At ICIE’s Annual Meeting in November, a panel addressed the
issue of federal environmental regulations – are they unduly burdensome, or
absolutely necessary? Most speakers,
while differing in opinion occasionally, fell somewhere in the middle of these
two ends of the spectrum.
Jim Werntz, Director
of Idaho
Office of EPA noted that Republican presidential candidates have gone so far as
to call for abolishment of his agency, arguing that federal regulations
negatively impact businesses and therefore the economy. But Werntz also noted there have been some
major successes attributable to the laws and regulations even when examined
from a cost/benefit standpoint.
“You won't hear me say that protecting our environment
doesn't cost money, but these are wise investments, and often result in cost
savings overall, resulting in lower health care costs, less cancer and fewer
deaths.”
Werntz said there are those who think our economic recovery
is going to gain steam and momentum if we cut regulation. But he noted a recent Idaho Statesman article
with figures from the Idaho Department of Labor citing the number of jobs lost
overall as a result of the burden of federal regulations as 1/20th
of one percent. The impact of
regulations, Werntz said, is measurable but small, with a National Federation
of Independent Businesses survey that cited poor sales as the biggest impact on
jobs, followed by regulations.
Werntz said that the most significant successes of the EPA have
been its addressing of health and environmental problems including the Clean
Air Act and the Clean Water Act and the Superfund.
Werntz conceded that there are problems with having the bar
of a federal standard set by the EPA as directed by Congress. One example of this problem, he said, is illustrated
by the issue of arsenic in drinking water, the levels for which were reset
about a decade ago from 50 ppb to 10 ppb.
This is problematic, because so much arsenic comes from Idaho’s geology, and
Werntz says the cost to communities to get down below that new arsenic standard
is “ridiculously high.”
Werntz pointed out that a lot of EPA regulations come from
court decisions, leaving the agency in the position of having to struggle to
implement complex regulations.
“I can only imagine what small businesses are struggling
with,” he said. “Many of our rules are more complex and more convoluted than
we'd like.”
The Small Business
Perspective
Suzanne Budge of the National Federation of Independent
Business agreed with Werntz about the complexities of EPA rules and the burden
they represent to small businesses. To a
large degree, she said, small businesses are affected more than large
businesses. Budge cited some specific
examples, and statistics:
- For small businesses, the average cost per
employee to comply with Federal regulations is $10,585
- There are 800 new or pending regulations that
can impact small businesses
- President Obama in his first 2 years in office
has presided over regulations (not just environmental) that Budge says cost the
economy at least $100 million annually. Budge said this is an amount that is
dramatically higher than either the Clinton
or Bush administrations.
The Big Business
Perspective
Trent Clark, Monsanto’s Public and Government Affairs
Director, weighed in on the topic of environmental regulations from the
perspective of big businesses, from the standpoint of Monsanto’s herbicide
product, RoundUp.
This product originates in Idaho, he said, and uses elemental
phosphorus, which requires that phosphate be stripped of its oxygen component
after mining. Soda Springs, Idaho,
is the location of the last phosphate furnace in the US, where there used to be 28
nationwide, a decrease largely due to environmental regulations.
Other critical needs for elemental phosphorus, Clark said,
include the nonflammable hydraulic fluid for airplanes and tracer rounds such
as those used by the military over Bagdahd.
Clark says that in the last 6 years Monsanto has encountered
a significant obstacle to their domestic source for phosphorus. Conforming to water quality standards for
Bluegill fish, a mine project near the Blackfoot river must exceed even
drinking water quality standards. Even
though the Blackfoot
River is not blue gill
habitat, the cost of the project was inflated from $3 million to $30 million. Monsanto did, however, show that there is a
way to mine the Blackfoot Ridge mine in a way that does not produce an effluent
that would be bad for blue gills.
Additional modeling on selenium sources resulted a need to
account for burrowing rodents. That was
done by caping the mine with a geo-synthetic clay liner laminate material that costs
about $28,000 per acre.
In the midst of this work, Clark
said, a new problem arose: the Blackfoot river was declared to be impaired for
selenium. The standard for selenium
effluent changed to 0. Idaho
declared that “zero” is actually a level that is detectable at less than a 1/2 part per billion standard. Monsanto therefore designed a water
collection system underneath the pile, again increasing the cost of the mine,
this time to $60 milion.
Clark said that Monsanto produces elemental phosphorus in
direct competition with China, where 50% of their phosphorus comes from artisan
operations – essentially, where families burrow in the hillside, filling wicker
baskets. A task master weighs the
baskets and metes out about enough to buy that day's food. In this operation, nothing is spent making
sure that the nearby water is safe for blue gills. Clark said he wonders about the
environmental impact will be if Monsanto decides $60 million is too much to
open such a mine.
“The impact would be taking a world-class sustainable
operation out of the US,
forcing dependence on artisan mining in China,” he said. “I can't see how anyone would say that that
would be good for the environment.”
Court interpretation
of EPA rules complicate clean water regulations
Attorney Andy Waldera provided context on the NPDES permit
program under the Clean Water Act, which dictates under what circumstances
pollutants can be discharged into jurisdictional waters and by whom.
The purpose of the CWA is to protect water bodies to make
them safe for fishing and swimming, with an overarching goal to prevent
discharge. Waldera qualified the permit
program as the exception to that general rule.
If you get a permit, and are meeting the terms of the permit, you’re
allowed to function as a point source, or a discrete conveyance of
pollutants. The fines for not complying with the terms of
the permit are up to $37,000 per day per violation, per point source. There are also criminal provisions.
Waldera said a big concern with the CWA is citizen
supervision. A citizen can file suit
against anyone they feel is in violation of the CWA. Those who do so, and are successful in bringing
in an enforcement action, can recover legal fees. In the long run, the cost of filing suit is
covered by tax dollars.
Exemption from the permit requirements include return flows
from irrigated agriculture. Irrigation
facilities are jurisdictional waters, which more often than not, include
interconnections with waters of the US.
How did an effort to maintain clean water become so
complicated? Waldera said a lot of EPA's direction lately has been coming from
the courts.
“I feel for the EPA,” he said, “it has to deal with fairly reasonable
regulations that come through the courts, and then through litigation become
much more cumbersome.”
Another issue is the Federal Insecticide, Fungicide and
Rodenticide Act. FIFRA says as long as
pesticides are applied in accordance with the label, the applicant is
protected. But Waldera said this is in conflict with the CWA, which considers
issues on a case by case analysis rather than a cost/benefit analysis.
What about applications with drift where you could hit
waters of the US? The Court ruled that
insecticides are pollutants to begin with.
How can you have a pesticide or an insecticide that performs a
beneficial service, Waldera asked, particularly when you're applying it in
accordance with its FIFRA label, you don't over apply, or have lingering
breakdown residue, and still treat it as a point source? The EPA, in considering this decision came up
with the Aquatic Pesticide rule, which addresses direct application and the
concept of drift. This rule says that if
you are using a compound that serves a beneficial purpose and is in compliance
with FIFRA, the benefits outweigh the costs. Even if there is some impact to
the environment, you are in compliance with the CWA. This decision also noted that you could not
have a point source discharge of a pollutant, because it had not broken down
into a pollutant yet.
Waldera said the 6th Circuit Court ruled that the EPA's new
rule did not meet the requirements of the CWA.
So the court vacated the rule, but then clarified that not all
pesticides are pollutants at the time they are applied, those that leave behind
a chemical residue are pollutants. Also,
if you apply it in excess of what is needed, the excess product is a chemical
waste and a pollutant. The court also said the NPDES permit applies to indirect
application as well as direct application.
The Clean Water Act also called out biological materials as
pollutants. The court did not accept the
timing analysis that said you could not
have the point source responsible for the pollutant, because the pollutant is
the result of the chemical breakdown.
The courts said that you would not have the breakdown products without
the point source.
So as a result, Waldera said, what would have been a
reasonable rule becomes the NPDES permit.
