Regulatory Policy
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EPA's Cooperative Approach on Coal Ash Nets "Action Plans" From Industry -- But Here's What EPA Could Really be Doing With Existing Authority

In 2008 alone, coal-fired power plants produced some 136 million tons of coal ash waste – dangerous stuff, because it contains arsenic, cadmium, mercury, and a host of other toxins that are a significant threat to basic human health. Ironically, coal ash has been growing as a problem in recent years in part because better pollution-control devices capture more toxic contaminants before they go up power plant smokestacks. Last year, around 55 percent of the stuff was piled up in rickety “surface impoundments” – that is to say, holes in the ground – and other unstable structures at hundreds of disposal facilities across the country. In December 2008, we got a stern reminder of just how rickety, when a coal ash spill in Kingston, Tennessee demonstrated the catastrophic consequences that occur when these structures fail. Heavy rain that month combined with a leak in an earthen wall in one such “impoundment” sent 1.1 billion gallons of coal ash slurry sliding across 300 acres of land. The spill’s clean-up costs have spiraled to $1.2 billion—equal to about 10 percent of EPA’s entire budget.

In response to the Kingston disaster and the engineering problems that created it, EPA surveyed 219 disposal facilities containing 584 different impoundment structures to learn more about these structures. The agency released the results in September, and followed up earlier this month by announcing a set of action plans developed by the facilities with coal ash ponds themselves, explaining what they'd do to make their sites safer. Many facilities refused to cooperate in the survey, claiming that they could not answer some of the questions without revealing protected confidential business information (CBI).

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Eye on OIRA: The 121st Day and Coal Ash Still Going to Pits in the Ground

Tomorrow will be the 120th day since the White House Office of Information and Regulatory Affairs (OIRA) began its review of the Environmental Protection Agency’s (EPA) star-crossed proposal to declare coal ash that is not safely recycled to be a hazardous waste. The number is significant because it marks the end of OIRA’s allotted review period for the proposal, under the Executive Order that governs OIRA.

The date will likely come and go without fanfare. By rights, OIRA ought to either release the proposal for public comment or return it to EPA for rewriting. You’d think OIRA would be eager to get the thing off its plate, since its staff have been compelled to sit through no fewer than 33 separate meetings on the subject in recent months, no fewer than 28 with industry lobbyists opposed to the rule. But I harbor no expectation of an announcement. It’s more likely that OIRA will just keep working to browbeat EPA staff into rewriting it to the point that the coal industry calms down.

Readers of CPRBlog may recall that coal-fired power plants, while providing half of the nation’s electric power, generate an astounding 136 million tons of toxic coal ash annually. They dump much of it into what are euphemistically called “surface impoundments,” but in fact are no more or less than big holes in the ground that remain open to rainfall from above and water seepage from below—hence the equally distressing labels “coal ash slurry” and “coal ash sludge.”

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Eye on OIRA: Coal Ash Visits by Regulation Foes Up to 28; OIRA’s Open Door Policy Creates Double Standard for Special Interests, Flouting Obama Ethics Initiatives

According to recent statements from the Office of Information and Regulatory Affairs (OIRA) press office, Administrator Cass Sunstein and staff are adamantly committed to granting an audience with OIRA senior staff to anyone who asks to see them about anything, and most especially pending health and safety rules. So not only are special interests granted second, third, fourth, and fifth audiences with OIRA staff after far more qualified political appointees and technical experts at agencies like the Environmental Protection Agency and the Food and Drug Administration have considered but refused to acquiesce to their demands, OIRA imposes no limits on how many times the same interest group—and even the same individual lobbyist—comes to the White House to whine. The most blatant example of this pseudo-transparency-turned-lobbyist-free-for-all is the uncontrolled swarming of special interests with respect to the pending EPA proposal to treat coal ash as a hazardous waste unless it is safely recycled. Here’s the scorecard as of February 6, 2010.


OIRA Meetings on Coal Ash, as of February 6, 2010

(Click links to see attendees and examine documents presented to OIRA staff.)

Parties Supporting EPA Proposal (5)

Parties Opposing EPA Proposal (28)

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The State of the Cost-Benefit State: What We Can Expect from Sunstein, 'Nudge,' and OMB on Regulatory Impact Analysis

This week the White House Office of Management and Budget (OMB) released its annual report to Congress on the costs and benefits of federal regulatory programs. For the policy wonks among us, the most intriguing part was a section on recommendations for reform of the OMB regulatory review process. Here we find hints of what might result from President Obama’s long-awaited overhaul of the executive order on regulatory impact analysis. Cass Sunstein – an eminent legal scholar and now head of the Office of Information and Regulatory Affairs (OIRA) within OMB – has written prolifically and powerfully on this subject and observers expect that the new executive order will bear his unmistakable imprint, shaking up what has been a long-calcified debate on the role of cost-benefit analysis in federal policymaking. If OMB’s annual report is any indication, they won’t be disappointed.

From Nudges to Shoves

OMB’s first major recommendation for reform is that agencies use more cognitive psychology, behavioral economics, and other social sciences in the crafting of regulations. This recommendation comes straight from the pages of Nudge, Sunstein’s popular book co-written with Dick Thaler. Nudge argues that conservatives and liberals should be able to agree on a wide variety of soft regulatory interventions – ones designed to alter the “choice architecture” for individuals in a way that improves well-being without directly forcing behavioral changes. My favorite example from Nudge involves the use of a painted fly image inside the urinals of men’s bathrooms, which apparently dramatically improves aim and thereby reduces cleaning costs. A more pertinent example is the use of an “opt-out” as opposed to an “opt-in” default standard for retirement savings programs, which can substantially enhance participation rates. The idea is that, for a variety of reasons, we underestimate our long-term savings needs. Altering the choice architecture in this way helps to overcome those cognitive limitations while still permitting individuals to opt-out if they desire.

These are fine policies as far as they go, but the question is . . . how far do they go? OMB writes that “[b]ehaviorally informed approaches can be applied in many domains, including financial regulation, public health, environmental protection, energy use, motor vehicle safety, and consumer protection.” But the effectiveness of nudges depends very much on context and goal.

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EPA's New NO2 Rule: A Tale of OMB Interference

The EPA issued a new rule recently on nitrogen dioxide (NO2) -- but not before it was weakened by OMB. The consequences for the public health are real.

The possibility of OMB interference in the rule was first raised by Matt Madia of OMB Watch. He noted that EPA's draft final rule -- sent to OIRA for review on December 18 -- required all metropolitan areas with a population of 350,000 people or more to install a monitoring station for measuring NO2 emissions near a major roadway in the area. By the time OIRA completed its review on January 22, the minimum threshold for monitoring stations had been increased to one per 500,000 people. Troubling, to say the least.

We noticed a document that shines further light on what happened behind the scenes. The EPA had made its position clear, it turns out. In a January 20th email about the "500,000" proposal, Lisa Heinzerling, the EPA's Associate Administrator for policy, wrote, "EPA does not support the alternative threshold described in the email below." (Full disclosure: Heinzerling is a former Member Scholar of CPR. We found the e-mail in question ourselves.)

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OIRA's First Year Under Obama: Deregulatory Stronghold Still Intact

This post is the seventh and final in a series on the new CPR report Obama’s Regulators: A First-Year Report Card.

The White House can influence the performance of protector agencies by the way it structures the regulatory landscape in which these agencies operate. Specifically, it can adjust the contours of this landscape in ways that either encourage or discourage proactive and effective action by the protector agencies. The manner in which it manages the Office of Information and Regulatory Affairs (OIRA)—a small bureau within the Office of Management and Budget that oversees the president’s regulatory policy and reviews individual regulations—is particularly significant in this regard. During the Bush Administration, OIRA operated as a strong deregulatory force. During the first year of the Obama Administration, this obscure but powerful office too often continued on that path.

Under President Obama, OIRA has continued to provide agencies that are themselves major polluters, the Department of Defense, for example, and regulated industries with a venue in which they can attack regulatory agencies and their health, safety, and environmental regulation. As part of its implementation of the regulatory review process, OIRA hosts meetings on rules that it has under review, meetings that are attended by the agency developing the rule and interested stakeholders. So far, the vast majority of these meetings have involved representatives from regulated industries or polluting agencies complaining about proposals under development by the protector agencies. For example, in June, OIRA hosted a meeting in which Department of Defense representatives sought to pressure EPA into abandoning reconsideration of a Bush midnight regulatory decision not to regulate perchlorate—a toxic chemical used in rocket fuel—under the Safe Drinking Water Act. The Department of Defense opposes such regulation because it would impose substantial cleanup costs on the agency. The meeting appears to have worked, as EPA has taken steps to delay regulating perchlorate.

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NHTSA's First Year Under Obama: Stuck in Neutral

This post is the fifth in a series on the new CPR report Obama’s Regulators: A First-Year Report Card.

The National Highway Traffic Safety Administration’s (NHTSA) progress on its statutory mission of reducing traffic fatalities came to a screeching halt in recent years, making it imperative that the Obama Administration work quickly to get this vital protector agency back into gear. Unfortunately, NHTSA coasted through part of the year, when it should have its foot on the gas. While it made some progress, it has not yet launched an affirmative agenda of its own to ensure future progress on its statutory mission.

At first blush, it might appear that President Obama succeeded in revitalizing NHTSA this past year. After all, the agency did take several important protective actions. A closer examination, though, reveals that most of NHTSA’s regulatory accomplishments could be characterized as low-hanging fruit. In many cases, the agency did not do much more than finalize rules that the Bush Administration had been working on and that were due out anyway. Of course, that’s not to say that these finalized rules will not help NHTSA to achieve its mission of reducing traffic fatalities.

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Next Up on BPA: EPA's Chemical Action Plan?

FDA scientists have had a chance to develop an assessment of the risks of BPA in food contact applications using a fuller body of low-dose studies and concluded last week that there’s some concern about the potential effects of BPA on the brain, behavior, and prostate gland of fetuses, infants and children (for a helpful analysis of the context of FDA’s decision, see Sarah Vogel’s post at The Pump Handle). Now, it’s time to look at what EPA is doing with respect to the ubiquitous endocrine-disrupting chemical.

In late September, Lisa Jackson announced that EPA’s Office of Pollution Prevention and Toxics would develop “action plans” for four chemicals or groups of chemicals, outlining potential future regulatory actions aimed at protecting the public and the environment from unreasonable risk. BPA was one of the candidates for an action plan, but when EPA released its four plans on December 30, BPA’s was not among them. EPA’s reason for delaying the BPA action plan was that it was waiting on FDA’s newest analysis and the results of $30 million worth of new studies being conducted under various grants from NIEHS.

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Coal Ash First Real Test of Obama Commitment to Health and Safety Regulation

A critical test of the Obama Administration’s commitment to reviving the Environmental Protection Agency (EPA) is teeing up behind closed doors at the White House. Once again, the Office of Management and Budget (OMB) is cast in the role of regulation killer, supported by a slew of state and other federal agencies that are polluters in this scenario. Other players include a nearly hysterical segment of the electric utility industry, which argues that labeling coal ash as a hazardous waste will prove prohibitively expensive, as well as a coalition of public interest activists that includes Robert Bullard, the father of the environmental justice movement. The story has ample drama: a provable case of racial discrimination, companies as haughty as any on Wall Street, and an appealing heroine, Lisa Jackson, the embattled EPA Administrator, who is the public face of this Administration on the environment but, in a discordant replay of history, could be forced to fall on her sword by anonymous White House economists. (Remember Bush II’s Christine Todd Whitman, former governor of New Jersey, pushed to resign by the machinations of Vice President Dick Cheney? Jackson has less prominent opponents, but just as much on the line.)

An industry victory on the issue would suggest that presidential appointees, confirmed by the Senate and presented to the American people as accountable for everything from food and drug safety to toxic chemical exposures in the workplace, are not really in charge of their agencies but instead could be compelled to become puppets for a White House staff any time a powerful industry screams loudly enough.

The most recent chapter in this saga begins in Kingston, Tennessee three days before Christmas, 2008. A six-story-high earthen dam used to contain a coal ash waste pond at a power plant operated by the Tennessee Valley Authority (TVA) collapsed, releasing more than 1 billion gallons of jet black sludge laced with arsenic, cadmium, chromium, lead, mercury, selenium, and thallium. By volume, the spill was more than 100 times larger than the Exxon Valdez disaster, covering more than 400 acres of homes, farms, businesses, roads, rivers, and irreplaceable wetlands. (See table at end of this post listing the chemicals commonly found in coal ash and their negative health effects.)

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Obama's Regulators Earn a B- for Year One in New CPR Report

Over the weekend, the Associated Press ran a story on the results of its enterprising investigation into the toxic content of children’s jewelry imported from China. Pressed to abandon the use of toxic lead in toys and jewelry, manufacturers have apparently begun using an even more dangerous metal, cadmium, which can cause neurological damage – brain damage – to children and give them cancer. AP tested 103 pieces of jewelry bought in American stores within the last few months, and found that 12 percent contained at least 10 percent cadmium. One item, a cute little Rudolph the red-nosed reindeer trinket, was 91 percent cadmium.

Addressing the question that leaps to mind – How did these extraordinarily dangerous trinkets get onto store shelves in the first place? – reporter Justin Pritchard writes these utterly terrifying and completely truthful words:

A patchwork of federal consumer protection regulations does nothing to keep these nuggets of cadmium from U.S. store shelves. If the products were painted toys, they would face a recall. If they were industrial garbage, they could qualify as hazardous waste. But since there are no cadmium restrictions on jewelry, such items are sold legally.

Of course, this is just the latest in a series of startling tales of dangerous products making it to market in the United States – poisoned peanut butter, toxic drywall, lead-painted toys, and more. Not to put too fine a point on it, but such products often kill people – sometimes immediately, from acute exposure to toxins, and sometimes over a longer period of time by way of cancer. If folks are lucky, their lives simply become miserable, with headaches, nausea, respiratory and heart problems a daily occurrence.

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