Trump’s 2-For-1 Order: Still Arbitrary and Capricious After All These Months

Posted on September 15, 2017 by Seth Jaffe

In June, I posted about Foley Hoag's brief in support of those challenging Executive Order 13771, the so-called “2 for 1” EO.  By ignoring the benefits of existing and proposed regulations, the Order ignores the purposes behind the legislation pursuant to which regulations are promulgated.  The Order is thus the definition of arbitrary and capricious.

Late last week, OMB issued a memorandum to executive agencies, requiring them to develop “Regulatory Cost Allowances” for FY 2018.  The memorandum is only one page.  In that one page, it uses the word “cost” 11 times.  The word “benefit” does not appear.

The memorandum notes that the purpose of the Order is to “lower regulatory burdens” and “to be prudent and financially responsible in the expenditure of funds, from both public and private sources.”

I hate to beat a dead horse, but one would have thought that the absolute size of the “regulatory burden” is not what’s relevant; what’s relevant is whether that regulatory burden is exceeded by the benefits of proposed regulations.  One would also have thought that requiring expenditures of private funds for regulatory compliance would be seen as “prudent” if those compliance costs are exceeded by the benefits.

Indeed, one would have thought – and I do still think – that seeking to lower regulatory compliance costs without regard to the benefits provided by government regulations is just plain crazy.

Silly me.

With Litigation Guaranteed, the fate of national monuments will be uncertain for some time

Posted on September 1, 2017 by Brenda Mallory

At the end of August as the last days of summer pass, the Conservation community waits with bated-breath to learn what the Trump Administration will do to twenty-one significant national monuments and the century-old tradition they reflect. The consensus—among those who have dedicated their lives to protecting special places, the local communities whose economies have been bolstered by their presence, and a broad swath of Americans who simply enjoy having extraordinary places to visit—is that it won’t be good. The further consensus is that what the Administration is considering likely exceeds the President’s legal authority under the Antiquities Act. Both progressive and conservative voices have recently argued that the president lacks the authority to diminish or revoke National Monuments. While the motivations for making this argument may be different, the basic statutory and constitutional arguments are the same, and the significance of the president taking this uncharted path to diminishing national monument protections is recognized (in either a positive or negative light) even by the few who argue he does have the authority to do so.

The legal question begins where many of our most controversial issues today start –the scope of a law. Yet, at its foundation, a history of simmering tensions over the extent of Federal lands in the west and the Federal government’s control over those lands has fueled passions around this issue. For over 110 years, the Antiquities Act has stood as one of the most powerful tools for the protection of cultural, historic, and scientific resources. Some have described it as the first statute with an exclusively protective purpose.  The statute gives a President the discretion to “declare by public proclamation historic landmarks, historic and prehistoric structures, and other objects of historic or scientific interest that are situated on land owned or controlled by the Federal Government to be national monuments.” A key question is what does “other objects of historic or scientific interest” mean? This Administration appears poised to take on the longstanding, judicially endorsed conclusion that this phrase includes large landscapes like the Grand Canyon, and to bring to the fore the threshold question of whether a subsequent President can change the monument designation of a predecessor.

In April, President Trump signed an Executive Order instructing Interior Secretary Zinke to undertake a review of Antiquities Act monument designations since 1996. Secretary Zinke then launched the review process identifying 27 monuments that fit the EO criteria: 26 because they were over 100,000 acres and one for the purpose of determining whether stakeholder engagement had been adequate. Recommendations were submitted to the President on August 24, 2017, but have not been made public. The Commerce Secretary received a similar presidential directive and is undertaking a separate process for marine monuments and national marine sanctuaries.

Over its history, monument designations under the Antiquities Act have been challenged as inconsistent with the statute and have always been upheld. See, e.g., Cameron v. United States, 252 U.S. 450 (1920), Cappaert v. United States, 426 U.S. 128 (1976). However, no President has attempted to revoke a prior designation and there has been no judicial challenge in the previous circumstances where a President has modified the boundaries of a designation. All signs are suggesting that we are about to see both for the first time: the President is expected to revoke or substantially reduce one or more monuments and, if he does, a challenge is inevitable. While this will be a case of first impression, the overwhelming view of scholars, which I share, is that the President does not have the authority to take these actions because Congress has not delegated him the authority to undo a designation. See, e.g., a collection of articles submitted to the Department of Interior by 121 scholars and similar analysis for marine monuments. Of course, there is an alternate view.

Putting the law aside, the atmospherics associated with this early battle by the Administration are noteworthy. First, like many of its other actions, the unprecedented nature and scope of the attack is striking. While it was immediately obvious after the election that there would be some effort to challenge then-President Obama’s most controversial monument designations, with Bears Ears National Monument in Utah at the top of the list, few expected that designations completed decades ago, by three different Presidents would be under threat. Businesses and communities have grown and developed because of and in reliance on these monuments, inseparable from the benefits they bring to their local areas. Upending years of investment and expectation is stunning. Nor was it expected that the attack would include so many monuments, land and sea, or that Marine Sanctuaries, which are completed over many years and with considerable process, would be thrown brazenly into the mix.  

Second, like the Administration’s attack in other areas, the stated narrative driving the challenge to national monuments – alleged abuse of executive power, failure to consult or listen to stakeholders, ignoring elected officials, restoring balance to the use of Federal land – is at odds with the Administration’s own behavior in the process.  As noted in the above-referenced articles, revoking or substantially reducing the size of a monument is beyond the scope of the President’s authority, a clear abuse of executive power. Even conservative leaning scholars and publications have joined the ranks of those condemning the anticipated executive action as beyond the President’s authority. Moreover, Secretary Zinke has unapologetically spent his “review process” meeting primarily with opponents of the monuments and the summary of his report released last week dismisses as part of a “well-orchestrated national campaign” the 2.7 million comments generated during the review process that overwhelmingly support retention or expansion of national monuments. Next, while the Republican elected officials are getting Zinke’s attention, it is not clear that the views of their Democratic colleagues are being given the same weight. Finally, talk of balance in federal land use is in direct conflict with the newly ascribed goals of “energy dominance” and the expedited efforts to open unspoiled areas to oil and gas drilling, and other extractive activities. Taken together, it is clear that this battle is less about correcting “unlawful” designations by previous Presidents and more about aggressively shifting the policy focus on Federal lands to exploiting the natural resources. For monuments designated under the Antiquities Act, only Congress has the authority to change the designation; and Congress is the appropriate body to consider whether policy shifts warrant such changes.

Finally, the attack on national monuments is not occurring in isolation. Many other efforts to eliminate or impair environmental and conservation protections on Public lands are underway.  They encompass repealing protective measures such as the stream protection rule, withdrawing the rule regulating hydraulic fracturing; repealing the Clean Water Act Rule; eliminating the ban on drilling in the Arctic; and rescinding the Executive Order directing federal agencies to consider rising sea levels when building public infrastructure in flood prone areas. They also include process initiatives that appear designed to undermine the fact based decision-making necessary to ensure the protection of environmental and conservation measures. These initiatives include Zinke’s Order to streamline onshore oil and gas permits, his regulatory reform initiative to eliminate “unnecessary regulatory burdens,” and his Order jumpstarting Alaska Energy focused on opening the Alaska National Wildlife Refuge and the National Petroleum Reserve Area to oil and gas drilling.

With this backdrop, there is a sense of foreboding as the Administration’s monuments review process comes to an end. One thing is clear, whatever is in the upcoming announcement by the Administration, it will likely take years of litigation before these issues are resolved and this century-old law will be put to the test.         

Eight Things Environmental Lawyers Can Do in the Age of Trump

Posted on August 28, 2017 by Michael Gerrard

One of the great things about the ACOEL is that its members are very diverse in their views on politics and policy.  On the subject of reactions to President Trump's environmental policies, we have a spectrum ranging from outraged to jubilant. Count me at the outraged end. I would welcome counter-thoughts from the other end of the spectrum.

With that disclaimer, here are my personal views.

This is a time of unprecedented peril to U.S. environmental law.  What can those of us environmental lawyers who are outraged do about this?

Obviously, each individual’s flexibility depends in large part on where we work – we academics have almost complete flexibility, as do lawyers in their own small firms; lawyers in NGOs quite a bit; lawyers in big law firms have significant constraints; and lawyers in government are the most tightly constrained.

But to the extent people do have flexibility, these are eight things we can do.

1. Push back

Resist these efforts by Trump, Scott Pruitt, Ryan Zinke and the rest. That may involve speaking out; suing or intervening or joining as amici in others’ lawsuits; or filing comments when the opportunity arises. We need to try to preserve the gains that were made in prior administrations to the extent possible.  Some day – though not soon enough -- we’ll have a new President who actually believes in law and science and cares about current and future generations, and when that day comes we’ll want to get back on track as quickly as possible.

2. Think globally, act locally

Much of the most important action for the rest of the Trump era will be at the state and the city levels. I’m fortunate to be in a state and a city where there is overwhelming consensus on the importance of environmental protection, and we have leaders who want to move forward – maybe not always as far and fast as we would like, but generally in the right direction. So those who are in state or city government, or who work closely with those who do, have special opportunities to devise and deploy tools that can work where you are and can serve as a model for elsewhere.

3. Decarbonize

To avoid the worst impacts of climate change we need to move away from fossil fuels and toward a clean energy economy that is centered around renewables like wind, solar and hydro, and that operates with the greatest possible degree of energy efficiency. The plummeting costs of wind and solar, in particular, mean we are in the midst of a very positive energy revolution in which renewables push out fossil. Lawyers are needed to help acquire the permits, real estate, and financing for the many new clean energy facilities and devices.

4. Adapt

The outlook for future climate change is extremely serious and seems to be getting worse. Sea level rise, melting ice, episodes of extreme heat, drought and precipitation, and other projections are no less than scary.  We need to build resilience into construction projects, natural resource management, and all manner of other activities. This can happen through zoning actions, licensing and rate proceedings, environmental impact review, and many other settings where lawyers are central players. We should do this both because we need our projects and activities to be resilient, and because if the leaders of large enterprises are led to recognize the impact that climate change may have on their own organizations, ultimately this should have a political impact.

5. Do no harm

If you can, avoid representing the NIMBY side in litigation against renewable energy projects.

In law firms -- If you possibly can, stay away from matters where you’ll be litigating on the side of Trump’s environmental deregulation campaign.

And to our friends who work at EPA, Interior, DOJ and other federal agencies -- you are in our hopes and prayers, we’re thinking of you all the time, we admire your perseverance, and to the extent we possibly can, we have your backs.

6. Reduce personal environmental footprint

Each of us can do more to lower our own environmental impact. This can mean, for example, replacing incandescent light bulbs with LEDs; insulating our homes; driving less and walking, biking, or taking mass transit more; driving electric, hybrid, or small efficient cars; eating less meat (especially beef); diligently turning off lights and appliances and closing faucets; flying less; and recycling more.

7. Contribute

Even if we can’t litigate or campaign directly, we can contribute money to those who do.  NGOs that are on the front lines of litigation, lawful activism and needed research, political action groups that work for pro-environmental candidates, and such candidates themselves are all worthy of support.

8.  Vote

Finally, there is no excuse for U.S. citizens not to vote at every opportunity, and those who can should work hard to try to persuade others to vote, and to cast those votes for an environmentally positive future.

If you do as many of these things as you can, you’ll have done your part in helping the planet through this awful Trump era, and hopefully into an area where we can all smile a lot more.

Using Offsets with a Carbon Tax? Use what works.

Posted on August 21, 2017 by Jeffrey C. Fort

Proposals to adopt a fee on emissions of greenhouse gases (also called "Carbon Taxes") have made headlines, with both "conservative Republicans" and "liberal Democrats" releasing ideas.   An elevated price on carbon -- the centerpiece of the suggestions for a federal program from both camps -- is not predicted to lower emissions, except by setting a very high price.  Such an approach is not practical, unless room is allowed for states to continue their innovations and for volunteers to also reduce emissions.   Getting the best result for the least cost - i.e. the most efficient emission reduction -- ought to be used.

EPA already has its Mandatory Reporting Rule.  It does not cover non-obvious sectors like farming who could be affected by the proposed fee.  The MRR reports provide a sound basis for any further federal program such as carbon fees.

Carbon taxes have yet to show direct evidence of any reductions in emissions of carbon equivalent greenhouse gases.  As another cost which can be passed on in many sectors, it is a clumsy way to achieve environmental benefits.

However, if a "fee" is imposed, it should recognize state programs such as the ARB and RGGI programs.  Those allowances ought to be counted and credited -- "a tonne is a tonne is a tonne" regardless of where emitted into the troposphere. 

Voluntary reductions from non-regulated sectors ought to count too.  Known as carbon offsets, they are issued by the several independent registries and have real environmental benefits and integrity. They are at least as real as monitored -- or more often estimated --emissions from AP-42 or other EPA-sanctioned sources.  Offsets can only be recognized: (1) for reductions which are not required by law and not business as usual; (2) if based on a scientific methodology to measure such which has been accepted after public comment and peer review, (3) from a project has been announced, undertaken and proven to have occurred.  Only after all such has been proven, is a credit awarded and available to be purchased and (4) then the offset credit must be chosen (i.e. purchased) for use by a regulated entity.  Thus, there are several steps at which such are scrutinized by independent parties.

The proposals for carbon taxes are well-intentioned.  But the most efficient and least disruptive approach would include not only recognizing state programs but also unlimited carbon offsets from economic sectors not under the tax.  All businesses should have a role; those who are more efficient in producing their products for lower climate impact ought to have a way to contribute.

NGOs 1, Trump EPA 0: The First Skirmish in the Great Environmental Rollback War Goes to the Greens

Posted on July 11, 2017 by Seth Jaffe

Last week, the D.C. Circuit Court of Appeals handed environmentalists at least a temporary win in what I think was the first case to reach judicial decision in Scott Pruitt’s great environmental roll-back tour of 2017.  The Court rejected EPA’s effort to stay the effective date of the New Source Performance Standards for fugitive emissions from oil and natural gas operations, pending EPA’s reconsideration of certain aspects of the Obama-era rule.

Notwithstanding Judge Brown’s dissent, EPA’s position on the merits seemed barely credible.  I understand the argument that the stay was not final agency action and thus not judiciable.  It just doesn’t seem compelling to me.  If EPA had amended to rule to extend the compliance deadlines, that clearly would have been subject to judicial review.  Why should the answer be different because EPA styles its action as a stay, rather than a revision to the regulations?  The impact is exactly the same.

As to EPA’s position that the four issues which it was reconsidering could not have been addressed during the original rulemaking by the industry groups now seeking reconsideration, EPA’s position was almost embarrassing.  As the Court repeatedly demonstrated, not only could the industry groups have addressed the issues during the original rulemaking, but they actually did so.  Moreover, EPA did consider those comments and, at least in parts, adopted them in the final rule.  My favorite example is the court’s discussion regarding the criteria for exemption for well-site pneumatic pumps.  As the Court noted:

[The American Petroleum Institute] … proposed precisely the technical infeasibility language EPA adopted in the final rule, suggested that an engineer certify technical infeasibility, and justified its proposed exemption based on a lengthy description of why existing sites were not designed to “handle” EPA’s proposal.

The record thus belies EPA’s claim that no industry group had an opportunity to comment on the “scope and parameters” of the pneumatic pump exemption.

The real question at this point is whether this decision is any kind of harbinger.  Practitioners know that the record of the Bush EPA in rolling back Clinton rules was shockingly poor, given Chevron deference.  Are we going to see the same again?  The Court threw EPA what could prove to be a rather large fig leaf by noting that the decision does not prevent EPA from reconsidering the methane rule.  The Court also quoted FCC v. Fox Television Stations – the same case on which EPA is relying in its rollback of the WOTUS rule:

[EPA] is free to [reconsider the rule] as long as “the new policy is permissible under the statute.., there are good reasons for it, and … the agency believes it to be better.”

This is where the battles are going to be fought over the next several years.

The Takings Line is Bent

Posted on June 26, 2017 by Brian Rosenthal

In an expansive review of regulatory takings, the Supreme Court reiterates governments must pay when overly impinging individual property rights by regulatory means, resulting in compensable takings.  The Court announces a flexible approach to analyze the private party’s parcel deemed taken by regulatory action (past or present).  Particularly, but not exclusively, when more than one parcel is involved as was the case before the Court, a new test emerges to define the taken parcel. The test includes consideration of the landowner’s expectations.  

The dissenters believe the Court for the first time strays away from its precedential findings on the whole parcel in issue as defined under state law, and predict the new multi-factor parcel review test will “tip the scales in favor of the government” for uncompensated takings by allowing the government to frame the taking as reasonable as it relates to the defined parcel and burden.

The majority is equally passionate, noting its test mitigates against the government’s unchecked usurpation and sometimes over-eager use of private property rights in the guise of the greater good.  The Court suggests “[p]roperty rights are necessary to preserve freedom” and supports its test as best suited for that protection.

The case involved a state’s restricting the development of lots on a protected river to those of a certain size, and resulted from unique circumstances where the property owners had come into possession of adjacent lots, each individually failing the development requirement.  Analyzing the facts under a multi-step review, the Court found the lots retained their economic value as a whole and supported a “no compensable taking” finding by looking at the following factors:

  1. No complete loss of economic value [might be non-compensable even if a complete loss where state property and nuisance laws would be deemed legitimately and commonly understood as a fair counterbalance to the regulatory taking (perhaps like wetlands restrictions)];

  2. Land treatment under governing state and local real estate law (how and where bounded);

  3. Physical characteristics (including topography and both its human and ecological features, such as if it were a coastal property or, as  here, a scenic river);

  4. Value (including any opportunities the burden may create, such as preserving a vista or greenspace or relationship of the lots); and

  5. Reasonable expectations of the landowners.

This case has been closely watched by both land use practitioners and regulating governments and municipalities.  Its implications reach squarely to environmental laws and regulations such as water regulations and use and development restrictions.

The Annual Texas Environmental Superconference—Austin in August?

Posted on June 26, 2017 by Jeff Civins

The Texas Environmental Superconference is one of a kind. Held each year in Austin in sweltering early August, this conference consistently sells out, attracting over 500 participants from the public and private sectors.Indeed, now in its 29th year, it was the winner of the first American Bar Association Section of Environment, Energy & Resources (ABA SEER) award for Best State or Local Bar Environment, Energy and Resources Program of the Year.

The key to the conference’s popularity is its unabashed willingness to integrate humor into content--with annual themes, skits, quizzes, prizes, and, for the past several years, even a conference song.Past themes have included Yogi Berra quotes (“It’s like déjà vu all over again”); Clichés (“The best thing since sliced bread”); Shakespeare (“Much Ado About Pollution”); “Star Wars (“May the farce be with you”); and Willie Nelson songs (“On the Road Again”).Dwarfing all other past conferences, though, was the Disney movie-themed conference, which featured the song “SuperconferenceAustinTexasExpialidocious” and is the subject of 2 You Tube videos. (introductory remarks and conference song).

Speakers generally weave the conference themes into their presentations and, on occasion, even appear in costume.For example, an EPA chief of enforcement appeared as Harry Truman in the politically-themed conference, “Join the Party,” and as Darth Vader, in the Star Wars-themed program. And an EPA General Counsel appeared as a tiara-wearing Wonder Woman in the super hero-themed program.A former EPA Regional Administrator and TCEQ Chairman appeared variously as the Beatles, the Odd Couple, Game Show contestants, and Yoda and Luke Skywalker.

This year’s conference – to be held on Thursday-Friday, August 4-5, 2017 – has as its theme board games and is entitled “Let the Games Begin.”The Wednesday evening session on enforcement is entitled “Trouble.”Registration is at Environmental Superconference-2017.

Participants look forward to attending each year for the chance not only to experience a fun and informative program, but also to network and to informally discuss issues of concern with other environmental professionals representing diverse perspectives, e.g., private and public sectors; regulators, regulated community, and environmental organizations; legal and technical professionals; and local, state, and federal governments.

The conference is organized by the Environmental and Natural Resources Law Section of the State Bar of Texas, in conjunction with other environmental professional organizations, including ABA SEER, the Air & Waste Management Association—Southwest Section, the Water Environment Association of Texas, the Texas Association of Environmental Professionals, and the Environmental Health and Safety Audit Center.Proceeds from the conference are used to fund environmental internships, student writing awards, and section outreach programs.

Thanks to a generous contribution from Supporter, EARTHx (formerly Earth Day Texas), the Superconference this year is offering –and last year offered--scholarships for employees of non-profit organizations with environmental matters as a significant focus.

The Annual Texas Environmental Superconference is the answer to the question, why come to Austin in early August?

The Millennial Environmental Voice: We Can’t Hear You Now

Posted on June 8, 2017 by Linda Benfield

The United States’ environmental agenda shifted abruptly with the election. Instead of implementing greenhouse gas initiatives, bolstering incentives for renewable energy projects, and fine-tuning various air, water and waste standards, we are suddenly discussing the future of the Endangered Species Act, debating withdrawal from the Paris Accord, filing away the Clean Power Plan, and considering the limits of science in regulatory decision-making.

Through all the discord, angst and celebration of the changed focus of environmental regulation, the Millennials have yet to assert their generational voice. Born between 1981 and 1996, these citizens are 21-36 years old. In 2015, they became the largest share of the American workforce at 33%, and there are estimates that Millennials will make up 50% of the American workforce by 2020. With those numbers, and their age, they have the potential to significantly impact elections for the next 35 years.

But who are they, and how will they impact the environmental agenda?  Only 50% of Millennials voted in the 2016 election – the worst turnout of any voting-age generation, and a decrease in their voting participation from the 2012 election. The tropes for this generation peg them as “socially conscious,” and willing to deeply engage in causes they believe in. However, empirical “time-lapse” research comparing responses from different generations at the same point in the responders’ lives, actually indicates that Millennials are no more altruistic than previous generations, and no more determined to seek meaning in their work and lives or do work that is worthwhile to society. This generation also faces different economic and social challenges than their parents did, and it is not clear how that perspective will translate to addressing environmental challenges.  

In the last 50 years, we have fundamentally changed the environmental “baseline.” Millennials never experienced burning rivers, and they didn’t grow up underneath the Denver “Brown Cloud.” The Clean Air Act, the Clean Water Act, and 40 C.F.R. are their baseline - and that is a different perspective than their Baby Boomer parents had when they were fighting against tangible environmental degradation. The Millennials can fundamentally impact our election results – if they vote. And until they vote, we won’t know what the environmental voice of this powerful generation sounds like. 

Trump's "2 for 1" EO: Can You Say "Arbitrary and Capricious"?

Posted on June 6, 2017 by Seth Jaffe

Last month, Mark Walker posted about Executive Order 13771.  Mark’s post was generally favorable, noting that a number of other countries have implemented some version of what is known as a “regulatory budget.”  This post provides something of a counterpoint to Mark’s. 

Put simply, I think that the Order is indefensible.  It’s not about regulatory reform.  It’s a transparent attempt to halt environmental regulation in its tracks, without regard to the benefit those regulations provide.

This week, on behalf of our client, the Union of Concerned Scientists, Foley Hoag filed an amicus brief in support of the plaintiffs in the case challenging the EO.  One paragraph from the brief pretty much summarizes the argument:

It is important to note, as Executive Order 13771 acknowledges, that agencies are already required, where not prohibited by law, to ensure that the benefits of regulations exceed their costs. Thus, the only impact of the Executive Order is to prohibit agencies from promulgating regulations whose benefits exceed their costs, unless they eliminate two other regulations whose benefits also exceed their costs. This is the definition of unreasoned decisionmaking. It is also a thumb in the eye of Congress, which enacted public health and environmental statutes in order to benefit the public.

It is a bitter irony that the government is defending the EO in part on the basis that it is just another in a long line of regulatory reform EOs, even though the EO is in fact a repudiation of those prior orders, not an extension of them.  This order is not about cost-benefit analysis; it is about cost-only analysis.  By definition this approach ignores the public benefits that the underlying statutes are intended to provide.  Thus, the “savings clause” cannot save the EO, because there is nothing left to save.

Superfund Reform, Part 2: Giving Credit Where Credit Is Due

Posted on May 30, 2017 by Seth Jaffe

Last week, I offered less than fulsome praise of EPA Administrator Pruitt’s announcement that he was taking control of remedial decisions for big Superfund sites.  Now, he’s followed up with a memorandum announcing establishment of a task force to look at ways to reform Superfund implementation.  While he’s still plainly wrong in putting Superfund “at the center of the agency’s core mission,” I have to confess that I think he otherwise has pretty much hit a home run with the latest memorandum.

Let’s start with the basics.  Superfund is a mess.  It’s one of the most poorly written statutes in Congressional history, and Superfund cleanups take way too long, are way too expensive, and fail to deliver bang for the buck in either risk reduction or productive reuse.

In a perfect world, Superfund would be amended to privatize cleanups and put cost-effective risk-based cleanups at the center of the program.  However, Scott Pruitt cannot unilaterally amend Superfund.  Heck, he may not realize it, but even Donald Trump cannot unilaterally amend Superfund.

Given this reality, Pruitt’s memorandum identifies all of the appropriate goals for meaningful administrative reform.  They include:

  • a focus on identifying best practices within regional Superfund programs, reducing the amount of time between identification of contamination at a site and determination that a site is ready for reuse

  • overhaul and streamline the process used to develop, issue or enter into prospective purchaser agreements, bona fide prospective purchaser status, comfort letters, ready-for-reuse determinations

  • Streamline and improve the remedy development and selection process, particularly at sites with contaminated sediment, including to ensure that risk-management principles are considered in the selection of remedies

  • Reduce the administrative and overhead costs and burdens borne by parties remediating contaminated sites, including a reexamination of the level of agency oversight necessary.

The last is my personal favorite.

I somehow expect I’m not going to be praising this administration on a regular basis, but I can still acknowledge when they get something right.  Let’s just hope that the task force is for real and comes up with a set of meaningful administrative improvements.

Fingers crossed.

A 2-Fer

Posted on May 25, 2017 by Mark Walker

Trump’s 2-for-1 Executive Order 13771 (January 30, 2017) requires that two existing regulations be eliminated for each newly enacted regulation in order to control regulatory costs and burdens.  The EO requires that the total incremental cost of all new and repealed regulations in FY 2017 be $0 or less.  The EO applies to most federal agencies, including the EPA.

Can anyone seriously contend that we cannot afford to get rid of some existing federal regulations?  Apparently yes - the idea was immediately dubbed by some as “ridiculous”.  A lawsuit has already been filed challenging the EO as facially arbitrary, capricious and an abuse of discretion. 

Fourteen States recently filed an Amici Curiae brief in the lawsuit supporting the EO, pointing out that numerous Presidents, Democratic and Republican alike, have previously issued executive orders seeking to reduce the number of federal regulations and the overall regulatory burden.

The notion of eliminating one or more existing regulations for each new regulation in order to reduce costs is nothing new.  The Netherlands, Canada, Australia and the United Kingdom have all previously enacted similar policies.  The UK currently has a 3-for-1 policy, which is estimated to have saved billions.

Certainly the 2-for-1 policy presents administrative and procedural challenges.  There is the sticky problem of estimating costs, as the EO is intended to address total opportunity costs (opportunities foregone by society as a whole - workers, businesses, consumers, households, etc.), and not simply business compliance costs.  In addition, the repeal of existing regulations must be done in accordance with the Administrative Procedures Act, which itself can be time consuming and costly.

The EO contains a savings clause that says no existing regulations can be repealed where prohibited by law.  Therefore, regulations expressly required by law without the consideration of costs cannot be repealed pursuant to the EO.  However, discretionary regulations are fair game.  Once again, we’ll have to wait and see how this EO holds up after court scrutiny.

Perhaps It Should Be Renamed the “Really, Really, Endangered Species Act”

Posted on May 1, 2017 by Seth Jaffe

Last Friday, the 9th Circuit Court of Appeals affirmed a District Court decision ruling that the Fish & Wildlife Service decision that listing of the whitebark pine as endangered or threatened was “warranted, but precluded” was not arbitrary and capricious.  The decision seems correct, but as the frustration of the Court reflects, it’s only because the ESA is designed to fail.

The procedural history is lengthy and not really necessary to repeat here.  Suffice it to say that the whitebark pine is both an important species and in significant distress, if not dire straits.  In response to a listing petition, the FWS issued a finding that listing the whitebark pine is “warranted, but precluded.”  Thus, the FWS instead added the whitebark pine to the list of “candidate species.”

A candidate species is one for which [FWS has] on file sufficient information on biological vulnerability and threats to support a proposal for listing as endangered or threatened, but for which preparation and publication of a proposal is precluded by higher priority listing actions.

The particular issue here was whether the FWS has any authority to base listing decisions on anything other than the Listing Priority Number assigned to the species.  As the Court noted, however, the ESA provides only that the ranking system is intended to “assist” in the identification of species for listing.  There is nothing that makes the LPN determinative.

That’s all well and good, but it does nothing for the whitebark pine.  As the Court stated:

When pending actions outstrip available resources, the Secretary must make its choices and live with its priorities, even though that means leaving factually (if not listed) threatened or endangered species without the protections of the ESA.

In other words, to paraphrase Eddie Cochran, “I’d like to help you tree, but you’re too inanimate to vote."

Does Chevron Ever Permit EPA to Rewrite a Statute? EPA’s Release Reporting Exemptions Are Struck Down

Posted on April 13, 2017 by Seth Jaffe

On Tuesday, the Court of Appeals for the District of Columbia vacated EPA’s final rule governing reporting of air releases from animal feeding operations.  The Court found that EPA had no statutory authority to exempt AFOs from the reporting regulations.

The decision is also important because it is another in a recent line of cases regarding the extent of agency authority to interpret statutes.  The issue was whether EPA had authority to exempt smaller AFOs from reporting requirements, on the ground that it could not:

foresee a situation where [it] would take any future response action as a result of such notification[s].

Although EPA did not explicitly justify its rule on de minimis grounds, the Court understood EPA to be making a de minimis argument and analyzed the rule in that context.  The Court concluded that EPA had not justified a de minimis exception, because:

an agency can’t use it to create an exception where application of the literal terms would “provide benefits, in the sense of furthering the regulatory objectives, but the agency concludes that the acknowledged benefits are exceeded by the costs.”

Here, the Court found that there were benefits to requiring reporting without a de minimis exception.  That was enough to vacate the rule.

It is worth noting the concurrence from Judge Janice Rogers Brown, who agreed that EPA had overstepped, but was concerned about the panel opinion’s summary of Chevron as being focused on whether the agency’s interpretation is “reasonable.”  Stoking the anti-Chevron flames, Judge Brown wrote to make clear that the “reasonableness” inquiry does not apply at step one of Chevron.  Ever-vigilant, she wants to be certain that courts do not abdicate their duty to state what the unambiguous language of a statute means.

I don’t have any problem with that.  Phase I of Chevron is an important bedrock principle.  If there’s no ambiguity, there’s no deference.  However, it’s worth noting that Judge Brown also stated that:

an Article III renaissance is emerging against the judicial abdication performed in Chevron’s name.

Notwithstanding the congressional discussion of this issue, I remain skeptical that any such “Article III renaissance” is occurring.  One concurrence from one appellate judge who happens to be named Gorsuch does not a renaissance make.

Of course, the really important part of Judge Brown’s concurrence was her citation to Luck Be a Lady, from Guys and Dolls, the greatest musical of all time.

Should Courts Defer to EPA’s Scientific Expertise if EPA Gets Rid of Its Expertise?

Posted on April 6, 2017 by Seth Jaffe

Earlier this week, the 9th Circuit Court of Appeals rejected challenges to the Federal Implementation Plan EPA promulgated after finding that Arizona’s regional haze State Implementation Plan was inadequate.  I think that the result is both correct and unsurprising.

However, one part of the opinion – a recitation of black-letter law – caught my eye.  In discussing the standard of review, the court noted that the arbitrary and capricious standard is “highly deferential.”  No surprise there.  It also noted that courts are particularly deferential when reviewing agency scientific determinations.  Also no surprise.

And yet….

What happens if EPA eliminates all of its climate science expertise, and then eliminates the Endangerment Finding?  Certainly, a court could still recite the traditional level of deference, but then note that “deference is not abdication” and rule that EPA’s decision must be reversed even under the deferential threshold.

And yet….

What happens if the Trump administration repeatedly makes regulatory decisions based on a “scientific” viewpoint that is so broadly rejected by the scientific community that “scientific” must be put in quotation marks?  Might courts at some point conclude that EPA has forfeited the deference normally given to agency scientific decisions?

Just asking.  It’s purely a hypothetical, of course.

Slashing EPA’s Budget Will Hinder Efforts to Improve Environmental Regulations

Posted on April 5, 2017 by Mark R. Sussman

          Since the election of President Trump and appointment of EPA Administrator Pruitt, more than a few articles and blogs have been written about the new administration’s plans to dismantle EPA, including the proposal to cut EPA’s budget by almost one third.   Even if one agrees that EPA needs to be “down-sized,” the massive cuts proposed by the Trump Administration are counter-productive.   If EPA fires thousands of environmental professionals, who will be left to repeal or revise unnecessary or unduly burdensome regulations?  Unlike Executive Orders, regulations cannot be rescinded or revised with the stroke of a pen.

          The hazardous waste regulations adopted to implement RCRA provide a case in point.  The Obama EPA adopted the final Hazardous Waste Generator Improvements Rule (discussed by a recent blog by Donald Stever) at the end of last year, acknowledging that the RCRA regulations are in many cases ambiguous, contain inconsistencies, and lack flexibility.  EPA took a year to address more than 200 comments before it finalized the rule.  Other aspects of the RCRA regulations also need to be modernized to encourage, rather than discourage, the reuse of materials derived from waste.

          Just one example involves the recycling of mercury-containing lamps, which have been regulated as Universal Waste since 1995.  Although fluorescent lamp manufacturers have reduced the amount of mercury in their lighting over time, such lamps are regulated as Universal Waste because many lamps exhibit the toxicity characteristic for mercury; and thus, would be classified as D009 hazardous waste.  While the Universal Waste Rules simplify the management of mercury containing lamps, the hazardous waste regulations and longstanding EPA interpretations of these rules impede the reuse of materials recovered through the recycling of universal waste lamps. 

          Two of the primary materials produced through lamp recycling are calcium phosphate powder and crushed glass.  Calcium phosphate powder removed from fluorescent lamps contains mercury at levels below the hazardous waste threshold, and the amount of mercury in such powder is typically further reduced by a retorting process.  Significantly, the phosphate powder also contains several rare earth elements, including Europium, Terbium and Yttrium, which are considered strategic materials by the United States Government, because of the need for such elements in many military and high-tech commercial products, such as cell phones, computer hard drives and other electronic equipment, and precision-guided munitions. 

          China controls about 95% of the production of rare earth elements.   Therefore, recycling calcium phosphate powder to produce rare earths provides a sustainable, domestic source of rare earths needed in the U.S. economy.  Unfortunately, as a waste derived material, regulators have limited the ability of businesses to stockpile calcium phosphate powder for future recycling, and much of this material is currently being disposed of in landfills, rather than being reserved for the recovery of rare earths.   

          Similarly, the crushed glass produced by lamp recycling has characteristics that make it a useful substitute for sand and other materials used in construction operations, such as for road sub-base and pipe bedding materials.  EPA’s view, however, is that since Universal Waste lamps would be considered D009 hazardous waste, glass produced as part of the recycling process is in the same hazardous waste treatability group as the initial universal waste lamps, and therefore, is subject to the Land Disposal Restrictions (LDR) for D009 –non-wastewaters. Thus, the glass must be tested to demonstrate compliance with the LDR standard of 0.025 mg/l for mercury using the TCLP test (designed to assess leachate in a landfill environment), before the glass can be used on land as a substitute for other products.  While the glass from lamp recycling typically complies with the LDR standard, the additional regulatory process discourages the reuse of this glass as a substitute for raw natural resources.

          If President Trump were truly interested in alleviating “unnecessary regulatory burdens placed on the American people”, EPA needs the resources to review specific regulations and identify those regulatory changes that will accomplish the President’s goals.  Slashing EPA’s budget, before identifying and promulgating the regulatory changes, will likely result in missed opportunities for improving environmental regulations.  Instead, massive reductions in staff and efforts to rescind many regulations without careful consideration will lead to mistakes and litigation, which is in no one’s interest.  Businesses need certainty, and the approach outlined by President Trump’s Executive Orders will instead result in more confusion and uncertainty.

TRUMP, TARIFFS, TERRA, and TWEETS

Posted on April 3, 2017 by Earl Phillips

Regardless of political leanings or perspectives held regarding this President and his administration or the likely effectiveness of tariffs in global trade, we likely agree that creating more good American jobs is a positive thing.  If his plan is successful, Donald Trump and this administration will, in part through the use of tariffs, reinvigorate domestic manufacturing. 

If willing to think more broadly, this may be achieved while at the same time improving (and setting the stage to further improve) the global environment and international worker safety.  These objectives need NOT be mutually exclusive.

Both the Republican and Democratic primaries featured unique candidates with compelling messages of creating and protecting jobs for Americans.  The Republican candidate survived his primary and went on to win the election, so let's consider the relevant promises and pronouncements of candidate, now president, Trump. His overarching refrain has been to "make America great again".  Consistent with this message, he has repeatedly assured the American public that he will promote, and ultimately increase, domestic manufacturing.  His vision is that this manufacturing, and the related jobs, will improve the lot of American workers.  While offering limited specifics, he has been unwavering in his commitment to level the economic playing field by imposing significant tariffs on goods and services manufactured abroad.

If President Trump is correct relative to the effectiveness of a tariff and willing to adjust this blunt tool to incorporate concerns for the global environment and humane working conditions, he can provide a path that leads to greater domestic manufacturing and jobs, as well as unparalleled international leadership with respect to the environment and worker safety.  This is possible provided President Trump is willing to leverage the appetite of overseas manufacturers to sell goods and services to Americans in return for a more level manufacturing playing field, as well as enhanced international Environmental Health and Safety (EHS) protections and benefits.

Assuming this administration does, in fact, look to tariffs as a means to stimulate domestic manufacturing, the following offers a path to proceed with the stated agenda while establishing a program designed to employ even more well trained Americans and improve the global environment:

 1. TARIFFs could be structured to afford the impacted offshore manufacturer with the following option: (A) PAY THE FULL TARIFF.  This option would presumably level the economic playing field between the offshore and domestic manufacturer of goods or provider of services; or (B) PAY A REDUCED TARIFF and EXECUTE AN EHS INSPECTION/ENFORCEMENT AGREEMENT.  This option would achieve not only the U.S. manufacturing and jobs agenda, but also would drive international EHS benefits.  A significant portion of the REDUCED TARIFF could be used to directly fund an environmental, health and safety inspection corps (EHS Corps).  This EHS Corps would be comprised of appropriately educated and trained American workers.  Notably, these EHS positions would be in addition to our domestic manufacturing jobs and represent even more American jobs for those with science, engineering, operations, and business and legal degrees.  THE INSPECTION/ENFORCEMENT AGREEMENT would also call for the participating company to submit to regular inspections, an enforcement regime and an administrative/judicial process similar to our federal template.  This Agreement would further level the manufacturing playing field while improving the global environment and driving international EHS performance to levels comparable to our federal programs.

 2. The EHS Corps would regularly inspect REDUCED TARIFF participants using a straightforward template approximating the United States federal EHS regulations.  This approach would not only compel offshore participants to achieve environmental protection and worker safety objectives similar to their U.S. counterparts, but also cause them to incur the same or similar resource and financial burdens to comply with this template or suffer enforcement consequences if they fail.  This compliance mandate when combined with the payment of the REDUCED TARIFF, would further level the playing field between offshore and domestic manufacturers.  Should a participant be a repeat or willful violator, then beyond the sanctions available within the REDUCED TARIFF inspection and enforcement regime, the U.S. would reserve the right to re-impose the FULL TARIFF or consider other import/export sanctions.

3. Strategically, the differential between the FULL TARIFF and the REDUCED TARIFF should motivate responsible corporations and businesses to elect the REDUCED TARIFF.  Beyond this, the REDUCED TARIFF should generate adequate revenue to fund the training and deployment of the EHS Corps as well as the inspection/enforcement process.

CONCLUSION:

President Trump and his administration can be true to their stated commitment to increase domestic manufacturing jobs through a more aggressive tariff while going one important step beyond, establishing the U.S. as an architect and catalyst for an improved, and more internationally uniform, approach to environmental, health, and safety concerns. 

 

NOTE:  THE CONCEPT OUTLINED ABOVE IS NOT AN ENDORSEMENT OF TARIFFS, BUT A REFLECTION OF ATTY. PHILLIPS BASED ON THIS ADMINISTRATION’S PRONOUNCEMENTS.  THIS IS NOT THE PRODUCT OF HIS LAW FIRM OR THE UNIVERSITY AT WHICH HE TEACHES.

 

The Latest Executive Order: Any Kind of Consistency Is the Hobgoblin of Little Minds

Posted on March 31, 2017 by Seth Jaffe

Make no mistake, the Executive Order signed by President Trump at EPA yesterday is a big deal.  Time will tell whether the Administration’s U-turn on the Obama rules currently in litigation, such as the Clean Power Plan and the rule on fracking on federal lands will make any difference to judicial review of those rules.  There are plenty of states and NGOs ready to step into EPA’s and BLM’s shoes to defend those rules.

Regardless, though, it’s important.  Social cost of carbon?  Poof.  Gone.  Climate Action Plan?  Gone.  Consideration of climate change in environmental impact reviews?  Gone.

We already know all this, though.  I’d like to focus on a few details concerning the EO that might have gone unnoticed.

  • The order states that development of domestic natural resources “is essential to ensuring the Nation’s geopolitical security.”  I found this statement interesting in light of the recent statements by Secretary of Defense Mattis, who very clearly stated that climate change is real and is itself an important security risk.
  • The order states that environmental regulations should provide “greater benefit than cost.”  I found this statement somewhat odd, given that the President’s prior EO known as the 2-for-1 order, essentially requires agencies to ignore the benefits of regulations and focus solely on the costs that they impose.
  • Similarly, the Order requires agencies, in “monetizing the value of changes in greenhouse gas emissions resulting from regulations,” ensure that their analyses are consistent with OMB Circular A-4, issued in 2003.  The Order states that Circular A-4 embodies “best practices for conducting regulatory cost-benefit analysis.”

I’d be interested in knowing if a single one of the authors or peer reviewers of Circular A-4 have anything nice to say about the 2-for-1 Order?

“This is not a ‘major rule’ but it is a “significant regulatory action”…. Really?!

Posted on March 30, 2017 by Donald Stever

On November 28, 2016, EPA released its somewhat euphemistically titled “Hazardous Waste Generator Improvement Rule” (81 Fed. Reg. 85732) which, in a whopping 97 pages of miniscule federal register text, revises the structure, and in some cases the substance of the rules that apply to generators of hazardous waste under RCRA. I have no space in a blog to detail the substantive changes, tweaks and repositioning to Parts 257, 260, 261, 262, 263, 264, 265, 268, 270 and 279, but I will mention some highlights. This is, of course, a major rule, but it is also an important rule in that it sensibly addresses a wide range of longstanding problems in both the organization and substance of the regulatory provisions that govern the conduct of entities that generate hazardous waste.

The largely needed and helpful changes made by the rule include (1) subtle modifications to the definitions of the three generator categories, (2) refinement of how accumulation of both hazardous waste and acutely hazardous waste is treated, (3) adding a definition of “central accumulation area, (4) adding a requirement that partial reclamation facilities and recyclers who receive manifested hazardous waste submit biennial reports, (5) and a substantial reorganization of § 262.10 by deleting and re-numbering several of its subsections while amending them in the process. In addition, EPA added new requirements for making hazardous waste determinations, attempts to define what “generator knowledge” means in connection with testing, changes certain recordkeeping requirements, and requires small quantity and large quantity generators to identify waste codes associated with their waste. The rule specifies procedures for counting hazardous waste, revises the mixture rule, amends the marking and labeling requirements by adding very specific requirements, adds not insubstantial new requirements for the use of satellite accumulation areas (my favorite sub-amendment is EPA’s effort to define the term “three days”), adds new closure requirements, revises the conditions for exemption from various requirements for all three generator categories, imposes a new “re-notification requirement” to obtaining an ID number, modifies the criteria for episodic generation events, and imposes new requirements for emergency planning,

There are other changes, a few of them, well, mystifying. My favorite is what appears to be a meaningless nomenclature change. From November 19, 1980 until November, 2016, if you generated 100 kg or less of hazardous waste or 1 kg or less of acutely hazardous waste you were called a “Conditionally Exempt Small Quantity Generator”.  After the effective date of the ‘Generator Improvement Rule” you are now called a “Very Small Quantity Generator”. EPA’s explanation for this change is truly wonderful - EPA felt that the term “conditionally exempt small quantity generator” was confusing because “all three categories of generators are conditionally exempt” from certain requirements. 82. Fed. Reg. 85740. Gee, I was never confused nor, to my knowledge, were any of my generator clients. I was also amused that EPA felt it necessary to try to define the term “three days” in connection with a provision pertaining to satellite accumulation.

Overall, however, this is a major, beneficial, rule. So what is the point of the heading to this blog? In the required boilerplate at the end of the preamble prior to the twenty-five pages of the actual rule, EPA concludes, as it must, that it is not required to subject the rule to scrutiny under the Congressional Review Act because the action is “not a major rule” as defined by 5 U.S.C. 804(2).  The Congressional Review Act?  Hmmm. Is that all?  No. In order to push this clearly beneficial rule out the door, not only did EPA employees have to generate 69 pages of notice-and-comment verbiage, but, in addition, also the Agency had to (a) submit the rule to OMB per Executive Orders 12866 and 13563 because though not “major”, it is a “significant regulatory action” in that it “may raise novel legal or policy issues arising out of legal mandates”, (b) satisfy the Paperwork Reduction Act by demonstrating that the rule is necessary, (c) satisfy the Regulatory Flexibility Act by demonstrating that the rule will not have a significant economic impact on small entities, and, in addition, also demonstrate that (d) it does not contain an unfunded mandate in violation of the Unfunded Mandates Reform Act, (e) it does not have “federalism implications” per Executive Oder 13132, (f) it does not have sufficient “tribal implications” to trigger review per EO 13175, (g) it does not present a disproportionate risk to children per EO 13045, (h) it does not significantly affect energy supply, distribution or use per EO 13211, (i) it does have environmental justice implications per EO 12898, and (j) it does not involve technology transfer.

Just think of the number of employee hours it took for EPA to make these largely sensible modifications to the RCRA generator requirements. If Mr. Pruitt gets his wish to shrink EPA staff by 30% how is the Agency going to get anything accomplished?

POTUS, SCOTUS & WOTUS: What Do They Have in Common With Michael Stipe and Jack Black?

Posted on March 15, 2017 by Jeff Thaler

Then-candidate Donald Trump’s unauthorized use of REM’s 1987 song, “It’s the End of the World as We Know It (And I Feel Fine)”, during a 2015 campaign rally sparked a sharp objection by the band’s Michael Stipe. Flash forward to 2017 and now-President Trump has been flexing his executive powers in a number of legal fields; for many environmental, energy or immigration lawyers it’s the end of the regulatory world as we knew it for decades, and they are not feeling so fine.

Executive Orders (EOs) raise classic constitutional law issues of the separation of powers, in that they often are used for “executive legislating” even though there is no explicit constitutional authority for them. EOs also blur traditional regulating lines, because they are not issued with public notice or comment, and usually state that they do not “create any right or benefit enforceable at law or in equity by any party against the United States.”

An EO can have the force of law, however, if the EO is based on either the Constitution or a statute, per the Supreme Court’s 1954 Youngstown decision. That is why one must carefully read each EO to determine the grounds of its authority, and then whether it is possibly contrary to a) existing laws or b) constitutional provisions such as due process or equal protection.

Facing an uncooperative Congress, POTUS Obama came to rely on EOs in his last two years in office (see this prophetic 2015 School House Rock episode). POTUS Trump took to EOs right out of the gate. The two Trump EOs that have garnered the most publicity and outcry deal with immigration restrictions The first EO was challenged in numerous courts, and the 9th Circuit issued on February 9 the first appellate decision on a Trump EO. Interestingly, and instructive for future litigants and legal counsel, the first issue addressed by the 9th Circuit, and the one they discussed the most, was . . . standing. The court then moved on to reviewability, and only briefly due process and equal protection. The complaint’s count on violating the Administrative Procedure Act for not following proper rulemaking proceedings was not even discussed in the ruling.

Trump issued two EOs of more relevance to environmental and energy lawyers. First was the January 30, 2017 EO entitled “Reducing Regulation and Controlling Regulatory Costs”, aka the add-one-subtract-two, no-increase-in-incremental-costs [undefined]- of-regulations EO. That was followed by the February 2, 2017 Interim Guidance of the OMB implementing (and implicitly amending) the EO by limiting it to “significant regulatory actions”—i.e. those of $100 million or more of annual effect on the economy. A week later the EO and IG were both challenged in federal court in D.C. as violating the APA, separation of powers, the Constitution’s “Take Care Clause”, and as being ultra vires. Plaintiffs referenced in part OSHA, TSCA, the ESA and CAA, and other energy/environmental laws as being inconsistent with the EO’s requirement that a new rule can only be promulgated if its cost is offset by the elimination of two existing rules. The EO ironically signals the possible demise of cost-benefit analysis —first mandated by then POTUS Ronald Reagan by an EO in 1981—by disallowing consideration of the economic benefits of a regulation when weighing its costs.

Many more EOs are promised in the coming weeks concerning a variety of environmental and energy laws and regulations. Early in the wave was the February 28, 2017 EO with the majestic name of “Restoring the Rule of Law, Federalism, and Economic Growth by Reviewing the ‘Waters of the United States’ [aka WOTUS] Rule”. This EO directs the EPA to review the WOTUS Rule while keeping in mind the national interest of “promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles of the Congress and the States under the Constitution.” Since WOTUS was a final rule published in the Federal Register, it can only be repealed and replaced by a new rule that goes through full notice-and-comment rulemaking, not simply by a non-legislative guidance or policy statement.

One who lives by the EO sword can slowly die from it too. POTUS Obama did not submit for approval to Congress the Paris Climate Change Agreement of 2016, calling it an “executive agreement”, thus POTUS Trump does not need Congressional approval to undo it. The Agreement terms do not allow withdrawal by a party before November 2019. However, the U.S. could withdraw from the overarching United Nations Framework on Climate Change with one year notice, if the Senate approves, and that in effect would undo our Paris “commitments”. And as a practical matter, the current Administration could also just choose not to implement the Paris obligations, because there is no binding duty to hit the emission reduction targets.

In sum, we live in interesting times.   Although Jack Black has said of this Administration that “It’s the end of the world”, for College members and their clients it’s the start of some fascinating new adventures in regulation and litigation. Stay tuned. 

Rifle Shots – Unleashing the Power of the Tweak

Posted on February 24, 2017 by JB Ruhl

Here’s a thought exercise: I’ll give you a budget of 25 words (including conjunctions, articles, and all the other little ones). You use up a word by either deleting, adding, or replacing one in an existing federal environmental or natural resources statute. How much could you transform the field of practice with just those 25 word edits? The answer is, quite a lot.

When we think of statutory reform, we usually think big, right on up to “repeal and replace.” But after more than 25 years of very little legislative action on federal environmental and natural resources statutes—the National Wildlife Refuge Improvement Act, Sustainable Fishing Act, and the recent Toxic Substances Control Act reforms are a few exceptions since the 1990 Clean Air Act amendments—much rides on the accumulations of judicial and agency interpretations of the meaning of a word here and a phrase there. As we enter a period of potential legislative volatility in this field, therefore, the rifle shot may be just as much in play as the nuclear bomb.

Like any statutory reform, rifle shots can make regulatory statutes either more or less regulatory. For example, one could add “including carbon dioxide” or “excluding carbon dioxide” in just the right place in the Clean Air Act and with those three words put an end to a lot of debate and litigation. Given the current political climate, however, it’s reasonable to assume any rifle shot would be aimed at reducing regulatory impacts. But even with just 25 words in the clip, one could transform the impact of several regulatory programs before running out.

For example, delete the words “harm” and “harass” from the statutory definition of “take” in the Endangered Species Act (ESA) (16 U.S.C. 1532(19)) [LINK 1] and you have a very different regulatory program. Much if not most of the land use regulation impact under the ESA stems from the inclusion of those two words; without them, the ESA’s prohibition of unpermitted take would restrict actions like hunting, killing, shooting, and wounding, but could not reach indirect “harming” from habitat modification.   Of course, the interagency consultation program under Section 7 (16 U.S.C. 1536(a)(2)) [LINK 2] would still be in place, prohibiting federal agencies from taking actions that “jeopardize” the continued existence of species. But just add “substantially” before “jeopardize” and the practical effect of that prohibition is greatly reduced.

I’ve managed to transform the ESA, vastly reducing its regulatory impact, with just three word tweaks. Twenty-two to go. Here are some more examples.  I’ll let readers evaluate the impacts.

·         Speaking of evaluating impacts, the environmental impact review process of the National Environmental Policy Act (NEPA) can really slow things down (42 U.S.C. 4332(B)). [LINK 3] To “streamline” the process, add the word “direct” before “environmental impact” in subpart (C)(1), which would eliminate the current practice of requiring analysis of indirect and cumulative impacts, and delete subpart (C)(iii), which requires agencies to evaluate “alternatives to the proposed action,” to remove a factor that bogs down much NEPA litigation. (Six more words down, sixteen to go.)

·         Heard all the commotion about which “waters” are subject to the Clean Water Act? Clear that up by changing the statutory definition of “navigable waters” (33 U.S.C. 1362(7)) [LINK 4] to read “waters of the United States subject to navigation.” That would be pretty extreme—it would remove most wetlands from jurisdiction—so one could control how far jurisdiction extends over wetlands by adding and their adjacent wetlands.” This would draw the line much closer to navigable water bodies than current interpretations reflected in Supreme Court opinions and agency regulations—Rapanos and the Water of the United States Rule become history. (Seven more words down, nine to go.)

·         And if you also want to put to rest the question whether the Clean Water Act applies to groundwater, edit the front end of the definition to read “surface waters.” (Another word down, eight to go.)

·         The Circuits are split over whether the Migratory Bird Treaty Act’s list of prohibited activities (16 U.S.C. 703(a)), [LINK 5] which includes to “take” or “kill,” sweeps within the statute’s reach any “incidental” taking or killing—injury or mortality that is not the direct purpose of the activity, such as strikes by wind turbines. Easy to solve! Add the word “purposeful” before the list of prohibited activities. (Another word down, seven to go.)

·         And, while we’re at it, let’s go ahead and add “excluding carbon dioxide” to the Clean Air Act definition of “air pollutant” (42 U.S.C. 7602(g)). [LINK 6] Adios, Clean Power Plan. (Three more words down, leaving just four to go.)

I’ll leave it to readers to think about how to use the last four words. The point here is that the system of environmental and natural resources law has become quite fragile. With Congress out of the picture for so long, courts and agencies have built up an interpretation infrastructure under which a single word or phrase often carries a tremendous burden of substantive and procedural program implementation. As a consequence, a mere tweak here and there can have dramatic effects on the program.

Granted, anyone who closely follows the statutes tweaked above will quickly appreciate the impact of any of the tweaks, and I’ve chosen some powerful examples unlikely to slip by any such experts. But subtler tweaks buried deep in a larger bill could more easily fly below the radar.

It remains to be seen whether Congress takes this rifle shot approach or goes bigger.  Rifle shots don’t eliminate or “gut” entire programs, which may be the current congressional appetite, but the above examples show the potency of this approach. I for one will be keeping my eyes out for rifle shots in bills every bit as much as I will be following the big bomb reform efforts. Do not underestimate the power of the tweak!

Bumble Bee Buzzkill

Posted on February 14, 2017 by Richard Horder

Citing its deep decline in numbers, on January 10, 2017, the U.S. Fish and Wildlife Service (“FWS”) listed the rusty patched bumble bee, Bombus affinis, as endangered under the Endangered Species Act (“ESA”).  FWS estimates the rusty patched bumble bee population has seen as much as a 91 percent reduction since the mid to late 1990s.  Twenty years ago, this species was practically ubiquitous in eastern North America, spanning across 28 states.  Now its territory covers only small regions in 12 states: Illinois, Indiana, Maine, Maryland, Massachusetts, Minnesota, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, and Wisconsin.

This listing is the first for bees under the ESA, but unlikely the last.  Like the rusty patch bumble bee, other bee species are facing steep declines in their respective populations.  Declining bee populations are troubling, because bees, as pollinators, are vital to the U.S. agricultural industry.  According to a study conducted in 2010 by Cornell University, bees and other pollinators are estimated to contribute a total of $29 billion to the industry, with $16.35 billion attributed specifically to pollination. 

The direct cause of these dramatic declines in bee populations is undetermined and likely due to a multitude of factors.  FWS states the threats to the rusty patched bumble bee include disease, exposure to pesticides, habitat loss, and climate change.  This listing will likely intensify the debate over commonly used pesticides, including neonicotinoids, which have undergone additional scrutiny after a 2016 study published in Nature linked the use of neonicotinoids to the decline of wild bee populations in England.

FWS published the proposal for this listing in the Federal Register on September 22, 2016 and the final listing was published in the Federal Regulation on. January 10, 2017. However, due to the Trump administration’s Inauguration Day memorandum halting or delaying any new federal regulations, the ESA’s protection for the rusty patch bumble bee is delayed until March 21, 2017-a stinging result.

The Conservative Uphill Slog for a Carbon Tax

Posted on February 9, 2017 by Seth Jaffe

Earlier this week, the Climate Leadership Council rolled out The Conservative Case for Carbon Dividends (note the absence of the “T” word in that title!).  It’s a serious proposal and, if we lived in a world of facts, rather than alternative facts, it would be a useful starting point for a discussion.

Here are the highlights:

  • A gradually increasing carbon tax, starting somewhere around $40/ton.
  • Return of all revenue from the tax to citizens through dividend checks.  The CLC predicts that the 70% of Americans with lowest income would receive more in dividends than they would pay in taxes.
  • Border carbon adjustments.
  • Elimination of existing carbon regulations.  It’s not clear what this would cover, but it would include at least the Clean Power Plan.  It would also include elimination of tort liability (presumably limited to tort liability related to claims concerning climate change).

I’d sign up for this today, but I’m not exactly one of the people that needs convincing.  According to GreenWire (subscription required), former Secretary of State James Baker, who led the public presentation of the report, acknowledged that attaining enactment of the proposal would be an “uphill slog.”  I think that’s putting it mildly.  The CLC members are basically a who’s who of the old-line GOP mainstream – precisely the types that President Trump appears to have consigned to the dustbin of history.

Nonetheless, hope springs eternal and we have to start somewhere.

IS PRESIDENT TRUMP REPEATING REAGAN’S MISSTEPS ON REGULATORY “REFORM”?

Posted on February 8, 2017 by Robert Percival

President Donald Trump’s first weeks in office have seemed like a reality TV show highlighted by frequent signing ceremonies for hastily-drafted executive orders.  One of these orders, signed on January 30, is entitled “Reducing Regulation and Controlling Regulatory Costs” (Executive Order 13771).   President Trump described it as mandating “the largest cut by far, ever in terms of regulation” and the key to “cutting regulations massively” for businesses. The order requires federal agencies to repeal two existing regulations for each new regulation they issue and it gives each agency a regulatory budget of zero for the imposition of aggregate costs on industry during the current fiscal year. 

The words “cost” or “costs” appear 18 times in the executive order; entirely missing from it is any discussion of the benefits of regulation.  By focusing solely on reducing the costs of regulation, President Trump is repeating a crucial mistake the Reagan administration made after launching a major “regulatory reform” initiative in 1981.  President Reagan’s Executive Order 12291 created a new system of regulatory review centered in the Office of Management and Budget (OMB).  It mandated that federal agencies perform cost/benefit analyses to support any major rule likely to cost more than $100 million annually.  Subsequent Presidents of both parties have retained this requirement and the centralization of regulatory review in OMB’s Office of Information and Regulatory Affairs.

Unlike Trump’s executive order, Reagan’s order directed federal agencies to consider both the costs and benefits of regulation.  It specified that such agencies should seek to maximize net benefits to society and to issue regulations only when their potential benefits outweighed their potential costs.  However, the Reagan administration undermined these directives by maintaining that costs and benefits need not be weighed when an agency proposed to repeal a regulation.  This contributed to a disastrous effort to repeal limits on the amount of lead additives that could be used in gasoline.

At the direction of Reagan’s Task Force on Regulatory Relief, EPA proposed to repeal the lead limits that had been sustained in the D.C. Circuit’s historic, en banc decision in Ethyl Corporation v. EPA.  While this would have saved oil refiners a small amount of money, it would have dramatically increased lead poisoning, costing society far more.  Yet, despite the Reagan administration’s new emphasis on cost/benefit analysis, no cost/benefit analysis was performed because EPA was proposing to repeal a regulation.

The rulemaking to abolish limits on lead in gasoline spawned such a firestorm of opposition, even from conservative columnist George Will, that the Reagan administration was forced instead to strengthen the regulation.  Three years later, after William Ruckelhaus had returned to lead EPA, the agency performed a cost/benefit analysis of phasing lead out of gasoline entirely.  After the analysis found overwhelming net benefits from banning leaded gasoline, EPA did so. Today nearly every country in the world has followed the U.S. in banning leaded gasoline, dramatically reducing lead poisoning.  Economists estimate that lead phase-out now generates more than two trillion dollars per year in net benefits globally. 

Under President Trump’s new executive order, federal agencies must repeal two rules, regardless of their benefits, in order to take any new regulatory action.  And the costs of the new regulation must be offset by the reduced costs from repealing existing rules. Thus, if EPA wants to strengthen regulations on lead in drinking water to protect people like the residents of Flint, Michigan, Trump’s executive order requires it to repeal two existing rules, for example (god forbid) by no longer prohibiting oil refiners from adding lead to gasoline. 

President Trump’s executive order has legal qualifiers that offer some hope.  It purports not to “impair or otherwise affect” agencies’ existing legal authority and it requires federal agencies to comply with the Administrative Procedure Act (APA) when repealing rules.  The APA’s judicial review provisions direct courts to strike down agency actions that are “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”  If an agency’s only justification for repealing a rule is to comply with President Trump’s new directive, it should be possible to convince a reviewing court that the action is arbitrary enough to be struck down. 

President Reagan’s efforts to relax environmental regulation generated a backlash in Congress, which responded by greatly strengthening the environmental laws and adding numerous deadlines for EPA action.  But that was because Congress then was controlled by lawmakers who cared about environmental protection.  Today’s Congress is controlled by lawmakers who regularly campaign against EPA regulations.  Regulations that are outmoded, ineffective, or excessively burdensome should be repealed, as President Obama directed in 2011 when he issued Executive Order 13563.   But President Trump’s poorly drafted Executive Order 13771 opens the door to repealing long-established protections for public health, safety and the environment without consideration of the enormous benefits they produce.

The Conservative Case For Chevron Deference

Posted on January 30, 2017 by Seth Jaffe

With GOP control of Congress and the White House, conservatives appear to have Chevron deference in their crosshairs.  Put simply, I don’t get it.  There are at least two good reasons why conservatives should prefer Chevron deference to no deference.

First, the alternative is for courts to decide all questions of agency authority.  But haven’t conservatives railed against unelected judges for years?  Bureaucrats are unelected, but at least they work for the elected President.  Isn’t EPA more likely to be responsive to President Trump than federal judges would be?

Second, the EDFs and NRDCs of this world would laugh hysterically at the notion that they have more sway with EPA than the regulated community.  Anyone ever heard of “Regulatory Capture”?

The argument in support of Chevron was made cogently by Ed McTiernan in a recent blog post, but the strength of the argument was really brought home by the decision this past week in Catskill Mountains Chapter of Trout Unlimited v. EPA, in which the 2nd Circuit Court of Appeals – to fairly wide surprise – reversed a district court decision that had struck down EPA’s “water transfer” rule.  

The rule was much favored by the regulated community, but there were very good jurisprudential reasons to affirm the District Court.  Indeed, the decision was 2-1 and even the majority opinion repeatedly noted that, were it writing on a blank slate, it might well prefer an interpretation that would strike down the rule.

Why, then, did the Appeals Court reverse the District Court and affirm the rule?  Chevron deference, of course.

Conservatives, be careful what you wish for.

The New Administration’s Initial Executive Order and Memoranda On Energy and Environmental Issues

Posted on January 26, 2017 by Theodore Garrett

The Trump administration has issued a key Executive Order and several memoranda relating to energy and the environment.  The goal of the Executive Order -- Expediting Environmental Reviews and Approvals for High Priority Infrastructure Projects – is to expedite environmental reviews and approvals.  It provides that action by the Chair of the Counsel of Environmental Quality to designate an infrastructure project as high priority would trigger an expedited review and approval process, as described in the memorandum Streamlining Permitting and Reducing Regulatory Burdens for Domestic Manufacturing.

Two other memoranda – those addressing the construction of the Keystone Pipeline and construction of the Dakota Access Pipeline – are intended to clear the way for approval of these two controversial pipelines.  The President also stated that he wants pipe for U.S. pipelines to be made with American steel.     

Finally, the White House issued a memorandum providing for a regulatory freeze of regulations that have not taken effect and withdrawal of regulations that have not yet been published in the Federal Register. In accordance with this directive, EPA has issued a notice postponing to March 21, 2017 the effective date of 30 regulations that were published by EPA after October 28, 2016.  The delay is intended to provide further review of these regulations by the new Administration.

The Order and memoranda do not change the requirements of relevant environmental statutes.  It remains to be seen to what extent these policies will affect future permitting or regulatory decisions.  Interested parties will wish to carefully monitor how these developments unfold.