Yesterday the House passed the Sunshine for Regulatory Decrees and Settlements Act (H.R. 712) by a slightly bipartisan 244-173 vote. The bill targets “sue and settle” litigation, which ranks among the most harmful, yet least understood issues in contemporary energy and environmental policy.
At heart, sue and settle is an affront to federalism. Virtually all of the Environmental Protection Agency’s (EPA) regulatory programs are “cooperative federalism” regimes, meaning that Congress split the responsibility for environmental protection between state and federal governments. With sue and settle, the EPA and environmental and advocacy groups shut out the states from the policy making process. This is outrageous because states are co-sovereign governments with a congressional delegation to work with EPA on environmental protection, whereas environmental groups like Sierra Club and the Natural Resources Defense Council are ideological special interests that spend untold resources on manipulating both the legal process and electoral politics.
In practice, sue and settle is a function of two interrelated legislative devices: statutory deadlines and citizen suits.
It starts with a surfeit of statutory deadlines. During the early 1970s, when Congress passed most of the EPA’s enabling statutes, lawmakers tried to micromanage the agency by including thousands of date-certain duties in these laws. Unfortunately, the agency has a woeful record achieving these deadlines. For example, in a recent study, I found that the EPA missed 98 percent of its 200 most important Clean Air Act deadlines since 1994. On average, the agency was more than five years late on these deadlines, so it’s not like the agency was even coming close.*
In a vacuum, the EPA’s refusal to perform its statutory deadlines wouldn’t be a problem. However, all of the agency’s authorizing laws include provisions that allow any individual or group to sue the government in order to force the EPA to perform its nondiscretionary duties—such as a missed deadline. These so-called citizen suits were another brainchild of the early 1970s. Back then, Members of Congress envisioned actual citizens pressing the agency. In reality, these suits are overwhelmingly brought by a handful of environmental special interests.
So, the agency is out of compliance with all of its deadlines, and environmental special interests can sue to compel the agency to meet these missed deadlines. In a typical sue-and-settle lawsuit, the agency refuses to contest such an agency-forcing suit, and instead engages in settlement negotiations with the plaintiff. During the Obama administration, states and regulated entities have been cut out of the negotiations. In a number of cases, the EPA and the green groups have litigated to prevent states from intervening in the suit. The settlement is then approved by a federal district court judge, whereupon it gains the force of law.
Sue and settle is a major problem because giving priority to the EPA’s responsibilities is policymaking. Under the Clean Air Act, the EPA should be setting policy with its partners, the states. However, with sue and settle, the agency has been making policy with environmental special interests to the exclusion of states.
H.R. 712 would mitigate the worst ills wrought by sue and settle shenanigans. The legislation would:
- Require the EPA to give notice of potential sue-and-settle litigation, in order to alert states about the possibility of participating;
- Require courts to look favorably upon motions to intervene in sue-and-settle lawsuits;
- Place negotiations pursuant to deadline citizen suits under the auspices of a third party (this provision prevents the EPA and green special interests from excluding from negotiations an intervening party to the suit);
- Require the EPA to publish any negotiated settlement in the Federal Register for notice and comment.
For more on sue and settle:
- I chronicle the legislative history of sue and settle in this law review.
- In this post, I explain another possible reform for sue and settle: culling statutory deadlines.
- The Government Accountability Office (GAO) recently wrote a report absolving the EPA of any sue-and-settle abuse; here, I explain why the GAO study is wrong.
- I participated on a team that produced Regulating behind Closed Doors, an overview of sue-and-settle published by the U.S. Chamber of Commerce.
*Note 1: The EPA and its defenders claim that the agency’s failure is attributable to a lack of congressional appropriations, but this rings hollow when one considers that the agency currently is focusing its available resources on climate regulations, which are discretionary—that is, the agency was not required to pursue its major climate rules like the Clean Power Plan and the Carbon Pollution Standards. Rather, the agency volunteered its resources to these ends. Meanwhile, it has continued to ignore its non-discretionary responsibilities assigned by Congress.