In April 2007, the U.S. Supreme Court ruled the Environmental Protection Agency (EPA) can regulate greenhouse gases under the Clean Air Act (CAA), giving EPA authority to determine whether emissions endanger public health. The 5-4 decision was surprising because the CAA did not include greenhouse gas regulation when it was written in the 1970s, and it requires EPA to regulate entities emitting 250 tons of hazardous pollutants each year. This threshold was set for pollutants with particulate matter and is extremely low for gases that include carbon dioxide and are measured in thousands of tons.
Nonetheless, on Dec. 7, 2009, EPA issued an "endangerment finding" for greenhouse gases and announced a rule will go into effect Jan. 1, 2011, starting with power companies and factories, which undoubtedly will include construction material manufacturers.
To obviate the 250-ton statutory threshold, EPA issued what it calls a "tailoring" rule to regulate only sources emitting more than 100,000 tons of greenhouse gases. However, the tailoring concept is highly unusual, and many experts believe EPA cannot simply ignore the CAA's explicit statutory language—they believe EPA must regulate all entities that emit more than 250 tons annually.
Even with the tailoring rule, construction material manufacturers will be regulated under the CAA's Prevention of Significant Deterioration, which could increase material costs for the construction industry. Furthermore, other regulatory programs triggered by the finding could halt building construction.
On Nov. 28, 2008, NRCA submitted comments to EPA urging it not to arrive at an endangerment finding and on Dec. 9, 2009, issued a press release addressing the dangers EPA's finding and regulations pose to the construction industry.
Litigation
On Feb. 12, 2010, the U.S. Chamber of Commerce filed a petition in the U.S. Court of Appeals for the District of Columbia challenging EPA's endangerment finding and regulations for greenhouse gases. Dozens of organizations also have challenged the regulations. At least 15 states have gone to court to stop EPA, and a bipartisan group of 20 governors wrote to Congress seeking its intervention.
Congressional action
EPA's endangerment finding was supposed to drive Congress to pass cap-and-trade or carbon-tax legislation to pre-empt regulations, but legislation has stalled and EPA is moving forward. To stop the regulations, Sen. Lisa Murkowski (R-Alaska) introduced Senate Joint Resolution 26, a bipartisan resolution of disapproval under the Congressional Review Act that could not be filibustered. NRCA joined dozens of other business associations in support of the resolution and on June 10, it came within four votes of passing the Senate at 47-53.
Senate Joint Resolution 26 is the opening salvo in what will be a sustained effort by Congress to wrest EPA's control over this issue. In March, Sen. Jay Rockefeller (D-W.Va.) introduced S. 3072, "Stationary Source Regulations Delay Act," to delay EPA regulations for two years.
Senate Majority Leader Harry Reid (D-Nev.) indicated he would give Rockefeller floor time for his bill during the lame-duck session. However, he has since shifted his stance, and S. 3072 may not be considered this year.
Growing support
Senate Democrats' support for the Rockefeller bill is growing and, along with support from Senate Republicans, could garner the 60 votes needed to pass. Should S. 3072 not be considered during the lame-duck session, the showdown with EPA on Capitol Hill will take place next year and in the courts where lawsuits have been filed by private parties and state governments.
Craig S. Brightup is chief executive officer of The Brightup Group LLC, Washington, D.C.
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