NRI Standing Committee Newsletter | July 9, 2021

7/15/2021

ncsl newsletter

Below you will find some of the latest agriculture, energy, environment, and transportation policy issues we are following in Washington, D.C. If you have questions about any of the stories below,  please reach out to either myself, Ben Husch (ben.husch@ncsl.org), or my colleague Kristen Hildreth (kristen.hildreth@ncsl.org) and we will point you in the right direction. 

Top Stories

President Joe Biden and Bipartisan Senate Group Reach Infrastructure Agreement

The president and a bipartisan group of 21 senators announced they have reached an agreement on a $1.2 trillion infrastructure package that includes nearly $580 billion in new federal funding as well as a continuation of existing federal infrastructure funding. Of the new funds, transportation infrastructure would receive more than $300 billion, along with $65 billion for broadband, $55 billion for water and $73 billion for energy infrastructure. The agreement includes a list of pay-fors, which includes funds previously earmarked for state and local governments, though not the relief funds provided as part of the American Rescue Plan Act (ARPA). Multiple steps remain before the agreement becomes law, including demands from members of the House that the Senate also agree to pass a human infrastructure package through the budget reconciliation process. Stay tuned to NCSL for further updates.

House Approves Long-Term Surface Transportation Reauthorization and Water Infrastructure Package

The U.S. House of Representatives approved a five-year, $550 billion surface transportation reauthorization—the “INVEST in America Act”—and more than $150 billion in funding for clean and safe drinking water infrastructure. The provisions include $105 billion for drinking water systems, which combines $45 billion to fully replace lead service lines and $53 billion over 10 years for the Drinking Water State Revolving Fund. They also include the Water Quality Protection and Job Creation Act of 2021, which authorizes $50 billion in direct investment in the nation’s wastewater infrastructure and water quality challenges, including $40 billion for the Clean Water State Revolving Fund over the next five years. It remains highly unclear how these bills will be merged with their counterparts in the Senate which have significant differences as Congress seeks to enact a large infrastructure package. For a deep dive on the INVEST Act and the clean water provisions, read NCSL’s Info Alert.

Supreme Court Rules Against States’ Rights in Pipeline Case

The Supreme Court of the United States (SCOTUS) held 5-4 that the federal government may constitutionally grant pipeline companies the authority to condemn necessary rights-of-way in which a state has an interest. Pipeline companies likewise may sue states to obtain the rights-of-way. For more information read NCSL’s Blog.

Agriculture

Senate Approves Major Agriculture Climate Legislation

The Senate passed the Growing Climate Solutions Act of 2021, 92-8, which would establish a certification program at the U.S. Department of Agriculture to help farmers increase their adoption of “climate smart practices,” and provide better access to voluntary carbon markets.

USDA to Review “Made in America” Meat Labeling Rules

The U.S. Department of Agriculture recommitted to plans to review the labeling for products regulated by the Food Safety and Inspection Service (FSIS). USDA announced its intentions to conduct its own rulemaking to address the concern that the voluntary “Product of USA” label may confuse consumers about the origin of FSIS regulated products. The announcement comes in response to the Federal Trade Commission’s rule to deter false, or unqualified, “Made in USA” claims.

Supreme Court Rules Against Unions on California Farm Access

SCOTUS ruled, 6-3, that California’s 1975 Agricultural Labor Relations Board rule giving union organizers access to agricultural land to recruit and organize employees infringed on the rights of agricultural employers by taking their property without compensation. Chief Justice John Roberts concluded the regulation unconstitutionally interfered with the growers’ property rights. The decision overturns the U.S. Court of Appeals for the Ninth Circuit which upheld the California board’s union access rule in May 2019.

Supreme Court Overturns 10th Circuit’s Decision on EPA’s Ethanol Blending Exemptions

SCOTUS overturned the 10th Circuit Court of Appeals ruling, 6-3, which said only small refineries that had received the exemptions continuously since 2011 qualify for new waivers, limiting the Environmental Protection Agency’s power to exempt gasoline makers from requirements to blend ethanol fuel. The ruling overturned the 10th Circuit's decision that voided the small refinery exemptions granted by the Trump EPA to three small refineries owned by HollyFrontier Corp. and Wynnewood Refining Co. LLC.

D.C. Circuit Strikes Down E15 Rule

The U.S. Court of Appeals for the D.C. Circuit vacated a portion of a previous administration’s rule which extended the sale of E-15 (gasoline which contains 15% ethanol) year-round, finding that the agency lacked the authority to do so and strikes EPA’s move to grant E-15 fuels the same volatility waiver that is applied to E-10. The sale of E-15 blends was previously prohibited during the summer months in several states, but in June 2019 EPA finalized its rule extending the waiver to E15.

Supreme Court Denies Petition to California’s Proposition 12 Law

SCOTUS denied a petition to review California’s Proposition 12 law, which would ban the sale of meat products from both in and out of the state that are not in compliance with the proposition’s animal housing standards. Another case challenging the standard is in front of the U.S. Court of Appeals for the 9th Circuit, but a decision has not yet been delivered.

Energy

House Passes Bipartisan State Energy Program Reauthorization

The House passed a bipartisan bill, 398-21, that would provide $90 million annually and includes new funds to support states’ development and strengthening of energy emergency plans and actions (or energy security plans). Qualifying plans must address all types of fuel sources, describe potential threats to each and outline possible mitigation approaches to those risks.

Federal Court Ruling Indicates New Approval Process for Pipelines

The U.S. Court of Appeals for the D.C. Circuit, the second highest court in the country, unanimously vacated the Federal Energy Regulatory Commission’s (FERC) approval of a Missouri pipeline over concerns that FERC did not properly determine whether or not there was market need for the pipeline, as they did not conduct a market study. Under its 1999 gas pipeline certificate policy, FERC allowed developers to use agreements between their affiliates to prove demand existed for their projects. The pipeline’s only customer was Spire Missouri, an affiliate of Spire Energy which owned the company that constructed the pipeline. The court endorsed Chairman Glick’s dissent in the 2018 approval of the pipeline. The case may create uncertainty for pending gas projects whose certificates are contingent upon agreements with affiliates to demonstrate need – for example, the PennEast pipeline which was recently ruled in favor of by SCOTUS depended on affiliates when it applied for its own certificate.

Federal District Court Blocks Executive Order Pausing Oil and Gas Leasing

The U.S. District Court for the Western District of Louisiana issued an injunction blocking the Department of Interior from pausing oil and gas leasing on federal lands and waters – prompted by the Jan. 27 executive order pausing oil and gas leasing pending review. The judge wrote that the pause was in violation of both the Outer Continental Shelf Lands Act and the Mineral Leasing Act, as neither law gives the agency “authority to pause lease sales,” only “continue to sell eligible oil and gas leases in accordance with the statutes.” He also stated the pause would also mean less money for the states from reduced future royalties. The order specifically directs planned lease sales in the Gulf of Mexico and Alaska’s Cook Inlet to proceed as previously planned.

Environment

DOI Announces Over $500 Million in Payments in Lieu of Taxes Funds for 2021

The Department of Interior (DOI) announced $529.3 million in Payments in Lieu of Taxes (PILT) funding for 2021 for more than 1,900 local governments. Since local governments cannot tax federal lands, annual PILT payments help to defray costs associated with maintaining important community services. DOI collects more than $10.3 billion in revenue annually from commercial activities on public lands, such as oil and gas leasing, livestock grazing, and timber harvesting. A portion of these revenues is shared with states and counties. The balance is deposited in the U.S. Treasury, which in turn pays for a broad array of federal activities, including PILT funding.

President Signs Bill Reinstituting 2016 Federal Methane Rules

The president signed a bill using the Congressional Review Act (CRA) to overturn the previous administration’s reversal of the 2016 methane rule on new oil and gas wells. The Senate used the CRA to overturn the reversal, 52-42 in May while the House overturned the reversal, 229-191 late June. Simultaneously, EPA is currently working to roll back a rule that eased methane inspection and leak repair requirements and changed other operational requirements and is in the process of proposing a rule developing new standards for regulating new and existing sources of methane emission from the oil and gas industry. For more details on the CRA visit NCSL’s website here.

EPA to Change TSCA Risk Evaluation Process

EPA announced plans to alter its risk evaluation process as part of the Toxic Substances Control Act (TSCA). Specifically, the agency is moving from issuing risk determinations for each individual use of a chemical to instead making a single risk determination for the whole chemical, based off findings that the bulk of uses for the first 10 chemicals found unreasonable risks. EPA will also reconsider the previous administration’s decision to not assess air and water exposure of chemicals to the general population, while also homing in on environmental justice considerations. The new risk evaluation methods will be made available via public comment and undergo review before the Science Advisory Committee on Chemicals.

Transportation

DOT Awards Infrastructure Grants to States and Airports

U.S Department of Transportation (USDOT) announced $905.25 million to 24 projects in 18 states under the Infrastructure for Rebuilding America (INFRA) discretionary grant program. The program aims to fund highway and rail projects of regional and national economic significance. Approximately 44% of the funding will be awarded to rural projects, which exceeds the statutory requirements for rural projects set by Congress by 19%.

Additionally, the Federal Aviation Administration (FAA) awarded more than $845 million in grants for airport infrastructure projects as part of the funding from the fourth round of FY 2021 Airport Improvement Program (AIP). Grants were awarded to projects at 388 airports in 49 states plus the District of Columbia. The agency separately provided $8 billion in COVID aid to eligible commercial service, reliever, and general aviation airports.

NHTSA To Require AV Companies to Submit Crash Reports

The National Highway Traffic Safety Administration (NHTSA) announced a new requirement for manufacturers and operators of self-driving vehicles to report crashes for vehicles equipped with advanced driver assistance systems (ADAS) or automated driving systems (ADS) that are at least a level 2 system. NHTSA said the action would allow regulators “to collect information necessary for the agency to play its role in keeping Americans safe on the roadways, even as the technology deployed on the nation’s roads continues to evolve.”

Thanks for reading! We will be back later this month to fill you in on other federal happenings.

Best,

Kristen and Ben

Additional Resources