As we reported in a previous blog post, President Trump’s Chief of Staff Reince Priebus issued a memorandum entitled “Regulatory Freeze Pending Review” to all federal executive departments and agencies implementing a regulatory freeze on new and pending regulations. This post provides some further information and insight into the freeze and the specific impacts it has had and will have on final and proposed environmental, health, safety, and pipeline regulations.
Technically speaking, the directive is not an executive order and does not have the effect of law. Thus, federal agencies are left with considerable discretion regarding how to implement it. The directive was issued with the intent of giving new department and agency heads an opportunity to review pending regulations and accept, reject, or redevelop them. In order to eliminate or change regulations, the new administration would need to commence a new notice-and comment rulemaking and provide a rational explanation for why the rule is no longer appropriate.
In accordance with the directive, the U.S. Environmental Protection Agency (“EPA”) published a notice in the Federal Register on January 26, 2017 identifying 30 final and published EPA regulations that are not yet effective and are therefore impacted by the directive’s stay. In its notice, EPA postponed the effective date of those regulations until March 21, 2017, while noting that EPA may consider delaying the effective dates beyond March 21 where appropriate. EPA also indicated that although the Administrative Procedure Act allows the freeze to take effect without public comment, public comment would be necessary for an extension of the freeze beyond March 21. The EPA regulations cover a broad range of environmental issues. An example of an EPA regulation that is impacted by the freeze is the final rule not yet in effect entitled EPA’s “Accidental Release Prevention Requirements: Risk Management Programs Under the Clean Air Act,” 82 Fed. Reg. 4594 (Jan. 12, 2017) (to be codified at 40 C.F.R. pt. 68), which would have become effective March 14, 2017. This regulation amends the Clean Air Act’s Risk Management Program by imposing accident prevention and audit requirements that apply mainly to chemicals manufacturing and petroleum-related industries but may also affect broader manufacturing and distribution sectors. Other final rules relate to national emission standards for radon emissions from operating mill tailings; a renewable fuel standard program; and approvals of state air plans. Eight of the final rules are national in scope, while the remaining 22 are state-specific. In addition to final rules, a number of EPA proposed rules may be affected by the stay; proposed rules that had been sent to the Federal Register for publication but not yet published have been withdrawn, and the directive requires no new regulations to be published until they have been reviewed and approved by the newly-appointed agency head.
The effect of Trump’s directive on health and safety and pipeline regulations is far less clear. A number of recent final and proposed OSHA regulations may also face potentially uncertain futures due to the freeze. For instance, a proposed rule entitled “Standards Improvement Project-Phase IV,” 81 Fed. Reg. 68503 (Oct. 4, 2016), would revise the lockout/tagout rules by removing the word “unexpected,” such that the standard would apply to any energization, not just unexpected ones. As a result of the freeze, the proposed rule cannot not be adopted as a final rule until it is reviewed and approved by the agency head, and the agency’s progress on the rule may well be stalled by the transition to a new administration.
Additionally, pending and proposed pipeline rules promulgated by the U.S. Department of Transportation’s (“USDOT”) Pipeline and Hazardous Materials Safety Administration (“PHMSA”) pursuant to the PIPES Act of 2016 may be delayed. In addition, PHMSA is keen on issuing advisories and guidance documents in lieu of formal rulemakings, and the directive’s inclusion of “guidance documents” (i.e., any “agency statement of general applicability and future effect that sets forth a policy on a statutory, regulatory, or technical issue or an interpretation of a statutory or regulatory issue”) means that these advisories and guidance documents may also be subject to the regulatory freeze. PHMSA has not issued any press release or formal notice regarding the directive’s effect on pending pipeline regulations, so it is not yet known how PHMSA will respond. In addition, the stay expressly excludes “emergency situations or other urgent circumstances relating to health, safety, financial, or national security matters, or otherwise,” and it is unclear whether any of the possibly affected rules would fall within the directive’s safety carveout. One rule possibly impacted by the freeze is the rule entitled “Pipeline Safety: Operator Qualification, Cost Recovery, Accident and Incident Notification, and Other Pipeline Safety Changes,” 82 Fed. Reg. 7972 (Jan. 23, 2017). This rule, with an original effective date of March 24, 2017, affects post-accident reporting obligations, safety training requirements, and permitting procedures. If USDOT, under its new head, does not take some action within the 60-day period of the directive’s stay, then there is some uncertainty regarding whether the rule will be stayed or whether it will go into effect on the original effective date stated in the rule.
As a final note, the directive has no impact on recent regulations already in effect. However, Congress could invoke the Congressional Review Act (“CRA”) to revoke some of those finalized regulations. Under the CRA, Congress has 60 “session” days from the date of the notification or after a rule is published in the Federal Register to issue a joint resolution of disapproval by a simple majority. Once a disapproval resolution is signed by the president, the rule cannot go into effect or continue in effect. The 60 “session”-day period for repealing regulations will likely apply to all federal rules adopted after May 30, 2016. A number of environmental, health, safety, and pipeline regulations, such as the Hazardous Waste Generator Improvements Rule, 81 Fed. Reg. 85732 (Nov. 28, 2016), which includes over 60 changes to the existing RCRA hazardous waste generator regulations, may be vulnerable to rescission under the CRA.