US Chamber of Commerce, National Automobile Dealers Association Seek Review of EPA Decision Allowing States to Regulate Emissions
The US Chamber of Commerce and National Automobile Dealers Association (NADA) have filed a petition seeking review of the EPA’s decision to allow states to regulate automobile emissions. In a Nonbinding Statement of Issues filed Oct. 13, 2009, the two groups outlined the questions to be addressed by the United States Court of Appeals for the District of Columbia Circuit in their lawsuit challenging the EPA’s decision to grant California’s request for a waiver of federal Clean Air Act preemption. The waiver allows California to regulate vehicle emissions and other states to adopt those regulations. A decision adverse to the EPA would limit the ability of individual states to regulate greenhouse gas emissions but does not implicate EPA’s efforts to set national emissions standards. However, some industry watchers predict that this is just the beginning of a “hurricane of lawsuits” challenging climate-related regulations. New York and 16 other states have recently filed a motion to intervene on the side of the EPA.
Chamber of Commerce and NADA Challenge
In its challenge to the EPA decision to grant the waiver to California, the Chamber and the NADA raised six issues for the Court to decide:
- Whether the EPA erred in reconsidering and reversing the denial of California’s request to waive preemption for its greenhouse gas emission standards under Section 209(b);
- Whether the EPA erred in concluding that the California determination that its own gas emissions standards satisfy the Clean Air Act’s “protectiveness” standard was not arbitrary and capricious;
- Whether the EPA erred in not denying California’s waiver request because California did not meet the requirement of showing that its standards were needed to meet compelling and extraordinary conditions;
- Whether the EPA erred in not denying California’s waiver request because it was inconsistent with Section 202(a) of the Clean Air Act [which addresses “Emission standards for new motor vehicles or new motor vehicle engines”];
- Whether the EPA complied with procedural requirements of the Clean Air Act and Administrative Procedure Act in reversing its earlier decision; and
- Whether California is precluded from obtaining a preemption waiver for its greenhouse gas emission standards under the Energy Policy and Conservation Act of 1975.
States, Environmental Groups Intervene in Support of EPA
Seventeen states, led by New York, have moved to intervene in the lawsuit on the side of EPA. The other states are Arizona, Connecticut, Delaware, Illinois, Iowa, Maine, Maryland, Minnesota, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, Washington, Florida, and Pennsylvania. The South Coast Air Quality Management District (California) also filed a separate motion to intervene in support of EPA and Administrator Jackson, as did the environmental organizations Environmental Defense Fund, Natural Resources Defense Council, the Sierra Club, and Environment California.
There has been no substantive briefing, but the EPA has filed a motion seeking an extension from the usual 30 days to respond to 90 days due to the complexity of the issues. The EPA previously stated that the decision to grant the waiver followed the law and was based on a comprehensive analysis of the science and that it is confident the courts will uphold the decision.
National Regulations
Earlier this year, the Obama administration reached consensus with the big three American automobile manufacturers on national regulation of greenhouse gas emissions from vehicles. On May 19, 2009, at a Rose Garden ceremony filled with representatives of major automobile manufacturers worldwide, President Obama announced that the EPA and National Highway Traffic Safety Administration will propose greenhouse gas emissions limits for cars and light trucks for model years 2012-16. The only way to reduce certain emissions is to increase fuel efficiency. Accordingly, the Administration’s proposal will require an average fuel economy standard of 35.5 mpg by 2016.
Then, on June 30, 2009, the EPA announced that it was reversing its decision under the Bush administration to deny California’s request for a waiver under the Clean Air Act. By reversing its decision and granting the waiver, the EPA is permitting California to enforce its own emission regulations. Fifteen states have already adopted the California plan. After 2011, compliance with the anticipated national regulations would satisfy the California standards, so assuming the national regulations are finalized in time, the waiver effectively allows states to impose regulations applicable to the model years 2009-2011. However, California could also impose more stringent restrictions after 2016.
The Chamber opposes such regulation because of the heavy burden it predicts will be placed on US businesses, and has previously attempted to slow or derail EPA regulation of greenhouse gas emissions under the Clean Air Act. The Chamber sought a hearing regarding the EPA’s decision to regulate GHGs under the CAA, and stirred controversy by characterizing the proposed hearing as a “Scopes monkey trial” on climate science. Some members have canceled their membership in the Chamber because of disagreement with the Chamber’s position on regulation of greenhouse gases. Meanwhile, advocates of increased regulation of greenhouse gas emissions have also excoriated the Chamber’s position on EPA regulations. Whatever their position, stakeholders on all sides of the issue will be closely watching the outcome of this lawsuit.
Chamber of Commerce seeks public hearing on scientific evidence of climate change; EPA calls request a "waste of time"
Yesterday the Los Angeles Times reported that “[t]he US Chamber of Commerce, trying to ward off potentially sweeping federal emissions regulations, is pushing the Environmental Protection Agency to hold a rare public hearing on the scientific evidence for man-made climate change.” In its blog, the US Chamber highlighted the LA Times story on the Chamber’s “efforts to force transparency from the EPA on their finding that greenhouse gases emissions are a danger to public health and welfare.” According to William Kovacs, the Chambers’ Senior Vice President, the Chambers’ June 23, 2009 Petition for EPA to Conduct Its Endangerment Finding Proceeding on the Record Using Administrative Procedure Act (APA) §§ 556 and 557 would put “the science of climate change on trial.”
Sections 556 and 557 of the APA set forth the procedures an agency must follow in conducting hearing “required by section 553 or 554” of the APA. Section 553 covers agency rulemaking and states, in relevant part: “[w]hen rules are required by statute to be made on the record after opportunity for an agency hearing, sections 556 and 557 of this title apply.” (553(c) Emphasis added). Section 554 covers adjudications and similarly applies “in every case of adjudication required by statute to be determined on the record after opportunity for an agency hearing.” (Emphasis added)
But the US Chamber does not argue that the Clean Air Act requires an on-the-record hearing. Instead it states that the Agency has authority to hold an on-the-record process. Footnote 119 of the petition states:
The Chamber is not asserting that the Clean Air Act expressly requires this. United States v. Florida East Coast Railway Co., 410 U.S. 224 (1973). But neither does the Clean Air Act preclude it. The Agency has the authority to adopt an on-the-record process of its own volition, in accord with its own promises of transparency and scientific integrity. Clean Air Act section 307(d)(1)’s indication that the “provisions of section 553 through 557 and section 706 of Title 5 shall not, except as expressly provided in this subsection, apply to actions to which this subsection applies” cannot be interpreted in referencing sections 553-557 of the APA to mean that EPA is prohibited from voluntarily applying such procedures, but only that EPA does not have a statutory obligation to use such procedures. It does not address EPA’s discretion in deciding whether to do so.
The US Chamber argues that EPA should exercise its discretion to hold an on-the-record hearing because “(1) scientific or technical issues are ‘complex’; (2) the problem posed is so ‘open-ended’ that the agency would benefit from diverse views; (3) the costs errors may pose are ‘significant.’ 1 C.F.R. § 305.76-3(1) (1993).”
The US Chamber’s announcement touched off a rhetorical rumble. According to the LA Times, Chamber officials described the hoped-for hearing as "the Scopes monkey trial of the 21st century." A climate scientist associated with the Union of Concerned Scientists responded that the proposal “brings to mind for me the Salem witch trials, based on myth.” EPA claimed the hearing would be a “waste of time.”
It is unclear what the Chamber’s next step will be if EPA does not change its mind and embrace the Chamber’s view that an on-the-record hearing would be valuable. While William Kovacs noted that litigation is a “certainty” regardless of what EPA does, it is not clear whether the Chamber would litigate EPA’s denial of the petition (which notes the Agency’s discretion to hold a hearing), EPA’s final endangerment finding, or both.
