B-217744, AUG 13, 1985

B-217744, AUG 13, 1985

ENVIRONMENTAL PROTECTION AND IMPROVEMENT - ENVIRONMENTAL PROTECTION AGENCY AUTHORITY - FUEL PERFORMANCE TESTING DIGEST: IN RESPONSE TO FOLLOW UP QUESTIONS ABOUT B-217744, JUNE 3, 1985, GAO AFFIRMS ITS OPINION THAT THE ADMINISTRATIVE PROCEDURE ACT APPLIES TO CORPORATE AVERAGE FUEL ECONOMY TEST PROCEDURES RULEMAKING. SPECIALIZED PROCEDURAL REQUIREMENTS FOR CLEAN AIR ACT RULEMAKING DO NOT APPLY TO CAFE. GAO WAS UNABLE TO CONFIRM THE EXISTENCE OF A POLICY IN THE EARLY 1970'S AT THE ENVIRONMENTAL PROTECTION AGENCY IN WHICH THE AGENCY DISAVOWED THE ADMINISTRATIVE PROCEDURE ACT'S EXCEPTIONS TO THE NOTICE AND COMMENT REQUIREMENTS FOR RULEMAKING. HOWEVER, 1977 AMENDMENTS TO CLEAN AIR ACT EXPRESSLY ALLOWED EXCEPTIONS TO NOTICE AND COMMENT, AND WOULD HAVE JUSTIFIED CHANGING ANY PREVIOUS POLICY TO USE ONLY FORMAL RULEMAKING. STRICT AND LITERAL INTERPRETATION OF EARLIER OPINION IS ENDORSED.

THE HONORABLE JOHN D. DINGELL: CHAIRMAN, SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS COMMITTEE ON ENERGY AND COMMERCE HOUSE OF REPRESENTATIVES

YOUR LETTER OF JUNE 17, 1985, ASKED TWO FOLLOW-UP QUESTIONS TO OUR OPINION B-217744, DATED JUNE 3, 1985, ON THE ENVIRONMENTAL PROTECTION AGENCY'S (EPA) ADMINISTRATION OF ITS TESTING RESPONSIBILITIES UNDER THE CORPORATE AVERAGE FUEL ECONOMY (CAFE) PROGRAM. 15 U.S.C. SECS. 2001-12 (1982). FIRST, YOU QUESTION OUR APPLICATION OF THE ADMINISTRATIVE PROCEDURE ACT (APA) TO CAFE RULEMAKING. YOUR CONCERN ARISES BECAUSE SECTION 307(D) OF THE CLEAN AIR ACT (42 U.S.C. SEC. 7607(D) (1982)) PRESCRIBES SOMEWHAT MORE STRINGENT PROCEDURES FOR CLEAN AIR ACT RULEMAKING. SECOND, YOU RECALL THAT EPA HAD A POLICY NOT TO CLAIM THE INTERPRETATIVE RULES AND GOOD CAUSE EXCEPTIONS TO THE NOTICE AND COMMENT REQUIREMENTS IN THE APA. 5 U.S.C. SEC. 553(B) (A) AND (B) (1982). FOR THE REASONS INDICATED BELOW, WE REAFFIRM OUR JUNE 3 OPINION AS REGARDS THE AVAILABILITY OF THE APA EXCEPTIONS, BUT WE ARE UNABLE TO DETERMINE THE STATUS OF ANY EPA POLICY RENOUNCING THE USE OF THE RULEMAKING EXCEPTIONS.

YOUR FIRST QUESTION ARISES BECAUSE THE CAFE LAW EXPRESSLY MENTIONS EMISSIONS TESTING UNDER THE CLEAN AIR ACT. SECTION 2003(D)(1) OF TITLE 15 REQUIRES THAT "TO THE EXTENT PRACTICABLE," FUEL ECONOMY TESTING PROCEDURES "BE CONDUCTED IN CONJUNCTION WITH EMISSIONS TESTS CONDUCTED UNDER SECTION 206 OF THE CLEAN AIR ACT (42 U.S.C. SEC. 7525)".

USING THE PLAIN MEANING OF THE WORDS "CONDUCTED IN CONJUNCTION WITH" WE UNDERSTAND THE CAFE LANGUAGE TO MEAN THAT FUEL ECONOMY AND EMISSION TESTS SHOULD BE ADMINISTERED AT THE SAME TIME. WE DO NOT FIND ANY IMPLICATIONS IN THIS LANGUAGE THAT RULES ESTABLISHING CAFE TEST PROCEDURES WERE TO BE SUBJECT TO SPECIALIZED CLEAN AIR ACT RULEMAKING PROCEDURES. MOREOVER, WE NOTE THAT THE CAFE RULES, INCLUDING THOSE RULES ESTABLISHING TEST PROCEDURES, ARE SPECIFICALLY SUBJECT TO APA JUDICIAL REVIEW. 15 U.S.C. SEC. 2004(A) (1982)). THIS IS ANOTHER INDICATION THAT THE APA APPLIES. SECTION 307(D) (42 U.S.C. SEC. 7607(D) (1982)), WAS ADDED IN ITS ENTIRETY BY THE CLEAN AIR ACT AMENDMENTS OF 1977. IT CONTAINS A LIST OF 13 DIFFERENT RULEMAKING ACTIONS TO WHICH IT APPLIES, AND CAFE IS NOT LISTED. HOWEVER, THE SECTION DOES APPLY TO THE EMISSIONS TESTING PROGRAM (SECTIONS 202 AND 206 OF THE ACT, 42 U.S.C. SECS. 7521 AND 7525). 42 U.S.C. SEC. 7607(D) (1)(J) (1982). THE EMISSIONS TESTING SECTIONS WERE ALSO AMENDED IN 1977, BUT THEY DID NOT REFERENCE CAFE, EITHER. THE FAILURE OF THE LATER ENACTED STATUTE TO REFER TO CAFE WHEN IMPOSING ADDITIONAL RULEMAKING REQUIREMENTS ON THE RELATED PROGRAM MILITATES AGAINST AN INTERPRETATION WHICH WOULD APPLY SECTION 307(D) TO CAFE. THIS IS CONSISTENT WITH OUR INTERPRETATION OF 15 U.S.C.SEC. 2003(D)(1), DISCUSSED ABOVE.

FURTHERMORE, BY ITS OWN TERMS, SECTION 307(D)(1) OF THE CLEAN AIR ACT EXPRESSLY ALLOWS EPA TO INVOKE THE APA NOTICE AND COMMENT EXCEPTIONS. THE PERTINENT PART OF THE STATUTE READS AS FOLLOWS:

"THE PROVISIONS OF SECTION 553 THROUGH 557 AND SECTION 706 OF TITLE 5 (THE APA RULEMAKING AND JUDICIAL REVIEW PROVISIONS) SHALL NOT, EXCEPT AS EXPRESSLY PROVIDED IN THIS SUBSECTION, APPLY TO ACTIONS TO WHICH THIS SUBSECTION APPLIES. THIS SUBSECTION SHALL NOT APPLY IN THE CASE OF ANY RULE OR CIRCUMSTANCES REFERRED TO IN SUBPARAGRAPHS (A) OR (B) OF SUBSECTION 553(B) OF TITLE 5." 42 U.S.C. SEC. 7607(D)(1)(1982).

SUBPARAGRAPHS (A) AND (B) ARE THE INTERPRETATIVE RULE AND GOOD CAUSE EXCEPTIONS DISCUSSED IN OUR JUNE 3 LETTER.

ON YOUR QUESTION ABOUT EPA'S POLICY OF NOT INVOKING THE EXCEPTIONS TO THE APA NOTICE AND COMMENT PROVISIONS, WE MADE INFORMAL INQUIRIES IN THE OFFICE OF AIR, NOISE AND RADIATION. NO ONE THERE RECALLED THE POLICY YOU DESCRIBED. SINCE YOU THOUGHT THE POLICY MIGHT HAVE BEEN INSTITUTED IN THE EARLY 1970'S AS THE RESULT OF INQUIRIES BY THE GOVERNMENT OPERATIONS COMMITTEE, WE ALSO REVIEWED THE COMMERCIALLY PRODUCED ABSTRACTS OF OPEN HEARINGS HELD BY THAT COMMITTEE FROM 1971 THROUGH 1976. WE FOUND NO TOPIC ABSTRACTED WHICH WOULD LEAD US TO BELIEVE THAT A PROMISE OR POLICY CONCERNING RULEMAKING PROCEDURES WAS ANNOUNCED BY EPA AS THE RESULT OF TESTIMONY ON CLEAN AIR ACT OR GENERAL ADMINISTRATIVE ISSUES.

YOU ALSO ASKED WHETHER OUR JUNE 3 OPINION SHOULD BE READ AS HOLDING "THAT EPA WAS OBLIGATED TO COMPENSATE FOR THE INFORMAL TEST CHANGES MADE IN VIOLATION OF THE LAW THROUGH SOME FORM OF CAFE ADJUSTMENTS." WE THINK THIS INTERPRETATION OVERSTATES OUR POSITION.

IN OUR JUNE 3 OPINION WE DID NOT CONCLUDE THAT EPA VIOLATED THE LAW BY USING ADVISORY CIRCULARS TO INSTITUTE TEST CHANGES. WE POINTED OUT THAT THERE ARE SEVERAL BROAD EXCEPTIONS TO THE RULEMAKING REQUIREMENT WHICH MIGHT HAVE LEGITIMIZED THE INFORMAL PROCEDURES USED. ALSO, WE NEITHER STATED NOR MEANT TO IMPLY THAT EPA WAS OBLIGATED TO MAKE CAFE ADJUSTMENTS AS A RESULT OF ITS CHANGES IN TEST PROCEDURES. WE DID, HOWEVER, OBSERVE THAT EPA SEEMED TO PROCEED FROM THE ASSUMPTION THAT MANUFACTURERS SUFFERED CAFE LOSSES AS A RESULT OF INFORMAL TEST CHANGES. WE WENT ON TO FIND THAT THE NPRM OF DECEMBER 21, 1983 (48 FED.REG. 56526) WAS A LEGALLY ADEQUATE RESPONSE TO THE SIXTH CIRCUIT COURT OF APPEALS ORDER TO CONSIDER "PROCEDURES FOR ESTABLISHING AN ADJUSTMENT FACTOR ***." GENERAL MOTORS V. COSTLE, NOS. 80-3271, 80 3272, 80-3655 (6TH CIR. JAN. 26, 1982). WE TRUST THIS INFORMATION SATISFIES YOUR NEED FOR

WE TRUST THIS INFORMATION SATISFIES YOUR NEED FOR CLARIFICATION OF OUR EARLIER OPINION. UNLESS AGREED OTHERWISE, THIS LETTER WILL BE AVAILABLE TO THE PUBLIC 30 DAYS AFTER ISSUANCE.