Natural Resources Committee Home

April 10, 2008

The Honorable Stephen L. Johnson
Administrator
U.S. Environmental Protection Agency
1200 Ariel Rios Building
Washington, DC 20460

Dear Administrator Johnson:

The agency asked for the governors’ comments on its internal guidance implementing Executive Order 13132, which addresses the federalism implications of a U.S. Environmental Protection Agency (EPA) rulemaking. On behalf of the nation’s governors, we appreciate the opportunity to respond.

Governors and EPA have a long and successful history of working together to promote our mutual environmental goals. We commend the agency for its diligence in protecting our natural resources and for often working with affected stakeholders to find proactive solutions. 

Governors are deeply concerned about the high and growing costs of environmental protection, including both the programmatic and capital costs required to comply with federal environmental mandates and reporting requirements. These costs, borne by states, local governments and the private sector, result in part from new federal requirements related to air, drinking water, water quality and waste management that require more sophisticated programs and additional environmental infrastructure throughout the nation.

As you know, the 1995 Unfunded Mandates Reform Act requires federal agencies to assess the costs and benefits of a final rule that will result in expenditures by state, local and tribal governments, in the aggregate, of $100 million. In 1999, President Clinton issued Executive Order 13132 to “further the policies of the Unfunded Mandates Reform Act.” The intent of the Executive Order was to protect “federalism,” or the framework giving states all powers not expressly given to the federal government in the Constitution.

We appreciate that the EPA guidance document acknowledges that some rules will not have substantial compliance costs or preempt state laws but may still have some federalism implications. However, the guidance goes on to state that the determination of which rules might have federalism implications without high compliance costs or preemption is a “judgment call.” Governors urge EPA to clarify how its program staff should determine federalism implications beyond cost and preemption.

The EPA should consider lowering the $100 million expenditure threshold that triggers intergovernmental review. The $100 million threshold has been triggered only twice since development of the federalism guidance. However, even rules with considerably lower state expenditures can pose administrative burdens and divert resources from other more critical activities. For instance, EPA requires states to track Clean Water Act permits and compliance monitoring using the new Integrated Compliance Information System (ICIS). This new database requires states to complete significantly more data forms and fields than currently required, resulting in additional data entry and field investigation by qualified technical staff. Consequently, this federal mandate adds additional requirements on states without additional federal funding and diverts scarce state resources for a federal purpose.

Governors recognize that federal intervention is appropriate in certain circumstances in which states fail to act collectively on issues of legitimate concern. Preemption of state laws, however, should be the exception and not the rule and should occur only in situations where the national interest is at risk. The Executive Order would allow federal preemption if there is the presence of a problem of national significance. EPA’s guidance document defines it as “[when] certain matters are of such a national character, as opposed to state or local.” This preemption threshold appears broader than advocated by the governors, and should be appropriately narrowed. Further, in those very limited cases where an agency might determine that federal preemption of state laws is in the national interest, the regulation should accommodate state actions taken before promulgation, permit states that have developed stricter standards to continue to enforce them and permit states that have developed substantially similar standards to continue to adhere to them without change.

Thank you for the opportunity to respond.

Sincerely,