Eight Years and $743 Billion Later

By Robert T. Vogler, Valley Proteins Inc.

Editor’s note – Robert T. Vogler is director of environmental affairs at Valley Proteins Inc. and chairman of the National Renderers Association’s Environmental Committee. He holds a juris doctor degree from Duquesne University and bachelor of science degree in agricultural engineering and agricultural science from Rutgers University.

Since 2009, the United States (US) federal government has issued 600 major regulations resulting in $743 billion in compliance costs, according to a study by the American Action Forum, including 81 major rules costing $100 million or more – or one major rule for every three days the federal government is open. Many of these rules, particularly the larger and more complex ones, focus on environment.

Today, the Environmental Protection Agency (EPA) continues to expand the scope of federal regulation. Below are updates on significant developments in air, water, and other national environmental initiatives of importance to the rendering industry.

Chesapeake Bay Blueprint
On February 29, 2016, the US Supreme Court turned down a request by the American Farm Bureau Federation to hear its challenge against EPA’s approach to regulating the watersheds in Delaware, Maryland, New York, Pennsylvania, Virginia, West Virginia, and the District of Columbia that contribute phosphorous, nitrogen, and sediment to the Chesapeake Bay. As a result of the denial, the July 2015 ruling by the US Third Circuit Court of Appeals stands, upholding EPA’s process for establishing and implementing Total Maximum Daily Loads (TMDLs) for the Chesapeake Bay, a process known as the Chesapeake Bay Clean Water Blueprint.

A TMDL is a tool used for achieving water quality standards. Under a TMDL for a given waterway, a limit is set on the maximum levels of pollutants allowed in that waterway and allocations are made to potential sources of the pollutants affecting the waterway. Under the Chesapeake Bay blueprint, EPA requires states to establish and implement TMDLs throughout the affected watershed and will oversee progress by the states toward achieving those goals under threat of backstop enforcement authority. Status reports are due in late 2016 on the progress each state is making toward meeting the TMDLs. EPA will begin setting phase III expectations in 2017.

The Chesapeake Bay blueprint is largely seen by opposition groups as a federal takeover of regulation of agricultural practices and land-use decisions, areas that were largely left to state and local regulation. Now that the courts have endorsed EPA’s approach to the cleanup of the Chesapeake Bay watershed, EPA is expected to use this blueprint for other watersheds with impaired waters, including the Mississippi watershed. In fact, EPA already has begun taking a similar approach to set nitrogen and phosphorous limits in the Malibu Creek watershed in California.

NPDES Program Update
On May 18, 2016, EPA published a proposed rule to update the National Pollution Discharge Elimination System (NPDES) permit program. The agency touted this as a “housekeeping” rule but it appears to be substantive in many respects. Changes in the rule include:

• allowing nongovernment organizations, such as advocacy groups, to collect water quality data on background levels of water pollutants to be used in NPDES permit decisions;

• treating certain administratively continued permits as proposed permits subject to EPA review, disrupting certainty and the status quo pending state issuance of a new draft permit; and

• tightening up “fact sheet” requirements prepared by state permit writers in connection with the issuance of new permits, resulting in more detail on analysis and justification for issuing permits.

Waters of the US
On May 27, 2015, EPA finalized the rules revising the definition of “waters of the US,” greatly expanding EPA’s jurisdiction over activities in wetlands, intermittent streams, drainage ditches, and upland areas. This was purported to clarify the scope of federal jurisdiction over upland and isolated waterways but is widely seen as a huge power grab by EPA and the US Army Corps of Engineers over waters and land areas already subject to state regulation.

Lawsuits have been filed by manufacturing and agriculture groups, as well as most of the states, challenging the rules as going beyond the statutory authority of the agencies. In October 2015, the US District Court for the Sixth Circuit issued a nationwide stay from EPA enforcement of the new rule. The legal challenges continue to work their way through the courts. If upheld, the rule is expected to adversely affect cattle ranchers and other agricultural endeavors, including rendering, as well as virtually any type of land development activity.

Ozone Standard
On October 1, 2015, EPA adopted a new National Ambient Air Quality Standard for ground-level ozone, lowering the standard from 75 parts per billion (ppb) to 70 ppb. Ground level ozone, or smog, is associated with respiratory ailments. The new standard will bring a large portion of the expanding, robust economic areas of the country into non-attainment, making the expansion of industry in those areas nearly impossible. In addition, existing permits could be reopened to require further reductions at existing facilities.

The effect of the rule is to further restrict emissions of nitrous oxides and volatile organic compounds as they are precursors to ozone. A coalition of business interests filed a lawsuit challenging the rule in the US Court of Appeals for the District of Columbia Circuit. This suit remains pending.

On June 14, 2016, the US House of Representatives (HR) passed the Ozone Standards Implementation Act of 2016 (HR 4775) by a vote of 234-177. Among other things, this bill would extend implementation deadlines, including nonattainment designations, to 2025 and reduce the frequency of periodic review of the standard from every five years to every 10 years.

Endangered Species
On February 11, 2016, the US Fish and Wildlife Service (FWS) rulemaking on critical habitat became final expanding critical habitat designations to include areas in which a species no longer lives and areas where a listed species may live in the future. On May 24, 2016, the National Oceanic and Atmospheric Administration (NOAA) National Marine Fisheries Service issued a proposed rule designating nearly 1,000 miles of river in nine states from Maine to Virginia and the District of Columbia as critical habitat for the Atlantic Sturgeon, a listed species under the Endangered Species Act.

A critical habitat designation requires federal agencies to ensure any projects they fund, authorize, or carry out are not likely to destroy or adversely modify that habitat. This does not apply to private citizens engaged in activities on private land that do not involve a federal agency. Affected activities include dredging, piers, barge unloading operations, bridge and transportation projects, wetlands development, commercial and recreational uses of the water, wastewater treatment, and water withdrawals. These types of projects will need to be evaluated with respect to the potential to destroy or adversely modify critical habitat if the project requires a federal permit or receives federal funding.

Indirect impacts to the rendering industry include the costs, delays, and complexities added to new infrastructure projects such as highways, water and sewer systems, and port improvements. A likely trigger for direct impact on a rendering operation would be any disturbance of wetlands or streambeds, such as construction or other development activities in or near the water.

However, there should always be a level of concern about the presence of endangered species in a project area. Even absent a federal project, no one may take, threaten, or harass an endangered species. So if endangered species are present on a project site, certain activities may be restricted by the Endangered Species Act, which provides for the “protection” of over 1,600 species.

With nearly 300 new species added during President Barack Obama’s administration, some observers suggest the goal of the act as currently being implemented is to list species rather than provide for protection and recovery. Advocacy groups have been filing petitions for large numbers of new listings and then seeking court-ordered deadlines for action under a “sue and settle” process.

In response, on September 27, 2016, FWS and NOAA published a final rule limiting each petition to a single species and requiring more rigorous scientific background to support a listing. As more species are listed under the Endangered Species Act and as the definition of critical habitat is broadened, it becomes much more likely that any development project could be affected by federal or state endangered species restrictions.

President’s Regulatory Legacy
Obama’s eight years in office have been marked by aggressive government rulemaking. The New York Times stated that he has “reshaped the nation with a sweeping assertion of executive authority and a canon of regulations that have inserted the United States government more deeply into American life.”

In addition to the new rules discussed above, other noteworthy new environmental regulations released since 2009 include:

• Clean Power Plan – Known as the takeover of the electrical power industry by EPA, this plan, if upheld by the courts, inserts the agency into the role of regulating power production and distribution, including the energy fuel mix of power generation, a role traditionally assumed by the states.

• Regulation of greenhouse gases – This ruling added greenhouse gases commonly found in nature to the list of regulated pollutants, expanding the potential reach of the Clean Air Act to nearly every boiler and restricting the use of certain fuels.

• Subpart JJJJJJ National Emissions Standards for Hazardous Air Pollutants for boilers located at area source facilities effectively restricts the use of fuels other than natural gas in industrial boilers.

These rules are part of a shift from a relationship of cooperative federalism – where federal and state governments work as partners to protect the environment – to one of coercive federalism where EPA imposes its will on the states and regulated community, leaving the states with no choice but to implement according to EPA mandates.

December 2016 RENDER | back