The Nickel Report

[caption id="attachment_291" align="aligncenter" width="300"] Navajo Generating Station[/caption]

In two related decisions issued on March 20, 2017, the Ninth Circuit upheld an EPA plan imposing regional haze requirements on the Navajo Generating Station (NGS).  The rulings suggest a possibility that future haze plans need not be unduly inflexible—sometimes forcing premature unit closures, as many haze plans did during the program’s first round of implementation.

President Trump released his budget request for fiscal year 2018 on March 16. The budget blueprint, or “skinny budget” as it is being called, holds fairly flat the federal spending for programs other than entitlements. It requests a significant increase in defense spending that is offset by cuts to nondefense discretionary spending.

The Environmental Protection Agency (EPA) faces drastic cuts, equaling nearly a third of its budget. This would bring the EPA’s total budget to levels not seen since 1990.

My daughter is on a high school team competing in “We the People: The Citizen and the Constitution” run by The Center for Civic Education to promote education about the Constitution and Bill of Rights. I have been privileged to have conversations with her about the Federalist Papers and some Supreme Court cases. She recently reminded me of the dissent in New State Ice Co. v. Liebmann, an opinion that may again become relevant to the evolution of environmental law, at least for those of us who live and function outside the Beltway.

How could a Depression-era case about the constitutionality of a certificate of public convenience and necessity be relevant to environmental law today? Well, there is a lot of discussion about ice manufacturing, which some might argue is relevant to climate change.

The fiscal year 2018 budget blueprint released by the Trump administration on March 16, 2017, proposes to zero out funding for the Chemical Safety Board (CSB or the Board). Elimination of CSB funding would reduce federal government expenditures by approximately $12 million annually.

You’ve likely heard that just hours after the inauguration, White House Chief of Staff Reince Priebus issued a Memorandum for the Heads of Executive Departments and Agencies captioned “Regulatory Freeze Pending Review.” The so-called Regulatory Freeze Memo sought to freeze midnight actions by the Obama administration. In response to President Trump’s freeze actions and expected regulatory reforms, California lawmakers are seeking to issue their own “freeze” to ensure regulations in place just before the transition remain effective in California. On top of that, California legislators have been introducing a series of bills designed to “insulate the state from dangerous rollbacks in federal environmental regulations and public health protections,” including:

• SB 49, entitled The California Environmental, Public Health, and Workers Defense Act of 2017, related to retaining all pre-Trump environmental regulations.
• AB 1646, related to website posting of petroleum refinery risk management plans (RMP) on public agency websites and establishment of emergency notification equipment.
• AB 1647, related to air monitoring for petroleum refineries.
• AB 1648, related to increasing CalOSHA’s refinery inspection resources.
• AB 1649, related to codification of Governor Brown’s Refinery Task Force.
• SB 584, related to speeding up the RPS 50 percent renewable goal by five years and setting a new 100 percent renewable goal at 2045.

In June 2016, Congress did something it had not done in over a quarter century: it enacted comprehensive, bipartisan revisions to a major environmental statute. More specifically, it substantially overhauled the Toxic Substances Control Act, or TSCA, a law that was first passed in 1976 and was widely considered to be in need of an update. The TSCA reform law, also known as the Lautenberg Act, expands EPA’s role in reviewing new chemical substances; gives EPA new authority to require testing of chemicals; and directs EPA to prioritize, evaluate and regulate the risks from existing chemicals. It also imposes strict deadlines on EPA for carrying out its new duties under TSCA.

And EPA has apparently taken these deadlines to heart.

Since 2013, EPA’s enforcement office has been promoting an initiative it terms Next Generation Compliance. In common parlance, the term “next generation” refers to the next stage of development or version of something. The term inherently suggests improvement – a better mousetrap, for example. Who would object to such progress? Several recent applications of EPA’s “Next Gen” strategy illustrate that, as with most things in life, the devil is in the details.

On February 28, 2017, President Trump signed an Executive Order (EO)  that sets into motion a process for the Administrator of the Environmental Protection Agency (EPA) and the Assistant Secretary of the Army for Civil Works (jointly, the “Agencies”) to review the Obama Administration’s Waters of the US (WOTUS) Rule.  80 Fed. Reg. 37,054 (June 29, 2015). The EO directs the Agencies to review the WOTUS Rule for consistency with the Clean Water Act (CWA) and the policies set forth in the EO, stating that “[i]t is in the national interest to ensure that the Nation’s navigable waters are kept free from pollution,” while at the same time “promoting economic growth, minimizing regulatory uncertainty, and showing due regard for the roles played by Congress and the States under the Constitution.”  Following review, the EO instructs the Agencies to publish, as appropriate, a proposed rule for notice and comment rescinding or revising the WOTUS Rule.

Congress has been working diligently on comprehensive tax reform proposals to be passed through the budget reconciliation process following passage of the 2018 budget resolution. Lowering the corporate and individual tax rates will require offsets like repealing certain tax credits available to corporations. What is unclear is whether repeal of some tax credits might be retroactive in effect, which would raise arguments of unfairness for companies that have detrimentally relied on current law.

On January 11, 2017, the US Environmental Protection Agency (EPA) published a proposed rule pursuant to Section 108(b) of the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA or Superfund), mandating extensive and costly financial assurance requirements applicable to the hardrock mining and mineral processing industry. On the same day, EPA also announced plans to commence rulemaking to consider similar requirements for additional classes of facilities in the petroleum and coal, chemical manufacturing, and electric power generation, transmission and distribution sectors. Both proposals derive from a series of lawsuits culminating in a “sue and settle” order of the DC Circuit Court of Appeals affirming a schedule agreed to between EPA and various environmental groups to issue financial assurance regulations.