The Trump Administration continues to put forward plans to overhaul rules and regulations.  Many of these changes have been focused on environmental regulations.  There will likely be strong opinions regarding the recent proposed changes:  Codifying Benefit and Cost Analysis (BCA) with respect to the Clean Air Act.

Benefit-Cost Analysis

President Ronald Reagan, by way of Executive Order (E.O.), first introduced the cost-benefit of regulations approach (E.O 12291).  The BCA looks at the cost to comply with the regulations (permitting, equipment, operation and maintenance, etc.) as well as benefits (reduction in mortality rates, hospitalization rates, lost work days and school days, etc.).

Codifying Environmental Regulatory Change

President Reagan signed E.O. 12291 that required federal executive agencies to perform a cost-benefit analysis (or benefit cost analysis – BCA) for each major rule. A proposed rule aims to codify the BCA for Clean Air Act Regulations.

If you care to take a deeper dive into this BCA, see Economic and Cost Analysis for Air Pollution Regulations.

Where this BCA gets more controversial is with the idea of co-benefits, including taking a secondary or tertiary benefit and applying it to the equation.  This is what the proposed rule seeks to limit by codifying the BCA process

Clean Air Act Rulemaking: Costs v Benefits

The title of the June 11, 2020, announcement in the Federal Register was, “Increasing Consistency and Transparency in Considering Benefits and Costs in the Clean Air Act Rulemaking Process.”

Under the Rationale and Summary section in the Federal Register, they state, “The EPA seeks to codify the practice of preparing BCAs in the development of future significant CAA regulations.  Specifically, EPA proposes that all future significant proposed and final regulations promulgated under the Clean Air Act be accompanied by a BCA.”

If you care to provide comments on the proposed rule, they must be received on or before July 27, 2020.

Commentaries on the Proposed Rule

Below are some comments found on the Internet regarding this proposed rule.

Attorney, Seth Jaffe, wrote, “As much as I hate to give aid and comfort to this Administration, I have to say that the rule does not herald the end of western civilization.  The biggest controversy surrounding the rule is its impact on consideration of ‘co-benefits.’ ”

The Institute for Hazardous Materials Management wrote, “The EPA is proposing to establish procedural requirements governing the development and presentation of benefit-cost analyses (BCA), including risk assessments used in the BCA, for significant rulemakings conducted under the CAA.  Together, these requirements would help ensure that the EPA implements its statutory obligations under the CAA, and describes its work in implementing those obligations, in a way that is consistent and transparent.”

Dan Bosch, Director of Regulatory Policy at American Action Forum, wrote, “Codifying a standard practice for BCA helps ensure that certain BCA principles are applied to each significant CAA rule consistently.  The proposed rule also seeks to address the use of co-benefits and double counting, which have been used to justify expensive regulations in the past.”

Regardless of the regulation, the greater overall certainty about how regulations are applied is typically better for business planning…the fewer surprises the better.

If you are looking for some summer reading, you can read the rule in its entirety.

If you need help with an environmental regulatory issue or a second opinion on a soil/groundwater remediation project, we can help.  Please contact our office with any questions or concerns you may have at 248-932-0228 or email info@dragun.com.

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