[House Report 115-509]
[From the U.S. Government Publishing Office]
115th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session ] { 115-509
======================================================================
BLOCKING REGULATORY INTERFERENCE FROM CLOSING KILNS ACT OF 2017
_______
January 10, 2018.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Walden, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 1917]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 1917) to allow for judicial review of any final
rule addressing national emission standards for hazardous air
pollutants for brick and structural clay products or for clay
ceramics manufacturing before requiring compliance with such
rule, having considered the same, report favorably thereon
without amendment and recommend that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 2
Background and Need for Legislation.............................. 2
What the Legislation Would Do.................................... 3
Committee Action................................................. 4
Committee Votes.................................................. 4
Oversight Findings and Recommendations........................... 6
New Budget Authority, Entitlement Authority, and Tax Expenditures 6
Congressional Budget Office Estimate............................. 6
Federal Mandates Statement....................................... 7
Statement of General Performance Goals and Objectives............ 7
Duplication of Federal Programs.................................. 7
Committee Cost Estimate.......................................... 7
Earmark, Limited Tax Benefits, and Limited Tariff Benefits....... 7
Disclosure of Directed Rule Makings.............................. 7
Advisory Committee Statement..................................... 7
Applicability to Legislative Branch.............................. 8
Section-by-Section Analysis of the Legislation................... 8
Changes in Existing Law Made by the Bill, as Reported............ 8
Dissenting Views................................................. 9
PURPOSE AND SUMMARY
H.R. 1917, Blocking Regulatory Interference from Closing
Kilns (BRICK) Act of 2017, was introduced by Representative
Bill Johnson (R-OH) on April 5, 2017. The legislation addresses
the Environmental Protection Agency's (EPA) National Emission
Standards for Hazardous Air Pollutants (NESHAP) for Brick and
Structural Clay Products Manufacturing and for Clay Ceramics
Manufacturing published on October 26, 2015. The bill would
extend the compliance dates for the final rule to allow for
completion of judicial review before compliance by the affected
entities would be required.
BACKGROUND AND NEED FOR LEGISLATION
EPA published its final rule entitled ``NESHAP for Brick
and Structural Clay Products Manufacturing; and NESHAP for Clay
Ceramics Manufacturing'' (2015 Brick MACT) on October 26,
2015.\1\ EPA has promulgated this rule pursuant to section 112
of the Clean Air Act (CAA), which authorizes the agency to set
emissions standards for certain sources that emit mercury and
other hazardous air pollutants (HAP). The final rule applies to
kilns at brick and structural clay products manufacturing
facilities, and at clay ceramics manufacturing facilities.\2\
Compliance for existing affected sources is required by
December 26, 2018.\3\
---------------------------------------------------------------------------
\1\See NESHAP for Brick and Structural Clay Products Manufacturing;
and NESHAP for Clay Ceramics Manufacturing; Final Rule, 80 Fed. Reg.
65469 (October 26, 2015). EPA published a correction to make two
technical corrections to the published regulation on December 4, 2015.
See 80 Fed. Reg. 75817 (December 4, 2015).
\2\80 Fed. Reg. at 65521, 65544.
\3\Id. at 65539 and 65566.
---------------------------------------------------------------------------
Prior to issuance of the 2015 Brick MACT, EPA had issued an
earlier version in 2003.\4\ This earlier rule required brick
plants to install equipment on their kilns to control hydrogen
fluoride (HF) and hydrogen chloride (HCl) emissions, and
particulate matter as a surrogate for metal HAPs including
mercury, and to create work practices to reduce other
emissions.\5\ While the brick industry spent millions of
dollars to comply with the 2003 rule,\6\ almost one year after
the compliance deadline had passed, that rule was vacated and
remanded back to EPA by the United States Court of Appeals for
the District of Columbia with direction to rewrite the rule.\7\
---------------------------------------------------------------------------
\4\See NESHAP for Brick and Structural Clay Products Manufacturing;
and NESHAP for Clay Ceramics Manufacturing Final Rule, 68 Fed. Reg.
26690 (May 16, 2003).
\5\Id.; see also, e.g. Chamber of Commerce Report published
February 2, 2016, which is entitled, ``Regulatory Indifference Hurts
Vulnerable Communities, No. 7 in a Series of Regulatory Reports,''
available at https://www.uschamber.com/sites/default/files/documents/
files/022360_etra_brick_study_01_29.pdf, p. 7.
\6\Id.
\7\Sierra Club v. EPA, 479 F.3d 875 (D.C. Cir. 2007).
---------------------------------------------------------------------------
In developing its revised rule, EPA determined that the
substantial emissions reductions achieved by the control
devices installed under the 2003 rule would be the starting
point for the emissions limits under the current rule.\8\ EPA,
in its final revised rule, set the level of performance based
on the controls installed in response to the now vacated
rule.\9\
---------------------------------------------------------------------------
\8\See, e.g. NESHAP for Brick and Structural Clay Products
Manufacturing; and NESHAP for Clay Ceramics Manufacturing; Proposed
Rules, 79 Fed. Reg. 75622, 75627, 75635-36 (Dec. 18, 2014).
\9\See, e.g. 80 Fed. Reg. at 65473.
---------------------------------------------------------------------------
Legal challenges to the final rule are currently pending in
the Court of Appeals for the District of Columbia.\10\ For the
2015 Brick MACT, concerns have been raised regarding the
legality of the rule, including potentially significant costs,
which may make compliance impossible for many smaller plants.
While EPA estimates annual costs to comply with the rule to be
$25 million, industry estimates have projected the annual costs
to be potentially up to $100 million or greater.\11\ Concerns
have specifically been raised that in developing the final
rule, EPA has incorrectly assumed that brick companies already
have or can readily borrow the capital needed to install the
required equipment, and that the costs of the rule can be
passed on to consumers simply by increasing brick prices.\12\
---------------------------------------------------------------------------
\10\Legal challenges have been filed by environmental organizations
and regulated entities in the U.S. Court of Appeals for the District of
Columbia Circuit. See Sierra Club v. EPA, No. 15-1487 (D.C. Cir.), and
consolidated cases (Case Nos. 15-1492, 15-1493, 15-1496).
\11\See, e.g. Chamber of Commerce Report at pp. 8-9 (``The Brick
Industry Association estimates that the annual cost of the Brick MACT
will be $100 million or more [citation omitted] and that compliance
will be nearly impossible for many smaller plants.''
\12\Id. at p. 8.
---------------------------------------------------------------------------
There are an estimated 7,000 workers employed by the brick
industry nationwide.\13\, \14\
---------------------------------------------------------------------------
\13\See Chamber of Commerce Report published February 2, 2016,
which is entitled, ``Regulatory Indifference Hurts Vulnerable
Communities, No. 7.
\14\See Chamber of Commerce Report at p. 6. For additional
background, see also, e.g. Brick Industry Association, An Overview of
the American Brick Industry available at http://www.gobrick.com/
Resources/American-Brick-Industry.
---------------------------------------------------------------------------
WHAT THE LEGISLATION WOULD DO
H.R. 1917 would extend the compliance dates of the final
2015 Brick MACT rule pending judicial review. The bill would
extend the compliance dates for the period of time that begins
sixty days after the final rule, or any successor or amended
rule, appears in the Federal Register, and would end when all
final legal challenges filed during that period have been
resolved, and are no longer subject to legal review.
This bill will ensure that there is adequate time for
meaningful judicial review before the owners and operators of
brick manufacturing facilities are required to make significant
and potentially irreversible decisions regarding capital
investments, or to operate less or shut down, all before the
legality of the 2015 Brick MACT is known. While some have
raised concerns that this bill would create an inappropriate
precedent, here the agency's original rule was vacated after
the compliance deadlines had already passed, and H.R. 1917
seeks to ensure this will not occur with respect to the current
rule.\15\
---------------------------------------------------------------------------
\15\The EPA's Mercury and Air Toxics (MATS) rule highlights how
EPA's rules can effectively circumvent meaningful judicial review. For
example, in Michigan v. EPA, 135 S. Ct. 2699 (2015), the U.S. Supreme
Court held that EPA had violated the CAA in enacting regulations for
power plants under Section 112 of the CAA. While the court found the
rulemaking to be legally flawed, as a practical matter, the court's
decision was of limited effect, See, e.g. June 30, 2015 EPA Connect,
The Official Blog of the EPA Leadership (EPA Acting Administrator
McCabe stated following the decision: ``the majority of power plants
are already in compliance or well on their way to compliance.''
---------------------------------------------------------------------------
COMMITTEE ACTION
On September 13, 2017, the Subcommittee on Environment held
a hearing on H.R. 1917. The Subcommittee received testimony
from:
Ryan Parker, President and CEO, Endicott
Clay Products;
Vincent Brisini, Director of Environmental
Affairs, Olympus Power, LLC, on behalf of Anthracite
Region Independent Power Producers Association
(ARIPPA);
Frank Moore, President, Hardy Manufacturing
Company, Inc.;
Steve Page, President and General Manager,
Sonoma Raceway;
Alexandra E. Teitz, Principal, AT
Strategies, LLC, on behalf of Sierra Club; and
Rebecca Bascom, Professor, Penn State
College of Medicine, on behalf of American Thoracic
Society.
On November 15, 2017, the Subcommittee on Environment met
in open markup session and forwarded H.R. 1917, without
amendment, to the full Committee by a record vote of 12 yeas
and 10 nays. On December 6, 2017, the full Committee on Energy
and Commerce met in open markup session and ordered H.R. 1917,
without amendment, favorably reported to the House by a record
vote of 31 yeas and 23 nays.
COMMITTEE VOTES
Clause 3(b) of rule XIII requires the Committee to list the
record votes on the motion to report legislation and amendments
thereto. The following reflects the record votes taken during
the Committee consideration:
OVERSIGHT FINDINGS AND RECOMMENDATIONS
Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of
rule XIII, the Committee held a hearing and made findings that
are reflected in this report.
NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES
Pursuant to clause 3(c)(2) of rule XIII, the Committee
finds that H.R. 1917 would result in no new or increased budget
authority, entitlement authority, or tax expenditures or
revenues.
CONGRESSIONAL BUDGET OFFICE ESTIMATE
Pursuant to clause 3(c)(3) of rule XIII, the following is
the cost estimate provided by the Congressional Budget Office
pursuant to section 402 of the Congressional Budget Act of
1974:
U.S. Congrfess,
Congressional Budget Office,
Washington, DC, January 10, 2018.
Hon. Greg Walden,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1917, the Blocking
Regulatory Interference From Closing Kilns Act of 2017.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Jon Sperl.
Sincerely,
Keith Hall,
Director.
Enclosure.
H.R. 1917--Blocking Regulatory Interference From Closing Kilns Act of
2017
H.R. 1917 would extend compliance dates for entities
affected by any final rule addressing national emission
standards for hazardous air pollutants (NESHAP) under the Clean
Air Act for brick, structural clay, and ceramic products
manufactured in kilns.
The rules that would be affected are:
NESHAP for Brick and Structural Clay
Products Manufacturing and NESHAP for Clay Ceramics
Manufacturing, published in the Federal Register on
October 26, 2015;
NESHAP for Brick and Structural Clay
Products Manufacturing and NESHAP for Clay Ceramics
Manufacturing: Correction, published in the Federal
Register on December 4, 2015; and
Any final rule that succeeds or amends those
rules.
The NESHAP rule published on October 26, 2015, requires
manufacturers of brick, structural clay, and ceramic products
to reduce emissions of hazardous air pollutants from kilns.
The bill would extend compliance dates for manufacturers to
allow for resolution of the judicial review process.
Manufacturers would not need to comply with the rule until a
specified period after a judgment becomes final (that is, the
judgment is not subject to further appeal or review) for all
legal actions filed during the 60 days after the final rule is
published in the Federal Register.
Using information from the Environmental Protection Agency
about current activities related to NESHAP, CBO estimates that
the costs of modifying existing regulations to comply with H.R.
1917 would be minimal and would not have a significant effect
on the agency's workload or spending.
Enacting H.R. 1917 would not affect direct spending or
revenues; therefore, pay-as-you-go procedures do not apply.
CBO estimates that enacting H.R. 1917 would not increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2028.
H.R. 1917 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act.
The CBO staff contact for this estimate is Jon Sperl. The
estimate was approved by H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
FEDERAL MANDATES STATEMENT
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES
Pursuant to clause 3(c)(4) of rule XIII, the general
performance goal or objective of this legislation is to extend
the compliance deadlines for EPA's 2015 Brick MACT rule pending
completion of judicial review.
DUPLICATION OF FEDERAL PROGRAMS
Pursuant to clause 3(c)(5) of rule XIII, no provision of
H.R. 1917 is known to be duplicative of another Federal
program, including any program that was included in a report to
Congress pursuant to section 21 of Public Law 111-139 or the
most recent Catalog of Federal Domestic Assistance.
COMMITTEE COST ESTIMATE
Pursuant to clause 3(d)(1) of rule XIII, the Committee
adopts as its own the cost estimate prepared by the Director of
the Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act of 1974.
EARMARK, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS
Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the
Committee finds that H.R. 1917 contains no earmarks, limited
tax benefits, or limited tariff benefits.
DISCLOSURE OF DIRECTED RULE MAKINGS
Pursuant to section 3(i) of H.Res. 5, the Committee finds
that H.R. 1917 contains no directed rule makings.
ADVISORY COMMITTEE STATEMENT
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
APPLICABILITY TO LEGISLATIVE BRANCH
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION
Section 1. Short title
Section 1 provides that the Act may be cited as the
``Blocking Regulatory Interference from Closing Interference
from Closing Kilns Act of 2017.''
Section 2. Extending compliance dates (Pending Judicial Review) of
rules addressing National Emission Standards for Hazardous Air
Pollutants for brick and structural clay products manufacturing
or clay ceramics manufacturing
Section 2(a) provides that the term ``compliance date''
means the date by which any State, local, or tribal government
or other person is first required to comply with the rule.
Section 2(b) provides that the final rules subject to the
Act include any final rule that addresses National Emission
Standards for Hazardous Air Pollutants (NESHAP) for brick and
structural clay products or for clay ceramics manufacturing
under section 112 of the Clean Air Act (CAA), including any
final rule that succeeds or amends the Environmental Protection
Agency's (EPA) final rule published at 80 Fed. Reg. 65469
(October 26, 2015) and 80 Fed. Reg. 75817 (December 4, 2015).
Section 2(c) provides that the time period by which the
compliance dates would be extended would be the period of time
that begins 60 days after the final rule appears in the Federal
Register, and ends on the date on which judgment becomes final,
and no longer subject to further appeal or review, in all
actions filed during the initial 60 days after the rule appears
in the Federal Register seeking review of the rule, including
actions pursuant to CAA section 307.
CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED
This legislation does not amend any existing Federal
statute.
DISSENTING VIEWS
We oppose H.R. 1917, also known as the BRICK Act. This
legislation would delay implementation of the Environmental
Protection Agency's (EPA) final Brick and Structural Clay
Products rule and the final Clay Ceramics Manufacturing rule
(Brick and Clay MACT) by extending all compliance deadlines
until ``judgment [on court appeals, motions for stay, and
administrative stay motions] becomes final, and no longer
subject to further appeal or review.'' The bill's mechanism for
extending compliance deadlines establishes a dangerous and
hazardous precedent. It would specifically encourage the filing
and perpetuation of frivolous and inappropriate lawsuits to
delay the legal effect of regulations to protect public health
and the environment.
H.R. 1917 is unnecessary: judicial redress in these
instances is already available to the industry; however, no
party has yet availed itself of their rights as interested
parties in these proceedings to request a stay of the rule in
federal court.
BACKGROUND
Section 112 of the Clean Air Act (CAA) requires EPA to set
technology-based standards to reduce air toxics. These
hazardous air pollutants (HAPs) are known or suspected to cause
cancer and other serious health effects, such as reproductive
or birth defects or neurological effects, or adverse
environmental effects. EPA rulemakings aim to reduce the
release of 187 HAPs, including mercury, cadmium, lead, benzene
and dioxin.\1\ EPA takes a technology-based approach to
regulating HAPs in order to achieve substantial reductions in
air toxics relatively quickly using readily available
technology.
---------------------------------------------------------------------------
\1\Environmental Protection Agency, About Air Toxics (https://
www.epa.gov/urban-air-toxics/about-urban-air-toxics) (accessed Jan. 9,
2018).
---------------------------------------------------------------------------
Section 112 requires EPA to develop regulations for
distinct source categories--like brick kilns--that set specific
emission limits based on levels already being achieved by
similar facilities. These regulations are known as Maximum
Achievable Control Technology (MACT) standards, and the CAA
required EPA to complete them for all source categories by
2000. EPA sets minimum emissions levels, known as the MACT
floor, based on the best-performing sources in a category.
As such, EPA's Brick and Clay MACT standards are long
overdue. The D.C. Circuit Court vacated an earlier version of
EPA's rule in 2007. On remand from the court, EPA developed a
new proposal and issued a final rule covering the Brick and
Structural Clay Products industry and the Clay Ceramics
industry in 2015.\2\
---------------------------------------------------------------------------
\2\Environmental Protection Agency, National Emissions Standards
for Hazardous Air Pollutants (NESHAP) for Brick and Structural Clay
Products Manufacturing; and NESHAP for Clay Ceramics Manufacturing, 80
Fed. Reg. 65470 (Oct. 26, 2015) (Final Rule) (www.gpo.gov/fdsys/pkg/FR-
2015-10-26/pdf/2015-25724.pdf).
---------------------------------------------------------------------------
SUMMARY OF THE BRICK ACT
Subsection 2(b) of the BRICK Act delays implementation of
the final Brick and Structural Clay Products rule and the final
Clay Ceramics Manufacturing rule, or any subsequent rule, by
extending all compliance deadlines based on pending judicial
review. Subsection (c) suspends all compliance deadlines
starting 60 days after the final rule appears in the Federal
Register and ending when ``judgment becomes final, and no
longer subject to further appeal or review.''
The bill's proponents argue that legislation is needed to
delay implementation of EPA's Brick and Clay rules until all
legal challenges are resolved by the courts. However, legal
challenges to final EPA rules are routine and courts have the
power on their own to stay the effectiveness of regulations
under court challenge.
The bill throws out existing judicial process by
legislatively granting a blanket extension for any compliance
deadline, regardless of the merits of the legal challenge or
the final outcome. This procedure would encourage frivolous
challenges and additional appeals in order to extend the
ultimate compliance deadlines set under the EPA final rule.
At the full committee markup, Ranking Member Pallone noted
that:
``Well-established legal factors exist for granting a
stay. These factors take into account whether there is
a likelihood of success on the merits, the prospect of
irreparable harm to the moving party and other parties,
and most importantly, whether granting the stay is in
the public interest. The courts have used these factors
time and time again to determine whether to grant a
stay and for how long. There is no reason for Congress
to override this process and the judgment of the
court.''\3\
---------------------------------------------------------------------------
\3\House Committee on Energy and Commerce, Statement of Rep.
Pallone, Debate on H.R. 1917, the ``Blocking Regulatory Interference
from Closing Kilns (BRICK) Act,'' Full Committee Markup, 115th Cong.
(Dec. 6, 2017).
This existing judicial process is the appropriate way to
seek a stay of a rule, and is preferable to the Congressional
intervention proposed by the BRICK Act. To date, no one has
petitioned the court to stay the effectiveness of the Brick and
Clay rules.
Furthermore, the BRICK Act is unnecessary since EPA
recently announced plans to reconsider the Brick and Clay rule,
which is expected to be finalized by August 2019. Due to these
plans, EPA asked the D.C. Circuit to indefinitely postpone the
brick industry's lawsuit on the rule's merits.\4\
---------------------------------------------------------------------------
\4\Respondents' Notice of Action on Brick/Clay Rule and Unopposed
Motion to Sever and Hold in Abeyance Industry Petitions, Sierra Club,
et al. v. United States Environmental Protection Agency, et al., D.D.C.
(No. 15-1487).
---------------------------------------------------------------------------
CONCLUSION
We oppose H.R. 1917 and the legislative remedy offered in
the bill. While we believe the brick and clay industry has
legitimate reasons to contest the current Brick and Clay MACT
rule, the industry has not availed itself of the appropriate
judicial remedy which has always been available to them:
requesting a stay of the rule by the court. This problem should
be resolved by the judiciary, not by Congress. Further, the
bill would incentivize all parties that contest these rules to
file repeated challenges resulting in endless delay of this
rulemaking and continued uncertainty about the regulatory
status of these facilities.
H.R. 1917 sets an extremely bad precedent. The majority has
offered this remedy in other legislation in response to other
CAA authorities and rulemakings. Had Congress adopted a policy
in the CAA that rulemakings would not be final until all court
challenges and lawsuits had been resolved, the U.S. would not
have realized the tremendous public health and environmental
benefits that our country now enjoys. The CAA does provide
judicial remedies. When properly petitioned, the courts already
have ample power under federal statutes to stay agency rule in
a myriad of instances. A fair and appropriate remedy for
interested parties who oppose the rule's application and
enforcement already exists--there is no need for another
remedy.
For the reasons stated above, we dissent from the views
contained in the Committee's report.
Frank Pallone, Jr.,
Ranking Member, Committee on
Energy and Commerce.
Paul D. Tonko,
Ranking Member, Subcommittee
on Environment.