Washington Insider -- Thursday

Slow Administration Progress on Infrastructure

Here’s a quick monitor of Washington farm and trade policy issues from DTN’s well-placed observer.

EPA Extends Comment Period on Rescinding WOTUS Rule

Comments on the proposed rescinding of the controversial Waters of the U.S. (WOTUS) rule are now due September 27, the Environmental Protection Agency (EPA) announced August 16, a 30-day extension.

Comments on the proposed ending of the Obama-era WOTUS rule were originally due August 28 but that will be extended by the action to give environmental groups, industry advocates and the public more time to weigh in.

When the proposal was officially released, the 30-day comment was a point of contention for supporters of the Obama-era rule.

EPA has proposed rescinding the WOTUS rule and putting back in place the Clean Water Act guidance in place prior to the updated version from the Obama administration. It's not clear what the Trump administration will propose to put in place but expectations are there will be a plan released some time yet in 2017.

In developing the replacement for the WOTUS rule as part of a two-step process, EPA and the U.S. Army Corps of Engineers "are consulting with state and local government officials, or their representative national organization" to gather information to develop that effort.

Court: EPA Wrongly Denied Small Refiners RFS Exemption

Two small refineries in Wyoming were wrongly forced to comply with the Renewable Fuel Standard (RFS) by the Obama administration in 2016, a federal court ruled Wednesday. Sinclair Oil-owned facilities had requested exemptions from the RFS, citing language in the law that allows EPA to spare small refiners from the program's biofuel blending requirements if they would experience "disproportionate economic hardship."

While the Department of Energy (DOE) recommended granting them a 50% waiver, EPA in October 2016 said both facilities were profitable enough to bear the RFS's costs and thus would have to comply fully with the program.

A divided panel from the 10th Circuit Court of Appeals today said EPA overstepped its authority by concluding the exemption could only be granted if complying with the RFS presented a long-term, "existential threat" to the refineries' survival. EPA "chose a definition of economic hardship plainly at odds with Congress's statutory command," concluded the two majority judges, Timothy Tymkovich, a George W. Bush appointee, and Nancy Moritz, an Obama appointee.

The matter was sent back to EPA for further action. The agency will now review the refineries' petitions in light of the ruling. The agency could find further reasons for denying the petitions or it may grant Sinclair the requested exemptions.

Washington Insider: Slow Administration Progress on Infrastructure

While there is strong interest across the country regarding the administration’s proposed infrastructure projects, Politico had only faint praise for the President’s roll-out of an executive order aimed at speeding up approvals for investment projects. It calls the order “only the latest in a string of efforts to call attention to the languishing proposal for a $1 trillion initiative to rebuild the nation's roads, tunnels and bridges.”

The new order aims to shrink the environmental permitting process to as little as two years, down from an average of seven years for "complex" highway projects and to ensure that just one federal agency serves as the point of contact for each project. It also nixes an Obama-era flood standard that would have required federally funded projects to be built to withstand the stronger storms projected to occur as the planet warms—a highly controversial move, observers say.

"My administration is working every day to deliver the world-class infrastructure that our people deserve and, frankly, that our country deserves," the president said.

However, Politico says the executive order is but “another drip in the trickle of actions” the administration has taken to highlight its interest in bolstering the nation's infrastructure, relying on existing authorities granted by Congress in its 2015 surface transportation law. A similar announcement had been made in June at DOT headquarters, which highlighted thick binders full of permit paperwork on stage and a vow to end the “painfully slow, costly and time-consuming" review process.

Politico noted that Tuesday’s announcement “did little to flesh out exactly how this administration plans to boost public and private investment in those projects.” The most detail the White House has provided to date was a six-page fact sheet released with little fanfare along with Trump’s fiscal 2018 budget proposal in May.

While infrastructure boosters have largely cheered the administration's posture on speeding up permit approvals, they're also eager to see the president provide substance into a policy priority that they hope can notch a rare bipartisan win for Trump's first year in the West Wing.

Nevertheless, administration officials and their allies argue that the latest order is a significant step toward smoothing out what they've decried as a long, confusing federal permitting process that allows a multitude of agencies to approve or reject projects. “We’re pleased that the Trump administration is continuing its effort to slice through burdensome, duplicative processes across government," said Christine Harbin, Americans for Prosperity's vice president.

Just days into his presidency, Trump signed an executive order directing federal officials to expedite environmental reviews for infrastructure projects deemed "high priority." And he announced in June he would revamp an Obama-era online "dashboard" to allow the public to track projects and see when deadlines are blown. However, Politico argues that Trump is “just the most recent president eager to hasten the federal permit process.” President Barack Obama signed orders of his own to speed up those environmental review proceedings and President George W. Bush before him formed a task force with the goal of "modernizing" the National Environmental Policy Act, the 1970 law that requires federal agencies to evaluate the environmental impacts of proposals affecting anything from construction to land management before endorsing them.

In addition, the new order is generating controversy from environmental groups who blasted the administration's latest permitting order, calling it a giveaway to big business that skirts long-standing safeguards for communities. "Arbitrary decisions and artificial deadlines can lead to costly mistakes we’ll all pay for down the line," said Rhea Suh, president of the Natural Resources Defense Council.

Trump's news conference following his meeting with administration officials on infrastructure also was eclipsed by the back-and-forth with reporters about the statements he'd made after last weekend's deadly protests in Charlottesville, Va.

Before he left site of the press conference, the President maintained that he still expects Democrats "will go along with" an infrastructure bill that his administration hopes lawmakers will consider later this year.

And, that might happen. Certainly, support for infrastructure runs deep on Capitol Hill—but, there are so many toxic fights underway now that it is difficult to trace the evolving positions of even well-known groups.

Certainly, the devil will be in the details, as always, experts say. It seems entirely possible that the administration could design a proposal that would gather minority support—or, it could offer a proposal heavily encumbered by large amounts of political baggage that would limit its attraction. So, this is yet another issue that is extremely important for producers, and which should be watched closely as it emerges, Washington Insider believes.

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