Issue

 
The U.S. Environmental Protection Agency (EPA) continues to press ahead with regulating greenhouse gases (GHGs) as “air pollutants” under the Clean Air Act.  

Background

 
In April 2007, the Supreme Court ruled that the Environmental Protection Agency (EPA) had the authority to regulate GHG emissions from new cars under the Clean Air Act if it determined that GHG emissions endanger public health or welfare.  In response, in April 2009, EPA issued a proposed finding that GHGs endanger public health and welfare; this “endangerment finding” became final in December 2009. EPA has also issued rules to regulate GHG emissions from tailpipes of new automobiles and light duty trucks; these rules were finalized on April 1, 2010.  
 
Under the Clean Air Act, once the GHG emission rules become final, certain provisions are automatically triggered that are expected to impose costly and burdensome requirements on agriculture, small businesses and the economy in general.  Title V of the Act requires “major sources” (defined by statute to mean entities that emit more than 100 tons of the pollutant per year) to obtain permits to continue operating.  Similarly, New Source Review (NSR)/Prevention of Significant Deterioration (PSD) building permit requirements automatically apply to new construction or renovation of structures for operations emitting more than 250 tons per year.  A significant number of agricultural operations not previously regulated under the Clean Air Act would thus come under regulation.   
 
The EPA issued an interpretive rule on March 29, 2010 that Title V and NSR/PSD requirements become applicable under the Clean Air Act when the regulatory requirement to control emissions takes effect.  For greenhouse gases, the regulatory effects of the tailpipe rule take effect on January 2, 2011.  On that date Title V and NSR/PSD requirements for greenhouse gases will also become applicable.
 
With regard to the Title V permit requirements, the U.S. Department of Agriculture (USDA) in comments to EPA said, “Even very small agricultural operations would meet a 100-tons-per-year emissions threshold.  For example, dairy facilities with over 25 cows, beef cattle operations of over 50 cattle, swine operations with over 200 hogs, and farms with over 500 acres of corn may need to get a Title V permit.”   
 
According to the USDA publication “Farms, Land in Farms, and Livestock Operations, 2007 Summary” National Agricultural Statistics Survey, (February 2008) dairy operations with more than 25 cows comprise 98.8 percent of milk production, beef operations over 50 head comprise 89.4 percent of beef inventory, and hog operations over 500 hogs comprise 96.8 percent of hog inventory.   
     
Regulation of GHGs under the Clean Air Act could also have impacts for farmers and ranchers seeking to build new structures or renovate existing structures.  The NSR and PSD permitting requirements can impose costly and burdensome permit requirements for sources falling under those programs, a situation that could well arise for certain agricultural operations.
 
Although EPA has failed to conduct an economic analysis of the impacts of GHG regulation as it is required to do, the agency recognizes that the economic impacts will be substantial, and that permitting authorities will be overwhelmed by the increased number of entities subject to GHG permit requirements.  In response, EPA has proposed to “tailor” the rule and phase in permitting requirements.  The so-called “tailoring rule” would administratively raise the threshold limits for those needing permits from the statutory levels of 100/250 tons per year to those entities emitting more than 25,000 tons per year.  The proposal would not exempt those entities emitting less than 25,000 tons per year, but would defer permit requirements until the largest emitters have received permits.   
 
Because it administratively seeks to change statutory requirements, the tailoring rule is deemed by many legal experts as violating the Clean Air Act.  Moreover, because the PSD and Title V permit programs are administered by the states, and most state laws and regulations are tied to the statutory levels, the tailoring rule would provide little relief to most farmers, ranchers and other small businesses because they will still be subject to state law requirements.         

Legislative Status

 
Pending in Congress are a number of bills and resolutions that would stop EPA from taking any more steps to regulate GHGs. Chief among  them is Senate Joint Resolution 26, introduced by Sen. Lisa Murkowski (R-Alaska), to disapprove the endangerment finding pursuant to the Congressional Review Act.  The resolution has 40 co-sponsors. Under the Congressional Review Act, a resolution needs 51 votes to pass in the Senate.   
 
In the House, Rep. Ike Skelton (D-Mo.) and Collin Peterson (D-Minn.) have introduced a companion resolution in the House, House Joint Res. 76.  An identical resolution was introduced by Rep. Joe Barton (R-Texas), House Joint Res. 77.  AFBF strongly supports these resolutions of disapproval, and urges state Farm Bureaus to ask their delegations to co-sponsor one of the resolutions.  

Regulatory History

 
In order for Title V and NSR/PSD to be triggered, two regulatory actions have to occur.  First, EPA must make a finding that GHGs endanger public health and/or welfare.  Second, EPA must finalize regulation of those gases for any sector of the economy.  On Dec. 6, 2009, EPA issued a final endangerment finding.   
 
The second step was completed on April 1 2010, with the promulgation of final motor vehicle GHG emission rules.  
 
EPA has taken one other regulatory action that may influence regulation of farmers and ranchers under the Clean Air Act.  In late 2009, EPA published a final rule that would require manure management systems that emit more than 25,000 tons of GHG per year to report those emissions to EPA under a rigorous scheme that includes monitoring and verification of such emissions.  EPA estimates that this rule will only affect about 110 dairy, beef and swine operations, but poultry operations may be more vulnerable to reporting requirements.  These reporting requirements will take effect next year.  

AFBF Policy

 
AFBF opposes regulation of greenhouse gases under the Clean Air Act.   

April 2010