July 1, 2011

DC CIRCUIT COURT VACATES EPA GUIDANCE DOCUMENT

James Holtkamp – UMA Air Quality Advisory Committee Chair
Attached is a DC Circuit opinion issued today vacating an EPA guidance document on ozone because, among other things, EPA violated the federal Administrative Procedure Act and the Clean Air Act by not going through public notice and comment. I continue to be in awe of EPA’s brazenness in ignoring decision after decision of the federal courts regarding use of guidance as surrogates for rulemaking.

This issue has continuing relevance here in Utah, not only with regard to the Unavoidable Breakdown Rule SIP Call, but also the expected rejection of the Regional Haze SIP.

Opinion for the Court filed by Circuit Judge TATEL.

TATEL, Circuit Judge: Yet again we face a challenge to the Environmental Protection Agency’s regulation of ozone under the Clean Air Act. At issue this time is an EPA “guidance document” addressing obligations of regions still in nonattainment of a now-revoked ozone air quality standard. Petitioner argues that the Guidance amounts to a legislative rule issued in violation of the Administrative Procedure Act’s notice and comment requirement and that its substantive content is contrary to law. Firing nearly all the arrows in its jurisdictional quiver, EPA argues that petitioner lacks standing; that the Guidance does not qualify as final agency action, and that petitioner’s claims are unripe for judicial review. As we explain in this opinion, all three arrows miss their target. On the merits, we conclude that the Guidance qualifies as a legislative rule that EPA was required to issue through notice and comment rulemaking and that one of its features—the so-called attainment alternative—violates the Clean Air Act’s plain language. We therefore grant the petition for review and vacate the Guidance.

U.S. MANUFACTURING IMPROVES IN JUNE

Today in Manufacturing
There were more orders and employment picked, but index remains markedly lower than it was earlier this year, suggesting that recovery is weak ... continue

OBAMA TAX PLAN UPSETS CORPORATE JET MAKERS

Today in Manufacturing
Industry behind corporate jets says proposal to eliminate tax break encouraging businesses to purchase the planes will hurt economy and cost jobs ... continue

REPORT: NATIONWIDE WIRELESS WOULD HURT GPS

Today in Manufacturing
New test results show that a proposed nationwide wireless broadband network would produce significant interference with GPS systems ... continue

COLUMN: SOLVE YOUR EMAIL WOES WITH LEAN

Today in Manufacturing
Use the Lean principles to solve your email troubles and be and feel more efficient ... continue

FEDERAL JOBLESS TAX EXPIRING

Today in Manufacturing
Amid debate over whether higher taxes should be part of deal to reduce annual deficits, small cut in federal unemployment taxes has received little attention ... continue

CHINESE MANUFACTURING SLOWS IN JUNE

Today in Manufacturing
Chinese manufacturing slipped to its slowest pace in 28 months, sapped by inflation-fighting curbs on credit and weaker overseas demand ... continue

STAKEHOLDERS APPLAUD OBAMA'S ADVANCED MANUFACTURING SPEECH

Quick Manufacturing News
The segments of industry targeted in the speech were pleased with the direction Obama is headed. Click to continue

UTAH RANKS #1 FOR ECONOMIC OUTLOOK
Utah Business

For the fourth straight year, Utah was ranked #1 for Economic Outlook in the ALEC-Laffer Economic Competitiveness Index. The nationally recognized index is based on state economic policies and forecasts Utah’s economic leadership. “I am very pleased to see Utah again listed as leading America into economic recovery,” said Governor Gary R.
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HOUSE PASSES LEGISLATION TO PROTECT INTELLECTUAL PROPERTY AND JOBS
NAM Capital Briefing
For the first time in almost 60 years, Congress is on the verge of sending legislation to the President's desk to revamp America's patent system. Earlier this year, the Senate voted 95-5 to pass legislation; last week, the House of Representatives passed the bipartisan America Invents Act (H.R. 1249) by more than 300 votes. Click here to read the NAM's key vote letter. The House and Senate bills include long-overdue updates that will allow manufacturers in the United States to bring their cutting-edge technological breakthroughs to the marketplace faster. The legislation also will help eliminate the current costs and complexities that burden our patent system and put manufacturers in America at a competitive disadvantage. Leaders in both chambers are currently working out their differences on the two pieces of legislation, and the NAM is working to ensure the interests of manufacturers are addressed. To view a copy of the NAM's ad in Roll Call in support of H.R. 1249, click here.


HOUSE COMMITTEE PASSES BILL TO SHIFT CLEAN WATER ACT POWER TO STATES
NAM Capital Briefing
Last week, the House Transportation and Infrastructure Committee voted in favor of a bill that would alter the Clean Water Act to shift regulatory power over water, wetlands and mountaintop mining from the Environmental Protection Agency (EPA) to individual states. The Clean Water Cooperative Federalism Act (H.R. 2018) was introduced by Reps. John Mica (R-FL) and Nick Rahall (D-WV) and faced severe opposition from many Committee members, most notably Rep. Tim Bishop (D-NY), who is the ranking member on the subcommittee with jurisdiction over the Clean Water Act. This legislation will prohibit the EPA from revoking permits for mining projects and setting new water quality standards without obtaining state approval first. The bill is likely to go to the floor for a vote this summer.

EPA RESPONDS TO MANUFACTURERS' CONCERNS AND EXTENDS COMMENT PERIOD FOR PROPOSED CLEAN WATER ACT GUIDANCE
NAM Capital Briefing
On Monday, June 27, the EPA extended the public comment period for the proposed Clean Water Act Guidance for an extra 30 days. The proposed guidance would expand the definition of "waters of the United States" to include bodies of water such as drainage ditches. This would be a massive expansion of the EPA's and Army Corps of Engineers' regulatory jurisdiction. The NAM has been actively engaged on the issue and sent a request June 24 for an extension of the comment period. The new deadline for comments is July 31. To contact your legislators, please click here.

SENATE COMMITTEE PASSES CFATS REAUTHORIZATION BILL
NAM Capital Briefing
On Wednesday, June 29, the Senate Committee on Homeland Security and Governmental Affairs voted in favor of reauthorizing the Department of Homeland Security's Chemical Facilities Anti-Terrorism Standards (CFATS) program. Sen. Collins' (R-ME) reauthorization bill, the Chemical Facilities Antiterrorism Security Act (S. 473), does not include an "inherently safer technology" mandate, which would require the biggest chemical facilities to consider using less toxic, alternative chemicals. The passage of the bill through Senate committee follows the recent passage in two House committees of the CFATS reauthorization bills. The NAM believes the CFATS program is worthwhile and supports measures to reauthorize the program. The NAM, along with other companies and trade associations, sent a letter of support to the Hill.

HOUSE INTRODUCES LEGISLATION TO DELAY BOILER RULES
NAM Capital Briefing
Last week, the House Committee on Energy and Commerce introduced H.R. 2250, the EPA Regulatory Relief Act, to require the EPA to develop achievable standards for non-utility boilers and incinerators and give the Agency another 15 months to redraft the proposal. The bill also would create a longer timeline for implementation and compliance with the standards. This bipartisan measure is a direct reaction to the EPA's ongoing work to alter the Boiler MACT and Non-Hazardous Secondary Materials (NHSM) standards. Estimates of the economic repercussion of these rules include a financial cost of over $14 billion and the risk of losing more than 200,000 jobs. Currently, the Boiler MACT rule is under an administrative stay, with the exception of the NHSM rule, while the EPA reconsiders certain portions. Congressional supporters believe H.R. 2250 will give the EPA the time it needs to draft achievable and common-sense rules. The cost of the current Boiler MACT proposal will be a burden on manufacturers everywhere, and the NAM applauds Congress for taking legislative action to ensure the EPA develops realistic rules.

FTAS WILL PROMOTE JOB GROWTH AND STRENGTHEN THE ECONOMY
NAM Capital Briefing
Senate Finance Chairman Max Baucus (D-MT) announced on Wednesday, June 29, that he would hold markups of the implementing legislation for the Colombia, Panama and South Korea agreements. Sen. Baucus will include legislation on a new Trade Adjustment Assistance (TAA) program in the Korea bill and reauthorize Andean Trade Preferences and the Generalized System of Preferences (GSP) in the Colombia legislation. NAM President and CEO Jay Timmons issued a statement following Sen. Baucus's announcement, stating, "Moving the FTAs forward in an expedited fashion is critical to manufacturers who cede market share to their overseas competitors each day that these barriers exist." Senate Republican Leader Mitch McConnell (R-KY), Ranking Member Orrin Hatch (R-UT) and House Speaker John Boehner (R-OH) oppose the inclusion of the TAA. Until this is resolved, timing of the Senate Finance and House Ways and Means markups and final transmittal of the agreements to Congress for approval remains uncertain. Click here to access the NAM's Trade Toolkit, with implementing bills, fact sheets and links to the economic benefits of all three agreements.

PACIFICORP DEBATES COSTS OF EPA RULES
UAE June Newsletter
At a June 15th hearing on the Clean Air Act, several differing opinions were shared. Senate Democrats praised the EPA on pollution restriction, while Re-publicans blasted new air qual-ity rules that they say could increase electricity prices by 23% by 2020.

MidAmerican Energy Holdings Com-pany, owner of PacifiCorp, told the Senate com-mittee that forcing all U.S. coal plants to comply with new EPA rules during the short time frame proposed by the agency "will cause the costs of labor and materials for both retrofits and new generation to rise dramatically as demand for skilled labor and parts will greatly outstrip sup-ply."

Cathy Woollums, senior vice president and chief environmental counsel for MEHC, told the committee it’s hard to translate the pro-jected costs to comply with the new rules into exact percentage rate increases to electricity customers. However, she noted that Pacifi-Corp's fossil steam generation currently has a cumulative net value of about $3.38 billion.

Woollums said that because of the large number of generating units that potentially will be
affected by new EPA regulations, "deferring the installation of compliance projects places MidAmerican and our customers at risk of not having access to necessary capital, material, and labor in a compressed time frame concur-rent with other utilities."

If the timetable of EPA's rules remains unchanged, Woollums said, compliance costs will be shouldered by customers in the form of higher rates in a narrow window from 2013 to 2015.

"These increases will dramatically in-crease production costs for industrial plants and could result in job losses. Also, units pre-maturely retired in response to these EPA rules will have remaining book value issues to ad-dress," she told the committee.

Woollums said that, through 2010, Mid-American Energy Co. has spent more than $370 million in capital expenditures for required pollution control equipment under the EPA rules.

"We estimate that the total costs for all pollution control projects (defined as capital, operations and maintenance and other costs) will exceed $1.1 billion by the end of 2020," she said.

"These total costs are expected to in-crease annual costs to customers by $130 mil-lion per year by 2020."

Woollums noted that PacifiCorp has spent more than $1.2 billion in capital expendi-tures from 2005 through 2010 to comply with the EPA rules, and estimates that total capital expenditures will exceed $2.7 billion by the end of 2022.

"Total costs that will have been incurred by our customers to pay for these pollution con-trol projects during the period 2005 through 2023 are expected to exceed $4.2 billion, and by 2023 the annual costs to customers for these projects will have reached $360 million per year," she said.