Regulatory agenda at EPA attracts legal attention
The deregulatory agenda for energy and environmental rules by the Trump administration and the Environmental Protection Agency will likely end up in a familiar place: court.
That was the message at a recent legal seminar hosted by the Oklahoma City law firm Crowe & Dunlevy. The seminar featured U.S. Rep. Tom Cole, R-Moore, who gave a wide-ranging update on Congressional matters in the first 100 days of the Trump presidency.
“This is a really big time for both the president and the Republican Party,” said Cole, a historian and former political consultant. “If we don’t deliver, we won’t be in the majority. Nobody has had a good offyear election since 2002. We got clobbered in 2006 and lost the (House) majority we had for 12 years. The Democrats got clobbered in 2010 and lost a majority they held for only two years.”
Trump and his pick to run the EPA, former Oklahoma Attorney General Scott Pruitt, have talked about returning EPA to its core mission and away from the activist tilt they said the agency had under the Obama administration.
Cole said about half of the suggestions from industry for deregulatory action involve the EPA in some way.
“Our friend Scott Pruitt is going to be a very, very, very busy guy,” Cole said.
Changes in presidential administrations are always fraught with uncertainty, but longtime regulatory watchers said the natural “pendulum swing” from one party to another is different this time.
“There is a lot going in Washington,” said Don Shandy, a director at Crowe & Dunlevy. “The president switched parties multiple times and so consequently, people just don’t know how to figure this out. That’s really moving a lot of different issues and people to do certain things that are a little bit surprising.”
Part of that is because Trump came to Washington with no policy track record other than what he said on the campaign trail. The certainty craved by business interests on regulatory matters hasn’t yet emerged, said Erin Potter Sullenger, an associate in the firm’s environmental, energy & natural resources practice group.
EPA budget cuts
Trump’s budget proposed a 31 percent cut for the EPA in the next fiscal year. It’s unlikely Congress will go along with that large of a cut, but most are expecting some kind of budget decrease, Potter Sullenger said.
“What this will mean is that the states will have to pick up a lot of the slack,” Potter Sullenger said. “If you’re not familiar with environmental laws, you might think, ‘how can they do that?’ But that’s through delegated authority, where the EPA has looked at state programs. States can have stricter standards, they just can’t go looser than the national standard. That’s where you could see some patchwork happening.”
Potter Sullenger said EPA will likely change course in some of its enforcement priorities program, which is announced on a threeyear cycle. The Obama administration focused on “blockbuster cases” that resulted in large fines for certain companies to make them an example to others in their industry. Last year, it emphasized new methane emissions rules for oil and gas operators and continued to defend the socalled Waters of the United States, or WOTUS, rule.
“Had Hillary Clinton won, I think you would have seen stronger enforcement in these areas,” Potter Sullenger said. “Now, in this administration, they’re actually going back and taking second looks at these rules and rewriting the rules of the game.”
“As budget cuts happen and enforcement activities fall or become more narrow or focused, your blockbuster cases might not get the attention they ordinarily would at a full budget situation,” Potter Sullenger said.
EPA sued frequently
LeAnne Burnett, shareholder and director at the firm, said the EPA always gets sued, no matter who is in power in Washington. Typically, under Democratic administrations, the agency gets sued by industry looking to slow down or overturn new rules. Under Republicans, it’s sued by environmental groups.
“We saw in the Obama administration, any kind of new policy that came in, whether it was strengthening environmental laws or not, was often met with some stakeholder suing the Obama administration in court,” Burnett said. “I think you’re going to continue to see that. You may just see the people who challenge it will shift from industry challenging a regulation they considered as overreach to the NGOs (nongovernmental organizations), the Sierra Clubs, etc. Make no mistake. They have the money, and they are anticipating this.”
Shandy said some lobbyists in Washington have proposed simply defunding certain regulations. But he said the statute of limitations on EPA enforcement actions is five years, so if a new president comes into office in 2021, that administration could potentially take things in the opposite direction.
“Someone told me, ‘Yeah, we’ve watched the pendulum swing and the problem is, the pendulum flew off the clock, busted the window and is outside somewhere.’ That’s good in a way, because it promotes some change.
“I think some folks in the oil and gas industry would agree that change needs to occur, but thoughtful change. They don’t want to see the pendulum fly off the clock and in the street. They want to know where the ditches are. Certainty is a really important deal.”