Modernizing the EPA: Beyond Regulation

The Environmental Protection Agency’s (EPA) regulatory power warrants most of the attention when it comes to modernizing the agency. However, there are numerous non-regulatory programs that should be eliminated or reformed. The spending for many of these programs can help achieve objectives similar to those of unnecessary EPA regulations by getting the private sector, states, and local actors to help meet the goals of the agency.

There are some common problems with many of these programs that are not always the fault of the EPA. Congress too often gives the EPA wide discretion to spend money with insufficient guardrails, effectively creating what amounts to massive slush funds for the agency. A prime example discussed in this chapter is the EPA’s Greenhouse Gas Reduction Fund, which is a $27 billion program created through the Inflation Reduction Act (IRA). When Congress gives the EPA (or any agency) too much discretion over how to spend money, it arguably is improperly delegating its spending power to the agency.

The non-regulatory programs of concern that are discussed in this chapter also require the EPA to intrude into issues that are inherently state and local matters, such as education, or are properly addressed by the private sector, such as disseminating information to consumers. Some of these programs do not just entail routine meddling but can also influence how students think about environmental issues and how individuals meet their basic needs such as the food they eat, the places they live, and the transportation choices they make.

Beyond addressing these programs, this chapter recommends three important organizational changes at the EPA that should help reduce waste and duplication as well as help facilitate transparency, fairness, and better communication across the agency.

Key issue

Eliminate the Greenhouse Gas Reduction Fund

The Inflation Reduction Act (IRA) amended the Clean Air Act (CAA) to create a program requiring the EPA to distribute $27 billion for “green” projects. The agency was required to hand out the money by September 30, 2024. Given that the EPA will have distributed this money before the 119^th Congress is able to get it back, the elimination of the program may seem unnecessary. However, Congress amended the CAA for this program and more money could easily be appropriated again for the agency’s use.

Under the statutory language, the money is supposed to be spent for zero emission technologies ($7 billion), general assistance ($12 billion), and low-income and disadvantaged communities ($8 billion). In implementing the program, the EPA has developed three different programs, but they do not neatly mirror this statutory language.

For example, one of the three EPA-created programs is the Solar for All program. The agency is going to spend $7 billion to provide solar panels on homes in low-income and disadvantaged communities. Yet, the underlying IRA provision appropriating the $7 billion is supposed to be used on more than just solar. It states that the money should be spent on zero emission technologies, “including distributed technologies and residential rooftops.” While the agency can spend on solar, the coverage of the provision is broader in scope, with solar being a subset of what the money can be spent on. If it were supposed to be solar only, Congress would have said this.

Additionally, the EPA has created the National Clean Investment Fund ($14 billion) and the Clean Communities Investment Accelerator program ($6 billion). These two programs authorize the EPA to distribute money to nonprofits that can then distribute money to eligible recipients.

The Greenhouse Gas Reduction Fund provides significant discretion to the EPA as to how to spend the money. It acts like an EPA slush fund. However, it is even worse. It authorizes the EPA to use its slush fund to, in effect, help create slush funds for favored nonprofit organizations. In implementing the National Clean Investment Fund and the Clean Communities Investment Accelerator program, the EPA exacerbated problems by distributing money to a small number of nonprofit organizations. As a result, the selected nonprofits have billions of dollars to use with limited oversight. Five of the eight selected nonprofits will have about $2 billion or more to distribute. One organization has $7 billion and another $5 billion.

The entire program, which is implemented by the EPA’s Office of the Greenhouse Gas Reduction Fund, is rife for abuse and cronyism, especially since so much money will be disbursed by nonprofits that will be very difficult to hold accountable. During a 2024 House Committee of Energy and Commerce oversight hearing, Chair Cathy McMorris Rodgers (R-WA) stated the following regarding the National Clean Investment Fund and the Clean Communities Accelerator program:

Even more concerning, two of the fund’s programs were designed so that the EPA can funnel billions of taxpayer dollars to non-profits who happen to be their political allies that can then fund green projects of their choosing. This is the perfect scenario for cronyism to take hold.

The federal government should not be picking energy winners and losers or subsidizing projects that should be able to secure private capital on their own if they are worthy investments. Further, even for legislators who do not object to the purpose of the program, the way the program operates should be a concern for them and all legislators. The Greenhouse Gas Reduction Fund ignores the fact that Congress and not the EPA has the spending power under the US Constitution. This EPA slush fund to help create nonprofit slush funds disregards basic principles of separation of powers.

Recommendation for Congress

Congress should eliminate the Greenhouse Gas Reduction Fund.

Key issue

Eliminate environmental education programs

The EPA should focus on improving the environment and not using taxpayer dollars to help indoctrinate students or intrude into areas that states and local communities can address on their own, if they so choose. The EPA claims that environmental education “does not advocate a particular viewpoint.” Yet the choices it makes when it selects grant recipients, the issues it chooses to emphasize, and the way it evaluates award recipients tell another story.

In fairness, there is arguably no way for the agency, regardless of administration, to avoid subjective policy and ideological preferences from influencing their choices. In addition, these choices will likely be consistent with the preferences of an administration. These are additional reasons why the EPA’s environmental education programs should be eliminated. Specifically, the following should be eliminated:

Environmental Educational Grants program. According to the EPA, “Since 1992, a total of 3,960 environmental education (EE) grants have been awarded by EPA nationwide for a cumulative total of $95,104,287.” The total per year has generally been in the $2 million to $3.5 million range. The money has often gone to educate students or those serving students. Recent projects include engaging schools in climate “action” within an urban area “suffering from the ravages of climate change,” “diversifying the environmental movement,” and “empowering” people to take “environmental action.” There is also money for projects “using urban greening initiatives (e.g., tree planting, nature-based solutions, and urban gardening) to help address the impacts of climate change…” and “transforming a state-of-the-art electric bus into a roving electric classroom…”

Some of these projects reflect not just biases, but apparent efforts to build up environmental activism. This is bad enough. In addition, the hard-earned tax dollars of Americans should not be used for the EPA to fund activities like tree planting or electric bus classrooms. Some people may find such projects to be useful to students, but if they do, they should contribute their own money to make this happen. It is not something that should be the role of government, and especially not the role of the federal government.

Presidential Innovation Award for Environmental Educators. The program “recognizes outstanding kindergarten through grade 12 teachers who employ innovative approaches to environmental education and use the environment as a context for learning for their students.” This language regarding environment as a context for learning suggests incorporating the environment through a “whole-of-education” approach integrating the environment to unrelated subjects. In fact, one of the selection criteria is “How does the teacher help to integrate environmental education into the broader school curriculum or coordinate environmental education with other teachers and academic subjects?”

Teachers are evaluated in part by looking at how they use topics like “climate change,” “reducing food waste in school cafeterias,” “school gardens,” and “environmental justice” to teach about environmental sustainability. The agency can use this program as a way to push its own agenda and cover issues that hardly constitute core federal environmental concerns, such as school gardens and food waste in school cafeterias.

Additional programs that should be eliminated are the National Environmental Education Training Program, President’s Environmental Youth Award, and National Environmental Education Advisory Council.

There is no reason for the federal government to be involved in any of these educational programs. It is especially troubling when an agency, in this case the EPA, has little oversight and significant discretion to hand out money to shape the views of Americans, starting when they are young children. It could also use the money to help get them in line with the regulatory agenda of the agency.

Recommendation for Congress

Congress should eliminate the EPA’s environmental education work.

Key issue

Eliminate the Office of Community Revitalization and all of its programs

The Office of Community Revitalization runs numerous programs that seek to plan everything from land use decisions to transportation choices to “equitable economic revitalization.” These programs, which have little to do with the EPA’s statutory objectives and are state and local matters, also overlap in many ways. They reflect heavy-handed federal central planning of basic aspects of the lives of Americans, which is way off mission for the EPA. Even if they were not federal programs, they would be extreme efforts by the government (federal, state, or local), to involve itself in issues should be left to individuals and the private sector. The programs are:

• Local Foods, Local Places. This program has enabled the EPA to partner with communities to do such things as “Making it easier for people to walk or bicycle to farmers markets, food cooperatives, and local restaurants” and “Developing community gardens in walkable, transit-accessible places.” The EPA’s role is to help protect the environment and these efforts to stretch its role well beyond this core work is another example of it going beyond its mission. As it is, the federal government should not be meddling in local matters such as how people transport themselves to certain food locations. This program also inappropriately picks food and transportation winners and losers.
• Health Places for Healthy People. The program, according to the EPA, “engages with community leaders and health care partners to create walkable, healthy, economically vibrant downtowns and neighborhoods that can improve health, protect the environment, and support economic growth.” This initiative has similar problems to Local Foods, Local Places. It puts the EPA into the role of local zoning board and local transportation planner.
• Recreation Economy for Rural Communities. This program “helps communities identify strategies to grow their outdoor recreation economy and revitalize their main streets.” Federal taxpayers should not be having their hard-earned dollars going to help build a recreation economy. The free market should be playing such a role, and to the extent there is any government involvement, it should be states and local government. This program is a prime example of federal waste and the heavy-handed role the federal government plays in even the most basic aspects of our lives.
• Building Blocks for Sustainable Communities. The EPA makes clear that this program is about local land use decisions. EPA staff and agency consultants provide technical assistance on issues such as transportation options and “housing type and location.” The program’s work has included strategies to support local culture and “successful parking management.” Local land use issues should be just that, local. The federal government, and certainly the EPA, should not be working on local parking and helping to advance local culture. In some ways, it is hard to think of more ridiculous federal meddling.
• Smart Growth Network. This appears to cover the agency’s smart growth work in general, and it includes programs previously mentioned such as Local Foods, Local Places and Recreation Economy for Rural Communities. “Smart growth” is a pleasant name given to a planning philosophy that is anything but pleasant. It seeks to promote high-density living and limit development. The EPA should not be involved in urban planning in the first place, but advancing policies that aim to influence how and where people live is especially egregious.

Recommendation for Congress

Congress should eliminate the EPA’s so-called community revitalization work.

Key issue

Eliminate EPA’s green purchasing programs

The EPA disseminates a significant amount of information about “greener purchasing” in a program it refers to as the Sustainable Marketplace. This does not appear to be a formal program but instead the agency packaging together in one place its green purchasing work.

Some of the EPA’s green purchasing work includes running two IRA programs dealing with the embodied carbon of construction materials. According to the agency, embodied carbon “refers to the amount of [greenhouse gas] emissions associated with upstream—extraction, production, transport, and manufacturing—stages of a product’s life.” The agency’s two programs include grants to help measure embodied carbon and to label construction materials with low embodied carbon.

Another aspect of the agency’s green purchasing work are ecolabel programs. The EPA has ecolabels that “address energy efficiency, water efficiency, products safer for human and environmental health, refrigerant emissions, vehicles emissions, and recycled materials.” These labels are EnergyStar, Safer Choice, SmartWay, Significant New Alternatives Policy (SNAP), Comprehensive Procurement Guideline (CPG), and WaterSense. The agency also manages a list of recommended ecolabels and standards.

These green purchasing programs assume the federal government needs to meddle in the marketplace by providing its seal of approval on what it deems to be environmentally satisfactory products. If consumers demand certain information, then businesses will respond by disseminating this information to them. If there is a need to create a labeling program to ensure credibility and consumer confidence, then private certification organizations should play such a role.

Recommendation for Congress

Congress should eliminate the EPA’s green purchasing programs and related work.

Key issue

Eliminate the Office of Climate Adaptation and Sustainability

The Office of Climate Adaptation and Sustainability is a new office within the EPA’s Office of Policy. It “focuses broadly on the impacts of climate change on the environment and the sustainability of communities and businesses and leads ongoing efforts to coordinate across EPA and the federal government on these issues.” Regardless of the climate angle, this is yet another example of the EPA getting involved in issues that should be left to local communities, and for this program, businesses.

Recommendation for Congress

Congress should eliminate this office and its work.

Key issue

Eliminate EPA’s programs to electrify vehicles and equipment

The EPA is not just using regulation to help eliminate gas-powered vehicles and equipment. It also has spent billions of dollars to lead a shift towards electric vehicles and equipment. This includes:

• Clean Heavy-Duty Vehicles Program. This program, created through the IRA, provides the EPA $1 billion to fund zero-emission heavy-duty vehicles and charging infrastructure, and training for drivers and mechanics on electric vehicles, among other things.
• Clean School Bus Program. The Infrastructure Investment and Jobs Act provides the EPA a total of $5 billion for the adoption of “clean” school buses and zero-emission (i.e., electric) school buses. Electric school buses cost about three to four times more than diesel-powered school buses. The money for this program must be expended from fiscal years 2022 through 2026.
• Clean Ports Program. The IRA amended the CAA to create a new program to fund zero-emission port equipment or technology. The provision appropriates $3 billion to be spent by September 30, 2027. The EPA though is already planning to award the $3 billion by the end of 2024. Regardless, this program amends the CAA and should be eliminated so the program will not be replenished with even more money.
• Deisel Emissions Reduction Act. Congress passed the Deisel Emission Reduction Act in 2005, giving the EPA authority, as the agency states, “to accelerate the upgrade, retrofit, and turnover of the legacy diesel fleet.” Some of this money has gone to the push for electrification, such as electrifying parking spaces and buying electric tractors. This program is broad in scope and covers everything from ports equipment, school buses, to locomotives.

These programs fail to properly consider costs, the unreliability of electric vehicles, and infrastructure obstacles. They do not respect the decisions made by local governments, businesses, or other buyers to make the best vehicle and equipment choices to meet their needs. Further, the buyers of the vehicles and equipment should not be subsidized in these purchases.

Recommendation for Congress

Congress should eliminate all EPA programs to fund the electrification of goods, including vehicles and equipment, and other programs to upgrade vehicle fleets.

Key issue

Reform environmental justice programs

There are numerous concerns regarding the EPA’s environmental justice programs and how the agency applies this nebulous and ever-expanding concept. The Biden administration has taken to a new level the conflation of environmental justice with civil rights issues. It has also made equity a central component of the EPA’s environmental justice work, and its work in general, including featuring it prominently in its FY 2022-2026 strategic plan.

The administration took the unprecedented step of creating a new office combining the agency’s existing environmental justice work with much of its civil rights work. The EPA explained that the new Office of Environmental Justice and External Civil rights “is the latest significant action under President Biden’s aggressive approach to embed environmental justice, civil rights, and equity across the government.”

Congress, through the partisan-enacted IRA, has also exacerbated problems. The IRA amended the CAA to create the Environmental and Climate Justice Program. The funds for this $3 billion program must be awarded to nonprofits, local governments, and other eligible parties by September 30, 2026. Some of this money is going to help local activists and community organizers to push their agendas. Examples include money for communities to have “meaningful involvement in the offshore wind (OSW) development process in the Gulf of Maine” and to “engage New Haven high school students in at least 200 paid jobs as environmental justice problem-solvers.” Another example includes giving money to educate residents “on how to advocate for their community’s best interest in dialogue with government and private entities over siting, permitting and other decisions affecting their environment.” The federal government in general should not be funding activism and community organizing, and in this case likely helping to advance the ideological objectives of the EPA and certain special interests.

The EPA is also using IRA money for the Environmental Justice Thriving Communities Grantmaking Program. According to the agency, it has selected 11 nonprofits to “serve as pass-through entities nationwide” in allocating $600 million. This is yet another EPA slush fund for nonprofit slush funds.

Recommendations for Congress

Return the agency’s environmental justice and civil rights work to where it was before. A new administration could do this on its own, but Congress should ensure that these two issues are not centralized into one office, as it is now. This would include sending the work back to the Office of the Administrator and Office of General Counsel, where it was before the Biden administration.

Eliminate the Environmental and Climate Justice Program and any related programs. Congress should repeal this IRA program that is using money to help activists and to create nonprofit slush funds. The federal government does not need to be intruding into areas that should be left to private organizations and local communities.

Clarify the concept of environmental justice. The EPA’s work should help all Americans and if it does its job properly, then it will do just that. If there is the continued use of “environmental justice,” the concern should focus on all communities, including low-income communities. When distributing assistance, such as drinking water grants, the agency should prioritize communities at greatest risk of suffering direct environmental harms. More important, the concept of environmental justice should first and foremost focus on how the agency itself is taking actions that have a disproportionate effect on communities, especially low-income communities, such as through driving up prices, reducing housing options, and limiting mobility.

Eliminate the use of “equity” throughout the agency’s environmental justice work and across the agency. This is yet another issue easily addressed by a new administration. However, Congress should clarify that equity (as opposed to equality) is not part of any valid conception of environmental justice and prohibit the agency from embedding the use of equity throughout its work.

Key issue

Reform the regional offices

The EPA has 10 regional offices throughout the United States that help to execute the agency’s work (see the map below). These offices were created to help the EPA better address and understand the specific environmental needs and concerns of different areas of the country. They are also supposed to effectively coordinate with the state governments in their region that are implementing federally delegated programs. The regulated community and states tend to see this as a vital function. Recognizing the differences between states and regions consistent with the goals of cooperative federalism is something that the EPA should make a leading objective. Further, by being closer to the those affected by the EPA’s work, agency officials can be more responsive and develop a better understanding of the challenges on the front lines instead of all work being managed from the Washington, DC headquarters office.

One risk of this approach is that different regional offices can interpret laws and regulations differently, leading to inconsistency across the regions. While one-size-fits all approaches can be problematic, consistency in the application of the law is important. Furthermore, the organization of the regions and their general approaches to enforcement should be similar, so that regulated industry is able to navigate without idiosyncratic differences. For example, the Trump administration’s EPA helped to ensure that the organizational structure of EPA regional offices generally aligned with each other and the structure of the EPA headquarters office. At the time, each regional office had a different structure. This structural change should help the agency facilitate communication, increase consistency, and make it easier for interested and affected parties to better understand the workings of the regional offices.

Source: EPA.

Recommendations for Congress

Regularly review whether regional offices are serving their purpose. Congress should regularly use the oversight process to evaluate whether the regional offices are properly respecting the lead role that state environmental agencies have in implementing our nation’s environmental laws, facilitating better environmental outcomes, helping to develop more timely and flexible processes, such as with permitting and compliance, respecting due process and treating regulated parties fairly, and working well with all interested parties. In addition, Congress should ensure that there are not glaring inconsistencies in the application of federal environmental laws across the Regions that undermine the mission of the agency.

Move or consolidate offices. Some of the regional offices are in very expensive cities, such as San Francisco, New York, and Chicago. Congress should direct the Government Accountability Office (GAO), in consultation with the EPA, to explore the savings and effects of moving regional offices to less expensive cites. One likely positive outcome would be to make it easier to attract and retain employees. Any new locations should certainly be easily accessible and appealing to potential employees. As part of this analysis, GAO should also examine the potential of consolidating regional offices (or reducing their size) and whether it can be done without sacrificing any benefits of the agency being closer to the people affected by its work.

Create more political appointee positions. To help develop consistency and for the agency to fulfill the objectives of an administration, whatever the party, Congress should add some more political appointee positions in the regional offices. Currently, only the regional administrator who oversees each region is consistently a political appointee.

Key issue

Eliminate OECA and shift its work to other offices

The EPA has a stand-alone office called the Office of Enforcement and Compliance Assurance (OECA) to enforce the statutes administered and implemented by the agency. This office is comprised not only of inspectors and investigators but also lawyers that report to the Assistant Administrator for OECA.

There are various problems with this structure. It can lead to miscommunication between OECA, the program offices (e.g. Office of Water, Office of Air and Radiation), and the Office of General Counsel on important legal and regulatory matters. OECA can even take legal positions that are inconsistent with the program offices, the General Counsel, and an administration.

Enforcement decisions should not be made within a vacuum independent of broader agency and regulatory objectives. A stand-alone office with enforcement as its primary mission can result in a singular short-term mindset of winning big cases and big settlements that can work at cross-purposes with other agency officials who are seeking to best protect the environment.

This does not mean that the EPA should not make enforcement a top priority. The opposite is true. The best way to have strong and effective enforcement is to have good communication, consistent positions, and recognition of the many factors that need to inform enforcement decisions, from agency and administration priorities, the objectives of the regulatory programs, respect for the rule of law, and fairness.

Recommendations for Congress

Eliminate the Office of Enforcement and Compliance Assurance and move existing OECA attorneys to the Office of General Counsel and OECA non-attorneys to the program offices. The enforcement and compliance work should be shared between the program offices and the Office of General Counsel, with both playing a lead role but the latter having final say on legal interpretation in consultation with the Administrator.

Place greater emphasis on compliance assistance. Without losing the objective of strong and reasonable enforcement, Congress should place greater emphasis on compliance assistance so that fewer enforcement actions are necessary in the first place. After all, the goal is for regulated parties to meet their legal obligations. If they are doing so without having to take enforcement actions, then this is beneficial for the environment and the agency.

Key issue

Require transparency in the EPA budget

It is very difficult to ascertain how the EPA spends its money. The agency’s own budget documents do not help matters. The most obvious way to organize the budget that best informs the public and policymakers about agency spending would be by showing the amount of funding each office receives, how they spend these funds, and the underlying statutory authority for the spending.

Yet the EPA budget summary is not organized in this common-sense manner. The latest budget summary, the EPA’s “FY 2025 Budget in Brief,” is indicative of how the agency has regularly developed its budget summaries in an opaque manner. It is organized by cross agency strategies and agency goals, making it unhelpful to figure out what the agency is doing. To provide some context as to how unhelpful this document is, the office that generates the agency’s greatest regulatory costs, the Office of Air and Radiation, is not mentioned once in the document.

The agency’s “justification of appropriation” documents to Congress do provide some spending figures by major office in a useful chart “EPA Budget by National Program Manager and Major Office,” but this by itself does not provide further details on what these offices are doing. Readers are required to go through the extensive justification document to try and piece together the specific work these offices are doing and how money is being spent to accomplish this work. This is not just difficult, but it also appears to be impossible to get anything close to a complete picture given the lack of information.

In fairness to the EPA, Congressional appropriations legislation for the EPA does not follow the office-by-office organization either. Whether the lack of transparency is caused by the appropriations process for the EPA, the agency’s own opaque budget information, or both is unclear. Regardless, the lack of transparency is a problem that needs to be addressed. If Congress is going to provide the necessary oversight for the EPA, it needs better information regarding how the agency is conducting its business, including how it is spending money.

This is not an impossible task. Other agencies disseminate budget information in a useful and logically structured manner. In a 2017 report, Myron Ebell, then-Director of the Competitive Enterprise Institute’s Center for Energy and Environment wrote about the EPA budget:

In submitting its annual budget justification, the EPA should use the same rational format employed by other agencies, which clearly identifies the spender, how much they spend, and the legal basis for the spending. Only when Congress can follow the money can it exercise its power of the purse to effectively oversee agency policy making.

This recommendation remains just as important today.

Recommendation for Congress

Require the EPA to provide a transparent budget. Congress should require that EPA budget information be presented in “the same rational format employed by other agencies,” as Ebell stated. To clarify, this is not simply a question of disseminating the necessary information, but also a question of presenting information in a useable manner for both the public and policymakers.

Conclusion

Congress should ensure that the EPA is focused on protecting Americans from genuine environmental harms. This is not merely about limiting the agency’s regulatory abuses. It is also about ensuring that the agency is not using funding in a manner not intended by Congress.

However, it is not always about agency abuse. Congress has too often created slush funds for the agency, giving far too much discretion to how the agency spends money. It has also created programs that divert the agency’s focus into areas that it should not be involved in, such as environmental education.

Legislators should look beyond regulation and carefully review the non-regulatory programs it has created and the broad spending authority it has provided the EPA. For those advocating a heavy-handed federal role dealing with the environment, regulation is just one tool to achieve their objectives. Spending is another tool, one playing a far more prominent role, as seen with the Inflation Reduction Act.

To properly modernize the EPA, Congress must be willing to address spending and make organizational changes to the agency, including the elimination of non-regulatory programs.