National Association of Home Builders v. San Joaquin Valley Unified Air Pollution Control District, No. 08-17309, (9th Cir., December 7, 2010)

In NAHB v. San Joaquin Valley UAPCD, the United States Court of Appeal for the Ninth Circuit held that Rule 9510, the San Joaquin Valley Unified Air Pollution Control District's (the “District”) rule requiring development sites to reduce the amount of air pollutants they emit, was not preempted by the Clean Air Act (the “CAA”). The Court found that Rule 9510 was a proper “indirect source review program” and thus, was not preempted.

Generally speaking, the CAA gives the states the job of regulating stationary sources of pollution, but the Environmental Protection Agency (the “EPA”), and with the EPA's permission California, are responsible for regulating emissions from motor vehicles and other mobile sources.

In response to levels of ozone, PM10 and PM2.5 that violated national air quality standards, the District adopted Rule 9510, which requires development sites to reduce the amount of pollutants they emit. Rule 9510 applies to various types of development projects, including, but not limited to those that involve: (1) 50 or more residential units, (2) 2,000 or more square feet of commercial space, or (3) 25,00 square feet of light industrial space. All development projects covered by Rule 9510 are required to undergo an Air Impact Assessment, which uses computer modeling to estimate the construction and operation air emissions of the proposed development if no mitigation measures are applied. This creates a baseline emissions level from which proposed developments must show between a 20% and 45% reduction in emissions through either the application of add-on controls, cleaner fuels, or more advanced equipment. Alternatively, a developer may pay fees to the District that are then used to fund emissions reductions elsewhere.