Clearing the air on regulatory excess
By Ben Lieberman
Copyright 1999 Washington Times
May 19, 1999
The Clinton
EPA's biggest regulatory victory was turned into its biggest legal
defeat last
Friday, as the U.S. Court of Appeals for the District of Columbia
invalidated
the agency's 1997 rules tightening the air quality standards for
ozone and
particulate matter. Beyond throwing out these costly and
unnecessary rules,
arguably the most objectionable ever enacted by the agency under
the Clean Air
Act, the court's decision in American Trucking Associations et al.,
vs.
EPA could have broader implications for the future of the federal
regulatory
state.
EPA's attempt to simultaneously revise the already strict
existing ambient air
quality standards for ozone and particulate matter (smog and soot),
represented
a number of firsts in the 30-year history of the Clean Air Act. It
was the
first time the agency ignored its own Clean
Air Scientific Advisory Committee, which generally concluded that
the new
standards would not substantially improve public health and did not
endorse
them. In the case of the ozone standard, it was the first time the
agency went
ahead with a rule that, according to its economic analysis, would
impose annual
costs in excess of
benefits - by as much as $8 billion dollars under one set of
assumptions. The new rules were also a
first in terms of the breadth and degree of opposition they
engendered. Not
just the usual big industry suspects, but representatives of small
businesses,
state and local governments, and interests as diverse as the
National Conference of Black Mayors and the American Farm Bureau
Federation
came out strongly against these measures and the titanic costs they
would
impose.
In Congress,
EPA's actions drew a level of bipartisan opposition unprecedented
for clean air
rules, including vehement resistance from John Dingell,
Michigan Democrat, one of the architects of the 1970 Clean Air Act
amendments
under which
EPA claimed its authority to regulate. Nonetheless, in a sign of
the Republican
majority's timidity on environmental matters, both the House and
Senate bills
to repeal the new rules never came to a vote.
Republican leaders, though they likely had a majority in support of
repeal,
withdrew the bills because of uncertainty that they could muster
enough votes
to override a presidential veto.
With no other recourse, nearly 40 of the entities opposed
to the new rules
filed suit in September 1997. The D.C. Circuit's
decision, released last Friday, vindicated many of their concerns,
and sent
shock waves throughout the regulatory community.
Most significantly, the court held that
EPA construed the Clean Air Act's provisions
"so loosely as to render them unconstitutional delegations of
legislative power." In other words, the agency's new
rules are so unbounded that they constitute legislation, not
regulation.
However, there is a crucial distinction between these two.
Legislation is the
function of Congress, not agencies. Congress can, if it chooses,
empower an
agency to carry out some well-defined duties, but it cannot empower
unelected
bureaucrats to simply enact whatever laws they think best.
Under the relevant section of the Clean Air Act,
EPA must set air quality standards that, by
"an adequate margin of safety, are requisite to protect the
public health."
EPA expansively interpreted this provision as meaning it could
simply
tighten existing standards to any new level it chose. However, the
court took
exception to the lack of any
"intelligible principle by which to identify a stopping
point." Indeed, the court concluded that the agency never
adequately explained why
even stricter new standards should not be adopted, or, for that
matter, what
was
wrong with the existing ones.
In this regard,
EPA's actions are not unlike any of a number of other
environmental, public health,
or other congressionally created goals that federal regulators are
chasing by
mindlessly cranking out successively tighter rules. Thus, the
implications of
this case could be far-reaching.
Rather than
strike down the Clean Air Act, the court is going to give
EPA the chance to fix the constitutional infirmity in its rules by
coming up with
the necessary
"determinate, binding standards for itself." If it tries
to do so, however,
EPA would probably have to admit what its critics inside and
outside the agency
have said
all along that its new rules are pursuing vanishingly small
marginal returns.
Other parts of the opinion indicate the court took a hard
look at
EPA's new rules in light of its statutory obligations, rather than
simply deferring
to agency expertise. In many instances, it
found the agency's reasoning wanting. For example, despite the
clear language
in the Clean Air Act obligating
EPA to consider
"all identifiable effects on public health or welfare"
when setting ambient air quality standards, the agency tried to
ignore the
adverse health effects that would be caused
by the new ozone rule.
Atmospheric ozone has both detrimental and beneficial
health impacts - on the
one hand, it contributes to smog in the lower atmosphere, but on
the other it
acts as a filter against excessive ultraviolet B radiation (UVB)
reaching
ground
level. Ironically,
EPA did not take into account the health implications of the latter
in setting its
supposedly health-based standard. The court threw out as
"bizarre"
EPA's attempt to get away with considering only
"one half of a substance's health effects in determining the
maximum level
for that substance."
The
EPA has indicated that it will file an appeal. Even if
unsuccessful, the agency
can start over and try to promulgate new ozone and particulate
matter rules
that avoid the problems pointed out by the court. Thus, the battle
is far from
over. Nonetheless, the D.C. Circuit has struck
a very important blow for regulatory accountability, and given a
warning to
overzealous regulators that business as usual may be coming to an
end.
Ben Lieberman is a policy analyst with the Competitive
Enterprise Institute.
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