Environmental Law Update - Federal Environmental Deregulation—Authority and Limits

By the time you read this prognostication of President Trump’s promised federal environmental deregulation, work will be well underway to implement his agenda. It is reasonable to assume that his efforts will be more successful than in his first term because of his party’s control of the House and Senate and a Supreme Court often sympathetic to conservative positions. The pace and extent of environmental regulatory change will be influenced by many factors, some of which are discussed below.

The Congressional Review Act (CRA), 5 U.S.C. §§ 801 to 808, provides an immediate and powerful tool for a new administration to overturn regulations enacted in the last few months of the prior administration. The CRA requires agencies to report the issuance of rules to Congress and provides Congress with special procedures, in the form of a joint resolution of disapproval, to consider legislation to overturn rules. The CRA’s broad definition of “rules” may include agency directives that do not require notice and comment, e.g., guidance documents and policy memoranda. 5 U.S.C. §§ 555, 804(3). This opportunity allows Congress and the President to quickly remove regulations issued in the last months of the outgoing administration without requiring the lengthy rulemaking process (discussed below) otherwise required to do so.

Environmental regulations subject to the CRA include rules promulgated by the Environmental Protection Agency (EPA). Environmental regulations subject to being overturned under the CRA include EPA’s Lead and Copper Improvements Rule, which requires lead pipes used to transport drinking water to homes to be replaced within ten years, and EPA’s recent ban on the use of certain high-priority chemicals, such as certain chlorinated solvents.

The new administration may also decide to reverse EPA’s position in defending current legal challenges to EPA regulations. For example, EPA is currently defending challenges to a preemption waiver issued under the Clean Air Act to allow California to impose its Advanced Clean Car program, requiring manufacturers to produce an increasing percentage of zero-emission vehicles. The Supreme Court recently agreed to decide whether fuel producers have a legal right to sue over EPA’s grant of this waiver. Ohio v. EPA, 98 F.4th 288 (D.C. Cir. 2024), cert. granted sub nom. Diamond Alternative Energy, LLC v. EPA, 2024 WL 5100664 (U.S. Dec. 13, 2024). The new administration could withdraw the EPA waiver, however, as occurred in 2019 during the Trump administration’s first term. That action would set the stage for litigation on the merits of EPA’s authority to issue such waivers. Seventeen Republican-led states have raised such a challenge, which, at least for now, the Court has declined to hear.

Authority Retained by State and Local Governments

State and local governments, particularly in jurisdictions controlled by Democrats, will continue to exercise regulatory authority on matters not preempted by federal law. Notable examples are state laws limiting per- and poly-fluoroalkyl substances (PFAS) in public water supplies and California’s Proposition 65 law establishing “safe harbor” levels for exposure to chemicals in consumer products. Cal. Health & Safety Code §§ 25249.5 to 25249.14. More mundane examples are state environmental property transfer laws, such as the New Jersey Industrial Site Recovery Act, and the voluntary environmental remediation programs that exist in nearly every state.

Regulatory Notice and Comment Requirements

If the new administration decides to repeal any EPA regulations, it will be required to follow the same notice and comment rulemaking requirements that apply to promulgating regulations under the Administrative Procedure Act (APA), 5 U.S.C. §§ 551 to 559. This will require EPA to publish a Notice of Proposed Rulemaking in the Federal Register to provide the public with an opportunity to comment before finalizing the repeal. Depending on the regulation at issue, affected parties who object to the repeal can file comments, which EPA will be required to address in its response. EPA must publish its response, including the final rule, in the Federal Register. If EPA’s response does not satisfy the commenting parties, those parties may sue EPA to obtain a stay and subsequent reversal of the repeal. Given the new administration’s indication that it will use executive orders to implement various changes, it is likely that affected parties will challenge executive orders as being barred by the rulemaking requirements of the APA.

Federal Citizen Suit Litigation

To the extent the new administration may choose not to enforce any existing environmental regulations rather than actively seek to repeal them, private parties may seek relief via citizen suits. Federal environmental laws containing citizen suit provisions include the Clean Air Act, 42 U.S.C. § 7604, the Clean Water Act, 33 U.S.C.§ 1365, the Resource Conservation and Recovery Act, 42 U.S.C. § 6972, the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9659, the Oil Pollution Act, 33 U.S.C. § 1365, the Endangered Species Act, 16 U.S.C. § 1540(g), and the Toxic Substance Control Act (TSCA), 15 U.S.C. § 2619. These provisions allow citizen suits against private parties for violating the statute and against the EPA Administrator for failing to perform nondiscretionary duties. Although citizen suit plaintiffs are not eligible to receive any penalties imposed by the courts to redress noncompliance, the citizen suit provisions provide for an award of reasonable costs and attorney’s fees to prevailing plaintiffs. After the November election, environmental public interest groups such as Earthjustice began to solicit donations on social media to fund their anticipated lawsuits against the new administration.

Upcoming TSCA Reporting Requirements for PFAS Substances

Current TSCA regulations require any person that manufactures or imports, or has manufactured or imported, PFAS or PFAS-containing articles in any year since January 1, 2011, electronically to report information regarding the articles, including production volumes and hazards, by January 11, 2026. 40 C.F.R. §§ 705.1 to 705.35. The regulations do not exempt small businesses. Small manufacturers reporting only as PFAS article importers have an extended deadline of July 11, 2026. Thus, many companies that have never dealt with TSCA, EPA, or other environmental agencies run the risk of noncompliance if they are unaware of these requirements.

The reporting rule under section 8(a)(7) of TSCA, 15 U.S.C. § 2607(a)(7), requires all manufacturers (including importers) of PFAS and PFAS-containing articles in any year since 2011 to report information related to chemical identity, uses, volumes made and processed, byproducts, environmental and health effects, worker exposure, and disposal to EPA. “PFAS-containing articles” include all manufactured goods and finished products treated with certain PFAS to strengthen the packaging or product or repel water or stains.

If the new administration does not act to extend the reporting deadlines further, regulated entities will risk being named in citizen suits even if EPA does not take action to enforce the regulation. Unlike other reporting requirements under environmental law, the proliferation of personal injury lawsuits pertaining to PFAS exposure creates a new legal risk for those subject to PFAS reporting—i.e., tort liability for PFAS exposures.

Companies that comply with the TSCA disclosure requirements by the applicable deadline will create a public record of their manufacture or importation of PFAS or PFAS-containing products. We expect plaintiffs’ personal injury attorneys to anticipate the new PFAS reporting eagerly. The personal injury lawyers will likely begin to review and evaluate the disclosed information to identify potential targets of lawsuits alleging harm to their clients from PFAS-containing products. But companies that fail to disclose by the deadline will be subject to enforcement from EPA and via citizen suits filed by others, including personal injury lawyers.

Industry Standards and the Global Market

California’s Proposition 65 provides a long-term example of how businesses adjust their products to conform to the requirements of the most stringent jurisdictions in which they do business. In the age of Internet commerce, even a small local company located thousands of miles from California is likely to receive and fulfill orders from customers based in California. Sellers of products sold directly to customers will consider the cost and efficiency of producing two lines of products or simply making one line that complies with California’s requirements. For example, chillers and similar products containing refrigerants sold in California are subject to more stringent standards for ozone-depleting chemicals than in other states.

Products sold in foreign markets must also continue to comply with the standards of the jurisdictions in which they are sold. Some of those standards are more stringent than those imposed under US environmental laws.