[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]
A RUSH TO REGULATE--THE CONGRESSIONAL REVIEW ACT AND RECENT FEDERAL
REGULATIONS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON ENERGY POLICY, NATURAL
RESOURCES AND REGULATORY AFFAIRS
of the
COMMITTEE ON
GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
MARCH 27, 2001
__________
Serial No. 107-14
__________
Printed for the use of the Committee on Government Reform
Available via the World Wide Web: http://www.gpo.gov/congress/house
http://www.house.gov/reform
-------
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75-850 WASHINGTON : 2002
_____________________________________________________________________________
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COMMITTEE ON GOVERNMENT REFORM
DAN BURTON, Indiana, Chairman
BENJAMIN A. GILMAN, New York HENRY A. WAXMAN, California
CONSTANCE A. MORELLA, Maryland TOM LANTOS, California
CHRISTOPHER SHAYS, Connecticut MAJOR R. OWENS, New York
ILEANA ROS-LEHTINEN, Florida EDOLPHUS TOWNS, New York
JOHN M. McHUGH, New York PAUL E. KANJORSKI, Pennsylvania
STEPHEN HORN, California PATSY T. MINK, Hawaii
JOHN L. MICA, Florida CAROLYN B. MALONEY, New York
THOMAS M. DAVIS, Virginia ELEANOR HOLMES NORTON, Washington,
MARK E. SOUDER, Indiana DC
JOE SCARBOROUGH, Florida ELIJAH E. CUMMINGS, Maryland
STEVEN C. LaTOURETTE, Ohio DENNIS J. KUCINICH, Ohio
BOB BARR, Georgia ROD R. BLAGOJEVICH, Illinois
DAN MILLER, Florida DANNY K. DAVIS, Illinois
DOUG OSE, California JOHN F. TIERNEY, Massachusetts
RON LEWIS, Kentucky JIM TURNER, Texas
JO ANN DAVIS, Virginia THOMAS H. ALLEN, Maine
TODD RUSSELL PLATTS, Pennsylvania JANICE D. SCHAKOWSKY, Illinois
DAVE WELDON, Florida WM. LACY CLAY, Missouri
CHRIS CANNON, Utah ------ ------
ADAM H. PUTNAM, Florida ------ ------
C.L. ``BUTCH'' OTTER, Idaho ------
EDWARD L. SCHROCK, Virginia BERNARD SANDERS, Vermont
------ ------ (Independent)
Kevin Binger, Staff Director
Daniel R. Moll, Deputy Staff Director
James C. Wilson, Chief Counsel
Robert A. Briggs, Chief Clerk
Phil Schiliro, Minority Staff Director
Subcommittee on Energy Policy, Natural Resources and Regulatory Affairs
DOUG OSE, California, Chairman
C.L. ``BUTCH'' OTTER, Idaho JOHN F. TIERNEY, Massachusetts
CHRISTOPHER SHAYS, Connecticut TOM LANTOS, California
JOHN M. McHUGH, New York EDOLPHUS TOWNS, New York
STEVEN C. LaTOURETTE, Ohio PATSY T. MINK, Hawaii
CHRIS CANNON, Utah DENNIS J. KUCINICH, Ohio
------ ------ ROD R. BLAGOJEVICH, Illinois
------ ------
Ex Officio
DAN BURTON, Indiana HENRY A. WAXMAN, California
Dan Skopec, Staff Director
Jonathan Tolman, Professional Staff Member
Regina McAllister, Clerk
Michelle Ash, Minority Counsel
C O N T E N T S
----------
Page
Hearing held on March 27, 2001................................... 1
Statement of:
Gestrin, Terry E., chairman, Valley County Commissioners,
Cascade, ID; Evan Hayes, wheat farmer, American Falls, ID,
representing the National Association of Wheat Growers;
Sharon Buccino, senior attorney, Natural Resources Defense
Council; and Thomas O. McGarity, W. James Kornzer Chair,
University of Texas School of Law.......................... 91
Gramm, Dr. Wendy Lee, former Administrator, Office of
Information and Regulatory Affairs, OMB, and director,
Regulatory Studies Program & distinguished senior fellow,
Mercatus Center, George Mason University; Marshall E.
Whitenton, vice president, Resources, Environment and
Regulation Department, National Association of
Manufacturers; Dr. Robert H. Nelson, professor, School of
Public Affairs, University of Maryland; and Raymond E. Ory,
vice president, Baker and O'Brien, Inc..................... 8
Letters, statements, etc., submitted for the record by:
Buccino, Sharon, senior attorney, Natural Resources Defense
Council, prepared statement of............................. 106
Gestrin, Terry E., chairman, Valley County Commissioners,
Cascade, ID, prepared statement of......................... 94
Gramm, Dr. Wendy Lee, former Administrator, Office of
Information and Regulatory Affairs, OMB, and director,
Regulatory Studies Program & distinguished senior fellow,
Mercatus Center, George Mason University, prepared
statement of............................................... 11
Hayes, Evan, wheat farmer, American Falls, ID, representing
the National Association of Wheat Growers, prepared
statement of............................................... 99
McGarity, Thomas O., W. James Kornzer Chair, University of
Texas School of Law, prepared statement of................. 116
Nelson, Dr. Robert H., professor, School of Public Affairs,
University of Maryland, prepared statement of.............. 51
Ory, Raymond E., vice president, Baker and O'Brien, Inc.,
prepared statement of...................................... 67
Ose, Hon. Doug, a Representative in Congress from the State
of California:
Memorandum dated September 25, 2000...................... 79
Prepared statement of.................................... 4
Whitenton, Marshall E., vice president, Resources,
Environment and Regulation Department, National Association
of Manufacturers, prepared statement of.................... 38
A RUSH TO REGULATE--THE CONGRESSIONAL REVIEW ACT AND RECENT FEDERAL
REGULATIONS
----------
TUESDAY, MARCH 27, 2001
House of Representatives,
Subcommittee on Energy Policy, Natural Resources
and Regulatory Affairs,
Committee on Government Reform,
Washington, DC.
The subcommittee met, pursuant to notice, at 10 a.m., in
room 2154, Rayburn House Office Building, Hon. Doug Ose
(chairman of the subcommittee) presiding.
Present: Representatives Ose, Otter, and Tierney.
Staff present: Barbara Kahlow, deputy staff director; Dan
Skopec, staff director; Jonathan Tolman, professional staff
member; Regina McAllister, clerk; Michelle Ash and Elizabeth
Mundinger, minority counsels; and Jean Gosa, minority assistant
clerk.
Mr. Ose. The committee will come to order. I want to
welcome everybody to the meeting of the Subcommittee on Energy
Policy, Natural Resources and Regulatory Affairs. This morning
we're having a hearing entitled, ``A Rush to Regulate--The
Congressional Review Act and Recent Federal Regulations.''
In the waning days of his administration, President Clinton
issued a flood of new regulations. Some are surely meritorious,
others raise serious concerns.
Congress has a tool to correct defective regulations. It's
called the Congressional Review Act. We're going to refer to
that as the CRA. The purpose of today's hearing is to examine
some of the late-issued rules and to ensure that the
decisionmaking process was careful and above reproach. The
hearing will consider not only substantive concerns but also
procedural flaws in issuance of these rulemakings.
Earlier this month, the Senate and the House passed a joint
resolution of disapproval for the Department of Labor's major
rule establishing a new comprehensive ergonomics standard. The
reversal of the ergonomics rule is the first instance in which
the CRA resulted in the nullification of a rule. This reversal
demonstrated that there is at least one rule that a majority of
Congress felt was not in the interest of their constituents.
On December 20, 2000, the three principal procurement
agencies, the Department of Defense, the General Services
Administration, and the National Aeronautics and Space
Administration, issued an amendment to the existing rules
governing present responsibility, to clarify what constitutes a
satisfactory record of integrity and business ethics for
contracting with the government. This is commonly called the
``blacklisting rule.''
Since the rule changes could potentially have a significant
impact on a substantial number of small businesses, the
agencies mistakenly certified that the rule will not have a
significant impact on a substantial number of small entities,
and thus the agencies failed to prepare the required initial
and final regulatory flexibility analyses. This rule is
currently being litigated.
On January 12, 2001, the Department of Agriculture
published a major rule prohibiting the construction of roads
and banning timber harvesting on 58 million acres of national
forest land, or 31 percent of all national forest land. For
comparison, all of new England, that being Connecticut, Maine,
Massachusetts, New Hampshire, Rhode Island, and Vermont
encompass only 44 million acres.
In the vast majority of the areas affected by this rule,
the biggest threat does not come from timber conditions but
from fire. Last year, more than 84,000 fires raged across the
country, scorching nearly 7 million acres of public land. The
number of acres harvested each year by comparison is roughly
half a million acres. The stated goal of the rule is to
preserve the forests for endangered species, recreation and
maintenance of water quality. Unfortunately, a forest ravaged
by serious fire is unlikely to provide any habitat for species,
little in the way of recreation, and probably a degraded water
quality. The rule, originally scheduled to become effective on
March 13th, is being reviewed by the new administration and is
also being litigated.
Two days prior to the inauguration of a new President, the
Environmental Protection Agency published a major rule
establishing new standards for diesel fuel. Under the rule, oil
refineries must remove 97 percent of the sulfur in diesel fuel
by 2006. The current standard of 50 parts per million was
reduced to 15 parts per million. The reason that sulfur needs
to be reduced from diesel fuel is not because sulfur itself is
a major source of pollution but because it interferes with
catalytic converters and other pollution control devices
necessary to produce cleaner-burning diesel engines.
I support the environmental goals of the diesel sulfur
rule. Diesel engines account for a substantial portion of the
ozone and particulates that pollute the air of our cities. This
pollution has a wide range of adverse health effects,
particularly the evidence linking diesel exhaust to an
increased risk of lung cancer. Dozens of studies link airborne
fine particles, such as those in diesel exhaust, to increased
hospital admissions for respiratory diseases, chronic
obstructive lung disease, pneumonia, heart disease and up to
60,000 premature deaths annually in the United States.
Despite my support for the environmental benefits that will
be achieved by this rule, I am concerned by the timing, both
the timing of the rule's publication and the timing of its
implementation. Economic studies have suggested that our
Nation's refineries may not be able to produce enough low-
sulfur diesel fuel to meet expected demand.
As a Member representing California, I can tell you first
hand it is not a good thing when energy supplies fail to meet
energy demands. Yet, that this rule was finalized days before
the end of an administration and just as our Nation is
struggling with several energy issues is somewhat
disconcerting.
I want to welcome our witnesses today. And, prior to
starting testimony from them, I am reserving the right for Mr.
Tierney to make an opening statement.
[The prepared statement of Hon. Doug Ose follows:]
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Mr. Ose. Mr. Otter, would you care to make an opening
statement?
Mr. Otter. Thank you, Mr. Chairman. I do have an opening
statement that I would like to submit for the record. But I
will be very brief in the comments that I make now.
Mr. Ose. Without objection.
Mr. Otter. I, too, am concerned, Mr. Chairman, about the
rush to judgment, the rush to regulate that we've had not only
in the two agencies that are coming before us this morning and
the devastating effects that they have had on our abilities to
produce, to travel, to indeed carry on the commerce that needs
to be carried on not only in my State but also in the entire
Union. And, because of that, I am particularly happy, Mr.
Chairman, that you have sought to call this hearing, and I look
forward to talking to the panels that will be coming before us
this morning.
But, I do want you to know that the outcome of this hearing
and the results that we will be able to go forward on are
extremely important to us because there's a lot of folks back
home in Idaho and in the Pacific Northwest that are hoping to
at least get some relief as a result of this subcommittee
hearing, Mr. Chairman. So I applaud you in your efforts this
morning.
Mr. Ose. Thank you, Mr. Otter.
This committee typically swears in its witnesses, so if you
would all rise.
[Witnesses sworn.]
Mr. Ose. Let the record reflect the witnesses answered in
the affirmative. I would like to introduce the witnesses.
Joining us today on my left is Dr. Wendy Lee Gramm, the former
administrator of the Office of Information and Regulatory
Affairs, OMB. She's currently at the Mercatus Center, where she
is a distinguished senior fellow and runs the regulatory
studies program.
Next to her is Marshall Whitenton who is the vice president
of Resources, Environment and Regulation Department for the
National Association of Manufacturers.
And sitting next to him is Dr. Robert Nelson, who is a
professor in the School of Public Affairs at the University of
Maryland.
And our final witness on this panel is Raymond Ory who is
the vice president of Baker & O'Brien, Inc.
If you could be so kind as to summarize your testimony
within the 5-minute timeframe, that would be most appreciated
and we would be able to get to questions quicker.
Dr. Gramm.
STATEMENTS OF DR. WENDY LEE GRAMM, FORMER ADMINISTRATOR, OFFICE
OF INFORMATION AND REGULATORY AFFAIRS, OMB, AND DIRECTOR,
REGULATORY STUDIES PROGRAM & DISTINGUISHED SENIOR FELLOW,
MERCATUS CENTER, GEORGE MASON UNIVERSITY; MARSHALL E.
WHITENTON, VICE PRESIDENT, RESOURCES, ENVIRONMENT AND
REGULATION DEPARTMENT, NATIONAL ASSOCIATION OF MANUFACTURERS;
DR. ROBERT H. NELSON, PROFESSOR, SCHOOL OF PUBLIC AFFAIRS,
UNIVERSITY OF MARYLAND; AND RAYMOND E. ORY, VICE PRESIDENT,
BAKER AND O'BRIEN, INC.
Dr. Gramm. Thank you for inviting me to testify on the
issue of the Congressional Review Act and recent Federal
regulations. Please note that this testimony reflects my own
views and not that of either the Mercatus Center or George
Mason University.
The objective of the Regulatory Studies Program is to
advance knowledge of regulations and their impact on society.
What we do is to analyze regulations and regulatory issues from
the perspective of the public interest and the typically
underrepresented consumer. We've long been concerned about the
growing burden of regulations and recently have focused on the
phenomenon of midnight regulations, or those regulations
promulgated during the 3 months following a national election.
Mercatus scholar Jay Cochran analyzed the number of pages
in the Federal Register in post-election quarters since 1948;
although an imprecise measure of regulatory activity, it's
about the best we have. Dr. Cochran found this phenomenon of
midnight regulations to be systemic and nonpartisan. This year
was no exception when the page count in the Federal Register
jumped by 51 percent when compared with the same quarters in
the preceding 3 years.
I have outlined in my written testimony some examples of
regulations that were finalized during this election period.
And, you, Mr. Chairman, have commented on many of them. More
detailed analyses of many of these regulations are available on
our Web site in the form of public interest comments that we
submitted during the comment period, as required by the
Administrative Procedure Act.
Our public interest comments provide independent analyses
of agency proposals from the perspective of the public interest
and not any special interest. Some analyses are performed by
Mercatus scholars; others are done for Mercatus by outside
academics and practitioners. Last year, alone we wrote 24
public interest comments covering most of the regulations being
discussed today and many more.
While our public interest comments may be lengthy, we have
a one-page summary with each public interest comment, along
with a checklist appended to each one. In the checklist, we
provide a very simple list of questions that policymakers
should address when crafting a regulation, and then summarize
whether or not the agency answered each question, along with a
grade ranging from A to F for excellent to unsatisfactory. The
kinds of questions we ask, for example, are did the agency
identify a specific problem that can't be addressed by either
market regulation or by other levels of government--State and
local government.
We ask whether agencies examined alternative approaches to
the ones they're proposing, whether they attempted to maximize
net benefits, whether there is a strong scientific or technical
basis for the regulation, and, finally, we ask whether or not
the agencies understood and considered both the distributional
effects of the regulation on different populations, but also
how individual choices would be affected.
I would like to just say a few sentences on some of the
important midnight regulations, some of which you have
commented on. The Forest Service roadless area regulation
covers biologically diverse areas, as you said in your opening
comments. And, while much public attention has been paid to the
impact on logging, our concern is that the Forest Service has
not shown that the ban on road construction is necessary or
appropriate for protecting other important values, such as
water quality, wildlife, and recreation in these areas.
The agency did not consider alternatives to a complete ban,
such as allowing low-impact temporary roads as needed for
forest health, fire protection, or ecosystem restoration.
The Federal Acquisition Regulation Council's blacklisting
rule shifts the burden of determining whether a firm meets
proper ethical standards from the agencies authorized by
Congress to government procurement agents. Under this regime,
blacklisting replaces the formal process and firms cannot
answer the charges against them and may be blacklisted for an
administrative complaint even before evidence is heard.
HHS's medical privacy regulations are costly, but HHS has
not identified any net social benefits that can be expected to
flow from this regulation.
Arsenic is a naturally occurring substance for which health
risks have not been observed at the levels found in U.S.
drinking water systems. EPA justified these standards using
evidence of risk from high arsenic doses in other countries,
although those populations smoke more, and have poorer health
in general. And actually there was a U.S. study of U.S.
populations where there was no statistical arsenic risk.
The reporting thresholds for lead under the toxic release
inventory would be reduced substantially, but release here
means the amount transferred offsite as waste, or even recycled
or retreated.
There are a number of other regulations. I see my time is
running out. I would like to point out that washing machine
standards and the energy efficiency standards are also very
costly to consumers. For the washing machine standards, for
example, the Department of Energy in their estimates would
imply that these standards would reduce energy use by 0.16
percent over a 24-year period, but we think its estimates are
overstated.
There are many other regulations worth reviewing, but I
thank you for your interest in regulations, especially midnight
regulations, because these are regulations pushed through at
the end of an administration's term when congressional
oversight is unavailable and can result in potentially costly
mandates that may do little to solve an identified problem.
I also applaud your use of all your authorities, including
the Congressional Review Act, to ensure that regulations which
are a hidden tax on citizens are appropriate and advance the
public interest. Thank you.
Mr. Ose. Thank you Dr. Gramm.
[The prepared statement of Dr. Gramm follows:]
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Mr. Ose. Mr. Whitenton.
Mr. Whitenton. Mr. Chairman and members of the
subcommittee, on behalf of the National Association of
Manufacturers, our 14,000 member companies, large, medium-
sized, and small, and the 18 million people who make things in
America, I want to thank you for this opportunity to testify
before you today.
At the outset, it's important to remind everyone that the
men and women working in the manufacturing sector share basic
American environmental health and safety values and want them
applied in their workplaces, their homes, and their
communities. Manufacturers certainly do not oppose health,
safety and environmental rules that are founded in sound
science and developed in a deliberative and public process that
is as cost effective as possible.
However, a number of rules that were hurried through the
promulgation process in the final days of this last
administration suffered from a serious deficiency in these
essential qualities of responsible rulemaking. As a result,
some recently finalized rules could require huge expenditures
even for modest, let alone any genuine, protection of human
health, the environment, and worker safety.
This hearing properly focuses on unfair or inadequate
agency rulemaking that technically met the requirements, if not
the spirit, of the APA as they were rushed to the Federal
Register before the end of the last administration. Examples of
rushed rules that have large impacts on manufacturers include
the EPA's TMDL rule, arsenic rule, TRI lead rule and diesel
sulfur reduction rule, OSHA's ergonomics rule, and the
Department of Agriculture's roadless areas rule.
Other witnesses at this hearing are scheduled to discuss
specifically the diesel sulfur reduction rule and the USDA
roadless rule. With respect to the other rules I mentioned, NAM
supports Administrator Whitman's recent decision to reconsider
the arsenic rule and asks Congress to require the EPA to
reconsider the TMDL rule and the lead TRI rule. The NAM
applauds Congress for its wise and courageous decision to use
the Congressional Review Act to disapprove the flawed
ergonomics rule. However, Congress must look at the root of the
problem. The EPA and OSHA could not have abused the public
trust if they had not had such a broad delegation of authority
from Congress.
Since the World War II era, Congress has established and
increased the power of non-independent Federal agencies.
Initially, Congress provided strong checks on the new agencies
through the one-House veto. In fact, by the early 1980's, there
were more than 200 statutory provisions that contained one-
House or even one-committee vetoes of regulations.
With the 1983 Supreme Court decision in INS versus Chadha,
however, the one-house veto regulation was declared
unconstitutional. The court ruled that Congress cannot overrule
an executive branch decision except by passage of legislation
and presentment or presentation of that legislation to the
President. In other words, except by passing a law.
In the mid-1990's, Congress passed the Congressional Review
Act, which is simply a procedural framework for focusing and
expediting congressional review and, if necessary, rejecting an
agency's rule. It is founded on the Chadha principle that
Congress can only change an agency rule with a law.
On a personal note, I was privileged to serve with Senator
Don Nickles when he devised and introduced, along with Senator
Harry Reid, the Congressional Review Act legislation in 1995,
and I also had the pleasure of working with the staff of this
subcommittee the following year, and House Judiciary Committee,
during the informal conference on that measure following its
amendment and passage by the House in 1996.
In the aftermath of the Chadha decision, the CRA has given
Congress another tool to oversee the implementation of its
legislative delegations to the agencies. It certainly is not
the only tool. The TMDL rule, for example, is outside the
window of CRA review by this Congress. And, we hope it will be
dealt with in other legislation.
Congress has not only every legal right to critically
review agency rulemaking, but it also has a duty to do so. This
is particularly true today because there are too many statutes
on the books that give agencies very broad statutory authority
to meet very general goals. For example, the EPA has authority
under the Clean Air Act to, ``protect public health with an
adequate margin of safety.'' In this connection, the NAM was
very disappointed in last month's Supreme Court decision in
Whitman v. ATA in which the court declined to agree with the
D.C. Circuit Court which had found that EPA had interpreted the
broad authorities in the Clean Air Act in a way that created an
unconstitutional delegation of legislative power to the
executive.
Unfortunately, it seems that Congress is going to have to
actively address its past broad grants of authority without
judicial help, and we hope that Congress will be much more
careful in the future when it is granting authority to the
Federal agencies. In the meantime, we urge Congress in general
to follow the example that has been set by this subcommittee of
conducting frequent and meaningful oversight over the agencies.
Thank you. I would be pleased to answer any questions you
might have.
Mr. Ose. Thank you Mr. Whitenton.
[The prepared statement of Mr. Whitenton follows:]
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Mr. Ose. Dr. Nelson.
Dr. Nelson. I am pleased to be here. I am a professor of
environmental policy in the School of Public Affairs of the
University of Maryland, and senior fellow of the Competitive
Enterprise Institute. My experiences in Federal land management
include working in the Office of Policy Analysis within the
Office of the Secretary of the Interior from 1975 to 1993.
In January 2001, former President Clinton set aside 58
million acres of new roadless areas on the national forests.
This was adding to an existing 35 million acres of roadless
areas in the national wilderness system that had previously
been approved by Congress. Combined, if the Clinton action
stands, congressionally approved and de facto wilderness areas
would now equal 93 million acres, almost half of the total land
in the national forest system. This is a vast amount of land to
set aside in such a restrictive land status that precludes most
management actions. Congress should now, I believe, act to
apply the provisions of the Congressional Review Act to rescind
these designations.
There are also procedural failings. Prior to the Clinton
designations, local citizens in good faith put in countless
hours in learning about, discussing and debating the land
management options for the nearby national forest lands. The
Clinton roadless mandates amounted to a betrayal of the trust
of these citizens in the land use planning process for national
forest decisionmaking.
The Clinton actions also swept aside a longstanding role of
the U.S. Congress. Since the Wilderness Act of 1964, Congress
has specifically approved each new permanent wilderness area.
The Clinton administration simply bypassed this process to
increase the total effective area of wilderness on the national
forest system by 160 percent.
Most management options will automatically be precluded
over the 58 million acres of roadless areas. What may be
helpful for the Congress is to consider some of the many
potentially desirable and even necessary management actions
that would now be ruled out in the future without further
consideration.
Despite the appealing public image of protecting nature
little touched by prior human impact, according to the Forest
Service's own figures, about 50 percent of the newly designated
roadless areas in the lower 48 States actually consist of
declining forests in a moderate state of ill health, ecological
deterioration, and fire-prone conditions.
The principal reason for their dire condition is the
previous century of the Forest Service following an active
policy of suppression of forest fire. By the fall of 2000, the
Forest Service had established priority areas for forest
treatments to reduce excess fuels and fire hazards, including
14 million acres within the Clinton roadless areas. These
treatments will largely be ruled out by the roadless
designations, leaving the West to face greater forest fire
hazards, as seen in the summer of 2000.
The roadless designations will also make it ``harder to
fight wildland fires.'' When intense and historically
unprecedented fires burn, the Federal Government not only ends
up spending huge amounts of money fighting them, more than $1
billion in 2000, but also the fires can do significant
environmental damages.
The largest economic values that would be automatically
foreclosed by the roadless designations involve future losses
in recreational opportunity. If the Clinton actions stand, they
will leave 56 percent of the total national forest lands set
aside for primitive recreation, and 44 percent will be
available for all the many other forms of more developed forms
of recreation. Yet, activities associated with developed
recreationsites are more popular with the American public and
are also the most rapidly growing. Hikers, hunters, fishermen,
snowmobilers, skiers, bird watchers, and many others, will all
face new limits on the ability to expand their recreation
opportunities.
A total of 7.6 million acres of land with oil and gas
potential are found within designated roadless areas. According
to a recent study commissioned by the U.S. Department of
Energy, a mean estimate of about 11 trillion cubic feet of
natural gas may underlie the designated roadless areas and
would largely be lost for exploration and production.
In summary, as I said, I am not arguing for any particular
management in the future for any particular area of land in the
national forests. Roadlessness may be appropriate in some
places. But to seek to impose a single national land standard
is the central error of the Clinton actions. These actions try
to resolve such matters from Washington, DC. My concern is to
maintain our future management options. Without any adequate
justification, the Clinton roadless designations would preclude
many important management actions that could offer large
benefits to the American people. The Congress should act
promptly to restore an element of common sense to national
forest management.
Mr. Ose. Thank you Dr. Nelson.
[The prepared statement of Mr. Nelson follows:]
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Mr. Ose. Mr. Ory.
Mr. Ory. My name is Raymond Ory and I am vice president of
Baker & O'Brien, an independent consulting firm serving the
domestic and international petroleum processing industries.
For more than 26 years, I have consulted to the petroleum
industry on matters involving commercial, strategic, and
technical issues. In September 2000, I coauthored a study for
the American Petroleum Institute, assessing the impact of
sulfur regulation on the supply and price of diesel fuels in
the United States. The new regulation was driven by the need
for future diesel fuel vehicles that employ new, emerging low
emissions technology. In general terms, this new law applies to
all refiners and importers and requires that sulfur levels in
at least 80 percent of the diesel fuel produced for on-road use
be 15 parts per million or less by June 1, 2006. This
represents a reduction of 97 percent from the currently
mandated levels of 500 parts per million. On May 31, 2010, 100
percent compliance is mandated.
This new law is but one of a number of recent and emerging
rules that will impact the refining industry during this
decade. While each is a cause for concern, collectively they
present a formidable challenge for even the most financially
capable within the industry. These regulations give rise to a
number of concerns. Refiners will need to make significant
capital investments, and compliance will tend to further reduce
capacity and invariably strain the volume of products being
produced.
Some refiners will be unable to support the level of
defensive investment necessary to comply and will seek to
divert product to export markets or withdraw from certain
domestic product markets. In some instances, the financial
inability to comply will result in the company exiting from the
refining business.
In forming its rule, the EPA believes that the industry
will respond in such a manner as to provide adequate domestic
supply, at a relatively low cost, and with little disruption
and little difficulty within the pipeline and distribution
systems. While we believe that the industry will, as it always
has, engage in investment and infrastructure change consistent
with the law, we also believe that the cost will be greater,
the difficulties more onerous, and a high potential for supply
disruption and price spikes will exist during the transition
period. This will be the result of insufficient regional
supplies necessary to satisfy demand.
We believe that this new law will have a dramatic
consequence to the overall business of refining, distribution
and marketing of petroleum products in the United States. It is
capital-intensive within the refining structure and will also
require investment and change in much of the national
infrastructure, some of which will be redundant after 2010. The
range of capital investments necessitated by the law is
arguably between $5 and $8 billion, or between $40 million and
$60 million for the average refinery.
In the past year, regions of the United States have
experienced price spikes in gasoline and heating oil, natural
gas and electricity. Despite the impact of such occurrences on
the consumer and local economies, we believe that this is
evidence that fundamental economics are at work. When supply is
insufficient to satisfy demand for any reason, market prices
will rise to levels sufficient either to decrease demand or to
attract additional supply.
In the short term, this can represent significant price
increases. I believe that under the provisions of the current
rule there is a high probability that such conditions will
exist in the 2006 to 2007 period that could cause regional
supply shortfalls and price spikes in ultra-low sulfur diesel
as well as 500 parts per million diesel. Thank you.
[The prepared statement of Mr. Ory follows:]
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Mr. Ose. I want to thank the witnesses for their testimony.
For the record, I want to enter into the record a memorandum
dated September 25, 2000 from Michael Sipple regarding the
blacklisting, proposed blacklisting rule at that time.
[The information referred to follows:]
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Mr. Ose. I will recognize the gentleman from Idaho for 5
minutes for questions.
Mr. Otter. Thank you very much, Mr. Chairman. I would like
to start off by asking Dr. Gramm if the study, the U.S. study
that you referred to relative to the arsenic levels, do you
have that report? Is that available?
Dr. Gramm. I believe that's available. It was a study of
the Mormon population. And it is probably in the record as
well. It would be in EPA's docket. Would you like me to get it
for you?
Mr. Otter. I would like very much, Mr. Chairman, not only
to have Dr. Gramm provide that for the committee, but also make
that an official part of this committee hearing record.
Mr. Ose. Without objection.
Mr. Otter. Thank you very much Mr. Chairman.
Dr. Gramm, in the Mercatus Center checklist, will these
rules and regulations make it better off for the people, and is
it a good thing for us to do? Would you run through that
checklist--the 7 points right quick for me?
Dr. Gramm. Yes. And, what we do I'll show to you. And I
have appended to this record in my testimony a list of all the
comments we've done on specific rules so you can look at these
checklists.
But, we ask the question, has the agency identified a
significant market failure or a systemic problem? Has the
agency identified an appropriate Federal role? Has the agency
examined alternative approaches? Does the agency attempt to
maximize net benefits? Does the proposal have a strong
scientific or technical basis? Are the distributional effects
clearly understood? And, No. 7, are individual choices and
property impacts understood?
Mr. Otter. Would you then, Dr. Gramm, using that checklist,
describe for me the school's--your checklist in grading on the
Forest Service's roadless rule?
Dr. Gramm. Under whether or not the agency has identified a
significant market failure: we've given them an unsatisfactory.
Mr. Otter. Was that the same as an F?
Dr. Gramm. As an F, that's right. As a matter of fact, we
have shifted from verbal--satisfactory, etc.--to just letter
grades.
Mr. Otter. That may be great for elementary school kids but
trust me, Dr. Gramm, we need F's and A's in Congress.
Dr. Gramm. F. F. Unsatisfactory, F.
And has the agency identified appropriate Federal role? C.
Alternative approaches, have they considered alternative
approaches? F.
Do they attempt to maximize net benefits? F.
Does the proposal have a strong scientific or technical
basis? F.
Are the distributional effects clearly understood? F.
And, are the individual choices and property impacts
understood? F.
And, what we also do is we put a sentence in explaining the
agency approach, and then our comments.
Mr. Otter. Thank you very much, Dr. Gramm.
I would like to now move to the next witness. Sir, I was
particularly interested in your historical review of what has
happened with the Administrative Procedure Act in Congress.
And, specifically, I do know that, when Congress entertains to
pass a piece of legislation, even though this is my first term
here, I'm already well aware of the ``power to enforce clause''
and I'm sure you know that, too. But, just to remind us both
that we're both speaking from the same page, the final clause,
the enacting clause says, ``and the director shall promulgate
such rules and regulations necessary to carry out the
provisions of this Act.''
Do we agree that's the delegation of authority then to the
agency or the Secretary?
Mr. Whitenton. As I understand what you're asking, do we
agree with the Constitution? And, yes, of course we would. The
Congress does have the power to delegate. Hopefully--we believe
it also has the obligation to keep track of what the agencies
do with that delegation and to keeping--setting the course
right when the agencies fail.
Mr. Otter. Yet, in three of the court cases that you
mentioned in your discussion, in your opening statement, that
power to enforce clause was in fact absent from two of those,
wasn't it?
Mr. Whitenton. I'm not sure, sir, what you're saying.
Mr. Otter. One of the questions before the court in the
1983 case, wasn't it whether or not the Congress had delegated
its authority to promulgate rules and regulations in that
instance?
Mr. Whitenton. It's my understanding that Congress had
delegated, but it was reserving too much, so therefore it was
not delegating properly.
Mr. Otter. Then it was a question of extent; is that right?
Mr. Whitenton. Yes, sir.
Mr. Otter. Would it be the only way for Congress to regain
its proper role to not put that clause in?
Mr. Whitenton. To not put the one-House veto in?
Mr. Otter. No, to not put the power to enforce clause in
that suggests that the Secretary or the department shall
promulgate such rules and regulations necessary to carry out
the provisions of the act?
Mr. Whitenton. We certainly believe that the proper
approach would be for Congress to take a much tighter view on
what it delegates in the first place so we do not get into the
problem, and be a little more specific and be much more
reluctant to give the power to agencies, and give more guidance
to the agencies in the promulgation of rules.
Mr. Otter. Thank you very much.
Dr. Nelson, in your testimony you suggested that not only
was the Clinton administration, as we have suggested, in a rush
to regulate and a rush to judgment, would, in your estimation
of environmental studies, the roadless rule do more harm than
good or more good than harm?
Dr. Nelson. I think it would be more damaging.
Environmentally it would be more damaging on the whole.
Basically it precludes taking a whole host of actions that
could be environmentally beneficial. As I mentioned, the
Clinton administration and the Forest Service had developed
plans for fuels treatments on Western national forests because
of the stressed, diseased condition of these forests. Many of
them are fire-prone and unhealthy, they include about a third
of the roadless areas in the lower 48 designated by the Clinton
roadless rule. Those would be largely precluded from future
management. So those areas would then be left in their current
unhealthy and fire-prone condition. If fires break out, as
we've seen, and especially in the current highly overstocked
condition of Western forests, they can do a lot of
environmental damage as well as threaten lives and property,
and cost $1 billion for the Federal Government to try to
suppress.
Mr. Otter. I thank you very much, Doctor. Thank you, Mr.
Chairman.
Mr. Ose. We'll have another round if you have additional
questions.
Dr. Nelson, I represent a district that has significant
forests in and around it, and the people who live in my
district use the forests for recreation, vacation time, family
time and the like. The thing I'm curious about is that, in
addition to the environmental benefits, the roadless rule seeks
to preserve recreation values which would be very important to
the people in my district.
The question I have is--I actually have a couple of
questions. Does the rule, as crafted, maximize the recreation
opportunities within our national forests or does it favor
certain types of recreation over others or certain recreation
users over others?
Dr. Nelson. Well, I think it clearly favors what we might
call the 20-year-old backpacker or anyone else who has the
energy to hike 10 or 20 miles at a time and is interested in
camping in the back country. It definitely is going to impede
the future opportunities to expand recreation for a host of
other kinds of people--hunters, fishermen, snowmobilers,
ordinary hikers who may want to walk 3 miles, as is more the
style of the average person, 3 miles in and 3 miles out. That
doesn't get you very far into a lot of wilderness areas.
As I mentioned, 56 percent of the total national forest
lands would now be left in a status basically suited for
primitive recreation. Primitive recreation is a relatively
small part of the total recreational base. There were something
over 90 million picnickers in the national forests in 1994 and
1995, and about 15 million backpackers. And, there were similar
results in all the other numbers that you look at. The use of
developed recreationsites is vastly greater than the levels of
primitive recreation on the national forests.
Mr. Ose. Before we leave that point, you're suggesting that
the use by general recreation is 6 times that, at least by your
numbers, the 90 and the 15 of primitive recreation users?
Dr. Nelson. I was actually saying picnickers. But yes, I
think that's reasonable. There are other areas of more
intensive recreational activity which have numbers approaching
100 million per year. As I say, backpackers are the more
primitive forms of recreation--you might be looking at 10, 20
million per year.
Mr. Ose. Let me ask this question very directly, then. To
the extent that we have a roadless policy, it's your opinion
there will be certain areas that will then be off limits to the
picnickers or general recreational users just by the nature of
having no ability to get there?
Dr. Nelson. Basically people drive to get at least within a
reasonably short distance to get to these areas. Ninety percent
of the use of forest service roads right now is for
recreational purposes. Now, of course, where you have the
existing road network, that is still going to be there. So what
we're talking about is roadless areas which hold the
opportunities for expanded future recreation use to meet
increasing recreation demands on the part of the American
public. Especially if you look at the areas where recreation
demands are increasing most rapidly, it's for the developed
forms of recreation. Unfortunately, some of the baby-boomers
and so forth are getting older and don't want to walk as far.
Mr. Ose. It happens.
Dr. Nelson. It also turns out that if you start looking at
the statistics, it's quite interesting. Minority groups--
Blacks, Hispanics, and so forth--have quite strong preferences
for developed recreation relative to these primitive forms of
recreations. Actually, primitive forms of recreation are the
particular domain of college-educated, relatively wealthier
portions of the population.
Mr. Ose. So you have been able to draw a connection between
the availability of some of these roadless areas and the
ability of some of our lower-income or other groups to access
recreational lands?
Dr. Nelson. As part of my preparation for this testimony, I
did look fairly exhaustively at the Forest Service's own
environmental study. And it's quite clear about these matters.
So I'm not simply basing it on my opinion, I'm using the
existing documented record prepared by the Forest Service.
Mr. Ose. My time has expired.
Mr. Otter for 5 minutes.
Mr. Otter. Thank you, Mr. Chairman. I would like to go back
to the question with Mr. Ory on the diesel fuel. During your
testimony you referred to a shortage of diesel fuel. Does your
study attempt to discuss or figure out how much of a shortage
there is going to be?
Mr. Ory. The study that we conducted was, as I indicated,
really as an assessment of the notice of proposed rulemaking.
And it was conducted in September, approximately September of
last year. And given those criteria and the provisions of the
notice, the shortage was approximately 15 percent nationally.
There were certain regions of the country that were more
exposed than others; in particular, the mountain States.
Mr. Otter. How much was the shortage going to be in the
mountain States, in the Pacific Northwest?
Mr. Ory. I don't remember the numbers specifically, but
higher; 30 percent, 25 or 30 percent.
Mr. Otter. My sources tell me that 37 percent is probably
pretty close. So I would be willing to halve that with you and
go with 34 percent if that's all right with you.
Mr. Ory. You have my permission.
Mr. Otter. What in your estimation would that do to the
price?
Mr. Ory. Well, I think we have a very valid example of what
those kinds of shortages or conditions, I should say, can do to
price. And, looking at the situation in California on
incremental power costs and natural gas, and certainly looking
at some of the regional shortages that occurred in the upper
Midwest in the middle of last year, in the summer of last year,
and there is expectation that a similar condition will occur in
the summer of this year, the price can go as high as it takes
to do one of two things: to either discourage demand, or to
cause very expensive increments of supply to occur.
Mr. Otter. What was your estimate that the shortage was
going to be in California?
Mr. Ory. From an ultra-low sulfur diesel standpoint, the
State of California is actually balanced. We didn't see a
particular condition existing in that part of the country. And,
the reason for that is that the State of California has already
spent their big dollars in reaching their so-called carb diesel
rule back in 1995, so they have to spend incremental dollars to
only take out the sulfur. So they will be the least affected.
We didn't foresee any shortage there.
Mr. Otter. And, those trucks that would be bringing
products and services, products into the U.S. economy, say,
from Mexico and from Canada, would they have that--the same
impairment on their use of diesel?
Mr. Ory. No, not to my knowledge.
Mr. Otter. Only for the diesel that they purchased while
they were in the United States?
Mr. Ory. That's correct.
Mr. Otter. And, also, Mr. Ory, the use of nonroad diesel,
did you make--did your study include nonroad uses?
Mr. Ory. No, it didn't. That's an issue yet to be decided,
I understand, by the EPA.
Mr. Otter. OK. So, we could have the trucks that are
actually taking the gas to market that would be regulated, and
they're moving around, so there's a certain displacement of
their ``pollutants,'' right?
Mr. Ory. That's right.
Mr. Otter. Yet the energy-producing, the electrical-
producing generator that may be sitting just off my backyard,
which would be sitting in one place and not going anywhere, its
pollution could be concentrated just in that area. So, we have
one area that is being regulated and another not.
Mr. Ory. That's correct. Diesel in stationary uses or off-
road uses, as the definition may be, has yet to be regulated.
Mr. Otter. Does your study divide up the quantity use
between the two? What percentage is used that would be
regulated and what percentage not?
Mr. Ory. When we look at--and not to get overly technical
here--of the fuel that goes into combustion engines, let's say
of any type and nature, some of which are in heavy trucks,
we're all familiar with those. Those are called on-road uses,
and they represent approximately 55, 56 percent of that part of
the petroleum barrel that is generically called distillate fuel
oils. Approximately another 30 percent to 35 percent is off-
road uses, and the rest is heating oil.
Mr. Otter. One last question, Mr. Chairman, 45 percent then
is not regulated?
Mr. Ory. That's correct.
Mr. Otter. Thank you very much.
Mr. Ose. I want to come back to Dr. Nelson, if I could. The
Forest Service put out an environmental document on the
roadless policy. I mean, they're required to do that. They
released it in November 2000. If I understand your written
testimony on page 2, the actual document that the Forest
Service put out in the form of the final EIS noted a change in
the procedure by which the Forest Service promulgated this
rule. That is, they went away from a historical collaborative
approach toward one that was almost top-down, if you will.
Could you expand on that, please?
Dr. Nelson. Well, the Forest Service, based on a mandate
from the Congress which goes back to the National Forest
Management Act of 1976, is directed to, and in fact has been
preparing land use plans for each national forest. These land
use plans are a continuing process. It involves extensive local
involvement of the citizenry. The people who are requested to
participate in this process do so with the expectation that the
land use planning process is, in fact, going to govern the
future uses, as the Congress seemingly directed, of the lands
in these particular national forests.
Essentially this Clinton roadless process bypassed and
superseded that land use planning process in which local people
had invested their time, their energy, and their trust. And, so
in that sense, I believe that there may even be some legal
questions raised, but certainly it was a violation of the trust
that the citizens had put in the Forest Service. The
expectations had been created by the Forest Service that land
use planning would drive the outcomes on these forests.
Instead, now a third of the national forest system, a
national dictate from Washington, DC, superseded all that land
use planning effort.
Mr. Ose. I think the operative thing I would like to
emphasize, I'd like to repeat it for the record, is on page 2
of your testimony you cite the Forest Service's final EIS,
``The roadless rule contradicts the past emphasis placed on
collaboration, and instead reflects a strategy of maximizing
national prohibitions on the use of National Forest lands,''
which is exactly what you've just said. So I appreciate your
highlighting that in your testimony.
Now, Mr. Whitenton on page 2 of your testimony, in the--
let's see, 1, 2, 3, 4, 5, 6, 7th line from the bottom, I don't
quite understand something. Where you're talking about the U.S.
Court of Appeals of the D.C. Circuit vacating the EPA
interpretive guidance as unenforceable. Is there a word left
out there? Shouldn't it have the word--between ``had'' and
``legal,'' shouldn't the word ``no'' legal force and effect be
in there?
Mr. Whitenton. That is certainly correct. Yes, sir.
Mr. Ose. OK. I struggled with that last night.
Finally, I want to ask Dr. Gramm a couple questions on the
blacklisting. As I understand the blacklisting rule--we worked
on this last session of Congress--there is a duty or an option
on the part of the contracting officer to entertain allegations
of behavior that might not comply with someone's standards, and
that those allegations can be used as rationale for
disqualification of a bidder. Am I correct on that?
Dr. Gramm. That is correct. Indeed, if there is a complaint
brought by an administrative agency, that could immediately
cause you to be blacklisted, even before you've provided
evidence to the contrary or allowed a hearing.
Mr. Ose. Why would--I mean, in a sense that's almost being
judged guilty before you're proven innocent, which is seemingly
a little bit backward.
Dr. Gramm. I believe you have it right, because it does
shift the burden of proof.
Mr. Ose. To the potential contractor.
Dr. Gramm. That's correct. To prove himself innocent if a
complaint is brought, but before he goes through the
proceedings. And, indeed, and again, this is a regulation we
actually did not do a large public interest comment on, but it
was a regulation we focused on during the midnight period. And,
there are some procedural issues. For example, it appears that
this authority that might have been delegated, for example, to
the National Labor Relations Board on some labor issues or
differences that might come up. In fact the blacklisting rule
would abrogate and supersede what Congress had given to the
National Labor Relations Board and those procedures.
Mr. Ose. My time has expired. I may come back to this with
you.
The gentleman from Massachusetts.
The gentleman from Idaho for 5 minutes.
Mr. Otter. Thank you once again, Mr. Chairman. I would like
to go now back to Dr. Nelson relative to the study that was
made by the Forest Service. In the reports on the roadless
area, the Forest Service said that they had received 1.1
million comments. Would you agree--is that what the study said?
Dr. Nelson. I believe that's correct, something of that
magnitude.
Mr. Otter. Do you feel like the citizens of the United
States, the citizens of the affected areas, had an adequate
opportunity to testify?
Dr. Nelson. I think that they were given adequate
opportunity to comment on the roadless rule. But, the end
result was always going to be this single national
determination. And, I believe also that the Forest Service, as
in fact it has documented in its own materials, ran into many
strenuous objections in its planning and its hearings and the
consultation process that it engaged in. But, yes, it did give
people quite a bit of opportunity to comment.
Mr. Otter. The actual scoping process was 120 days, was it
not?
Dr. Nelson. I believe so. I'm not sure.
Mr. Otter. We had 1.1 million comments that they took 120
days to gather and then analyze. So, roughly, you wouldn't have
any idea would you, Doctor, how many people were involved in
this process?
Dr. Nelson. I really--no, I don't know. But they did issue
it as a draft and then it was another 5 months from the draft
to the final.
Mr. Otter. During that time period, there should have been
some analysis of the input that was made during the scope of
the hearings.
Dr. Nelson. You would assume so.
Mr. Otter. And, try to reflect that.
Dr. Nelson. Yes.
Mr. Otter. By my calculations, if we took that entire time
for the analysis, it would have taken about 8,000 comments per
day or roughly 1,000 analyses per hour in order to--by however
many people were involved--in order to come up with the final
result and, if that final result was truly going to represent
the input that was received during that scoping hearing. Would
you agree with that?
Dr. Nelson. Yes, I'm sure that they had a huge volume of
material to deal with, there is no doubt about that.
Mr. Otter. As a professor of environmental studies, what
would you instruct to your students during their process of
trying to arrive at a proper program or, let's say, a proper
rule in the future? Would you suggest that they could take and
analyze 8,000 comments a day and, in the process, come out with
a rule which would be representative of what was necessary?
Or----
Dr. Nelson. Well, I'm sure that the Forest Service found
that there were certain common themes through a lot of these
comments. So, although they did receive a million, there
obviously weren't a million separate issues. I do think,
however, that there was a great deal of selection, especially
in the selection of the alternatives for the final
environmental statement, which were very narrowly construed.
There were four alternatives. Three of them were all versions
of the roadless policy and the other one was no action.
There were a host of other possibilities that could have
been raised, and not only could have but should have been
raised. They include various forest fuels treatment
alternatives, different forms of timber harvesting, different
forms of use of roads. I don't know whether it was specifically
due to their failure to take account of the comments. It
probably was to some extent, but whatever the explanation, I
would definitely fault the Forest Service for a failure to
consider an adequate range of alternatives.
However, I would say that, despite all the failures, if you
actually read the EIS document rather closely and you discount
for some of the rhetorical flourishes that are there because
the administration is obviously defending its own policy, I
believe the document actually makes a rather strong case
against this policy. So, I have tried in my written testimony
to show some of the reasons why, if you actually read the
document, I think a fair-minded reader could only come away
with a conclusion that this is a significant mistake to pursue
this roadless policy in the manner proposed.
Mr. Otter. Thank you very much, Mr. Nelson.
Mr. Whitenton. Mr. Chairman, I want to apologize. When you
asked me the question about whether the word ``not'' should be
inserted on page 2, I do want to explain that it was
accurately, if inartfully drafted, as written. The court in
Appalachia Power v. EPA had vacated the EPA guidance because it
had forced an effect of law and because they hadn't followed
APA procedures. If the EPA had followed the proper rulemaking
procedures, then the court would not have vacated the guidance.
Mr. Ose. I understand your point. It was inartfully read
also, so I want to make that clear. I appreciate the
clarification.
Dr. Gramm, if I might, I want to go back to the
blacklisting issue. We talked a few moments ago about
allegations being disqualifiers if the contracting officer
found them sufficient. The concern I have is the compounding
effect of that. If we had a contractor who is in front or
before the government seeking to provide a service, allegations
surface that its behavior or its standards are unacceptable to
some third party, how do you ever stop or resolve such a
process?
Dr. Gramm. I think that's the very great difficulty. You
could inflict great harm for what may be a complaint for which
there isn't strong evidence--that that complaint should go
forward. And, this would supersede and abrogate a number of the
formal procedures and safeguards that are already in place to
deal with those kinds of complaints. For this reason the
members of that FARC council have opposed this particular
regulation.
Mr. Ose. So the FARC council itself opposed the regulation?
Dr. Gramm. That's right. General Services Administration,
the Environmental Protection Agency, NASA, and the Defense
Acquisition Regulation Council oppose the regulation. The FARC
council that proposed the regulations included some of these
members, DOD, GSA and NASA, but yet the members also oppose the
regulation.
Mr. Ose. All right.
Dr. Gramm. If I could raise another issue on some of the
issues----
Mr. Ose. If I may, I do want to go back to an earlier part
of your testimony. You offered testimony about the grades on
some of the rules in terms of compliance with standards or
procedures. Would you be willing to submit for the record the
grades that you have with you for the various rules that are
the subject of our concerns?
Dr. Gramm. Yes. As a matter of fact, I would like to
include the whole public interest comment, when we have a
written public interest comment, which will be more amplified.
Mr. Ose. Without objection, we will accept that.
So go ahead.
Dr. Gramm. May I raise a few issues that have been raised
on some of the other issues? I rather rushed through my oral
statement, trying to keep under the time. But, on the roadless
rule, I by and large agree with what Dr. Nelson has said, and I
raise one question. I believe that in the proposed rule the
Forest Service was going to exclude Tongass, but in the final
rule they included Tongass, and that is a very major change
that perhaps should have gone out for further comment.
On TMDLs, which Mr. Whitenton has discussed, I wanted to
say that EPA's approach to water quality management in the TMDL
rule would attempt to address water bodies that are not meeting
standards, but its approach is very procedural, very
prescriptive, and would create a program for water that is much
like the State implementation program that we have for air. And
I would argue that has some severe issues especially as it
relates to unfunded mandates.
With regard to the diesel rule, which we again have
information that I didn't go into here, I would point out that
the diesel rule aims at reducing the amounts of emissions, but,
in fact, most of the areas are already in compliance with the
Clean Air Act. So, you have all these costs imposed in areas
where they are already in compliance with the Clean Air Act.
Finally, on energy efficiency standards, which I rushed
quickly through, I would point out that the air-conditioning
and the heating efficiency standards would particularly
adversely affect consumers in the Pacific Northwest and other
areas where they do not use these machines as much as what the
Department of Energy has assumed.
Mr. Ose. Thank you. I want to thank our witnesses, Dr.
Gramm, Mr. Whitenton, Dr. Nelson, Mr. Ory, for joining us this
morning. I appreciate your testimony.
Dr. Gramm. Thank you.
Mr. Ose. We will now ask the second panel to join us. That
would be Terry Gestrin, Evan Hayes, Sharon Buccino, and Thomas
McGarity, please.
As with the first panel, I would ask these witnesses please
rise to be sworn in.
[Witnesses sworn.]
Mr. Ose. Let the record show the witnesses answered in the
affirmative. I would like to recognize the gentleman from
Massachusetts for the purposes of an opening statement.
Mr. Tierney. Thank you, Mr. Chairman. I apologize for
making this statement at this point in time but one of our
deregulated agencies, the airlines, doesn't seem to do its job
very well these days and we were delayed considerably getting
in.
Mr. Chairman, I thank you for holding this hearing and I
have no objection to you having discussion and conversation
about whether or not the Clinton administration rushed through
regulations before going through necessary checks and balances.
However, I think we also have to look at the actions taken by
the Bush administration and Congress in its recent rush to
deregulate.
Near the end of the Clinton administration, many important
environmental, labor, and health protections were issued. Many
were the result of years of thorough analysis of numerous
scientific and economic studies and volumes of public comment.
For instance, Mr. Chairman, before issuing the rule that
protects inventories of roadless areas in our national forests
from roads and logging, the Clinton administration received a
recordbreaking 1.6 million comments; 95 percent of those
comments urged the adoption of stronger protection for roadless
areas. The Forest Service also held over 600 public meetings
where it heard from the communities that would be directly
affected by the rule.
Congress held a number of hearings on this rule and 165
Members of Congress wrote a letter asking that roadless areas
be protected from roads for logging and mining. There are
opponents to the roadless rule, as you would expect from any
regulation. However, I don't see how they can claim that this
was rushed when it was issued or it was issued without adequate
public participation.
In another instance, the EPA issued its new stricter
standard for arsenic in drinking water. Under the old standard,
the National Academy of Sciences estimated that 1 out of 100
people would get bladder, lung, skin, kidney, or liver cancer.
This risk is about 100,000 times greater than the cancer risk
that we allow for food.
It was long past time to update the standard and, in fact,
Congress should have required the revision of the standard over
25 years ago. The EPA issued a proposed Rule 18 years ago, and
again in June 2000. After reviewing over 1,000 comments and
numerous scientific and economic analyses, the EPA issued its
final rule. Again, the public had plenty of opportunity to
express its views and any rush was the result of congressional
mandates.
Similarly, rules protecting the confidentiality of our
medical records, setting new emission limits for diesel trucks
and buses, and ensuring that lawbreakers are not rewarded with
Federal contracts were the result of a lengthy, thorough public
process. They are not ``midnight regulations'' that were rushed
through the process without public input or thorough review of
scientific and economic studies.
However, the same cannot be said for the actions recently
taken for those opposed to rules. In its rush to undermine the
roadless rule, the arsenic standard, and the contractor
responsibility rule, the Bush administration has suspended
these rules without giving the public notice and an opportunity
to comment on suspension. And, as some witnesses will explain,
these suspensions may well have been illegal.
I am also concerned about the use of the Congressional
Review Act to disapprove these labor, environmental and health
protections. The procedures for disapproval leave very little
opportunity for debating these issues. When Congress
disapproved the ergonomics rule, debate in the House and Senate
combined was limited to 12 hours, only 2 of those in the House,
with little or any notice given to the public to share their
concerns about disapproval. It would be unfair to the public to
undo the final result of a thorough public process in such a
rushed manner.
Furthermore, congressional disapproval is a harsh remedy
that severely limits the opportunity to enact a similar rule in
the future. Thus, we ought to take great care in deciding to
use this drastic measure to undo rules that were enacted
pursuant to a thorough public process.
Mr. Chairman, there are very serious questions behind the
current rush to deregulate. Sunday's Washington Post indicated
that the coal industry, which has provided over $12 million to
Republicans, is the primary beneficiary of many of the proposed
revisions and repeals. The new arsenic standard makes it harder
for mining companies to pollute our drinking water. The
roadless rule would make it more difficult for the mining
industry to destroy pristine areas in our national forests. And
another threatened rule strengthens environmental protections
applicable to the mining industry and makes it harder for the
mining industry to escape liability for environmental
violations.
All of these rules have been targeted for repeal by the
Bush administration and the Republican Majority in Congress.
The Post article entitled, ``Coal Scores With Wager on Bush,''
reports that ``Few businesses placed as big a bet on the
Republicans in the last election as the coal industry which
gave 88 cents out of every dollar in campaign contributions to
GOP candidates or organizations. Two months into the Bush
Administration, that wager has begun to pay off.''
The article lists the close connection between coal
lobbyists and the administration. It reports ``Among them were
Irl Engelhardt, chairman of the Peabody Group, the Nation's
largest coal enterprise, whose holding company contributed
$250,000 to the Republican National Committee in July.
Engelhardt himself served as an energy advisor to the Bush-
Cheney transition team. The Bush-Cheney transition team was
sprinkled with industry officials.''
The article also reports, ``The coal industry may enjoy
even better connections in Congress.'' I ask unanimous consent,
Mr. Chairman, that this article and other materials relevant to
the hearing be included for the record.
Mr. Ose. Without objection.
Mr. Tierney. Thank you. Mr. Chairman, there are a lot of
concerns regarding the rush to deregulate. I share your concern
that Presidents and Congress may rush regulatory decisions
without going through the public rulemaking process with its
important checks and balances. Implementation, repeals,
suspensions, and other modifications of rules are important
decisions that should not be taken lightly. I look forward to
hearing from the witnesses on these issues. Thank you.
Mr. Ose. I thank the gentleman.
I would like to call Mr. Otter to introduce some folks.
Mr. Otter. Thank you Mr. Chairman. I bring before the
committee this morning the chairman of the Valley County, ID
County Commissioners, Mr. Terry Gestrin, who will talk to us
this morning about the effects of this rush to regulate in
terms of locking up 9.7 million acres in Idaho alone for
roadless use.
I also at this time, Mr. Chairman, would like to invite my
old friend, Evan Hayes, who will be here to talk to us about
the diesel and the low sulphur diesel ruling by the EPA. Mr.
Hayes does represent the National Association of Wheat Growers,
and Mr. Hayes and I have served on many committees in the State
of Idaho. I can tell you this is a gentleman that has been
working at ground zero for most of these regulations. I welcome
both of you to the U.S. Congress.
Mr. Ose. Thank you, Mr. Otter. I want to welcome all the
witnesses and please confine your summary of your remarks to 5
minutes so we can have the questions accordingly. Mr. Gestrin.
STATEMENTS OF TERRY E. GESTRIN, CHAIRMAN, VALLEY COUNTY
COMMISSIONERS, CASCADE, ID; EVAN HAYES, WHEAT FARMER, AMERICAN
FALLS, ID, REPRESENTING THE NATIONAL ASSOCIATION OF WHEAT
GROWERS; SHARON BUCCINO, SENIOR ATTORNEY, NATURAL RESOURCES
DEFENSE COUNCIL; AND THOMAS O. McGARITY, W. JAMES KORNZER
CHAIR, UNIVERSITY OF TEXAS SCHOOL OF LAW
Mr. Gestrin. Thank you, Mr. Chairman. I appreciate the
invitation to testify today. Outside of Tongass, with over 9
million acres of roadless areas, Idaho will suffer the greatest
impact. Of the 44 counties in Idaho, it appears that Valley
County is the most affected county in the Nation. This is hard
to determine because we were never supplied with definitive
maps to tell us exactly where these acreages are. Valley County
has a little over 2.2 million acres; 88 percent of that, or
over 2 million acres, is Federal public lands. Our static
population in our county is 8,000 people. It swells to over
30,000 in the summer. Most of these people come to recreate on
national forest lands.
The roadless initiative will affect that. The Payette
National Forest, with over 2.3 million acres, and the Boise
National Forest, with almost the same acreage, comprise the
majority of the forestlands located in Valley County. Between
the wilderness and the new roadless area management program, we
are left with only 17 percent of the Payette and 27 percent of
the Boise National Forest available for active management.
Valley County recently had an economic study completed by the
University of Idaho, which I would also like to enter into the
record today.
Mr. Ose. Without objection.
Mr. Gestrin. This shows the effect of losing the timber
industry brought about by many, many regulations of which the
roadless initiative is just a last nail in our coffin. Direct
loss by the loss of our sawmill creates an economic loss of $27
million, with over 225 front-line jobs potentially at stake.
Combine this with secondary jobs, the loss of economy to Valley
County alone is over $43 million, according to the University
of Idaho study.
I would suggest, if we are going to promote economic
development, we would want to make policies or promote
activities with local benefits. Our local school district with
an enrollment of about 400 students in Cascade is going to lose
75 children whose parents are going to be without work come
June when the sawmill closes. The superintendent of that
district estimates its economic loss to the school in hard
dollars of $200,000.
We are facing the worst forest health crisis in history. It
is inconceivable to me that we could even consider implementing
a roadless initiative in its present form; 67 million acres of
national forest is classified by the Forest Service as high to
moderate-risk to catastrophic fire, insect infestation and
disease. Last year, more than 7 million acres of public lands
burned to the ground in the worst fire season in 90 years. I
assure you that we've had the mildest winter in 40 years. With
current tests by the Forest Service indicating the timber is at
about 14 percent moisture content. So look out, folks, we are
facing the worst-case scenario of burning what hasn't burned.
Incidentally, I understand that kiln-dried lumber is
between 12 to 16 percent moisture.
We need to engage in policies that allow local management,
not adding another strand of barbed wire to the existing fence
created by regulations that eliminate the ability to manage our
natural resources.
I have talked on some of the economic impacts. Time
restraints will limit my comments on social impacts, but there
are many. Could you imagine for a moment telling your spouse
and children when you come home with the news that you don't
have a job, your way of life is in imminent danger? Divorce
rates are going to increase, spousal abuse, child abuse, and
all the other things that go with that.
We are losing our rural and national resource heritage. I
would like to comment on what I understood our NEPA process
guaranteed for us. NEPA to me meant that we are guaranteed a
true and meaningful process to provide public comment that will
be given due consideration prior to the decision being made.
The Interior Columbia Region Basin project has taken in excess
of 6 years for the NEPA process and a Record of Decision is yet
to be made. This project is only for one watershed in the West.
It's a huge watershed, by the way. Now we are expected to have
this decision on the roadless initiative, and this was
completed in 1 year and 3 months.
I realize that NEPA does not guarantee a good decision but
it certainly is intended to guarantee a good process.
I'll sum up with one statement. In 1887, the Purpose of
National Forests was enacted to improve and protect the forest
within the boundaries, or for the purpose of securing favorable
conditions of water flows and to furnish a continuous supply of
timber for the use and necessities of the citizens of the
United States.
In conclusion, I would ask that we're not fenced out. Local
government needs to be involved in the decisionmaking process
which will ultimately lead to the improvement of our local
forest health, economy, and social health of our own local
communities. Please realize that the best decisions that can
possibly be made are at the local level. This ensures that
accountability is at the highest level.
Thank you Mr. Chairman.
Mr. Ose. Thank you Mr. Gestrin.
[The prepared statement of Mr. Gestrin follows:]
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Mr. Ose. Mr. Hayes.
Mr. Hayes. Mr. Chairman, Ranking Member----
Mr. Ose. Pull that mic next to you.
Mr. Hayes. Mr. Chairman, Ranking Member, Congressman Otter,
thank you for your kind words. Congressman Otter has been an
extremely good friend to us----
Mr. Ose. Mr. Hayes, is that microphone turned on?
Mr. Hayes. Is that better?
I will just start over again so we can do it right.
Mr. Chairman, Ranking Member, sorry about not knowing how
to run the microphone. I am just a farmer. Congressman Otter,
thank you for your kind words. I want you all to know that
Congressman Otter has been an extremely good friend to us in
Idaho as Lieutenant Governor and as a Congressman. We are
tickled to death to have him back here to represent our great
State.
Today, I would like to visit with you just for a few
moments about the diesel fuel regulations and the possibilities
or the effects it would have on agriculture. Let me begin and
tell you a little story about a farmer. This was a story that
President Kennedy told years ago. He talked about our ability
to market as farmers. He said, you know, farmers are a rare
group. He said, they buy retail, sell wholesale, and pay the
transportation both ways.
That's what we are folks. We are extremely poor marketers.
But we are a very unique group of marketers because of the fact
that we do not go to the marketplace and say, we want X dollars
for our product. We go to the marketplace and say, how much
money will you give us for our product? This makes us
completely different than the rest of the economy. And so this
regulation is going to affect us considerably differently
because we don't have the option to add fuel surcharges and
things of this nature.
Supply and demand is a tremendous item for us in
agriculture. Last year, I got a real shock. I was hauling
malting barley to Idaho Falls, 125 mile haul. As the so-called
shortage on oil became more apparent and the concerns of a
shortage of oil, we saw our diesel fuel prices skyrocket. What
a sticker shock it is when you put the nozzle in your tank and
fill the tank on your truck that holds 200 gallons of fuel. You
turn around and you look at the pump and it says you owe them
$400. That is 50 cents a mile, because we run it 4 miles to the
gallon in the mountains of Idaho. That is a real sticker shock
to you.
We need to really take a long look at this new EPA
regulation on how much money this is going to cost us. How much
money is it going to cost us to run our tractors and trucks.
Can we afford to do that?
Agriculture has the largest trucking fleet in the world.
Now, farmers didn't become farmers because they wanted to
become truckers. Farmers owned trucks because they are a
mandatory part of our operation. We have to be able to take
fertilizer, fuel, grain, etc., to our drills in the spring of
the year. Then we have to be able to at harvest time take our
commodity from the combine to our first part of storage, or to
our bins. Then it comes marketing time. We have to be able to
haul this product on to the market. We don't do this because we
like to be truckers. We do this because it's necessary for our
farm use. Now, we can't afford to run new trucks, so,
therefore, we buy used over-the-road trucks. Currently, I own
one that I consider to be a road truck. It's a 1984 Peterbilt
which I bought for $9,000. I have run this truck in the 9 or 10
years that I have owned it about 70,000 miles. So, in other
words, I'm running this truck at about 7,000 miles a year.
Now, under the new regulations, if I understand them
correctly, by 2006, 50 percent of these trucks are going to
have to meet the new emissions standards, and by 2010 we are
all going to have to meet the emissions standards. This means
we're either going to have to retrofit our engines, replace our
engines, or buy new trucks. Now, it doesn't make a lot of sense
to me to put a $10,000 or $15,000 engine to meet the emissions
standards in a $10,000 truck. Somehow that just doesn't balance
in my baseline. Also it doesn't balance in my books to pay
$80,000 for a new truck to haul a commodity that I run 7,000
miles a year.
The next item I need to discuss with you is our tractor
fleet. Our tractor fleet, as you know, is also the largest
tractor fleet in the world. Presently, I am running a tractor
on my farm that my father purchased in 1960 when I was a
freshman at Idaho State University. I am still using that
tractor. We have to maintain our tractors. We have to make sure
that we run them as long as we possibly can.
My concerns under the new diesel fuel regulation is that
can we burn the fuel in these old tractors? If we can't burn
this new fuel--and I am not sure we can because I am only being
speculative on this--but can we burn this fuel? If we can't, we
will have some awfully expensive mailbox holders out there.
That's the only thing we will be able to use these tractors for
is to hang our mailbox on them, because we're certainly not
going to be able to use them in the farm.
Mr. Ose. Mr. Hayes you will have to wrap up.
Mr. Hayes. I will.
Mr. Ose. We will give you 30 seconds to wrap up.
Mr. Hayes. Thirty seconds to wrap up. I would recommend
that the committee do one thing as quickly as possible, that is
that this committee introduce legislation under the
Congressional Review Act to repeal the recent diesel fuel
emissions standard by the EPA and then to rework these
standards to something that will protect the environment and at
the same time be economically feasible for us in agriculture.
Thank you, Mr. Chairman. I will stand for questions.
Mr. Ose. Thank you Mr. Hayes.
[The prepared statement of Mr. Hayes follows:]
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Mr. Ose. I now have the pleasure of introducing Mrs. Sharon
Buccino who is a senior attorney for Natural Resources Defense
Council. I want to welcome you. I appreciate you for forwarding
your testimony. I did have the pleasure of reading it last
night and it was quite informative. So, if you can summarize,
thank you.
Ms. Buccino. Good morning. My name is Sharon Buccino. I am
a senior attorney at the Natural Resources Defense Council.
Mr. Ose. Can you move that closer?
Ms. Buccino. NRDC is a national membership organization.
NRDC is a nonprofit organization with over 400,000 members
across the country. NRDC members value the public health,
safety and environmental protections put in place by Federal
agencies, such as the Environmental Protection Agency.
The protections issued in the last few months of the
Clinton administration have been attacked by some, but this
regulatory activity is neither unique to the previous
administration nor cause for dramatic reversal by the current
one or Congress. The protections that have come under attack,
like the plan to protect the few remaining wild areas in our
national forests and efforts to reduce cancer-causing arsenic
in our drinking water, promise to deliver tremendous benefits
to the American public. They enjoy broad public support and, in
some cases, have explicitly been mandated by Congress. These
protections are the law of the land and should be expeditiously
implemented, not delayed or rescinded.
The allegation that these protections were rushed through
at the last minute and lacked substantial support is completely
indefensible. The protections are all the product of a lengthy,
deliberative, public process, a process established by law
pursuant to the Administrative Procedure Act. Those who wish to
change the important public protections recently enacted should
engage in the same deliberative process rather than circumvent
the process through the Congressional Review Act or suspending
the effective dates of the rules.
I would like to address four of the specific environmental
protections that have come under attack. First, the plan to
protect our remaining wild forests. It is simply incorrect to
characterize this rule as a ``midnight regulation'' rushed
through at the last minute. The public input that went into the
development of this forest protection plan is perhaps the most
of any rulemaking effort ever.
I would also like to address the issue that was raised by
one of the earlier witnesses about access. This plan protects
the last and best of America's rapidly shrinking pristine
forests for public access and recreation, including hiking,
hunting and fishing. It is incorrect to equate these areas with
wilderness designation. The main characteristic of wilderness
areas is a prohibition on motorized use. And motorized use like
snowmobiles, all-terrain vehicles, are allowed in roadless
areas so they are very different from wilderness areas.
Far from excluding timber companies from our national
forests, the plan simply channels industrial uses to more than
half of our national forests that have already been impacted by
logging and other extractive industries.
I would also like to address the issue of fire. The new
protection plan does not foreclose addressing fire. I question
Dr. Nelson's characterization of the problem being focused on
roadless areas. Just recently, the Forest Service told the
House Resources Committee that only 14 percent of high-risk
fire conditions in the national forest land occur on roadless
areas. The problem is not in remote areas, but in fact in the
urban forest interface, and this is where just last year
Senator Domenici directed significant new funding.
Dr. Nelson has also ignored that tree removal is in fact
allowed in roadless areas to address the fire threat.
I am going to run out of time here quickly so I will leave
my remarks on arsenic and diesel to what's in my written
testimony. I will be happy to answer any questions.
I would like to address the appliance efficiency standards
because there has been a lot of discussion this morning about
the energy shortage the Nation faces. A key component of the
solution is reducing demand through more efficient appliances.
In January, the Department of Energy issued new efficiency
standards for air-conditioners, clothes washers, and water
heaters. These standards were explicitly mandated by Congress
and they are all more than 5 years late.
And, contrary to what Dr. Gramm suggested earlier, these
rules actually save consumers significant money. Consumers and
businesses are projected to save over $22 billion during the
next 25 years due to the new standards. And, by 2020, more
efficient appliances are expected to save 54,000 megawatts and
that's almost enough to power all of California.
It makes little sense to talk about delaying these
standards at precisely the time our Nation is facing an energy
shortage.
In conclusion, I urge members not to use the Congressional
Review Act to block important public health, safety and
environmental protections. As I discussed, these rules, like
protecting the last remaining wild areas in our national
forests, were issued after a lengthy public process over
several years. Discarding all the effort and public involvement
that went into important public health and environmental
protections with one rushed vote in Congress is a disservice to
the American people. Rescinding environmental protections or
delaying their implementation denies the public benefits they
rightfully expect from their government and hopefully neither
Congress nor the new administration will let them down. Thank
you.
Mr. Ose. Thank you, Ms. Buccino.
[The prepared statement of Ms. Buccino follows:]
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Mr. Ose. I would like to welcome Thomas McGarity. He holds
the W. James Kronzer Chair in law at the University of Texas
School of Law, and is an expert in administrative law
procedures and the like. Thank you for coming.
Mr. McGarity. Thank you, Mr. Chairman. My name is Tom
McGarity, and I do teach and have taught for 20 years at the
University of Texas School of Law, environmental law and
administrative law. I will say I do not speak for the
University of Texas. I speak for myself here in this capacity.
As is typically the case during the transition between one
administration and another, the volume of proposed and final
regulations issued by many executive branch agencies increased
during the last few weeks of the Clinton administration. Some
were significant and controversial rules that the agencies had
been deliberating over for many years. The same thing happened
at the end of the Carter administration and at the end of the
Bush administration. It is, of course, not at all unusual for
decisionmaking institutions like executive branch agencies,
courts, the Supreme Court of the United States, to increase its
workload or output at the end, and even this institution
increases substantially output toward the end of a designated
term.
On January 20th, Chief of Staff Andrew Card issued a
memorandum to the heads of the executive branch agencies.
Subject to limited exceptions, it required them to withdraw
proposed or final regulations that had gone to the Office of
the Federal Register but had not been published in the Federal
Register. With respect to final regulations that had been
published but had not taken effect, agency heads were to
temporarily postpone those regulations for 60 days. The
executive branch agencies complied by publishing notices in the
Federal Register, most of which contained pretty much
boilerplate for those actions.
The law is clear that the postponement of the effective
date of a final rule is ``rulemaking'' and is subject to the
Administrative Procedure Act's notice and comment procedures.
The Federal Register notices for the 60-day delay contain
boilerplate explanations that I think were not even remotely
plausible under the existing case law. They spoke of rules of
procedure. They spoke of a good cause exception. The rules of
procedure exception is inapplicable because these regulations
did, or most of them jeopardize or substantially affect the
rights and interests of parties; that is, the withdrawal of the
regulations did.
The boilerplate explanations did not demonstrate good cause
because a change of administrations is not the sort of
emergency situation that justifies the invocation of that
exemption.
The Card memo implicitly contemplated that agencies would
rescind regulations, having considered them, and on March 23,
2001, EPA did that with respect to the final rule for arsenic
where it extended indefinitely the effective date for the rule
for arsenic in drinking water. And I would correct my testimony
on page 15, line 3. It should say, ``extend indefinitely the
effective date,'' not ``extends indefinitely the rule,'' if
that confused anyone.
Any recission or modification of a published final rule
must be accomplished through notice-and-comment rulemaking
procedures. Furthermore, any such action must be supported with
data and analysis sufficient to pass judicial scrutiny under
the ``arbitrary and capricious'' test.
One alternative to unlawful postponement or withdrawal of a
published rule is action under the Congressional Review Act to
rescind the major rule. Because it has been--because it has the
effect, rather, of undoing the work of agencies and private
parties, all the work they have put into the rule, this
relatively blunt tool has the potential to waste large amounts
of public and private resources.
In my view, Congress should not hastily exercise its power
to undo the legitimate products of deliberative--of the
deliberative rulemaking process. In general, neither the
offices of individual Congresspersons or the committee staffs
or really any institution within Congress, now with the demise
of the Office of Technology Assessment, is populated with
persons with the technical expertise to second-guess the
conclusions of agency staff and upper-level agency
decisionmakers. The primary determinants of congressional
decisions under the Congressional Review Act are likely to be
political and not technical considerations. The fate of
individual regulations long in the making should not turn on a
hasty and unprincipled exercise of raw political power.
Congress has wisely refrained in the past from using the
Congressional Review Act to reward political beneficiaries and
punish political enemies. It should continue to do so in the
future.
Thank you Mr. Chairman.
Mr. Ose. Thank you Mr. McGarity.
[The prepared statement of Mr. McGarity follows:]
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Mr. Ose. I would like to recognize Mr. Otter for 5 minutes.
Mr. Otter. Thank you very much, Mr. Chairman. I appreciate
all the comments from the panel members. I would like to go
first to Terry, to Mr. Gestrin. Would you reiterate one more
time the impact that the roadless rule has had thus far, even
though we are just entering the phase on the roadless rule,
would you reiterate the impact it has had on the economy within
Valley County?
Mr. Gestrin. Yes, Mr. Chairman, Congressman Otter. As
indicated by our economic analysis, the loss of our timber
industry in Valley County is going to be a $43 million hit to
the economic viability of our community, but it is also a
complete change in our social structure. It is just one more
regulation on top of ESA and everything else that just finally
drives industry out. Plus, we also have the devastations
created by fires.
As you can see, an example of last summer's forest fire
burning, it is a very social and economic impact. But, we also
have areas that were inventoried recently as roadless but
they're already roaded. So there's confusion sometimes that
we're talking about areas that have never had a road, because
if you go to the Forest Service definition it states nonsystem
roads. Well, a system road is a road on their map that they
maintain, which are their system roads. The other roads, the
work roads, the nonsystem roads, are now being considered
roadless areas. We have a new designation of 5,000 acres just
inventoried last year that has had management, active
management in the past, that, in fact, has work roads in it. So
it just adds more de facto wilderness, if you will, to what we
have. Idaho already has the largest wilderness in the lower 48.
Mr. Otter. Terry, you have mentioned in your testimony that
I guess by the first of June, Boise Cascade is going to shut
down the last lumber mill they have in Valley County. They have
already shut down the one they have in Linn County, another
county in Idaho. My apologies to the other members, folks here,
that don't know the geography as well as Terry and I do. That
will bring the total then to a total of 33 lumber mills, in
excess of 3,000 folks that have lost their jobs in economies
within those communities within the last 8 years. With the
roadless area added to what we consider the mismanagement of
the last 8 years of our national forest in Idaho, can you
foresee what's going to take the place of those lumber mill
jobs or those wood products jobs?
Mr. Gestrin. We are looking at every aspect we possibly can
to bring in broadbands or anything else, but in these remote
locations we don't have the infrastructure, the transportation,
the things necessary to actually have other types of economic
activities, if you will. So we will be relying somewhat on the
Internet and broadband aspect. However, those jobs have
historically not paid as well as the national resource jobs do.
Our real basis of our wealth in this country comes from
national resources.
I think lately we have watched the stock market and what
happens when we put our faith in information. Our real wealth
comes from resources. On the map, if you want to look at
geography, all those parts from here, it's a dark color, that's
where I am from. That's what I am talking about that is the
most affected place in the lower 48.
Mr. Otter. Mr. Chairman, I think my time is about out.
Mr. Ose. Mr. Otter, if I might inquire, is it your desire
to enter the map into the public record?
Mr. Otter. Yes, it is. Thank you for reminding me.
Mr. Ose. Without objection.
The gentleman from Massachusetts for 5 minutes.
Mr. Tierney. Thank you, Mr. Chairman. Mr. McGarity, I agree
with you, I think. Your premise, if I am correct in stating it,
is that you cannot legally suspend or postpone a regulation
without first going through a notice and a whole process.
Mr. McGarity. That's right. To rescind or postpone one, you
need to go through the same sort of process you went through to
promulgate it in the first place.
Mr. Tierney. The underlying theory is that you are making
just a dramatic change in people's lives and the effect on
their lives doing the suspension or postponement and the
rescission as you were in implementing the rule in the first
place.
Mr. McGarity. That's right. Presumably the rule has
beneficiaries who will be harmed by its rescission.
Mr. Tierney. Now, in at least one instance, the
administration suspended a final rule that is already in
effect. That was on January 19, 2001, the contractor
responsibility rule went into effect, providing that when
awarding a Federal contract, the government must ensure that
the company receiving the contract has a satisfactory record of
complying with Federal laws, including tax, labor, employment,
environmental, antitrust, and consumer protection laws.
On January 31st, though, the current administration, the
chairman of the Civilian Agency Acquisition Council, issued a
memorandum to civilian agencies authorizing a 6-month
suspension of the rule. Morton Rosenberg, a specialist in
American public law at the Congressional Research Service,
analyzed the issue and found that that memo is likely illegal.
Do you agree with that?
Mr. McGarity. Yes. In fact, I read that memorandum and I do
agree with its analysis. Yes, sir.
Mr. Tierney. Mrs. Buccino, you started to talk about a
couple of other areas and you didn't get a chance to finish
because of time constraints. But we've listened to people
testify about the arsenic rule, and have criticized it. Will
you tell me what your concerns are with the statements that
were made by the Bush administration and others concerning the
suspension and the repeal?
Ms. Buccino. Yes, I would be happy to. What was done in
issuing a new arsenic standard was to change the standard from
50 parts per billion to 10 parts per billion. The 50 parts per
billion had been based on data from the 1940's. And Congress,
in fact, has directed three different times to EPA to revise
that standard. Now, just recently, the administration announced
that they were going to withdraw the revised standard and
reconsider it. We believe that action is both potentially
unlawful and inappropriate because the new standard delivers
long overdue protections from cancer to the American public,
and we believe that it should not be undone.
Mr. Tierney. The new standards are also in effect in the
European Union and the World Trade Organization.
Ms. Buccino. That's correct.
Mr. Tierney. So it wouldn't be anything novel to this
global environment we find ourselves in.
Ms. Buccino. That's correct.
Mr. Tierney. Now, I listened to others of the witnesses who
made the case for the phasing in of the diesel regulations, and
I would only imagine that those same arguments or contentions
were made during the rulemaking process on diesel, and
apparently adjustments were made for those contentions or they
just weren't agreed with. Will you tell us a little bit about
that situation, your views on that?
Ms. Buccino. Yes. The diesel rule was also a product of a
very lengthy process. It was initiated in May 1999, so several
years ago, and there was extensive both information and
scientific studies regarding the health effects and cost-
benefit analysis that were collected and evaluated by EPA. And,
all the various stakeholders had extensive formal and informal
opportunities to comment and have input on that. Now this rule,
in fact, the administration has decided is so important that
they were moving forward with implementation of it.
Mr. Tierney. So far.
Ms. Buccino. That is correct. And I would also like to
point out that in response to some of the concerns about the
shortages in supply, there is a very lengthy time for
compliance. It is not until 2006 that new trucks have to comply
with it, and it is a much longer period of time for existing
engines.
Mr. Tierney. Much longer time for existing engines. So the
2006 only applies to new vehicles.
Ms. Buccino. That's right.
Mr. Tierney. Mr. McGarity, I agree with your observation
that the CRA is essentially a political tool providing no
opportunity for expert testimony or for a more technical view
of things. In your view, is that law? Is CRA legal? Is it
constitutional?
Mr. McGarity. The CRA, in my view, is constitutional. My
published writings are very much on record as being a proponent
of Congress when it comes institutionally between Congress and
the executive branch and Congress and the judicial branch. I
think Congress is the institution in which power should rightly
be lodged.
At the same time, certainly the legislative vetoes of past
years were unconstitutional. What makes the CRA constitutional,
if sometimes conceivably unwise and certainly exercised in an
unwise way, is that it is presented--the joint resolution is
presented to the President. It's the presentment, I think,
that's the key point there. That being said, one does hate to
see it being used very frequently for really purely political
reasons.
Mr. Tierney. Thank you.
Mr. Ose. I want to make sure that Mr. McGarity understands
that those of us in Congress appreciate his appreciation for
our influence. It's a roundabout way of saying we probably
agree with you on that.
Mr. McGarity, if I might, I want to go back to the
Administrative Procedure Act, the Congressional Review Act. Now
if I understand correctly, it was Congress that passed the
Administrative Procedure Act. It's not a rule, it's an actual
statute.
Mr. McGarity. The Administrative Procedure Act was enacted
after a long period of sort of struggle and deliberations in
1946.
Mr. Ose. Something passed by Congress.
Mr. McGarity. Oh yes, absolutely.
Mr. Ose. So it is an actual statute.
Mr. McGarity. Yes.
Mr. Ose. And, the Congressional Review Act was passed in
1996. If I recall correctly, it had significant support on both
sides of the aisle. And President Clinton signed it.
Mr. McGarity. That is correct, sir.
Mr. Ose. The difference between the Congressional Review
Act and the legislative vetoes that have been previously
attempted, you have characterized as the Congressional Review
Act, requires the President's participation, if you will, in
the final determination.
Mr. McGarity. Right. It's the presentment to the President
which is required by the Constitution.
Mr. Ose. So there is nothing in your testimony that we
might construe as being adverse to the existence of the
Congressional Review Act. There might be differences of opinion
as to when and how to use it, but you are not suggesting any
challenges to its underlying merit or authenticity.
Mr. McGarity. I certainly don't challenge its authenticity.
I think it is a constitutional statute.
Mr. Ose. I want to ask you about the temporary suspension
issue of a rule. In a previous case before the court of appeals
in D.C., that being Public Citizen v. Department of Health and
Human Services, the court upheld a trial court's findings that
FDA's Food and Drug Administration temporary suspension of the
rule's effective date pursuant to President Reagan's regulatory
Executive Order 12291, which was announced without notice and
public comment, that the temporary suspension does not violate
the Administrative Procedure Act because it was temporary and
allowed the new FDA commissioner an opportunity to review a
pilot program. Are you familiar with this?
Mr. McGarity. Yes, I know the case. I don't have it before
me, but I am familiar with it.
Mr. Ose. From your recollection, do you concur or disagree
that the temporary suspension of a rule is allowed?
Mr. McGarity. A temporary suspension of a final rule is a
rule itself and must be accomplished through rulemaking. It is
allowed if one goes through the proper procedures.
Mr. Ose. Which would be the exemptions and what have you?
Mr. McGarity. Either one can be exempted from section 553
or one needs to go through notice and comment, yes.
Mr. Ose. So under this case before the D.C. Court of
Appeals, apparently the court made a determination that the
exemption was valid. As I read your written testimony last
night, the boilerplate language, that is your language, your
words, I should say, is not sufficient to merit an exemption
under this case law.
Mr. McGarity. That's right. What we have is boilerplate,
literally the same language for 60 regulations, and it's hard
for me to believe that's a considered analysis in the case of
each regulation that there's good cause, which I think is the
exemption that is involved in Public Citizen.
Mr. Ose. OK. I found your written testimony highly
informative and I want to thank you for that. I may agree with
it or disagree with it, but I appreciated your presentation of
your remarks and I was much more knowledgeable after having
read it than I was before, and I appreciate that.
Mr. McGarity. Thank you very much.
Mr. Ose. However, I do want to go back to one of your
initial statements to Mr. Tierney, and that is your respect for
congressional discretion in setting policy. Going back to I
think the Federalist Papers, or even before that, I think you
will find wide agreement here that it is Congress that should
set policy and the executive branch implement it.
Mr. McGarity. That's not always the case among my
colleagues in academia who sometimes think the courts ought to
be having more than that. But I was a constituent of Mr. Brooks
up here for many years.
Mr. Ose. We struggle with it here.
Mr. Otter for 5 minutes.
Mr. Otter. Thank you very much, Mr. Chairman.
Mr. Hayes, would you tell me what is the cheapest
transportation for your farm products? What's the cheapest
transportation other than throwing it? What is the cheapest
transportation to get your product to the world marketplace?
Mr. Hayes. For the entire State of Idaho, I would have to
say the cheapest transportation is our barge network on the
river.
Mr. Otter. Why is that?
Mr. Hayes. I think it's because they can move large volumes
of grain in an expedient manner and be able to reach the
Portland market as economically sound as they can.
Now, we have a little problem with that from southeastern
Idaho, hitting the port of Lewiston. However, 30 percent of our
grain out of southeastern Idaho goes down the river through the
port of Lewiston.
Mr. Otter. What is 30 percent of the grain? Give me that
tonnage.
Mr. Hayes. I can't do that, I'm sorry. The figure is not in
my mind.
Mr. Otter. Would 168,000 of soft white wheat be reasonable
that goes through?
Mr. Hayes. Oh, I'm sure, yes.
Mr. Otter. All right.
Ms. Buccino, in your organization--you are here for your
organization?
Ms. Buccino. Yes.
Mr. Otter. What is your organization's position on the
removal of the dams in the four upper Snake River dams?
Ms. Buccino. That, I'm personally not aware of. There are
people in our West Coast offices that work on that issue, so I
am afraid I will not be able to answer that question directly.
Mr. Otter. So you are normally not familiar with what
happens out on the West Coast.
Ms. Buccino. That's not true, but there are different
substantive areas that we each work in, and we are working in a
lot of different areas and there has been plenty to keep me
busy here in Washington, so that's what I have been focusing on
recently.
Mr. Otter. For the record, let me state that your
organization does support the removal of the four Snake River
dams on the lower Snake. And the reason I bring this up is
because it seems to me that your position on the diesel fuel
and your organization's position on the diesel fuel is
inconsistent with your position on the removal of the dams, as
testified by Mr. Hayes.
In fact, I know the figures pretty well, but I want them
for a matter of record. In order to take 1 ton of wheat from
Lewiston, ID 514 miles down river to Vancouver, WA and then
load it onto an ocean-going vessel for shipment to Taipei, it
takes 1 gallon of diesel fuel. Now, to get that same ton of
wheat or grain down river on a train, you would only get it 202
miles. But worst off, on a truck, the very target of this whole
diesel rule, you would only get it 59 miles. One ton of wheat
59 miles, not 514 as is the case.
The other question I would have relative to your
organization's position, do you suppose that there is any
connection in your testimony here today in your position and
your organization's position on these issues relative to
funding that was received by your organization from the Federal
Government for those very issues?
Ms. Buccino. I disagree with that contention. We're a
nonprofit organization. We represent our membership, which is
over 400,000 across the country; and we advocate positions that
we believe are in the public interest based on the science
regarding health effects and also the various cost-
effectiveness analyses.
I would actually like to take this opportunity to introduce
into the record a document related to the wild forest
protection plan which people have referred to as the roadless
rule. This is a report by NRDC called End of the Road, but it
actually is a summary of the scientific--independent scientific
research that's been done on the adverse ecological impacts of
logging and road building in the national forests.
I actually would urge members, when you're evaluating the
rules that have been discussed today, not just to look at the
limited amount of material you've collected today, whether it's
the public interest comments submitted by the Mercatus Center
or NRDC's documents but to evaluate the administrative--the
complete administrative records that were collected over the
years of rulemaking that went into these protections.
Mr. Otter. Thank you very much, Ms. Buccino; and thank you,
Mr. Chairman.
I just would close in stating that the same organization,
the National Resources Defense Council, has taken a pretty firm
position in favor of campaign reform; and it did receive--
because they believe that votes follow money. And, they did
receive $2.5 million in Federal contract awards from 1998 to
2000 for supporting and spreading the success story for the
Department of Energy on refrigerators, washing machines and air
conditioners and heat pumps, is now saying that $2.5 million
does not color the testimony that we've received here today. I
would suggest that the organization can't have it both ways.
Thank you, Mr. Chairman.
Mr. Ose. The document you held up we will enter into the
record without objection.
Ms. Buccino. Yes. Thank you.
Mr. Ose. I think we're close to the end here. I do have one
question.
Ms. Buccino, we had earlier testimony I think from Dr.
Nelson about the process that the Forest Service used in
finalizing its Environmental Impact Statement on the roadless
policy. Embedded in the document were comments about the
roadless rule process contradicting past emphasis on
collaboration, and I'm trying to reconcile that. Because your
comments have been somewhat different. Can you provide some
feedback on that?
Ms. Buccino. I think what that reference is to the
collaborative process is referring to the Forest Service
management plans that are developed for each individual
national forest. Nothing in the new forest protection plan does
away with that process or--those plans are moving forward. The
idea is that the guidance and the protections that are in this
recent protection plan are to guide development of those forest
plans. It's important to remember the extensive public process
that I emphasized, and I do think it's fair to characterize it
as the most ever for a rulemaking process that went into the
new forest protection plan that was recently announced.
Mr. Ose. If I might just--I don't want to argue with you
and debate about it. I want to think about what you have to
say. I'm just trying to reconcile what the Forest Service
imbedded in its environmental document with what may have
happened, and I'm frankly a little bit confused, given the
testimony.
Mr. Tierney, do you have anything to add?
Mr. Tierney. I don't.
Mr. Ose. I want to thank the witnesses for appearing today.
We appreciate your testimony both written and oral. It was
highly educational. And with that--one other thing. We're going
to leave the record open for 10 days. So if you have something
you want to submit that would be fine.
Again, thank you for coming. We're adjourned.
[Whereupon, at 12:03 p.m., the subcommittee was adjourned.]
[Note.--Various publications from the ''Journal of Labor
Research, Volume XXII, No. 1, Winter 2001,'' may be found in
subcommittee files.]
[Additional information submitted for the hearing record
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