SoCal Air Quality Agency Faces Federal Lawsuit over Bogus Clean Air Credits

Nearly 20 years of data indicates air district broke federal law
LOS ANGELES (April 1, 2008) – Demanding an end to years of unregulated and illegitimate pollution credits provided by South Coast Air Quality Management District (AQMD) to polluting companies throughout the South Coast Air Basin, a coalition of environmental and environmental justice groups delivered a 60-day notice of intent to sue letter to the AQMD today. The letter uses data from the State of California to expose 17 years of credits unlawfully doled out by the air district to energy companies and other polluting facilities in Southern California, sometimes resulting in millions in profits.
In its most recent effort to distribute non-existent credits, AQMD stands to earn $419 million while industry will save $300-500 million by purchasing the credits at below-market rates. “Southland residents continue to suffer as a result of the air district’s bungled efforts to comply with the same laws that it is supposed to enforce,” said Tim Grabiel, environmental justice attorney with the Natural Resources Defense Council. “The air district is selling credits that flat out don’t exist to the very companies pumping pollution into our lungs everyday. This has real and significant negative impacts on our health and the environment.”
Federal and state law requires developers to purchase emission credits prior to building or expanding polluting facilities. Valid emission credits are created from shutdowns of older facilities or reductions at existing facilities and require proof that the decrease in emissions is real, permanent, quantifiable, and enforceable.
“The program’s emission credits were used up long ago, and not only once, but many times after that,” said Jesse Marquez, executive director of Coalition for a Safe Environment. “The lack of regulatory agency oversight has allowed the public to be exposed to deadly air pollution. The air district has abused its authority, violated the public trust, and is playing Russian roulette with our children’s health, lives, and future.”
After the 1990 amendments to the Clean Air Act, AQMD “carried over” credits from its local trading program into the federal program. Two recent lawsuits by the coalition have exposed that nearly 60 percent of the 1990 credits could not be verified, though AQMD continued to distribute them. Questions regarding the remaining 40 percent of credits led AQMD to eliminate any that remained in 2005, but evidence indicates that AQMD had already excessively overdrawn pollution emission accounts by that year, allowing for tons of unlawful air pollution within the region.
“This trading program is deeply flawed,” said Angela Johnson Meszaros, counsel for Desert Communities Against Pollution. “The District’s effort to implement this federally-mandated trading program has slowed the air basin’s progress toward meeting the health-based clean air standards.”
This same coalition of environmental justice and environmental organizations filed two previous lawsuits in response to the 2007 AQMD rule change allowing 11 fossil fuel-fired power plants to move forward in Southern California. A recent AQMD report confirmed that constructing just one of the 11 proposed power plants in the City of Vernon will likely result in killing anywhere from four to 11 people each year, causing hundreds of premature deaths over the life of the facility. The plant is planned for construction next to a heavily populated, majority Latino neighborhood.
“The irony of this situation is that the air district recently declared a public health crisis in the Southland due to severe air pollution, but they’re contributing to it,” said Darryl Molina, organizer with Communities for a Better Environment, who works in Huntington Park, opposing the Vernon Power Plant project. “It’s the air district’s job to protect the air we breathe. The day they fire up this power plant, everyone’s health will suffer.”
The coalition contends there are other ways of meeting the growing energy needs of the area than simply relying on polluting power plants, such as energy efficiency and renewable alternatives. A report by an independent energy consultant, commissioned by the coalition, supports these claims. The report also indicated that the 2001 energy shortages were a result of energy supply manipulation by market players, not a true shortage of electricity. 
The coalition includes the Natural Resources Defense Council, Coalition for a Safe Environment, Desert Citizens Against Pollution, and Communities for a Better Environment. They seek a court declaration that AQMD violated the federal Clean Air Act and an injunction that prohibits AQMD from distributing these invalid credits in the future. Facilities that relied on good faith on these unlawful credits will not be affected by the lawsuit. Instead, the coalition seeks a court order that phases out the use of unlawful credits and requires AQMD to implement a program to reduce emissions equivalent to the emissions that were unlawfully allowed. These emission reductions should take place in the same communities that hosted and continue to host these unlawful emissions, according to the letter.