State attorneys general have taken numerous actions to reduce harmful, climate change-causing greenhouse gas emissions and other pollutants from the transportation sector. Under the Obama administration, the Environmental Protection Agency (EPA), the National Highway Traffic Safety Administration (NHTSA), the California Air Resources Board and car manufacturers worked together to establish national Clean Car Standards that would limit greenhouse gas emissions by gradually raising fuel efficiency standards for new passenger vehicles and light trucks.
The Clean Car Standards have emerged as a major flash point between state attorneys general and the Trump administration, with the administration putting forward a proposed rule that would freeze vehicle emissions standards for model years 2020 through 2026. The so-called Safer Affordable Fuel Efficient Vehicles proposed rule (also referred to by the Trump administration as the “Safe Vehicles” rule) has been criticized by state attorneys general for failing to meet any of the objectives implicit in its name.
As part of its plan to roll back the Obama-era Clean Car Standards, the Trump administration has also proposed revoking California’s Clean Air Act waiver to set its own vehicle emissions standards. If finalized, the decision to revoke California’s waiver would be historically unprecedented, standing alone as the only time in the EPA’s history that it has revoked a waiver previously granted to the state.
This decision would not only affect California, the only state that has received a Clean Air Act waiver to set its own emissions standards under federal law; the proposed rule would also have negative consequences for 13 other “Section 177 States” that have adopted the California standard. Colorado, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and Washington D.C. have all adopted California’s emissions standards as Section 177 States. Together these states represent 113 million people (one-third of the United States population), and account for 85 million registered vehicles (approximately one-third of all registered vehicles in the United States).
The rollback of national vehicle emissions standards has been vigorously opposed by a multi-state coalition of state attorneys general. In addition to their opposition to the rollback of national Clean Car Standards, state attorneys general have successfully taken the Trump administration to court in an effort to force the administration to enforce a previously finalized rule increasing penalties on automakers that failed to meet national Corporate Average Fuel Economy (CAFE) standards.
Opposing the Rollback of National Clean Car Standards
Air emissions from cars and trucks are a significant source of pollutants, including smog ingredients and carbon pollution. In October 2012, the EPA and the Department of Transportation (DOT) concluded a joint rulemaking, in cooperation with the automobile industry, that harmonized greenhouse gas emissions and fuel economy standards. Under the rule, automakers agreed to progressively raise the fuel economy of their cars to an average of 54.5 miles per gallon by 2025, nearly double the average in 2012. The higher mileage requirements are projected to eliminate as much as six billion metric tons of greenhouse gases and save consumers more than $1 trillion at the pump over the lifetime of the cars affected.
Opposing a Flawed Mid-Course Review
In January 2017, the EPA completed a mid-course review and confirmed the feasibility of staying on track and meeting the higher mileage requirements. California, which has special status under the Clean Air Act to receive waivers to impose more stringent standards, also participated in the mid-course review and endorsed the EPA's conclusions. In March 2017, the Trump administration announced its intention to reopen the review and potentially revise downward the mileage standards that the automobile industry has already committed to achieve through 2025. In June 2017, a coalition of state attorneys general transmitted a letter to the EPA threatening legal action if the EPA attempts to weaken air pollution standards set for passenger cars and light-duty trucks for model years 2022-2025.
In April 2018, the EPA provided notice that, in its view, the fuel efficiency standards for cars for model years 2022-2025 previously agreed to are no longer appropriate due to allegedly changed circumstances. Subsequently, the EPA and the DOT promised to initiate a rulemaking process to revise the standards downward. The day after EPA’s determination, 12 attorneys general were joined by mayors nationwide in releasing a declaration vowing to challenge the EPA’s determination that the mileage standards should be rolled back. Separately, the attorneys general of California, Rhode Island and Vermont announced commitments to fight the rollback of vehicle efficiency standards.
Acting on the declaration, a coalition of 18 attorneys general filed a petition for review of the EPA’s determination in May 2018 with the D.C. Circuit Court of Appeals. The lawsuit, led by California Attorney General Becerra, is based on the EPA’s arbitrary and capricious decision to begin weakening the fuel efficiency standards for model years 2022-2025 in violation of its responsibility under the Clean Air Act.
In February 2019, the coalition of 18 attorneys general filed their initial brief with the D.C. Circuit challenging the EPA’s April 2018 determination that the fuel efficiency standards for model years 2022-2025 are no longer appropriate. The states noted that EPA made its determination without providing the public the opportunity to comment on the “new” evidence that the fuel efficiency standards were not feasible. Additionally, EPA ignored evidenced that the emission standards could be achieved at a lower cost than previously expected. The attorneys general requested that the D.C. Circuit reverse the April 2018 determination, which served as the basis for EPA and DOT’s August 2018 proposal to freeze fuel efficiency standards at 2020 levels.
That same month, Colorado Attorney General Phil Weiser filed an amicus brief in support of the coalition of 18 attorneys general challenging the April 2018 determination that the fuel efficiency standards should be reopened. The amicus noted that EPA has improperly withheld the technical analysis that served as the basis for the April 2018 determination. Additionally, there is not, despite EPA’s claims to the contrary, a significant record supporting the determination as evidenced by the largest vehicle manufacturer’s support for maintaining the fuel efficiency standards through 2025.
In May 2019, after EPA had filed its initial merits brief the previous month, the coalition of attorneys general filed their reply brief. The reply brief noted that EPA’s initial brief had not disputed the core component of the states’ legal argument — that the agency unlawfully ignored the substantial administrative record it had developed in the January 2017 mid-term review in certifying that the clean car standards are achievable. In particular, the attorneys general pointed out that EPA had misrepresented data on vehicle electrification and failed to consider or acknowledge its prior analysis on affordability and fuel prices.
In October 2019, the D.C. Circuit ruled that the April 2018 determination is not a final agency action and thus the court could not hear the challenge to the determination. The court emphasized, however, that the EPA will be required to provide a reasoned explanation for and cannot ignore prior factual findings in its effort to weaken the existing fuel efficiency standards for vehicles.
Opposing the Freeze/Rollback of Fuel Efficiency Standards
Initiating its rulemaking process, in August 2018, the EPA and the DOT released a proposed rule to freeze fuel efficiency standards at 2020 levels, instead of maintaining annual increases in fuel efficiency through 2026. The proposal also would rescind California’s waiver to set its own standards for regulating greenhouse gas emissions from vehicles.
On the same day the proposal was released, California Attorney General Becerra expressed the state’s willingness to use every legal tool at its disposal to challenge the proposal. Additionally, Massachusetts Attorney General Maura Healey led a coalition of 20 attorneys general in releasing a statement announcing their intention to challenge the proposed rule that will significantly increase carbon pollution, reduce air quality and cost drivers money on gas. The coalition included every attorney general from the jurisdictions that have adopted California’s more stringent fuel efficiency standards.
Later in August 2018, a coalition of 18 attorneys general requested that the EPA and the DOT extend the comment deadline on the proposal from sixty to 120 days and hold additional public hearings for the proposal. The attorneys general noted that a 120-day comment period would be consistent with past practices for similarly important and complex proposed regulations and that an additional hearing in California specifically devoted to the EPA’s unprecedented proposal to withdraw California’s Clean Air Act waiver would be appropriate. In response, the EPA only provided the public three additional days to submit comments and denied the request for an additional hearing in California.
In September 2018, California Attorney General Becerra testified at the public hearing in Fresno, California on the proposed revision of fuel efficiency standards. Attorney General Becerra opposed the proposed rollback of the fuel efficiency standards because the proposed rule violates federal law as the standards are far below the “maximum feasible level” based on technology available today and available between 2021 and 2026. Additionally, Attorney General Becerra noted that the EPA and the DOT have failed to offer sound reasons for rolling back the fuel efficiency standards. The testimony also expressed opposition to attempts to revoke California’s waiver under the Clean Air Act.
In October 2018, a coalition of 21 attorneys general filed comments requesting that the EPA and the DOT withdraw the proposed fuel efficiency rule. The comments noted that freezing fuel efficiency standards at 2020 levels violates the agencies’ responsibilities under the Clean Air Act to protect the public from air pollution. Additionally, the proposal violates the Administrative Procedure Act as the EPA and the DOT have ignored substantial evidence at their disposal that runs counter to their rollback objective and have failed to provide justifications for reversing course on fuel efficiency standards.
In December 2018, a coalition of twenty attorneys general sent a letter to EPA Administrator Wheeler, requesting that EPA withdraw the proposed fuel efficiency rule in light of the Fourth National Climate Assessment. The National Climate Assessment, released in November 2018 makes clear that action is needed now to reduce climate change-causing greenhouse gas emissions in order to avoid the worst effects of climate change. At a minimum, the letter urged EPA to reopen the comment period for the fuel efficiency rule to allow for public input on and adequate consideration of the Assessment’s findings. Ten days later the coalition submitted a copy of the National Climate Assessment to the rulemaking record for the proposed fuel efficiency rule and highlighted parts of the Assessment that support the coalition’s submitted comments on the proposed rule.
In June 2019, New York Attorney General Letitia James led a coalition of ten attorneys general in sending a letter thanking the Chair and Ranking Member of the House Energy and Commerce Committee for holding a hearing on EPA’s and DOT’s proposal. The letter encouraged Congress to exercise its oversight authority over federal agencies, such as the EPA and DOT that have flouted Congress’s commands in the Clean Air Act and the Energy Policy and Conservation Act to reduce air pollution and improve fuel economy. The attorneys general concluded by noting that if the EPA and DOT finalize their proposal, the attorneys general stand ready to file suit to overturn the final rule and expect to prevail, but emphasized that they would prefer to be cooperatively working with the federal government to craft solutions to the climate change challenge.
The following month, New York Attorney General James led a coalition of twelve attorneys general in submitting supplemental comments with the EPA and DOT on the proposed fuel efficiency rule. The attorneys general noted that the EPA and DOT violated an executive order in developing the proposed rule by failing to consult with state officials about the proposal that would preempt state policies in attempting to rescind California’s waiver to set its own fuel efficiency rules and the right of other states to adopt California’s standards. The comments indicated that documents that the EPA and DOT recently provided to New York in response to a Freedom of Information Act (FOIA) request could not substantiate EPA’s and DOT’s claim in the proposed rule to have satisfied the requirement to consult with states. Consequently, the states asked the EPA and DOT to withdraw the proposed fuel efficiency rule and comply with the requirement to consult with states.
In March 2020, the EPA and DOT, having previously issued a final rule to withdraw California’s waiver to set its own vehicle emissions standards (below), issued its final version of the so-called Safer Affordable Fuel-Efficient Vehicles rule. The final rule establishes greenhouse gas and fuel efficiency standards for vehicles for model years 2021 through 2026, requiring annual fuel efficiency improvements of 1.5 percent. The 1.5 percent improvement target is far below the five percent annual improvement previously required by the Clean Car Standards. The new standard is expected to generate an additional 1.5 billion metric tons of carbon emissions by 2040.
Immediately after the final rule was released, attorneys general announced commitments to challenge the final Safer Affordable Fuel-Efficient Vehicles rule. The attorneys general of California, Colorado, Illinois, Maryland, Massachusetts, New York and Virginia released statements opposed to the final rule.
In May 2020, a coalition of 24 attorneys general led by California Attorney General Becerra filed a petition for review in the D.C. Circuit challenging the administration’s final rule.
Opposing Withdrawal of California Waiver
In September 2019, the EPA and the DOT issued a final rule to withdraw California’s waiver to set its own vehicle emissions standards (above). The EPA and the DOT, ignoring the explicit authority in the Clean Air Act for California to set its own standards, claimed that the state’s vehicle standards are preempted under the Energy Policy and Conservation Act and the Clean Air Act. The agencies separated out the waiver rule from the fuel efficiency rollback; they indicated their intention to finalize the fuel efficiency rule in the coming months. In addition to undermining California’s clean car rule, revocation of the California waiver also impacts the state car rules of thirteen other states and the District of Columbia, all of whom have voluntarily adopted California’s emission standards as their own standards under Section 177 of the Clean Air Act.
Within one week of its issuance, state attorneys general filed suit opposing withdrawal of California’s waiver. More specifically, California Attorney General Becerra led a coalition of twenty-four attorneys general in filing a lawsuit in federal district court in the District of Columbia to prevent the waiver withdraw from going into effect. The lawsuit notes that the assertion that California’s standards are preempted by the Energy Policy and Conservation Act and the Clean Air Act contravenes the texts of those statutes and prior case law. It also is arbitrary and capricious, in violation of the Administrative Procedure Act.
In October 2019, DOT filed a motion to dismiss the attorneys general’s lawsuit or to transfer the litigation to the D.C. Circuit Court of Appeals. The motion contends that the D.C. Circuit Court of Appeals has exclusive jurisdiction to hear the complaint from the attorneys general.
In response, in November 2019, the state attorneys general filed a protective petition for review challenging the withdrawal of California’s waiver in the D.C. Circuit, in case the D.C. federal district court determines that it does not have jurisdiction to hear the September 2019 lawsuit from the attorneys general. The November petition for review preserves the ability of the coalition of twenty-four attorneys general to challenge the September 2019 final rule withdrawing the California waiver.
In June 2020, the coalition of attorneys general filed their opening brief in the D.C. Circuit. The coalition noted that the EPA lacks authority under the Clean Air Act to withdraw California’s waiver and that the agency’s grounds for denying the waiver based on its determination that the regulated pollution is a global issue, rather than a local issue, is unlawful. The attorneys general pointed out that California has demonstrated a need for greenhouse gas and zero-emission-vehicle standards to address its long-standing challenges with local air quality and the severe threats it faces from climate change.
In addition, the coalition noted that the appeals court lacks jurisdiction to review DOT’s preemption rule under the Clean Air Act and the Energy Policy Conservation Act and that the matter should first be heard by the district court. If the appeals court were to conclude that it has jurisdiction, the court should vacate the preemption rule because it exceeds DOT’s authority.
In September 2020, the EPA and DOT filed their opening brief in the D.C. Circuit litigation. The federal government claimed that the EPA and DOT rightly withdrew California’s waiver as California’s vehicle emission standards do not meaningfully reduce the overall U.S. contribution of greenhouse gas emissions to global emissions. The brief also asserted the D.C. Circuit could properly hear the case.
Freedom of Information Act Request
Following the August 2018 release of the proposed rule to freeze fuel efficiency standards at 2020 levels, the California Air Resources Board (CARB) filed a FOIA request with EPA and DOT in September 2018. CARB requested that EPA and DOT release documents that the agencies relied on in justifying the August 2018 proposed rule because this critical information was not disclosed and contradicts previous analyses conducted by the agencies, threatening public health.
In April 2019, Attorney General Becerra filed a suit in the District of Columbia federal district court to compel EPA and DOT to make available the requested information. The lawsuit noted that EPA had violated FOIA in failing to make timely determinations on the request and that DOT had violated FOIA in providing inadequate justifications for withholding the requested documents.
The federal district court for the District of Columbia released a memorandum opinion in June 2020 holding that the EPA and DOT conducted a satisfactory search in response to the FOIA request and that the withheld information was protected under the deliberative process privilege.
Defending Fine Increases for Non-Complying Automakers
In 2015, Congress required the EPA to update its schedule of fines for Corporate Average Fuel Economy violations. In response, the EPA issued an interim final rule in July 2016 that increased the penalties imposed on automakers for non-compliance with CAFE requirements.
In July 2017, the Trump administration, acting through the National Highway Traffic Safety Administration within the Department of Transportation, announced an indefinite delay of the increased penalties required by the final rule. In September 2017, five state attorneys general sued the Trump administration in the Second Circuit Court of Appeals for delaying the imposition of the new CAFE penalties, noting that the DOT's action violated both the Administrative Procedure Act and Congress's directive that agencies increase CAFE penalties.
The Second Circuit in April 2018 vacated the Trump administration’s delay of the imposition of new penalties. In June 2018, the Second Circuit panel released its opinion explaining its April 2018 order. The opinion faulted the Department of Transportation for lacking the statutory authority to indefinitely delay the effective date of the rule and delaying the rule without going through the notice-and-comment rulemaking process.
In April 2018, the NHTSA issued a notice of proposed rulemaking to reverse the increased penalties imposed on automakers for non-compliance with CAFE requirements. California Attorney General Becerra and New York Attorney General Eric Schneiderman led a coalition of attorneys general in filing comments opposed to the NHTSA’s proposed rulemaking. The comments, filed in May 2018, noted that if the penalty for failing to comply with CAFE requirements is not sufficiently high, automakers will not be incentivized to produce fuel-efficient vehicles.
In July 2019, the NHTSA released its final rule. The final rule drastically cut fines to nearly a third of what was required by Congress in 2015 for automakers that fail to comply with CAFE standards. Within a week of the final rule being released, in August 2019, California Attorney General Becerra and New York Attorney General Letitia James led a coalition of 13 states in suing to reverse the July 2019 final rule.
In August 2020, the Second Circuit sided with the attorneys general in again vacating the NHTSA’s latest attempt to insulate automakers from fine increases for non-compliance with CAFE requirements. The court held that the CAFE fine, despite the NHTSA’s arguments to the contrary, is a “civil monetary penalty” properly subject to the 2015 fine schedule statutory update and found untimely, and thus unauthorized, the NHTSA’s assertion that the fine increase was unwarranted as a matter of economic policy.