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“Unfunded Mandates” Hearing to Take Up Ozone Rule Costs to Communities

06/07/2016

The Senate Environment and Public Works Committee (EPW) has asked local elected officials to share their views on the controversial new federal ozone standard today at a hearing entitled, “Oversight of EPA Unfunded Mandates on State, Local, and Tribal Governments.”

The new National Ambient Air Quality Standards (NAAQS) for Ozone, adopted by the Environmental Protection Agency (EPA) last October, has drawn widespread bipartisan opposition from federal, state, and local elected officials, as well as editorial boards, business and industry groups, and others who warn that the costs of the rule far outweigh any apparent benefits of dropping permissible ozone concentrations in ambient air from 75 parts per billion (ppb) to 70 ppb.

Witnesses at the hearing are set to bring concerns about the standard to a national stage. Chief among those expected to testify at the hearing is Berks County, PA, Commissioner Christian Leinbach, who knows all too well how the lower standard will impact his community.

The Center for Regulatory Solutions (CRS), a project of the Small Business and Entrepreneurship Council, interviewed Leinbach last fall before EPA made their final decision. At the time he said the lower ozone standard would likely stifle job creation, slow economic development, and jeopardize transportation projects for the Keystone State. He focused in on Berks County, a part of the state that EPA was slated to reclassify as fully compliant with the 75 ppb standard, but has now been thrust into uncertainty under the new rule. As Commissioner Leinbach previously told CRS:

With ozone levels steadily declining and our region, as well as much of the Commonwealth, close to compliance with EPA’s current regulations, an even stricter ozone standard is premature at best and is little more than regulatory overreach that’ll kill jobs. Berks County relies heavily on manufacturing jobs and nonattainment will result in the EPA holding up permitting decisions for plant expansion and could even threaten highway funding. EPA needs to reject this unnecessary regulation that’ll come at great cost with little environmental benefit and move back toward some level of common sense.

EPW also invited the National Association of Counties (NACo), a group representing a majority of county governments across the nation. Previously, NACo warned of the threat the lower standard posed to transportation funding, along with the economic development costs county governments face under a nonattainment status. From NACo:

Additionally, a more stringent ozone standard challenges local governments’ ability to increase economic development within their regions. Areas designated as in nonattainment can have a more difficult time attracting industry to their counties, due to concerns that permits and other approvals will be too expensive or even impossible to obtain.

Growing Opposition to Ozone Rule

The “unfunded mandates” hearing comes amid mounting congressional opposition to the rule. Recently, bipartisan opposition to the rule gained momentum in the U.S. House when the House Energy and Commerce Committee overwhelmingly supported H.R. 4774, the “Ozone Standards Implementation Act of 2016,” sponsored by Rep. Pete Olson (R-TX) and co-sponsored by Rep. Henry Cuellar (D-TX).

This legislation proposes to give states more time and flexibility to implement the standard, and provides assistance for states that are struggling to implement the new standard. Moreover, the legislation fixes the fundamentally flawed NAAQS process by mandating that EPA review the ozone standard every ten years, instead of every five. U.S. Senators Shelley Moore Capito (R-WV) and Jeff Flake (R-AZ) introduced a companion bill to H.R. 4775. As with the House bill, the Senate bill calls on EPA to monitor the impact of foreign sources of emissions on compliance, a factor that western states, many of which will almost inevitably be thrown into nonattainment, will be grappling with as a major hurdle to achieving the new standard.

States Also Mounting Opposition to Ozone Rule

In addition to a flurry of congressional action aimed at minimizing the harm from the new standard, business groups, editorial boards, and a bipartisan list of elected officials are just a few of the others that are calling on the EPA to put the brakes on the ozone rule.

Notably, the standard has drawn the ire of prominent state Democratic elected officials such as Colorado’s Governor John Hickenlooper, who some are speculating could even be tapped as Hillary Clinton’s running mate. In March, Gov. John Hickenlooper called suspending EPA’s new ozone standard “a great idea” because of the challenges posed by background ozone levels. The governor’s comments came at a forum in Denver, where the EPA has conceded that the metropolitan area will be unable to meet the stringent new ozone standard by 2025 due to “background ozone.” From the governor:

You know, we’re a mile high. Air quality issues affect us more directly than they do at lower elevations. So we’re going to keep pushing it, we’re not going to back off, we’re going to continue to improve the air quality in the state every year if I have anything to say about it, but at the same time, those standards, you know, to be punitive when you’re working as hard as you can … to get cleaner air as rapidly as you can, it seems like it’s not the most constructive stance.

Colorado has seen strong bipartisan opposition to the ozone rule where both of the state’s top elected Democrats, Gov. Hickenlooper and U.S. Senator Michael Bennet, have joined a growing bipartisan list of state and local elected officials in opposition to the rule.

But Gov. Hickenlooper’s comments also reflect the concerns of state air regulators from Texas, California, Arizona, and Utah who testified at an Energy and Power Subcommittee hearing in April on H.R. 4775. The state air regulators called for a delay in implementation and noted that the EPA is unprepared to take background ozone into account when implementing the standard. One witness told the committee that due to background ozone, EPA’s new ozone standard will unfairly punish communities due to “air pollution they did not create and that the state cannot regulate.” Similar concerns were raised by state air regulators at a two-day workshop in February in Phoenix, Arizona.

Consensus: New Ozone Rule Will Not Work

Consensus is growing in Washington D.C. and across the United States that EPA went too far when it lowered the permissible level of ozone to 70 ppb. With the committee hearing today set to highlight the costs these communities face as a result of the rule, it is just the latest in what has become a drumbeat of bad news for the federal ozone standard. It is increasingly obvious that it is up to Congress and the Courts to rein in the agency before the regulation starts to impose consequences on communities that cannot afford to bear the brunt of this new federal regulation.