On Tuesday, July 6, CEI submitted comments on the Environmental Protection Agency’s (EPA) reconsideration of Part One of the Trump administration’s Safer Affordable Fuel-Efficient Vehicles Rule (SAFE 1). The EPA’s objective is to build a case for “rescinding” SAFE 1 (86 FR 22428). CEI strongly supports SAFE 1. Our comments urge the EPA to leave it in place.
SAFE 1, finalized on September 27, 2019, is a joint rulemaking of the EPA and the National Highway Traffic Safety Administration (NHTSA). The rule interprets and implements two federal preemption statutes. Section 32919(a) of the Energy Policy and Conservation Act (EPCA) prohibits states from adopting or enforcing laws or regulations “related to” fuel economy standards. Section 209(a) of the Clean Air Act (CAA) prohibits states from adopting or enforcing motor vehicle emission standards.
However, CAA Section 209(b) makes a big fat exception for California. The EPA “shall” waive preemption for California if its standards, “in the aggregate,” are at least as protective as the corresponding federal standards. On the other hand, “no such waiver shall be granted” if the EPA administrator finds that California does not “need” such standards to meet “compelling and extraordinary conditions.”
In SAFE 1, NHTSA determined that EPCA 32919(a) preempts California’s greenhouse gas (GHG) motor vehicle programs, specifically, the state’s tailpipe carbon dioxide (CO2) emission standards and zero-emission vehicle (ZEV) mandates. The EPA, for its part, withdrew portions of a January 2013 preemption waiver that purported to authorize those policies.
The EPA based its decision on two separate grounds. First, it determined, citing NHTSA’s regulatory codification of EPCA’s preemptive effect, that the January 2013 CAA preemption waiver was “invalid, null, and void” (84 FR 51328). The EPA also concluded, based on a lengthy review of the text, structure, and legislative history of CAA Section 209(b), that California does not need its GHG motor vehicle standards to “meet compelling and extraordinary conditions” (84 FR 51328-51350).
For reasons of space, this post does not discuss the arcane dispute over how to interpret CAA Section 209(b)’s waiver denial criteria. The focus here is on the EPA’s statements relating to the threshold inquiry: whether EPCA 32919(a) prohibits California’s CO2 tailpipe standards and ZEV mandates.
Nothing to See Here (EPCA Preemption)
The EPA requests comment on several issues but not on SAFE 1’s core argument that EPCA 32919(a) automatically voids state policies that regulate or prohibit CO2 tailpipe emissions.
Only once (86 FR 22429) does the EPA obliquely invite comment on EPCA’s preemptive effect: “Because EPA [in SAFE 1] relied on NHTSA’s regulation on preemption, what significance should EPA place on the repeal of that regulation if NHTSA does take final action to do so?” The prior question—what significance the EPA should place on EPCA preemption if NHTSA, in SAFE 1, got it exactly right—is not asked.
One might assume that NHTSA, in its reconsideration, would tackle the merits of SAFE 1’s EPCA preemption argument head on. Surprisingly, NHTSA says even less about it than the EPA does. Instead, NHTSA proposes to delete what it declines to debate.
Indeed, NHTSA proposes to withdraw not only SAFE 1’s regulatory text and the associated preemption analysis, but also all similar utterances in previous rulemakings going back to 2003 or earlier (86 FR 25982). Note that the regulations codified by those rules expired long ago and were not based on preemption language in the first place. This plan to withdraw all previous instances of NHTSA’s consistent view of EPCA preemption, while offering no reasoned rebuttal or alternative interpretation, is quite novel. We appear to be witnessing the birth of regulatory cancel culture.
When someone refuses to rebut an argument on the merits, it is typically a sign that he cannot do so. Here are the bare bones of the EPCA preemption argument the agencies decline to engage:
- EPCA 32919(a) prohibits states from adopting or enforcing laws or regulations “related to” fuel economy standards.
- California’s tailpipe CO2 standards are physically and mathematically “related to” fuel economy standards. An automobile’s CO2 emissions per mile are directly proportional to its fuel consumption per mile. If an agency regulates tailpipe CO2 emissions, it also regulates fuel economy, and vice versa (84 FR 51313).
- The Congress that enacted EPCA in 1975 understood the scientific relationship between CO2 emissions and fuel economy. That is why it approved the EPA’s procedure of testing fuel economy by measuring tailpipe CO2 emissions (83 FR 43234; EPCA 503(d)(1)).
- In addition, tailpipe CO2 standards are fleet average standards, just like the fuel economy standards they mimic, and unlike tailpipe emission standards for criteria and toxic air pollutants, which apply to each vehicle. Tailpipe CO2 standards and Corporate Average Fuel Economy (CAFE) standards are “two sides (or, arguably, the same side) of the same coin” (83 FR 43327).
- California’s ZEV mandates also have a substantial impact on corporate average fuel economy. As ZEV mandates tighten, fleet-average fuel consumption per mile decreases, and fleet-average fuel economy increases. Thus, EPCA also expressly preempts state ZEV mandates.
- Preemption statutes derive their authority from the Supremacy Clause (Article VI, Clause 2). All constitutionally valid federal statutes “shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary notwithstanding.” Per the Supreme Court, “It is basic to this constitutional command that all conflicting state provisions be without effect.” Per the Ninth Circuit, preemption statutes void conflicting state policies ab initio—from the moment those policies are adopted or enacted, not when a court later rules on the conflict.
- EPCA 32919(a) envisions no exceptions, does not even allow equivalent or identical state regulations, and provides no authority to waive preemption of state laws or regulations. Moreover, the statute preempts any state law or regulation merely “related to” fuel economy standards. It is difficult to imagine a clearer, broader, or more categorical preemption.
SAFE 1 also argues in detail that EPCA 32919(a) implicitly preempts California’s GHG motor vehicle standards because those policies interfere with the fuel economy system Congress created. For example, the 2007 Energy Independence and Security Act (EISA) amended EPCA to prohibit NHTSA from considering the fuel economy of alternative vehicles (including electric vehicles) when setting CAFE standards (see 49 U.S.C. 32901 and 32902). The amendment aims to ensure that CAFE standards never become so stringent automakers must sell EVs to comply. Mandating EV sales is the very purpose of California’s ZEV program, which logically culminates in banning sales of gasoline-powered vehicles.
The EPA and NHTSA’s reconsiderations do not engage any of those points on the merits.
Dancing Around EPCA Preemption
The EPA invites comment on several “issues” that supposedly warrant rescinding SAFE 1 and restoring California’s waiver.
One such issue is “the time elapsed” between the final SAFE 1 Rule and the EPA’s 2013 waiver decision and the “associated reliance interests” of states that had incorporated California’s GHG standards into their plans to meet national air quality standards (86 FR 22422).
Time elapsed is a frivolous objection. The time elapsed between the 2013 waiver and the final SAFE 1 Rule was six years—less than the two terms of the Obama presidency. If six years locks a policy in place and puts it beyond revision or repeal by the next administration, elections no longer matter.
As for reliance interests, all government programs, including the most wasteful, inefficient, and duplicative, create reliance interests. Unlawful bureaucratic power grabs do so as well. If the creation of reliance interests is enough to legitimize unlawful policies, accountable government under the rule of law is dead. Do citizens have no “reliance interest” in constitutional government?
The EPA seems not to notice that usurpations damage or destroy as well as create reliance interests. The Obama administration’s 2010 motor vehicle rule, which purported to establish one national program jointly administered by the EPA, NHTSA, and California Air Resources Board (CARB), required automakers to surrender their legal right to challenge CARB’s waiver authority (75 FR 25328). That was a right on which they previously relied.
Consumers also have reliance interests. They rely on marketplace competition to expand vehicle choice and to make cars more affordable. CARB’s vehicle electrification crusade runs directly counter to that reliance interest.
The EPA observes that, before SAFE 1, the agency “consistently declined to consider other potential bases for denying a waiver such as Constitutional claims or the preemptive effect of other Federal statutes” (86 FR 22432). The implication here is that because the EPA’s action in SAFE 1 was unprecedented, it must also be unlawful.
Not so. Unprecedented usurpations call for unprecedented corrections. Prior to the July 2009 waiver for California’s GHG motor vehicle standards, the EPA never authorized state motor vehicle standards expressly prohibited by Congress. Prior to the May 2009 “historic agreement” between the White House, CARB, and automakers, no administration had colluded with California under a vow of silence to circumvent EPCA preemption. Prior to the 2010 motor vehicle rule, no EPA or NHTSA rulemaking forbade automakers to challenge California’s authority in court.
The EPA cites the D.C. Circuit’s opinion in Motor & Equip. Mfrs. Ass’n, Inc. v. EPA (1979) that “Nothing in CAA section 209 requires [the Administrator] to consider the constitutional ramifications of the regulations for which California requests a waiver.” That is correct. But not required is not the same as forbidden. The court also stated that “nothing in section 209 categorically forbids the Administrator from listening to constitutionally-based challenges.”
The court further suggested that the EPA should leave such issues to the judicial branch because “petitioners are assured through a petition for review here that their contentions will get a hearing.” In fact, however, petitioners cannot do that, thanks to the aforementioned “historic agreement” and the Obama administration’s 2010 auto rule.
When granting the January 2013 waiver, the EPA opined that it “may only deny waiver requests based on the criteria in section 209(b), and inconsistency with EPCA is not one of those criteria” (78 FR 2145). SAFE 1 deemed that inference “inappropriately broad” (84 FR 51338). CEI concurs.
Consider the common sense of the matter. Suppose bribery and extortion had been instrumental in assembling the legislative majorities that passed AB 1493, California’s motor vehicle greenhouse gas emission standards law. Or suppose CARB adopted the standards solely on its own initiative, without benefit of any authorizing legislation and in open defiance of state’s governor and lawmakers. Would the EPA still claim it must approve the standards because 209(b) does not list criminality and unconstitutionality as criteria for rejecting waiver requests? One would hope not.
Congress undoubtedly intended for the EPA to grant waivers for lawful standards. But that is the core issue here. Are California’s tailpipe CO2 standards and ZEV mandates legal under EPCA 32919(a)? If the standards are illegal, is the EPA’s only obligation to approve them? Does CAA 209(b) also obligate the EPA to ignore NHTSA’s assessment, in a joint rulemaking, that Congress prohibited those standards? Can an executive agency reasonably claim that the illegality or unconstitutionality of state actions on which it is required to deliberate are issues outside the scope of its responsibility?
The EPA does not pose those obvious questions in its reconsideration. CEI does in its comments. We look forward to seeing the agency’s response.