Bill Funk on CPRBlog {Bio}
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Executive Fiat or Business as Usual? Claims of Presidential Overreach are Just Politics

In his State of the Union Address President Obama announced that, while he intended to work with Congress to achieve various goals, he will act unilaterally, invoking his “executive authority,” pending congressional action.  There followed a laundry list of initiatives that he said he would take on his own.  Predictably, Republicans have railed against the President’s proposed actions, accusing him of subverting the rule of law.  It’s all just politics.

First guilty party: President Obama.  For all his touted exercise of executive authority, there is nothing revolutionary there.  Most of the initiatives are simply the use of the bully pulpit to call upon various groups and constituencies to do the right thing.  For example, the White House hosting a Summit on Working Families, asking the Vice President to lead a “full review” (as opposed to a partial review, I guess) of America’s job training programs, asking every business leader to help the long-term unemployed find jobs, and mobilizing leaders from business, labor, community colleges and other training providers to boost the number of apprenticeships in this country.  Not that those are not good things, but they are hardly strong medicine.  The rest of the initiatives involve the exercise of existing, well-established statutory authorities, not the use of some free-floating constitutional “executive authority.”  For example, the first out of the box was the President’s order requiring new contracts with the federal government to establish a $10.10 minimum wage for contractor employees.  However, at least since 1979, when the D.C. Circuit upheld President Carter’s maximum wage and price controls for government contractors, it has been well established that the Federal Property and Administrative Services Act authorizes the government to dictate the wages of contractor employees.  Another announced initiative is the launching of four new manufacturing innovation institutes, but this is just the direction of the use of appropriated funds consistent with the statutory restrictions on their use.  Likewise, the so-called “myRA,” or the poor man’s IRA, is justified in reality by Treasury Department authorities regarding the sale of government bonds, and it is entirely voluntary for employers.  In other words, the President is guilty of hype – portraying himself as the sole person with the power to do these things.  It would not be nearly so dramatic if he said that he was utilizing already existing statutory authorities.  

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Myths and facts surrounding the Supreme Court’s review of GHG emission permitting

 On Tuesday, the Supreme Court granted six of the nine petitions challenging a DC Circuit Court of Appeals ruling in favor of the EPA’s rules regulating greenhouse gases under the Clean Air Act. However, the Court granted review of only one aspect of the various petitions: whether the EPA’s use of vehicle emission standards to regulate greenhouse gases triggers permitting requirements for stationary power sources that contribute to carbon pollution.

The regulations at issue implement the Clean Air Act’s Prevention of Significant Deterioration (PSD) program, which regulates new major emitting sources in areas meeting the Act’s minimum standards for at least one of the so-called Criteria Pollutants. In these areas, which include almost everywhere in the United States, the Act requires EPA to impose a permit requirement on major emitting facilities, which would include a best available technology requirement, if the facility emits an air pollutant “regulated under the [Act]” in excess of a certain amount. The Court rejected other challenges, including challenges to EPA’s determination that greenhouse gases endanger public health as well as challenges asking for reconsideration of the Court’s decision in Massachusetts v. EPA that COis a pollutant regulated by the Clean Air Act.

Despite the narrow review, special interests opposed to environmental regulation have flooded the news with misinformation regarding the EPA’s use of the Clean Air Act to regulate greenhouse gases, whether the Agency has the power to regulate at all and have called for an end to any further regulations to protect the environment and public heath.

Listed below are several myths and corresponding facts regarding the Court’s decision and the EPA’s regulation of greenhouse gases in response to some of the reported misinformation.

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Time to Stand Up and Be Counted

Executive Order 12866 may be twenty years old, but formal, centralized review of agency rulemaking by the Office of Information and Regulatory Affairs (OIRA) is more than thirty years old, having been instituted by President Ronald Reagan in Executive Order 12291 in 1981. Since then, this centralized review has been carried out without significant change over five presidential administrations and has had bi-partisan support in both the House and Senate. Progressives have been less enamored with this review, seeing in it a deliberate bias against regulation by reason of its additional roadblocks to and delays in adopting regulations. This bias was clearly intentional in the origin of the centralized review by President Reagan, who famously said, “government is not the solution to our problem; government is the problem.” However, even when Democrats became President the bias remained. President Clinton’s E.O. 12866 begins with a statement of regulatory philosophy that agencies should adopt “only such regulations as are required by law . . . or are made necessary by compelling public need,” not regulations that simply further the public interest or increase the net welfare to society. President Obama not only retained E.O. 12866 but also, in his E.O. 13563 explicitly reaffirmed its principles. 

Of course, there is nothing inherent in the concept of centralized oversight of agency regulation that requires a bias against regulation. After all, OIRA Administrator John Graham in the George W. Bush administration instituted “prompt letters,” which proactively requested agencies to take certain actions, including adopting new or strengthening older regulations. However, Although the “prompt letters” initiated by OIRA administrator John Graham in the George W. Bush administration demonstrate the ability of centralized review to spur regulation and to push for further regulation, the fact that there were only seven such letters in eight years probably reflects the exception that proves the rule.


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Government Seeks Certiorari on Clean Water Act’s Direct Review Provision in EPA v. Friends of the Everglades

Environmentalists know about the Environmental Protection Agency’s Water Transfer Rule. See 40 CFR § 122.3(i). It states in essence that discharging polluted water from one body of water to another unpolluted body of water is not a discharge of a pollutant under the Clean Water Act. According to the EPA, this action would not be regulated by the Act, because no pollutant is being “added” to the “waters of the United States.” There may be an addition of a pollutant to a particular body of water, but that is not enough, the EPA says. There must be an addition to the “waters of the United States” as a whole. This is also known as the “unitary waters” approach.   

This issue has arisen in a number of different cases, perhaps most notably in South Fla. Water Mgmt. Dist. v. Miccosukee Tribe of Indians, 541 U.S. 95 (2004), in which polluted water from canals was being pumped into Lake Okeechobee without a permit. The Supreme Court rendered its decision in that case before the EPA adopted the Rule, although EPA had earlier interpreted the Act informally to the same effect. The Court declined to decide the validity of the EPA’s informal interpretation, remanding the case to the lower courts on other grounds. After remand and the EPA’s adoption of the Rule, the Eleventh Circuit upheld the transfer, deferring to the EPA’s interpretation of the Act under Chevron, USA, Inc. v. NRDC, 467 U.S. 837 (1984). Before the Eleventh Circuit issued its decision, however, environmental groups had filed direct challenges to the Rule in both district and circuit courts. Those cases were stayed pending the decision in the Miccosukee case, and after that decision the circuit court cases were consolidated in the Eleventh Circuit. 

Inasmuch as the Eleventh Circuit had already ruled on the validity of the Rule, environmental groups argued that the court did not have jurisdiction to hear a direct challenge to the rule and that only district courts had jurisdiction to hear the challenges. If they could divest the Eleventh Circuit of jurisdiction in favor of district courts, then challenges brought in district courts in other circuits might reach a different conclusion as to the validity of the Rule. The EPA, on the other hand, would like the Eleventh Circuit to rule on the case because a favorable outcome to the Agency would be ensured.

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National Meat Association v. Harris: More Preemption in the Supreme Court

On November 9th the Supreme Court will hear oral argument in National Meat Association v. Harris, wading once again into the mire of federal preemption. The National Meat case involves a California statute that prohibits the slaughter of non-ambulatory animals for human consumption and requires that non-ambulatory animals be immediately and humanely euthanized. A federal law, the Federal Meat Inspection Act (FMIA), thoroughly regulates, although one could question how strictly, the process of slaughtering animals for human consumption. It also contains an express preemption provision that prohibits states from making any “requirements within the scope of this chapter with respect to premises, facilities and operations of any establishment [subject to this chapter], which are in addition to, or different than those made under this chapter.” 21 U.S.C. § 678. But then it also provides that: “this chapter shall not preclude any State ... from making requirement[s] or taking other action, consistent with this chapter, with respect to any other matters regulated under this Act.” The National Meat Association filed suit for declaratory and injunctive relief against the California law as it applies to swine and the processing of pork, claiming that the California law is preempted by the federal law. The Ninth Circuit, in an opinion reflecting the inimitable style of Judge Alex Kozinski, held that the California law was not preempted. The court said that the California law merely identifies what animals may be slaughtered for human consumption, not how they are to be slaughtered. And the law’s provision requiring the euthanizing of non-ambulatory animals, the circuit court said, does not relate to the slaughtering of animals for human consumption. The Supreme Court, against the advice of the Solicitor General, granted certiorari.

Before the Court, the petitioner, the National Meat Association, rests its argument on the express preemption provision, disclaiming any reliance on obstacle preemption (the judicially created doctrine that a state law is preempted if it stands as an obstacle to the full attainment of  the goals of a federal law). The United States as amicus in support of the petitioners likewise limits its argument to express preemption, although in a footnote the government asserts that there would in any case be obstacle preemption. So, the initial issue is whether the preemption provision should be read narrowly, as respondents argue and the Ninth Circuit held, relying on Wyeth v. Levine, or broadly, as the petitioners argue, relying on an earlier FMIA case, Jones v. Rath Packing Co. Of course, neither side’s argument on this is correct. In Wyeth, the Court reaffirmed the approach that there is a presumption against federal preemption, but in that case there was no preemption provision to be construed. In Rath Packing, the Court did not give the FMIA’s preemption provision a broad reading; instead it read it according to its terms, rejecting what it called a “strained” interpretation or a “restrictive reading."

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In Williamson v. Mazda, SCOTUS Has Chance to Right Preemption Wrongs

Cross-posted from ACSblog.

The Supreme Court will hear arguments on November 3 in a potentially important preemption case, Williamson v. Mazda Motor of America. In Williamson, a child was fatally injured in a collision when she was sitting in the center rear seat of a Mazda van, secured by a lap belt. The two other passengers in the vehicle, both wearing lap-shoulder belts, survived with minor injuries. The young Williamson, however, suffered severe abdominal injuries and internal bleeding because her body jackknifed around the lap belt. The Williamsons sued Mazda asserting that the van was defectively designed by providing only a lap belt in the center rear seat. When the van was built, the National Highway Transportation Safety Administration's Federal Motor Vehicle Standard (FMVSS) 208 only required lap belts in the center seat, even while it required lap-shoulder belts in all other seats. Mazda moved to dismiss the case on the grounds that the common law tort claim was preempted by the federal standard. The California trial court granted the motion and the appellate court affirmed. The Supreme Court granted certiorari to consider that decision.

This is not the first time that the Supreme Court has considered the relation between FMVSS 208 and state tort law. In Geier v. American Honda Motor Co. (2000), the Court held that FMVSS 208 at the time of that case preempted a state tort law claim that the failure to provide for an airbag was a design defect. Since that case, virtually every tort claim based on an alleged design defect regarding seat belts or airbags has been dismissed as preempted in light of the Geier decision. Thus, the outcome in Williamson in the lower courts is not surprising. What is surprising is that the Supreme Court granted certiorari to hear the case.

There are two possible explanations. First, unlike Geier, in which the United States filed an amicus brief in favor of preemption, here the United States filed an amicus brief in favor of granting certiorari, arguing that the lower courts had misread Geier and applied it much more broadly than appropriate. Second, on the merits, the United States is absolutely correct; Geier was a very fact-specific case, which subsequent courts have misread.

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ABA Makes a Positive Step with Resolution on Agency Preemption

In November 2008, with Riegel v. Medtronic recently decided, bills introduced into Congress to overturn its effect, and Wyeth v. Levine about to be argued in the Supreme Court, the President of the American Bar Association created a task force to review ABA policies regarding preemption of state tort law. The composition of the task force was equally split between those who generally favor preemption and those who generally oppose it and included both private practitioners and academics (I was one of those academics). Earlier this month the task force unanimously presented its recommendations to the House of Delegates of the ABA, the policy making body of the ABA, and the House adopted those recommendations by an overwhelming majority.

Eschewing any attempt to take a substantive position on the desirability of preemption of state tort law or the lack thereof, the task force focused on the procedures that should accompany any decision to preempt state tort law. The resolution urges that when Congress considers preempting state tort law it should take into account the historic responsibility States have exercised over the health and safety of their populace and to balance that responsibility against the competing concerns for national uniformity. Moreover, Congress should as a regular matter address foreseeable preemption issues clearly and explicitly when it enacts a statute that has the potential to affect state tort law. It should clearly and explicitly state when it intends to preempt state tort law and clearly and explicitly set forth the extent of the preemption it intends, and the extent to which, through a savings clause or other means, it intends not to preempt state tort law. All too often Congress has not spoken clearly, leaving to courts or agencies the federalism balancing that properly lies in the domain of Congress.

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The Public Needs a Voice in Policy. But is Involving the Public in Rulemaking a Workable Idea?

Informal rulemaking under the Administrative Procedure Act was, as the late Kenneth Culp Davis opined, "one of the greatest inventions of modern government." It not only decreased the procedural requirements (and therefore the overhead) of “formal” rulemaking, but it also broadened the universe of persons able to participate in the informal proceeding to the public at large. Subsequently, other laws, such as the Freedom of Information Act, the Government in the Sunshine Act, and the Federal Advisory Committee Act, have expanded the ability of the public to monitor agency activities, if not to participate in them. BTI (before the Internet), agencies informed the “public” of proposed rules by publication in the Federal Register, which was widely available in public libraries. Interested members of the public could then submit comments on the proposal through the U.S. Mail (or private express carriers). Of course, those “in the know,” the Washington lawyers and lobbyists who actually read the Federal Register notices, could not only comment on the proposals but also monitor what was submitted to the agency by going to the agency’s FOIA reading room. And, of course, these same lawyers and lobbyists could also make use of their proximity to the agencies by arranging one-on-one meetings with influential persons in the agency. “Good government” at the time meant that such meetings would be docketed and summarized and any written material there obtained placed in the record. This information might be useful to the other insiders in Washington, but it was useless to the public at large.

The availability of the Internet has led some to believe that this rulemaking paradigm can be altered in favor of greater public participation and influence, presumably to the detriment of the traditional power brokers. is the official government attempt to put rulemaking online. As a means of empowering the public, however, it’s a disaster. It is difficult to navigate, and its search engine can’t find its way home. For example, if you wanted to find the Department of Transportation’s recently proposed rulemaking to prohibit commercial truck drivers from texting while driving, you might try using the keyword “texting.” But if you did, you wouldn’t find this rule. If you’re an expert (one of those Washington insiders with a little tech savvy), however, it’s OK, because you probably already know the docket number.

Along comes Cornell Law School and its Legal Information Institute (known for its immediate dissemination of Supreme Court opinions), with a new initiative, the Cornell E-Rulemaking Initiative or CeRI. Together with the Departments of Transportation and Commerce and the National Science Foundation, CeRI is attempting to help agencies transition to electronic rulemaking. In particular, CeRI wants to facilitate public participation in government policymaking and increasing public participation beyond the notice-and-comment process.

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Obama's Memo on Preemption -- Striking a Blow for Good Government

On Wednesday, by the stroke of a pen, President Obama reversed a major Bush administration policy, striking another blow for good government. For eight years the Bush administration sought to accomplish tort reform by stealth and indirection with several agencies proclaiming in preambles to regulations that the regulations preempted state tort law. These agencies included the National Highway Traffic Safety Administration, the Federal Railroad Administration, the Consumer Product Safety Commission, and most notably the Food and Drug Administration. The FDA's broadest claim -- that its drug labeling regulation preempted state tort law -- was rejected by the Supreme Court earlier this year in Wyeth v. Levine.

In a November 2008 White Paper, CPR Member Scholars called for the President to amend or strengthen the existing Executive Order on Federalism to reverse this Bush policy and to re-establish the presumption that federal regulations protecting health, safety, and the environment do not preempt state tort law. The President has now done this.

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The First 100 Days: A Positive Beginning on the Freedom of Information Act

There are few areas where the difference between the Republican and Democratic parties is more stark than that of the Freedom of Information Act. The FOIA, of course, requires agencies to provide copies of their records to any person upon request unless the record fits within one of nine specific exemptions. Among the most important of these are the exemption for classified information, inter-agency or intra-agency communications containing advice or recommendations, information compiled for law enforcement purposes, and private commercial information. Nevertheless, the Supreme Court has made it clear that the FOIA is a disclosure statute; nothing in the FOIA requires an agency to withhold records even if they fall within an exemption, although it is possible that some other statute might. Full text