Legislative Update: House Faces Appropriations Stalemate, EPA Designates Vinyl Chloride

Vinyl Chloride Among Chemicals Targeted in EPA’s New High-Priority Designations 

On July 25, the Environmental Protection Agency (EPA) proposed to designate five chemicals, including vinyl chloride, as “high-priority” under the Toxic Substances Control Act (TSCA). This designation will initiate extensive risk evaluations followed by potential rulemaking to address identified “unreasonable risks.” The proposal invites public comments until October 23, reflecting EPA’s commitment to transparency and thorough data collection.  As part of its newly announced policy, the EPA will be releasing “a proposed designation document” for each candidate chemical, detailing “the information, analysis, and basis used to support” its designations. The Vinyl Institute released a statement on the decision.

The other four targeted chemicals include acetaldehyde, acrylonitrile, benzenamine, and 4,4′-Methylene bis(2-chloroaniline) (MBOCA), which are used in the manufacture of plastics and other industrial applications. The elevated prioritization of vinyl chloride comes in light of incidents like the 2023 East Palestine, OH train derailment that has raised calls by environmental groups for stricter controls to protect vulnerable communities and extreme activists like Beyond Plastics, who are demanding that vinyl chloride be banned.

Conversely, the Vinyl Institute and industry representatives have urged caution, arguing that the chemicals’ uses are generally safe and should not be prioritized based on rare incidents or media attention. Despite these opposing views, the EPA had indicated in December that it anticipated designating these chemicals as high-priority. The prioritization process lasts 9-12 months and is expected to conclude by mid-December, with risk evaluations and potential rulemaking extending into 2028.

House Faces Appropriations Stalemate, Cancels Votes Next Week

The House appropriations process, plagued by partisan disputes, collapsed on July 22. Plans to pass four of the 12 annual bills were abandoned due to concerns over the Agriculture (H.R. 9027) and Financial Services (H.R. 8773) bills, prompting House GOP leaders to postpone votes on them. Conservative objections to high Agriculture spending levels and moderate worries about an abortion-related provision in the Financial Services bill have complicated their passage.

House leadership decided to proceed with the less contentious Energy-Water (H.R. 8997) and Interior-Environment (H.R. 8998) bills, but intra-party disputes and a razor-thin majority that couldn’t withstand defections caused the House GOP leaders to withdraw the fiscal 2025 Energy-Water spending bill from the floor on the night of July 23, due to increasing opposition from several Republicans over policy and project funding issues.

The House did pass its $38.5 billion Interior-Environment spending bill late July 24, after a daylong whipping effort by GOP leadership that was aided by absences on the Democratic side.  The bill, which cuts EPA’s base budget by 20 percent and a 15 percent cut to TSCA programs, passed in a narrow 210-205 vote.  Before passing the bill, lawmakers adopted several GOP amendments, including an amendment prohibiting funds for the EPA’s Justice, Equity, Diversity, and Inclusion Workgroup.

The $59.2 billion Energy-Water bill (H.R. 8997) faced growing opposition from GOP members, driven by concerns over Energy Department permitting standards and funding for a Georgia harbor-deepening project. However, the House Rules Committee did not allow this amendment for floor consideration.  Still, other Republican members opposed the bill over insufficient funding for some of their local projects. The lack of Democratic support further exacerbated difficulties in passing the bill.

With the other bills in a stalemate, GOP leadership announced that the House will scrap next week’s votes and start its August recess a week early. The Senate Appropriations Committee is scheduled to consider its version of the Interior-Environment bill on July 25; action on that panel’s Energy-Water bill could come next week before the Senate recesses for August.

Bipartisan Support Secures Passage of WRDA Bill in House

The House voted 359-13 on July 22 to pass the Water Resources Development Act of 2024 (WRDA) bill (H.R. 8812), reauthorizing U.S. Army Corps of Engineers programs and projects. This bill supports nationwide water and port infrastructure projects, including flood mitigation, coastal resilience, and ecosystem restoration efforts. Funding for these projects is addressed in the Energy-Water appropriations bill (H.R. 8997), that passed this week.

In addition to reauthorizations, the bill aims to improve transparency and efficiency in project delivery by overhauling Corps policies. The bill passed through a fast-tracked process requiring two-thirds support, with members often backing projects that benefit their districts, thus garnering bipartisan support.

House Appropriations Chairman Tom Cole (R-OK) shared his concerns about provisions that might undermine Congress’ authority to oversee and fund federal agencies before the vote. He highlighted issues such as agencies spending fees without congressional approval and transferring funds without oversight, which he argued could reduce accountability and empower unelected officials. Despite his concerns, Cole supported the bill following Transportation and Infrastructure Chairman Sam Graves’s (R-MO) assurances that these issues would be addressed during the conference process with the Senate.

Chevron Ruling Spurs Legislative Battle Over Executive Rulemaking Powers

Lawmakers from both parties are pushing contrasting legislation in response to the Supreme Court’s recent decision to overturn Chevron deference. Senator Bill Cassidy (R-LA) introduced a GOP bill to increase congressional oversight on executive rulemaking.  The  Upholding Standards of Accountability (USA) Act also requires agency heads to testify before relevant committees and improve cost-benefit analyses of rules. Cassidy argues that the Executive Branch has exploited Chevron deference to extend its power beyond congressional intent.

On the other side, Senator Elizabeth Warren (D-MA) is leading a Democratic effort with the Stop Corporate Capture Act, which aims to codify the previous Chevron precedent. Warren’s bill seeks to empower agencies to continue rulemaking based on a “reasonable interpretation” of statutes, countering congressional efforts to overturn regulations via the Congressional Review Act. It also aims to enhance public commentary on rules and protect independent technical research from conflicts of interest.

The GOP seeks to have the Biden administration reassess its regulations post-Chevron, believing many overstep executive authority. Concurrently, Democratic priorities include strengthening agency independence in rulemaking. The White House has expressed concern over the Supreme Court’s ruling, and experts suggest that the decision may complicate regulatory compliance for businesses.

Biden steps down, Trump Names JD Vance as His Vice Presidential Candidate

President Joe Biden announced on July 21 that he will not seek the Democratic nomination he secured in primaries. This unexpected decision places the Democratic Party in an uncertain position just weeks before their national convention in Chicago on August 19-22. Biden immediately endorsed Vice President Kamala Harris to challenge Republican nominee Donald Trump. The Democratic Party quickly coalesced behind Harris, who by Monday secured the majority of Democratic delegates needed to become the party’s nominee for president and attended her first campaign event as a Presidential candidate.  By Tuesday, Senate Majority Leader Chuck Schumer (D-NY) and House Minority Leader Hakeem Jeffries (D-NY) also endorsed Harris, and former President Barack Obama is anticipated to announce his endorsement today.

The Democratic Party now faces a series of challenges and uncertainties as they navigate this unprecedented situation leading up to the convention and threats from GOP members who said they would possibly seek to invoke the 25th amendment to force President Biden to resign as President.  The Democratic National Committee met on July 24 to approve new rules for approving their presidential nominee choice.   They can begin to hold a virtual roll call as early as Aug. 1–less than two weeks from Biden’s withdrawal date.   The virtual process will be open to anyone with 300 signatures from delegates.  The new nominee must choose their running mate by Aug. 7.

Given the large number of delegates that have already pledged to Harris, she is the presumptive nominee, and at this time, Arizona Senator Mark Kelly (AZ), Pennsylvania Gov. Josh Shapiro, Kentucky Gov. Andy Beshear and North Carolina Gov. Roy Cooper appear to top her list of possible VP candidates being vetted.

Harris has a well-known record on climate action and sponsored the Green New Deal resolution. As California Attorney General, she has sued oil companies.  She has advocated for environmental justice and supported fracking bans.  In her past campaigns and time in the Senate, Harris has favored steeper tax hikes on businesses and high earners while providing tax credits for low and middle-income people.

In other election news, Republicans wrapped up their national convention last week, with former President Donald Trump announcing that he has chosen Ohio Senator JD Vance as his Vice Presidential pick. Vance, an avid supporter of oil and gas companies and policies, has advocated for opposing EPA regulations to reign in car and light truck emissions.  He is known for being skeptical of climate change and seeking to repeal multiple clean energy provisions in the Inflation Reduction Act.  His views on these issues are expected to align closely with those of Donald Trump.

Federal Court Upholds EPA’s Climate Rule Amid Ongoing Legal Battle

A federal court declined to stay the Environmental Protection Agency’s (EPA) climate rule, which mandates coal-fired power plants to either install emission-capturing technology or shut down. This decision tentatively upheld the rule, rejecting claims that the EPA overstepped its authority, thus maintaining a key part of President Biden’s climate agenda for the time being. On July 23, 25 Republican states, led by West Virginia and Indiana, filed a petition for emergency relief, asking the Supreme Court to overturn the D.C. Circuit’s decision denying their stay requests.

The rule in question, issued in April, targets existing coal-fired plants and future natural gas plants, requiring them to adopt carbon capture technologies. Critics argue that the rule is premature and potentially harmful to grid reliability. Despite these objections, the D.C. Circuit Court of Appeals ruled that the West Virginia and other challengers did not demonstrate a likelihood of success on the merits or irreparable harm, a crucial criterion for staying the rule. The court also dismissed arguments that the rule violated the “major questions” doctrine, emphasizing that EPA’s actions were within its regulatory purview.

The ruling represents a setback for the coal sector and its allies, who are concerned about the economic and operational impacts of the rule. The court highlighted that compliance deadlines are not imminent, with initial deadlines set for 2026 and actual implementation not required until 2030, allowing ample time for planning. The court has called for an expedited briefing schedule to ensure the case is heard promptly in the 2024 term, though a final decision is unlikely before President Biden’s term ends. The upcoming presidential election could play a crucial role in the rule’s future, with potential shifts in administration policies depending on the outcome.