expected in other areas of
the world's oceans for decades (Feely et al. 2008; Chan et al.
2017). These perturbations to seawater chemistry join others
associated with changing seawater temperatures (Garc[iacute]a-Reyes
and Largier 2010) and reductions in ocean oxygenation (Bograd et al.
2008; Chan et al. 2008). Therefore, marine communities along the
coast of California are increasingly subjected to a suite of
concurrent environmental stressors. Substantial impetus exists to
understand, quantify, and project biological and ecological
consequences of these stressors, which current work suggests may be
pervasive and diverse (Kroeker et al. 2010, 2013; Gaylord et al.
2015).''). Further, evidence in the record from a 2019 study
demonstrated that locally enhanced carbon dioxide concentrations
above Monterey Bay, California, fluctuate by time of day likely
because of the magnitude of nearby urban carbon dioxide pollution
and the effects of topography on offshore winds, and that this
fluctuation increases the expected rate of acidification of the Bay.
See Northcott, et al., Impacts of urban carbon dioxide emissions on
sea-air flux and ocean acidification in nearshore waters, PLoS ONE
(2019). For decades, the monthly average carbon dioxide
concentrations off California's coast have been consistently higher
and more variable than those at Mauna Loa (which are commonly used
as the global measurements). In fact, another more recent study
shows that the waters of the California Current Ecosystem, off the
coast of Southern California, have already acidified more than twice
as much as the global average. E.g., Cal. Office of Environmental
Health Hazard Assessment, Atmospheric Greenhouse Gas Concentrations
(Feb. 11, 2019).
---------------------------------------------------------------------------

    Finally, in demonstrating the need for GHG standards at issue, CARB
attributed GHG emissions reductions to vehicles in California. For
instance, ``CARB project[ed] that the standards will reduce car
CO2 emissions by approximately 4.9%/year, reduce truck
CO2 emissions by approximately 4.1%/year (the truck
CO2 standard target curves move downward at approximately
3.5%/year through the 2016-2021 period and about 5%/year from 2021-
2025), and reduce combined light-duty CO2 emissions by
approximately 4.5%/year from 2016 through 2025.'' \318\ CARB also
projected that its GHG emissions standards for MYs 2017-2025 will
reduce fleet average CO2 levels by about 34 percent from MY
2016 levels of 251 g/mile down to about 166 g/mile, based on the
projected mix of vehicles sold in California.'' \319\ CARB further
noted that there might be a GHG emission deficit if only the Federal
GHG standards were implemented in California.\320\ The GHG emissions
from California cars, therefore, are particularly relevant to both
California's air pollution problems and GHG standards at issue.
---------------------------------------------------------------------------

    \318\ 78 FR at 2139.
    \319\ Id. at 2135.
    \320\ Id. at 2122.
---------------------------------------------------------------------------

    In SAFE 1, EPA dismissed California's ``need'' for the GHG
standards at issue because their impact on GHG emissions would be too
small to ``meaningfully address global air pollution problems of the
sort associated with GHG emissions'': ``[T]he most stringent regulatory
alternative considered in the 2012 final rule and [Final Regulatory
Impact Analysis] . . . , which would have required a seven percent
average annual fleetwide increase in fuel economy for MYs 2017-2025
compared to MY 2016 standards, was forecast to decrease global
temperatures by only 0.02 [deg]C in 2100.'' \321\ EPA also received
similar comments in response to the Notice of Reconsideration. But
since the inception of the waiver program, EPA has never applied a test
to determine whether a California waiver request under 209(b)(1) would
independently solve a pollution problem. EPA has never applied a de
minimis exemption authority to California waiver request under section
209(b)(1).\322\ EPA believes there is no basis for exercise of such a
test under section 209(b), considering that CARB continues to maintain
that emissions reductions in California are essential for meeting the
NAAQS.\323\ EPA has reiterated that ``California's policy judgment that
an incremental, directional improvement will occur and is worth
pursuing is entitled, in EPA's judgment, to great deference.'' \324\ As
the Supreme Court has recognized, ``[a]gencies, like legislatures, do
not generally resolve massive problems in one fell regulatory swoop. .
. They instead whittle away at them over time, refining their preferred
approach as circumstances change and as they develop a more nuanced
understanding of how best to proceed.'' \325\ And so, in the ACC
program waiver decision, EPA also explained that ``[t]he issue of
whether a proposed California requirement is likely to result in only
marginal improvement in air quality not commensurate with its cost or
is otherwise an arguably unwise exercise of regulatory power is not
legally pertinent to my decision under section 209.'' \326\
---------------------------------------------------------------------------

    \321\ 84 FR at 51349.
    \322\ See, e.g., 74 FR at 32766 (``As noted by the Supreme Court
in Massachusetts v. EPA, while it is true that regulating motor
vehicle GHG emissions will not by itself reverse global warming, a
reduction in domestic automobile emissions would slow the pace of
global emissions increase no matter what happens with regard to
other emissions.'').
    \323\ See Alabama Power Co. v. Costle, 636 F.2d 323, 360-66,
n.89 (D.C. Cir. 1979).
    \324\ 74 FR at 32766 (``Under this approach, there is no need to
delve into the extent to which the GHG standards at issue here would
address climate change or ozone problems. That is an issue
appropriately left to California's judgment. . . . Given the
comments submitted, however, EPA has also considered an alternative
interpretation, which would evaluate whether the program or
standards has a rational relationship to contributing to
amelioration of the air pollution problems in California. Even under
this approach, EPA's inquiry would end there. California's policy
judgment that an incremental, directional improvement will occur and
is worth pursuing is entitled, in EPA's judgment, to great
deference.'').
    \325\ Massachusetts v. EPA, 549 U.S. 497, 524 (2007).
    \326\ 78 FR at 2134.
---------------------------------------------------------------------------

    Further, nothing in either section 209 or the legislative history
could be read as requiring EPA to grant GHG standards waiver requests
only if California's GHG pollution problem is the worst in the
country.\327\ CARB further demonstrated a ``need'' for its GHG
standards by projecting GHG emissions reductions deficits from
implementation of only the Federal GHG program in California. ``[I]f a
National Program standard was theoretically applied only to California
new vehicle sales alone, it might create a GHG deficit of roughly two
million tons compared to the California standards.'' \328\
---------------------------------------------------------------------------

    \327\ 49 FR at 18891.
    \328\ 78 FR at 2122 (citing EPA-HQ-OAR-2012-0562-0374 at 3).
CARB also noted that ``to the extent a manufacturer chooses not to
exercise their National Program compliance option in California this
would actually provide additional GHG benefits in California, so
compliance in California can never yield fewer cumulative greenhouse
gas reductions from the industry wide fleet certified in
California.'' Id. at 2122 n.61.
---------------------------------------------------------------------------

3. California's ZEV Sales Mandate as Motor Vehicle Control Technology
Development
    Congress also envisioned that California's other role under section
209(b) would be an innovative laboratory for motor vehicle emission

standards and control technology. California is to serve as ``a kind of
laboratory for innovation'' \329\ and to ``blaze its own trail with a
minimum of federal oversight.\330\ California's ``unique [air
pollution] problems and [its] pioneering efforts justif[ied] a waiver
of the preemption section.'' \331\ Congress stressed that California
should serve the Nation as a ``testing area'' for more protective
standards.'' \332\ In the 2009 GHG waiver, for example, EPA explained
that ``the basic nature of the compromise established by Congress [is
that] California could act as the laboratory for the nation with
respect to motor vehicle emission control, and manufacturers would
continue to face just two sets of emissions standards--California's and
EPA's.'' \333\ California's ZEV sales mandates have so far supported
development of technologies such as battery electric and fuel cell
vehicles that embody the pioneering efforts Congress envisaged. EPA
acknowledged this important role in the ACC program waiver by
explaining that California needs the ZEV sales mandate requirement to
ensure the development and commercialization of technology required for
the future, deeper vehicular emission reductions California will have
to attain to meet its NAAQS obligations as well as achieve other long-
term emission goals of new vehicle sales between 2040 and 2050.\334\ In
SAFE 1, however, EPA did not consider this additional role carved out
in section 209(b)(1) for California as a proven ground for motor
vehicle control emissions technology.\335\
---------------------------------------------------------------------------

    \329\ MEMA I, 627 F.2d 1095, 1111 (D.C. Cir. 1979).
    \330\ Ford Motor Co., v. EPA, 606 F.2d 1293, 1297 (D.C. Cir.
1979).
    \331\ S. Rep. No. 90-403, at 33 (1967).
    \332\ Id.
    \333\ 74 FR at 32763.
    \334\ 78 FR at 2123, 2130-31.
    \335\ 84 FR at 51343 (``[I]n a statute designed to address
public health and welfare, it certainly cannot mean standards that
allow a state to be ``a laboratory for innovation'' in the abstract,
without any connection to a need to address pollution problems.'').
---------------------------------------------------------------------------

    In sum, while nothing in section 209 or the legislative history
limits EPA's waiver authority to standards that reduce criteria
pollution,\336\ analyses in this section again recognize the way the
different requirements in the ACC program work together to reduce
criteria and GHG pollution and spur technological innovation. These
analyses conclude that GHG pollution exacerbates tropospheric ozone
pollution, worsening California's air quality problems, and the manner
in which GHG and criteria pollutant standards work together to reduce
both forms of pollution. Ample record support exists on California's
need for both GHG standards and ZEV sales mandate at issue to address
compelling and extraordinary conditions in California. As noted above,
in SAFE 1 EPA, however, relied on an excerpt of the ACC program waiver
record to determine the lack of criteria emission benefits of GHG
emission standards and ZEV sales mandate at issue. In doing so, EPA did
not evaluate the complete record from the ACC waiver proceeding and the
nature of California's air quality problem, including the relationship
of climate change to California's ability to achieve the ozone NAAQS in
the assessment of California's need for these requirements.\337\
---------------------------------------------------------------------------

    \336\ The Agency again notes that, unlike provisions of the CAA
such as section 211(c)(4)(C) which allows EPA to waive preemption of
a state fuel program respecting a fuel characteristic or component
that EPA regulates through a demonstration that the state fuel
program is necessary to achieve a NAAQS, section 209(b) makes no
mention of NAAQS pollutants or otherwise indicates that air
pollutants should be treated differently.
    \337\ For example, CARB's ISOR for its ZEV standards identifies
at Table 6.2 the well to wheel emission benefits of the ZEV program
compared to the LEV III program. ZEV ISOR, EPA-HQ-OAR-2012-0562-0008
at 78. See also 2012 Waiver Request at 16. CARB noted in its
comments on the SAFE proposal that ``Rising temperatures exacerbate
California's ozone problem by increasing ground-level ozone
concentrations.'' CARB, EPA-HQ-OAR-2018-0283-5054 at 371-72 (citing
the 2012 Waiver Request). In addition, ``Several studies indicate
that a warming climate is expected to exacerbate surface ozone in
California's two major air basins: South Coast Air Basin and San
Joaquin Valley. Id. at 372 (citing Jacob & Winner. Effect of Climate
Change on Air Quality, 43:1 ATMOS. ENVIRON. 51 (Jan. 2009); Wu, et
al., Effects of 2000-2050 Global Change on Ozone Air Quality in the
United States, 113, D06302, J. GEOPHYS. RES.-ATMOS. (Mar. 19, 2008),
available at https://doi.org/10.1029/2007JD008917; Rasmussen, et
al., The Ozone-climate Penalty: Past, Present, and Future, 47:24
ENVTL. SCI. & TECH. 14258 (Dec. 17, 2013), available at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3990462/).
---------------------------------------------------------------------------

    As noted above, in SAFE 1, EPA established a new test under section
209, requiring a particularized, local nexus between (1) pollutant
emissions from sources, (2) air pollution, and (3) resulting impact on
health and welfare, a test that would exclude GHG pollution from the
scope of the waiver.\338\ But this test is found nowhere in the text of
section 209-- the statute does not contain this requirement, or even
use these terms.
---------------------------------------------------------------------------

    \338\ 84 FR at 51339-40.
---------------------------------------------------------------------------

    EPA's review of the complete record confirms the Agency's
conclusions in the ACC program waiver that California needs the GHG
standards at issue to meet a compelling and extraordinary conditions
regardless of whether the Agency focuses on criteria or greenhouse gas
pollution reduction. This review also indicates that opponents of the
waiver (including EPA in SAFE 1) did not meet the burden of proof
necessary to demonstrate that California did not have a need for the
GHG standards, including under the nexus test applied in SAFE 1. It
also bears note that EPA's longstanding practice, based on the
statutory text, legislative history, and precedent calls for deference
to California in its approach to addressing the interconnected nature
of air pollution within the state and is not limited to criteria
pollutant problems. Critically, EPA is not to engage in ``probing
substantive review'' of waiver requests,\339\ but rather ``afford
California the broadest possible discretion in selecting the best means
to protect the health of its citizens and the public welfare.'' \340\
---------------------------------------------------------------------------

    \339\ Ford Motor Co. v. EPA, 606 F.2d 1293, 1300 (D.C. Cir.
1979).
    \340\ MEMA II, 142 F.3d 449, 453 (D.C. Cir. 1998).
---------------------------------------------------------------------------

E. Conclusion

    Considering the text, legislative history, and precedent that
support the Agency's historical practice of interpreting section
209(b)(1)(B) as calling for a program-level evaluation of waiver
requests, as well as the uncertainty in settled expectations created by
the SAFE 1 interpretation, EPA rescinds its actions in SAFE 1 regarding
both the interpretation of section 209(b)(1)(B) and the findings
regarding California's need for the GHG standards and ZEV sales
mandate. EPA believes that the burden of proof had not been met in SAFE
1, based on the complete factual record, to demonstrate that California
did not have a need for the GHG standards and ZEV sales mandate under
the SAFE 1 interpretation of the second waiver prong nor had the burden
been met to support a finding that the ample evidence in the record at
the time of the ACC waiver decision did not demonstrate that California
had a need for its standards to meet compelling and extraordinary
conditions. As noted above, the result of the recission of the SAFE 1
action is the reinstatement of the ACC program waiver. EPA confirms the
traditional interpretation of section 209(b)(1)(B) was appropriate and
continues to be, at least, a better interpretation regardless of the
recission of the SAFE 1 interpretation of this criterion.\341\
---------------------------------------------------------------------------

    \341\ See 84 FR at 51344 n.269.

---------------------------------------------------------------------------

VI. EPA Inappropriately Considered Preemption Under the Energy Policy
and Conservation Act (EPCA) in Its Waiver Decision

    SAFE 1's other justification for withdrawing the ACC program waiver
was that California's GHG standards and ZEV sales mandate were
preempted under EPCA. As explained in detail in Section IV, EPA
believes this basis for reconsideration was outside the appropriate
bounds of EPA's authority to reconsider previously granted waivers. In
particular, if EPA could reconsider and withdraw a waiver based on a
factor not contained in the specified criteria for denial in section
209(b)(1), EPA could circumvent the specified criteria for denial via
reconsideration of previously granted waiver.
    Even if it were appropriate for EPA to reconsider a previously
granted waiver based on non-statutory factors, in this action, EPA
concludes that it was inappropriate to rely on preemption under EPCA as
a basis for withdrawing certain aspects of the ACC program waiver. In
SAFE 1, a joint action between NHTSA and EPA, NHTSA concluded that
state or local regulations of tailpipe carbon dioxide emissions are
``related to fuel economy standards'' and are therefore preempted under
EPCA.\342\ As a direct result of NHTSA's codified text and
pronouncements on preemption set forth in SAFE 1, EPA withdrew the ACC
program waiver for California's GHG standards and ZEV sales mandate on
grounds that they were preempted under EPCA. In SAFE 1, EPA believed it
was appropriate to consider the effect of NHTSA's actions, including
the view that California cannot enforce standards that are void ab
initio, and thus EPA stated that ``to the extent that administrative
action is necessary on EPA's part to reflect that state of affairs, EPA
hereby withdraws that prior grant of a waiver on this basis.'' \343\
NHTSA has since issued a new final rule that formally repeals the
codified text and pronouncements regarding preemption under EPCA found
in SAFE 1. Upon reconsideration, EPA now believes that, given NHTSA's
repeal of its regulation and pronouncements in SAFE 1, preemption under
EPCA cannot serve as a basis for the withdrawal of the ACC program
waiver as it did in SAFE 1--if it could ever legitimately serve as such
basis. EPA thus believes it is appropriate to rescind the portion of
the waiver withdrawal that was based on preemption under EPCA.
---------------------------------------------------------------------------

    \342\ 49 U.S.C. 32919(a) (``When an average fuel economy
standard prescribed under this chapter is in effect, a State or a
political subdivision of a State may not adopt or enforce a law or
regulation related to fuel economy standards or average fuel economy
standards for automobiles covered by an average fuel economy
standard under this chapter.''). NHTSA noted that a law or
regulation having the direct or substantial effect of regulating or
prohibiting tailpipe carbon dioxide emissions from automobiles or
automobile fuel economy is a law or regulation related to fuel
economy standards and expressly preempted under 49 U.S.C. 32919(a).
84 FR at 51317-18. NHTSA's rule was codified at 49 CFR 531.7
(``Preemption'') and 533.7 (``Preemption''), as well as each
Appendix B in 49 CFR part 531 (``APPENDIX B TO PART 531--
PREEMPTION'') and Part 533 (``APPENDIX B TO PART 533--PREEMPTION'').
    \343\ 84 FR at 51338.
---------------------------------------------------------------------------

    In addition, given the unique consideration of preemption under
EPCA in SAFE 1 and its effect on an otherwise validly issued waiver
under the CAA, EPA believes it is helpful to provide additional
information regarding the Agency's historical practice and views to
demonstrate why consideration of preemption under EPCA was
inappropriate. Consideration of preemption under EPCA is beyond the
statutorily prescribed criteria for EPA in section 209(b)(1).
Preemption under EPCA was not a factor that California addressed under
the applicable waiver criteria in its initial request nor was it a
factor that EPA considered in granting the ACC program waiver. Until
SAFE 1, the Agency consistently refrained from reviewing waiver
requests against factors beyond the statutorily listed criteria under
section 209(b)(1). Thus, EPA also believes that in the reconsideration
of a waiver where EPA had previously declined to consider preemption
under EPCA, SAFE 1 was contrary to congressional intent and the
Agency's historic practice of hewing to section 209(b)(1) statutory
criteria in reviewing waiver requests. Given this backdrop, EPA
believes that the joint rulemaking context of SAFE 1 was an improper
basis to deviate from EPA's long held belief to not consider factors
outside the scope of section 209(b)(1), especially given that the
Agency indicated it would only be a singular occurrence. EPA continues
to view the text and congressional intent of the statute, as well as
subsequent case law, as best supporting a limited scope of review for
waiver requests under section 209(b)(1)--irrespective of whether a
waiver proceeding is undertaken either solely by EPA or in unison with
another agency. Therefore, based on EPA's historical practice of not
considering factors outside of the section 209(b)(1) criteria and
because EPA believes the ``joint-action'' premise was improper, the
Agency is rescinding its withdrawal of the ACC program waiver based on
preemption under EPCA.

A. Historical Practice and Legislative History

    Historically, in reviewing California's waiver requests, EPA has
refrained from the consideration of factors beyond those criteria set
out in section 209(b)(1).\344\ EPA has generally explained that the
text, structure, and purpose of the California waiver provision
indicate congressional intent for EPA to provide significant deference
to California's judgment, especially on ``ambiguous and controversial
matters of public policy.'' \345\ In section 209(a), Congress generally
preempted state standards relating to the control of emissions from new
motor vehicles and engines, but, in section 209(b), Congress carved out
an exception for California, directing EPA to grant California a waiver
of section 209(a) unless the Agency can make a finding under section
209(b). Congress recognized that California's ``compelling and
extraordinary circumstances,'' and its historical practice of
regulating in the area, were sufficient ``to justify standards on
automobile emissions which may, from time to time, need be more
stringent than national standards.'' \346\ In creating the waiver
program, Congress intended not only for California to be able to meet
its own emission reduction needs, but also for California to act as ``a
kind of laboratory for innovation'' for motor vehicle standards and
control technology.'' \347\

Thus ``Congress consciously chose to permit California to blaze its own
trail with a minimum of federal oversight.'' \348\
---------------------------------------------------------------------------

    \344\ See, e.g., 43 FR at 32184 (rejecting objections to the
procedures at state level, objections that section 207(c)(3)(A)
establishes field protection, and constitutional objections all as
beyond the ``narrow'' scope of the Administrator's review); 74 FR at
32783 (rejecting comments asking for the consideration of EPCA
because it is not one of the three statutorily prescribed criteria);
78 FR at 2145 (again rejecting comments asking for the consideration
of EPCA because it is outside the statutory criteria); 79 FR at
46265 (rejecting the argument that the HD GHG Regulations
``impermissibly regulate fuel economy'' because, like the commerce
clause and Federal Aviation Administration Authorization Act of 1994
(FAAAA) issues, this issue is ``outside the proper scope of review
since it is not among the criteria listed under section 209(b).'').
    \345\ 78 FR at 2112, 2115; 40 FR at 23103-04; 58 FR 4166.
    \346\ H.R. Rep. No. 90-728, 90th Cong., 1st Sess. 21 (1967); S.
Rep. No. 403, 90th Cong., 1st Sess. 33 (1967) (``The waiver of
preemption is for California's `unique problems and pioneering
efforts.' '').
    \347\ MEMA I, 627 F.2d 1095, 1111 (D.C. Cir. 1979); 113 Cong.
Rec. 30950, 32478 (Statement of Sen. Murphy) (``The United States as
a whole will benefit by allowing California to continue setting its
own more advanced standards for control of motor vehicle emissions.
. . [The] State will act as a testing agent for various types of
controls and the country as a whole will be the beneficiary of this
research.'').
    \348\ Ford Motor Co. v. EPA, 606 F.2d 1293, 1297 (D.C. Cir.
1979).
---------------------------------------------------------------------------

    Legislative history makes clear that the Administrator must
``presume'' that the California standards ``satisfy the waiver
requirements'' and that the burden of proving otherwise rests on the
Administrator or other parties favoring denial of the waiver.\349\
Further, according to the House Committee Report for the 1977
amendments that strengthened California's waiver provisions, EPA is
``to afford California the broadest possible discretion in selecting
the best means to protect the health of its citizens and the public
welfare.'' \350\ According to the House Report, ``The Administrator,
thus, is not to overturn California's judgment lightly. Nor is he to
substitute his judgment for that of the State. There must be ``clear
and compelling evidence that the State acted unreasonably in evaluating
the relative risks of various pollutants in light of the air quality,
topography, photochemistry, and climate in that State, before EPA may
deny a waiver.'' \351\ EPA's historic practice of considering only
listed criteria is thus in keeping with the highly deferential review
of waiver requests that Congress intended in carving out the exception
from preemption of new motor vehicle and engine standards in section
209(a).\352\
---------------------------------------------------------------------------

    \349\ MEMA I, 627 F.2d at 1121-22 (citing, for example, S. Rep.
No. 403, 90th Cong., 1st Sess. 33 (1967)).
    \350\ MEMA II, 142 F.3d 449, 453 (D.C. Cir. 1998) (quoting H.R.
Rep. No. 95-294, at 301-02 (1977)).
    \351\ H.R. Rep. No. 95-294, at 302 (1977), reprinted in 1977
U.S.C.C.A.N. at 1381.
    \352\ See, e.g., 74 FR at 32783; 78 FR at 2145.
---------------------------------------------------------------------------

    Courts have generally agreed with the Agency's consideration of
only listed CAA criteria in reviewing waiver requests, also pointing to
the statute's lack of any indication of the ability to consider non-
statutory criteria as well as the waiver program's significant
deference to California. The D.C. Circuit has stated that, under the
text of the statute, the section 209(b) criteria are ``the only waiver
standards with which California must comply'' and that, therefore,
``[i]f EPA concludes that California's standards [meet section 209(b)],
it is obligated to approve California's waiver application.'' \353\ The
D.C. Circuit has repeatedly described EPA's waiver approval role as
``limited'' and ``narrow.'' In MEMA I, for example, the court explained
that ``the Administrator has consistently held since first vested with
the waiver authority, [that] his inquiry under section 209 is modest in
scope. He has no `broad and impressive' authority to modify California
regulations.'' \354\ The court further noted that ``there is no such
thing as a `general duty' on an administrative agency to make decisions
based on factors other than those Congress expressly or impliedly
intended the agency to consider.'' \355\ Similarly, the court has
stated that ``[t]he statute does not provide for any probing
substantive review of the California standards by federal officials''
and that ``EPA's only role is to review California's proposed rules
under a narrowly defined set of statutory criteria.'' \356\ Thus, the
court has consistently rejected arguments requiring EPA to consider
factors outside of the statutory criteria. In MEMA I, the court
rejected a constitutional objection to a waiver, explaining that,
because ``the Administrator operates in a narrowly circumscribed
proceeding requiring no broad policy judgments on constitutionally
sensitive matters,'' ``[n]othing in section 209 requires him to
consider the constitutional ramifications of the regulations for which
California requests a waiver . . . although nothing in section 209
categorically forbids'' it.\357\ In the same case, the court also
rejected an antitrust objection as outside the scope of the
Administrator's review.\358\ The court again upheld EPA's decision to
not consider constitutional objections in American Trucking Association
(ATA) v. EPA, stating, ``We agree with EPA that ATA is seeking
`improperly to engraft a type of constitutional Commerce Clause
analysis onto EPA's [s]ection 7543(e) waiver decisions that is neither
present in nor authorized by the statute.'' \359\
---------------------------------------------------------------------------

    \353\ MEMA II, 142 F.3d at 463.
    \354\ MEMA 1, 627 F.2d at 1119 (internal citations omitted).
    \355\ Id. at 1116-17.
    \356\ Ford Motor Co. v. EPA, 606 F.2d 1293, 1300 (D.C. Cir.
1979), and ATA v. EPA, 600 F.3d 624, 628 (2010), respectively.
    \357\ MEMA I, 627 F.2d at 1115 (declining to consider whether
California standards are constitutional).
    \358\ Id. at 1117 (``[N]othing in section 209 or elsewhere in
the Clean Air Act can fairly be read to imply a duty on the
Administrator to deny a waiver on the basis of the antitrust
implications of California regulations.'').
    \359\ ATA v. EPA, 600 F.3d at 628.
---------------------------------------------------------------------------

    It is against this backdrop that EPA has reviewed waiver requests
by evaluating them solely under the criteria of section 209(b). For
instance, prior to SAFE 1, EPA had solicited comment, in the context of
the 2008 and 2009 GHG notices for comment on CARB's first waiver
request for GHG emission standards, as to whether the EPCA fuel economy
preemption provisions were relevant to EPA's consideration of CARB's
authority to implement its motor vehicle GHG regulations.\360\ In both
instances, EPA declined to consider preemption under EPCA.\361\ In the
2009 waiver, EPA explained that ``section 209(b) of the Clean Air Act
limits our authority to deny California's requests for waivers to the
three criteria therein.'' \362\ EPA further pointed to its historic
practice of ``refrain[ing] from denying California's requests for
waivers based on any other criteria,'' which had been reviewed and
upheld by the Court of Appeals for the District of Columbia
Circuit.\363\ In the 2013 review of the ACC program waiver request, the
Agency again declined to consider factors outside the statutory
criteria, explaining that ``EPA may only deny waiver requests based on
the criteria in section 209(b), and inconsistency with EPCA is not one
of those criteria.'' \364\ A year later, EPA yet again declined to
consider constitutionality claims, preemption under EPCA, and the
implications of the Federal Aviation Administration Authorization Act
of 1994 (FAAAA).\365\ EPA explained that section 209(b) limits the
Agency's authority to deny California's requests for waivers to the
three criteria therein and that the Agency has consistently refrained
from denying California's requests for waivers based on any other
criteria.\366\
---------------------------------------------------------------------------

    \360\ 73 FR at 12159.
    \361\ Id.; 74 FR at 32783.
    \362\ 74 FR at 32783.
    \363\ Id. (citing MEMA I, 627 F.2d at 1111, 1114-20, and MEMA
II, 142 F.3d 449, 466-67 (D.C. Cir. 1998)).
    \364\ 78 FR at 2145.
    \365\ HD GHG Regulations for certain model year sleeper-cab
tractors and dry-van and refrigerated-van trailers. 79 FR at 46256,
46264.
    \366\ Id. In rejecting the commerce clause objection, the
decision cited MEMA I's statement that ``[t]he waiver proceeding
produces a forum ill-suited to the resolution of constitutional
claims.'' Id. (citing MEMA I, 627 F.2d at 1114-20). Thus, the
decision concluded, ``Constitutional challenges to the HD GHG
Regulations [were] more appropriately addressed by a legal challenge
directly against the state.'' Id.
---------------------------------------------------------------------------

    In SAFE 1, EPA changed course, reasoning instead that the Agency
pronouncement in the ACC program waiver decision on factors EPA could
consider in denying a waiver request ``was inappropriately broad, to
the extent it suggested that EPA is categorically forbidden from ever
determining that a waiver is inappropriate due to consideration of
anything other than the `criteria' or `prongs' at section
209(b)(1)(B)(A)-

(C).'' \367\ EPA explained that this statement and EPA's historical
practice of not considering preemption under EPCA ``were made in the
context of EPA acting on its own to administer section 209(b) in
considering such applications.'' \368\ Further, EPA distinguished these
previous single-agency actions from its SAFE 1 joint action context by
explaining that ignoring NHTSA's determination of preemption in the
same action, ``would place the United States Government in the
untenable position of arguing that one federal agency can resurrect a
State provision that, as another federal agency has concluded and
codified, Congress has expressly preempted and therefore rendered void
ab initio.'' \369\ At the same time, EPA expressed intentions not to
consider factors outside the statutory criteria in future waiver
proceedings.\370\ EPA then concluded that NHTSA's determination of
preemption in the same action ``renders EPA's prior grant of a waiver
for those aspects of California's regulations that EPCA preempts
invalid, null, and void'' because ``California cannot enforce standards
that are void ab initio.'' \371\
---------------------------------------------------------------------------

    \367\ A complete discussion of preemption under EPCA in SAFE 1
can be found at 84 FR at 51337-38.
    \368\ Id.
    \369\ Id. Citing Massachusetts v. EPA, the Agency also asserted
that the consideration of EPCA was supported by the Supreme Court's
holding because it ensured consistency between NHTSA and EPA's
programs. Id.
    \370\ 84 FR at 51338.
    \371\ Id.
---------------------------------------------------------------------------

B. Notice of Reconsideration of SAFE 1 and Request for Comment

    In its April 28, 2021, Notice of Reconsideration, EPA acknowledged
that SAFE 1's consideration of NHTSA's finding of preemption under EPCA
deviated from its historic practice of ``declin[ing] to look beyond the
waiver criteria in section 209(b) when deciding the merits of a waiver
request from CARB.'' \372\ EPA sought comment on whether ``EPA properly
considered and withdrew portions of the ACC program waiver pertaining
to GHG standards and the ZEV sales mandate based on NHTSA's EPCA
preemption action, including whether EPA had the authority to withdraw
an existing waiver based on a new action beyond the scope of section
209.'' \373\ Given EPA's reliance on NHTSA's preemption findings as a
basis of waiver withdrawal in SAFE 1, EPA also sought comment on how
the repeal of SAFE 1, should NHTSA take final action to do so, would
affect its own reconsideration of SAFE 1.
---------------------------------------------------------------------------

    \372\ 86 FR at 22429.
    \373\ Id.
---------------------------------------------------------------------------

C. Comments Received

    EPA received comments in support of and against the consideration
of preemption under EPCA in reviewing requests for waivers by
California. Multiple comments related to the Agency's use of the joint
action with NHTSA as a justification for deviating from the Agency's
practice of reviewing waiver requests under the specific statutory
criteria. Some commenters agreed that the context of a joint action
necessitated consideration of preemption under EPCA because NHTSA was
the agency charged with interpreting and implementing EPCA and so EPA
must consider its findings in the same action.\374\ One commenter also
argued that the joint rulemaking of SAFE 1 would be consistent with
pronouncements in Massachusetts v. EPA (2007) on the agencies'
respective statutory obligations and the need to avoid inconsistency
and so, ``[o]nce NHTSA proposed to finalize a determination that EPCA
preempts California's GHG motor vehicle standards, it would be
unreasonable for the EPA to refuse to take NHTSA's action into
account.'' \375\
---------------------------------------------------------------------------

    \374\ See, e.g., CEI at 11-12; AFPM at 2, 6.
    \375\ CEI at 11.
---------------------------------------------------------------------------

    Other commenters argued that the context of the rulemaking, whether
joint or not, was irrelevant. One commenter stated emphatically that
``what Congress directed EPA to consider when it wrote Section
209(b)(1) does not change depending on whether EPA acts alone or with
another agency.'' \376\ Some commenters also argued that the context of
the rulemaking was a particularly insufficient justification for
revoking the waiver given language in SAFE 1 that allowed for
inconsistent consideration of EPCA preemption. Several commenters noted
that EPA constrained the future applicability of SAFE 1 by explaining
that the Agency would not consider factors outside statutory criteria
in future waiver reviews in other subject areas.\377\ Another commenter
also noted that ``the action purported to be `joint,' and yet as now
acknowledged, SAFE Part 1 `is properly considered as two severable
actions, a rulemaking by NHTSA and a final informal adjudication by
EPA.' '' \378\ These inconsistencies, they argued, made SAFE 1's
distinction between single-agency and joint actions arbitrary and
capricious.
---------------------------------------------------------------------------

    \376\ States and Cities at 20. See also Twelve Public Interest
Organizations app. 1 64-65.
    \377\ NESCAUM at 3; Twelve Public Interest Organizations at app.
1 64-65; States and Cities at 20.
    \378\ SCAQMD at 7 (quoting 86 FR at 22439, n.40).
---------------------------------------------------------------------------

    Commenters also argued for and against consideration of factors
outside the statutory criteria--including, but not limited to,
preemption under EPCA--regardless of the kind of agency action,
although EPA did not make this argument in SAFE 1. Commenters argued
that EPA's authority to look outside the statutory criteria at EPCA was
at least permissive, if not mandatory. According to one commenter,
``EPA exaggerates the Court's position'' in MEMA I in its
Reconsideration notice: ``[T]he court did not say that the EPA is
forbidden to take constitutional ramifications into consideration, only
that it is not required to do so.'' \379\ Another commenter agreed that
MEMA I and MEMA II ``do not preclude EPA from considering'' preemption
under EPCA but then went further, saying that ``EPA is required to
consider EPCA preemption.'' \380\ The commenter argued that MEMA I
rejected petitioners' constitutional objections to a waiver under an
institutional competence line of reasoning, concluding that ``[t]he
waiver proceeding produces a forum ill-suited to the resolution of
constitutional claims.'' \381\ In contrast, they continued, the waiver
proceeding is an appropriate forum for determining whether emission
standards ``relate to'' fuel economy because this issue is ``within the
agency's competence, as this relationship is mathematical and based in
science rather than understandings of Constitutional law and
precedent.'' \382\ However, the other commenter, who agreed that EPA is
not ``forbidden'' from considering preemption under EPCA, also noted
that EPA ``has no special competence to interpret EPCA.'' \383\
---------------------------------------------------------------------------

    \379\ CEI at 10 (original emphasis).
    \380\ AFPM at 5-6.
    \381\ Id. at 6 (quoting MEMA I, 627 F.2d 1095, 1114-15 (DC Cir.
1979)).
    \382\ Id.
    \383\ CEI at 11.
---------------------------------------------------------------------------

    Several commenters also argued that EPA could not reinstate the
waiver because NHTSA concluded that EPCA preempts the standards, such
standards were void ab initio, and therefore ``the state mandates
referenced in CA's petition for reconsideration are not even eligible
to be considered for a CAA waiver of preemption.'' \384\ To ignore

this, they claimed, would violate the Supremacy Clause of the
Constitution. EPA, therefore, must look outside the statutory criteria
to consider preemption under EPCA because it cannot ``reasonably claim
that the lawfulness and constitutionality of state actions over which
it has supervision are issues outside the scope of its
responsibility[.]'' \385\
---------------------------------------------------------------------------

    \384\ NADA at 3-4; See also AFPM at 3 (``Since California's GHG
tailpipe standards and ZEV mandate are related to fuel economy, they
are not lawfully adopted and void ab initio--and there is nothing
for EPA to reinstate.''); Urban Air at 47-48; CEI at 2 (``But EPCA
preemption is the proverbial elephant in the room. If SAFE 1's EPCA
preemption argument is correct, the EPA could not grant a valid CAA
preemption waiver for California's tailpipe CO2 standards
and ZEV mandates, because EPCA had already turned those policies
into legal phantoms--mere proposals without legal force or
effect.'').
    \385\ CEI at 11.
---------------------------------------------------------------------------

    In contrast, other commenters pointed to EPA's historical practice
of evaluating waiver requests under the section 209 statutory criteria,
the text of the statute, and the policy implications of looking outside
the statutory criteria, to support a return to EPA's traditional narrow
approach. Most commenters argued that EPA's traditional interpretation
was consistent with the text of section 209(b), which has no reference
to preemption under EPCA or any other factors outside the three
statutory criteria.\386\ Not only does EPA have ``no grounds to read
EPCA preemption considerations into the statute,'' \387\ these
commenters argued, but to consider non-statutory criteria would
actually be ``arbitrary and capricious'' \388\ and contrary to
``precedent respecting separation of powers and federalism
principles.'' \389\ Yet another commenter stated that the narrow
interpretation ``provides a safeguard from the capricious injection of
outside-the-scope argumentation'' because ``[w]hen the adjudication is
permitted to stray from the statutory criteria, prospects for a fair
hearing can be derailed, and the EPA Administrator may be more prone to
overstep and exert policy preferences that are impermissible.'' \390\
---------------------------------------------------------------------------

    \386\ See, e.g., States and Cities at 20 (``EPA's traditional
understanding of its limited role is entirely consistent with the
text of Section 209(b)(1) and precedent interpreting it.''); NCAT at
12 (``As EPA has stated in several prior waiver decisions, there is
no reference in Section 209(b) to EPCA preemption nor anything that
could be construed to address this issue. Section 209(b) is
unambiguous in this regard, and EPA has no grounds to read EPCA
preemption considerations into the statute.'').
    \387\ NCAT at 12.
    \388\ NESCAUM at 7 (``As the D.C. Circuit has explained in the
context of Section 209(b), `there is no such thing as a general
duty' on an administrative agency to make decisions based on factors
other than those Congress expressly or impliedly intended the agency
to consider.' It is a basic principle of administrative law that an
agency action is `arbitrary and capricious if the agency has relied
on factors which Congress has not intended it to consider.' '').
    \389\ States and Cities at 20 (``It is likewise entirely
consistent with precedent respecting separation of powers and
federalism principles and holding that `a federal agency may pre-
empt state law only when and if it is acting within the scope of its
congressionally delegated authority.' Louisiana Pub. Serv. Comm'n v.
FCC, 476 U.S. 355, 374 (1986).'').
    \390\ SCAQMD at 7.
---------------------------------------------------------------------------

    Additionally, in their petitions for reconsideration of SAFE 1,
several states and cities asserted that EPA unlawfully changed course
in SAFE 1 by considering (and relying on) the purported preemptive
effect of EPCA, which is outside the confines of section 209(b) and
argued that this rationale for withdrawing the waiver was flawed.\391\
---------------------------------------------------------------------------

    \391\ 86 FR at 22428.
---------------------------------------------------------------------------

D. Analysis: EPA Is Rescinding Its SAFE 1 Actions Related to Preemption
Under EPCA

    Since SAFE 1, NHTSA has formally withdrawn its conclusions (and
associated regulatory text) that state or local regulations of tailpipe
carbon dioxide emissions are related to fuel economy standards and
therefore preempted under EPCA.\392\ Thus the predicate for EPA's
decision to withdraw the ACC waiver on that basis no longer exists.
Furthermore, given the context of EPA's reconsideration of the ACC
program waiver at the time of SAFE 1, the Agency believes it was
inappropriate to reconsider the validity of the waiver against criteria
such as preemption under EPCA. In this action, based on the two
independent grounds noted above, the Agency is rescinding the portion
of SAFE 1 that withdrew the ACC program waiver based on preemption
under EPCA.
---------------------------------------------------------------------------

    \392\ 86 FR 74236.
---------------------------------------------------------------------------

1. NHTSA Has Since Repealed Its Findings of Preemption Made in SAFE 1
    In the Notice of Reconsideration, EPA sought comment on the
Agency's reliance on NHTSA's preemption findings as a basis for its
withdrawal of the ACC program waiver in SAFE 1. EPA also sought comment
on how the repeal of SAFE 1, should NHTSA take final action to do so,
would affect its own reconsideration of SAFE 1.\393\ NHTSA has since
withdrawn its findings of preemption and the preemption basis of
withdrawal is no longer applicable. Specifically, NHTSA has issued a
new final rule that formally repeals the codified text and additional
pronouncements regarding preemption under EPCA found in SAFE 1.\394\ In
SAFE 1, EPA stated that it was appropriate to consider the effect of
NHTSA's actions, including the view that California cannot enforce
standards that are void ab initio and thus EPA stated that ``to the
extent that administrative action is necessary on EPA's part to reflect
that state of affairs, EPA hereby withdraws that prior grant of a
waiver on this basis.'' \395\ Since this condition no longer exists,
EPA believes it is appropriate to rescind the waiver withdrawal that
was based on preemption under EPCA. EPA believes that, to the extent it
was ever appropriate for the Agency to base its action on NHTSA's
finding of preemption under EPCA in SAFE 1, the repeal of the
preemption rule makes it likewise appropriate to rescind the Agency's
action in SAFE 1. This would also act to minimize regulatory
uncertainty as to do otherwise would create further confusion that
resulted from the joint action in SAFE 1 and would not appropriately
reflect the current state of affairs under the circumstances of a
unique federal regulation that had otherwise motivated EPA's actions in
SAFE 1. NHTSA's recent action also supports EPA's belief that its
practice of limiting its review of section 209(b) criteria, as
explained below, remains appropriate in the context of preemption under
EPCA.
---------------------------------------------------------------------------

    \393\ 86 FR at 22429.
    \394\ 86 FR 74236. NHTSA notes in this rulemaking that ``the
Agency is repealing all regulatory text and appendices promulgated
in the SAFE I Rule. In doing so, the Agency underscores that any
positions announced in preambulatory statements of prior NHTSA
rulemakings, including in the SAFE I Rule, which purported to define
the scope of preemption under the Energy Policy and Conservation Act
(EPCA), do not reflect the Agency's reconsidered understanding of
its proper role in matters of EPCA preemption.''
    \395\ EPA distinguished these previous single-agency actions
from its joint action context by explaining that ignoring NHTSA's
determination of preemption in the same action, ``would place the
United States Government in the untenable position of arguing that
one federal agency can resurrect a State provision that, as another
federal agency has concluded and codified, Congress has expressly
preempted and therefore rendered void ab initio.'' 84 FR at 51338.
---------------------------------------------------------------------------

2. EPA Improperly Deviated From Its Historical Practice of Limiting Its
Review to Section 209(b) Criteria
    Section 209(b)(1) of the Act limits the Agency's authority to deny
California's requests for waivers to the three criteria contained
therein and the Agency has consistently refrained from reviewing
California's requests for waivers based on any other criteria. EPA
acknowledges that California adopts its standards as a matter of law
under its state police powers, that the Agency's task in reviewing
waiver requests is limited to evaluating California's request according
to the criteria in section 209(b), and that it is appropriate to defer
to litigation brought by third parties in other courts, such as state
or federal district court, for the resolution of any constitutionality
claims and assertions of inconsistency with other statutes.

Considering the lack of statutory and precedential support as shown
below, even if EPA were to have discretion to consider criteria outside
section 209(b), EPA now views the joint-action context of SAFE 1 as an
insufficient justification for deviating from its statutory authority
and the Agency's historical practice and therefore the Agency rescinds
its actions regarding preemption under EPCA in SAFE 1.
    Withdrawal of the waiver was premised on NHTSA's preemption
regulations in what EPA explained was a joint rulemaking action. But
nothing in section 209(b) can be read as calling for consideration of
preemption under EPCA in evaluating waiver requests regardless of
whether EPA engaged in joint rulemaking with another agency or acted
alone. Specifically, under section 209(b), EPA must grant California a
waiver of the preemption contained in section 209(a) unless the
Administrator makes a finding under any one of the listed criteria:
``The Administrator shall . . . waive application of the preemption in
section 209(a) if the Administrator finds any of the following: `(A)
[California's] determination [that its standards in the aggregate will
be at least as protective] is arbitrary and capricious, (B)
[California] does not need such State standards to meet compelling and
extraordinary conditions, or (C) such State standards and accompanying
enforcement procedures are not consistent with section [202(a)].' ''
\396\ Evaluation of preemption under EPCA is not a listed criterion.
---------------------------------------------------------------------------

    \396\ CAA section 209(b)(1)(A)-(C).
---------------------------------------------------------------------------

    Nor did SAFE 1 premise preemption under EPCA on any of the three
statutory criteria. In the ACC program waiver request, CARB made a
protectiveness finding that, as a quantitative matter, its standards,
in the aggregate, were as protective as the Federal standards and did
not address preemption under EPCA.\397\ In fact, while California might
opt to respond to comments on preemption under EPCA, California would
not be expected to take it into account in any protectiveness finding
made for a waiver request. It bears note that California's practice is
not unusual because there are other factors and provisions of the CAA
that California does not account for in making its protectiveness
finding under section 209(b)(1).\398\ In granting the ACC program
waiver request, EPA found that California's protectiveness finding was
neither arbitrary nor capricious.\399\ EPA also responded to comments
on the consideration of preemption under EPCA in granting the waiver
but dismissed such objections as outside the scope of its review.\400\
Historically, EPA draws a comparison between the numerical stringency
of California and federal standards in making the requisite finding as
to whether California's protectiveness determination is arbitrary and
capricious.\401\ Thus, neither California's initial request, nor EPA's
waiver grant, considered preemption under EPCA and as previously
explained in the ACC program waiver, EPA declined to consider
preemption under EPCA viewing it as outside the scope of Agency review.
---------------------------------------------------------------------------

    \397\ 2012 Waiver Request at 15-17.
    \398\ For example, ``California is not required to comply with
section 207 to get a waiver.'' MEMA II, 142 F.3d 449, 467 (D.C. Cir.
1989).
    \399\ 78 FR at 2125.
    \400\ Id. at 2145.
    \401\ Section 209(b)(2) provides that if each State [California]
standard is at least as stringent as comparable applicable Federal
standards then such standard shall be deemed to be as protective of
public health and welfare as such federal standards for purposes of
section 209(b)(1)(A). EPA acknowledges that in 1977 Congress amended
the waiver provision to allow for California to address its unique
combination of air quality problems and that California only be
required to demonstrate stringency in the aggregate and that
therefore some pollutant standards may not be as stringent.
---------------------------------------------------------------------------

    SAFE 1 made clear that consideration of and reliance on preemption
under EPCA was the consequence of regulations promulgated by NHTSA. As
SAFE 1 also acknowledged, however, EPA does not ``administer'' EPCA;
that task falls to NHTSA.\402\ Instead, ``[i]f EPA concludes that
California's standards [meet section 209(b)], it is obligated to
approve California's waiver application.'' \403\ EPA therefore
disagrees with the comment that Massachusetts provides the Agency
special duty to consider preemption under EPCA in a joint rulemaking
action in reviewing waiver requests. In Massachusetts, the Supreme
Court recognized the potential overlap between NHTSA's and EPA's
statutory obligations and concluded that ``there is no reason to think
the two agencies cannot both administer their obligations yet avoid
inconsistency.'' \404\As one commenter noted, EPA and NHTSA have
previously engaged in joint actions that addressed fuel economy and GHG
emissions. In those actions, NHTSA's role has been to set national fuel
economy standards and EPA's role has been to set national GHG
standards.\405\ These roles are complementary, but distinct. The Court
acknowledged the independence of these roles in Massachusetts: ``EPA
has been charged with protecting the public's `health' and `welfare,'
42 U.S.C. 7521(a)(1), a statutory obligation wholly independent of
DOT's mandate to promote energy efficiency. See Energy Policy and
Conservation Act, Sec.  2(5), 89 Stat. 874, 42 U.S.C. 6201(5).'' \406\
---------------------------------------------------------------------------

    \402\ 84 FR at 51338 (``EPA agrees with commenters that EPA is
not the agency that Congress has tasked with administering and
interpreting EPCA. This is especially so because `[t]he waiver
proceeding produces a forum ill-suited to the resolution of
constitutional claims.' MEMA I, 627 F.2d at 1115.'').
    \403\ MEMA II, 142 F.3d at 463.
    \404\ Massachusetts v. EPA, 549 U.S. 497, 532 (2007).
    \405\ In its most recent rulemaking addressing GHG emissions
from light-duty vehicles, EPA extensively coordinated with NHTSA on
details of the program but did not conduct it as a joint rulemaking.
See 86 FR 74434, 74436 (December 30, 2021).
    \406\ Massachusetts, 549 U.S. at 497, 532.
---------------------------------------------------------------------------

    Regarding the Agency's simultaneous pronouncement that reliance on
preemption under EPCA would be a singular exercise that would not be
repeated, statutory support or past precedent for this singular
consideration was also lacking.\407\ In fact, this singular exercise
would allow for EPA to evaluate the same waiver request differently and
depending on EPA's own choice--the choice to act with another agency or
not--rather than on the merits of the waiver request itself within
specified criteria in section 209(b). Again, the result of this unique
application of EPA's authority is unsupported under section 209(b)(1).
---------------------------------------------------------------------------

    \407\ ``EPA does not intend in future waiver proceedings
concerning submissions of California programs in other subject areas
to consider factors outside the statutory criteria in section
209(b)(1)(A)-(C).'' 84 FR at 51338.
---------------------------------------------------------------------------

    As previously noted, EPCA is generally administered by NHTSA and
consideration of preemption under EPCA in reviewing waiver requests
would for instance call for EPA to resolve the much debated and
differing views as to what is a ``law or regulation related to fuel
economy,'' as contemplated by 39 U.S.C. 32919(a).\408\ Relevant
judicial precedent would also appear to call into question whether
California's GHG standards and ZEV sales mandates are indeed preempted
under EPCA.\409\ But as previously explained, EPA does not implement
EPCA, and the Agency's review of waiver requests is highly deferential.
---------------------------------------------------------------------------

    \408\ EPA takes no position on any role NHTSA might play under
42 U.S.C. 32919(a) and acknowledges that NHTSA discusses this in its
recent final rulemaking. See generally 86 FR 74236.
    \409\ See, e.g., Cent. Valley Chrysler-Jeep, Inc. v. Goldstene,
529 F. Supp. 2d 1151, 1153-54 (E.D. Cal. 2007), as corrected Mar.
26, 2008; Green Mountain Chrysler Plymouth Dodge Jeep v. Crombie,
508 F. Supp. 2d 295, 300-01 (D. Vt. 2007).
---------------------------------------------------------------------------

    EPA also disagrees with comments that the Agency must generally
consider factors outside the criteria listed in section 209(b),
including preemption under EPCA, regardless of the joint- or single-
agency nature of the action. EPA

has never claimed that it has such broad authority to consider factors
outside section 209(b) and the decades of waiver practice, as well as
judicial precedent, are indicative of the Agency's narrow scope of
review for California waiver requests: ``[T]he Administrator has
consistently held since first vested with the waiver authority, [that]
his inquiry under section 209 is modest in scope. He has no `broad and
impressive' authority to modify California regulations.'' \410\
Instead, EPA has consistently declined to consider factors outside the
three statutory criteria listed in section 209(b).\411\ This limited
scope of review has been repeatedly upheld by the courts. For example,
in MEMA I, the D.C. Circuit stated that ``there is no such thing as a
``general duty'' on an administrative agency to make decisions based on
factors other than those Congress expressly or impliedly intended the
agency to consider.'' \412\ In MEMA II, the D.C. Circuit again rejected
consideration of a factor outside the 209(b) statutory criteria because
doing so would restrict California's ability to ``exercise broad
discretion.'' \413\
---------------------------------------------------------------------------

    \410\ MEMA I, 627 F.2d 1095, 1119 (D.C. Cir. 1979).
    \411\ See, e.g., 43 FR at 32184 (rejecting objections to the
procedures at state level, objections that section 207(c)(3)(A)
establishes field protection, and constitutional objections all as
beyond the ``narrow'' scope of the Administrator's review); 74 FR at
32783 (declining to consider EPCA preemption, stating that ``section
209(b) of the Clean Air Act limits our authority to deny
California's requests for waivers to the three criteria therein.'');
79 FR at 46264 (reiterating that EPA can only deny a waiver request
based on the 209(b) statutory criteria, dismissing comments on
preemption under EPCA, as well as the Constitution and the
implications of the FAAAA).
    \412\ 627 F.2d at 1116.
    \413\ 142 F.3d at 464.
---------------------------------------------------------------------------

    Commenters also claim that ignoring NHTSA's finding of preemption
would violate the Supremacy Clause of the Constitution because the
necessary consequence of NHTSA's conclusion in SAFE 1 is that certain
standards were void ab initio as preempted under EPCA and as such that
``the state mandates referenced in [California's] petition for
reconsideration are not even eligible to be considered for a CAA waiver
of preemption.'' \414\ EPA disagrees. As the D.C. Circuit has held,
``[t]hat [the Administrator] like every other administrative officer
owes allegiance to the Constitution does not mean that he is required
to issue rulings of constitutional dimension.'' \415\ Thus, ``[n]othing
in section 209 requires [the Administrator] to consider the
constitutional ramifications of the regulations for which California
requests a waiver.'' \416\
---------------------------------------------------------------------------

    \414\ NADA at 3.
    \415\ MEMA I, 627 F.2d at 1114-15.
    \416\ Id. at 1115.
---------------------------------------------------------------------------

    Moreover, consideration of factors beyond those set out in section
209(b)(1) would subject California and vehicle and engine manufacturers
to changes in regulatory schemes by other federal agencies not acting
under the authority of the CAA.\417\ SAFE 1 and subsequent events
perfectly encapsulate this problem. For instance, NHTSA has since
finalized the repeal of the regulatory provisions and pronouncements it
made in SAFE 1 that were the underpinnings for EPA withdrawing certain
aspects of the ACC program waiver and with that action the Agency's
basis for revocation of the waiver under EPCA has now evanesced.\418\
Additionally, this is affirmation of EPA's long held view that waiver
proceedings are not the appropriate venue for resolving these issues,
and the joint-rulemaking context is not and should never have been
justification for deviating from statutory authority and the Agency's
historical practice.
---------------------------------------------------------------------------

    \417\ ``The manufacture of automobiles is a complex matter,
requiring decisions to be made far in advance of their actual
execution. The ability of those engaged in the manufacture of
automobiles to obtain clear and consistent answers concerning
emission controls and standards is of considerable importance so as
to permit economies in production.'' S. Rep. No. 403, 90th Cong., at
730 1st Sess. (1967).
    \418\ See 86 FR 74236.
---------------------------------------------------------------------------

    It also bears note that consideration of factors beyond the
criteria contained in section 209(b) would not be limited to preemption
under EPCA. Commenters suggested, for instance, that EPA would not be
able to ``ignore the First Amendment,'' in the hypothetical situation
where California impos[ed] standards on some manufacturers in