Tracking Trump’s Midnight Regulations: Administrative Challenges Expected

In anticipation of inauguration day on January 20, 2021, the Trump Administration is racing to issue so-called midnight regulations. Midnight regulations have been used by many outgoing administrations just before leaving office to finalize policy priorities. The White House Office of Information and Regulatory Affairs has been reviewing dozens of regulations submitted since Election Day, indicating that a deluge of regulatory changes is forthcoming. Many of the these involve energy and environmental policies, so businesses affected by these regulations may want to keep track of developments in the coming year.

Environmental regulations of interest include the following:

  • Endangered Species Act implementation. The U.S. Fish and Wildlife Service (FWS) and the National Marine Fisheries Service (NMFS) have proposed to change the way that new species are listed as endangered or threatened, the way in which critical habitat is designated, as well as procedures for interagency cooperation.
  • Migratory Bird Treaty Act (MBTA) implementation. The FWS has proposed narrowing the scope of MBTA protections to apply “only to actions…directed at migratory birds,” effectively ending long-standing penalties for the accidental killing of migratory birds during industrial activities.
  • Retaining existing National Ambient Air Quality Standards (NAAQS) for Particulate Matter (PM). Under the Clean Air Act, EPA is required to set NAAQS for “criteria pollutants.” Under the statute, NAAQS must be updated every five years. This year, the Agency proposed to retain, without changes, the existing PM2.5 NAAQS of 12 ug/m3, which was met with criticism due to evidence that PM2.5 causes significant harm at concentrations below 12 ug/m3. The EPA has also proposed retaining current NAAQs for ozone, which has faced similar criticism.
  • Changing standards under the Safe Drinking Water Act (SDWA) for lead, copper, and other water contaminants. The SDWA gives EPA authority to set national drinking water standards. EPA’s proposed revisions would leave current standards in place for copper pipes under the SDWA’s Lead and Copper Rule and leave the action level for lead at 15 ppb. EPA also released a preliminary decision to introduce national primary drinking water regulations for two per- and polyfluoroalkyl substances (PFAS) under the SWDA, though critics believe more PFAS should be regulated under the proposal.
  • Reissue and Modify Clean Water Act (CWA) Nationwide Permits. The U.S. Army Corps of Engineers (Corps) issues Nationwide Permits (NWPs) to authorize specific activities under § 404 of the CWA and § 10 of the Rivers and Harbors Act of 1899. On September 15, 2020, the Corps published a notice of proposed rulemaking which would affect ten existing NWPs, including the following: NWP 29 (residential developments), 39 (commercial and institutional developments), 40 (agricultural activities), 42 (recreational activities), 43 (stormwater management facilities), 51 (land-based renewable energy generation facilities), and 52 (water-based renewable energy generation pilot projects).
  • Revising New Source Performance Standards for power plant carbon emissions under the Clean Air Act. In late 2018, the EPA proposed to revise Obama-era performance standards for greenhouse gas emissions from new, modified, and reconstructed coal-fired power plants. The changes would overturn the EPA’s prior decision that partial carbon capture and storage technology (CCS) was the best system of emission reduction.

There are two tools available to the incoming administration to delay, alter, or undo any midnight regulations passed by the Trump Administration, and one similar tool available to Congress:

  • Rulemaking authority under the Administrative Procedure Act

All regulations currently under review must comply with the Administrative Procedure Act (APA). The APA is a federal statute that governs the process by which federal agencies develop and issue regulations. It requires a series of actions by the federal agency, including cost-benefit analysis, risk evaluation, publishing of notices in the Federal Register, and public comment, among other more technical requirements. Outgoing administrations may quickly finalize rules that have gone through the notice-and-comment process, shorten public comment periods, or issue more interim final rules. There are concerns that this rushed completion of midnight regulations may fall short of APA’s requirements. In that case, even regulations that survive the transition may be vulnerable to legal challenges on procedural grounds.

  • Executive authority to temporarily delay the effective date of final but not-yet-effective midnight regulations

A second, lesser-known procedure allows an incoming President to issue an executive memorandum ordering a 60-day blanket delay on all midnight regulations that were not “in effect,” or published in the Federal Register, by January 20, 2021. The practice was established by President Reagan and has since been followed by presidents of both parties. See Presidential Memorandum of January 29, 1981, 3 C.F.R. 223 (1981). The 60-day delay allows incoming administrations additional time to review the regulations and, as desired, institute rulemaking procedures to further delay, alter, or rescind them.

  • Blocking midnight regulations using the Congressional Review Act.

Finally, Congress could use the Congressional Review Act (CRA) to overturn midnight regulations. Under the CRA, a new final rule may be invalidated by a joint resolution of disapproval passed by Congress and signed by the President. Congress can only use this tool on regulations issued during the previous 60 congressional working days. The 60-day clock starts when the federal agency submits a final rule to Congress or publishes it in the Federal Register, whichever is later. For regulations issued with less than 60 working days left in the current congressional session, that clock will start anew when the new Congress convenes. Because of this complicated timeline, lawmakers may have until mid- to late-spring to overturn Trump’s midnight regulations. A full explanation of how the CRA works can be viewed here.                

The Trump Administration has been focused largely on environmental deregulation the past four years. President-elect Joe Biden is expected to undo much of that work, but in light of the potential challenges outlined above, it will be an arduous and painstaking task. The sudden flood of regulatory activity and ensuing administrative challenges will be difficult to navigate, but KMCL attorneys are here to answer questions about how they might affect you or your business.