Hill Heat

ESI’s EPA Budget Briefing

Witness

• Stephen L. Johnson, EPA Administrator

10:12 Johnson: As the administration sprints to the finish line, I believe this budget keeps it on the path to a cleaner future. With both demand and cost on the rise, innovators are pushing clean energy solutions. We estimate industry will explore thousands of oil and gas wells on tribal and national lands. The budget requests hundreds of new staff to assist our partners assess the projects.

The budget also attempts to address the serious challenge of global climate change.

The budget supports EPA’s collaborative work to protect our waterways. I’m proud of our response to hurricanes Katrina and Rita.

10:17 AM Feinstein The legal justification for your waiver rests heavily on the 1967 decision. In 1977 Congress amended the Clean Air Act, changing the language and intent of Section 209. The committee language stated that the intent was to provide California the broadest latitude possible. Your waiver justification document does not mention Congressional intent in 1977. Why?

Johnson I am bound by Section 209 and there are three very specific criteria. I only looked at one. Based on the record before me, again, affording California the broadest discretion, it does not mean that I am a rubber stamp. It is not a popularity contest.

10:49 Craig Sitting on EPW we get two bites at you. Today I won’t chew as hard.

Feinstein Even though that section allows other states to adopt California’s standards?

Johnson You raise a very good point. Section 209 and the law and the criteria does not allow me to consider what other states may or may not do. As I pointed out the more states that believe greenhouse gas emissions is a problem are making the very point that California is not unique. It is not exclusive. Rather it is a national problem requiring a national solution.

Feinstein According to the Washington Post, you overruled your legal and technical staff last October. Did a single one of your staff support a flat denial?

Johnson They presented me with a wide range of options, from approving to denying the waiver. They were all presented to me as legally defensible options. I appreciate the opportunity for their candid input, but the Clean Air Act gives me the responsibility alone.

Feinstein You are saying the technical and legal staff recommended approving the waiver. Is that correct?

Johnson They presented me with a wide range of options, from approving to denying the waiver. Generally it is my approach to ask for input, if they choose to give input, that’s fine. Routinely I seek input.

Feinstein We’ve been told that none of the staff was in favor of denying the waiver.

Johnson I received a range of options.

Feinstein I know that.

Johnson I respect the opportunity to receive candid opinions. My decision is not based on a popularity contest of opinions.

Feinstein You’re not answering the question, but there’s nothing I can do but interpret your non-answer.

10:26: Feinstein You’ve missed your 2007 deadline to make the health endangerment finding. Will you respect the direction of the highest court of the land?

Johnson I will commit to that we will make the decision. We are working on the implementation regulations. We have a number of court-ordered deadlines.

Feinstein When might we expect this?

Johnson I don’t have a date, but I assure you we will respond to Mass vs. EPA.

10:28 Allard I have some concerns about enforcement.

10:39 Leahy I’m going to divert for just a moment. I want to talk about mercury pollution. Your agency had the mercury rule. I said at the time I thought it was wrong. On February 8 the Court of Appeals for the DC Circuit, a very conservative court, agreed with my position and struck down your rule. If you had listened to my opinion you could have saved taxpayers significant fees. Does your agency plan to abide by the Clean Air Act, by the law?

Johnson Thank you for the question. Always follow the law, sir. The EPA and DOJ are currently evaluating the decision. We haven’t decided on a course of action. We also recognize because of the Clean Air Interstate Rule we have early reductions of mercury. We are disappointed the first regulation of mercury was struck down. We’re evaluating that now.

Leahy The court made their decision based on the arguments heard in the case. The AP reports officials have threatened states with disapproval for adopting more aggressive mercury regulations, despite what the EPA said in the court. If there was a misrepresentation by the government to the court that’s a serious matter. Have officials ever threatened states against instituting mercury regulations?

Johnson I don’t recall any firsthand knowledge. I don’t know if they have.

Leahy Will you go back and find out?

Johnson I’ll be happy to respond for the record.

Leahy I would like to know the answer. If the AP is correct, then the EPA gave misleading information to the courts. The courts, the Judiciary Committee would consider it a very serious matter. You adopted the Mercury Trading Rule in 2005 and committed to reducing mercury hot spots.

Johnson We haven’t decided yet.

10:50 Feinstein I believe very firmly your staff was in favor of the waiver unless you tell me otherwise. Did any other people in the administration weigh in on the waiver?

Johnson I received many opinions, the decision was my own.

Feinstein Did you discuss this with the White House?

Johnson I discuss major issues with the White House, I think that’s good government.

Feinstein I read the 48 pages. I find it not at all impressive. I think it is harmful to our state and the country. I’d like to go back to the remand. You have not given me a firm date. I find this unbelievable on what is called an Environmental Protection Agency, not an Administration Protection Agency.

Johnson I respectfully disagree that this is an easy decision. Justice Scalia set it up as a three-part test for me. If I find there is endangerment, I must regulate. If I find that there is not endangerment, I should not regulate. If there are other factors I need to consider them. The way the Clean Air Act operates, a decision in the regulation of mobile sources could have a significant impact on stationary sources. I know people are anxious for me to get on with business. Climate change is a serious issue. It’s one I’m carefully considering. Airlines, off-roads, marine, I could go on and on.

Feinstein How many personnel are working on the endangerment finding?

Johnson I don’t know exactly.

Feinstein We’ve been told noone is working on it. Is anyone working on it?

Johnson I know I am working on what are the next steps. It’s what I’m currently evaluating.

Feinstein How many of your staff are working on the endangerment finding?

Johnson I don’t know. I am currently evaluating what are the next steps to take in response to the Supreme Court, the Energy Act, the numerous petitions. I know we have staff working on a myriad issues. I know we have people working on major economies, reviewing McCain-Lieberman legislation, the Greenhouse Gas Registry. We have a lot of issues we’re working on.

Feinstein What I deduce is that none of your staff is working on it. I’ve got to believe you’re stonewalling.

Johnson I’m not stonewalling.

11:10 Feinstein Have you taken every Congressional earmark out of this budget?

Johnson I am told by our staff that the answer is yes.

11:30 Argument with Ted Stevens and Johnson over earmarks (and the definition of an earmark) and funding water and sewer facilities Alaskan villages.

11:37 Stevens I’m trying to seek re-election now. I don’t understand why it’s been reduced.

Stevens What did you ask the president for?

Johnson I support the president’s budget.

Stevens You going to answer my questions, sir?

Johnson brings in EPA water guy.

Stevens You can tell me what you requested OMB this year. What was that amount?

EPA water guy We requested the amount consistent with the 2004 request.

Stevens This is not a spending program, it’s a loan program.

Feinstein My staff says we never agreed to this.

Stevens This policy forces earmarks. It’s bureaucratic arrogance. Having served eight years in another administration, I don’t appreciate this. It sounds like your 04 was sacrosanct as far the government is concerned. It’s a crazy system. The Greenhouse Gas Registry. The White House proposed no money for this program. Sen. Klobuchar asked me about it. Why didn’t you put any money in this program?

Johnson We have $3.5 million this year. We expect by September of this year we will have a proposed regulation for the registry. I believe states are developing registries.

Stevens Is there any direction Congress would give you with regards to spending money you would follow?

Feinstein You’re right. I put in the $3.5 million. They need it for two years.

Johnson We are working on a draft regulation. I intend to make sure we obey our mandate.

Stevens Do you remember in the old days we dealt with this by bureau reclamation? We eliminated the job of the person who refused to follow our direction.

11:48 Feinstein There is no way for us to restore those cuts. I don’t even know if we want to pass this budget. Why run for the Senate? Why act as an appropriator? Why put our names on a budget that we know is going to fail to accomplish our purpose?

Stevens We’re better off on the 2008 budget. Did you ever think about that?

Johnson We believe this budget is a good budget. It balances the needs for moving forward at the same time we have to be good stewards of taxpayer money.

Stevens You should bring back the message that in all likelihood we’ll send the President a continuing resolution for 2009.

Feinstein The cuts go on and on and on. For the first time he said in so many words we’re not going to recognize any Congressional add. You’re saying the president conditions all funding. We don’t even need an Appropriations Committee!

11:51 Stevens He ought to read the Constitution. Arrogance. Pure arrogance.

Feinstein There is no jointness. We are to be a rubber stamp for the President’s request.

Stevens I don’t think the President even knows some of these items.

Feinstein Let me sum up by saying this is a very unhappy budget. The hearing is adjourned.

Ed. —I would like to welcome the participation of the Environmental and Energy Study Institute on Hill Heat. EESI was founded in 1984 by a bipartisan group of members of Congress concerned about energy and environmental issues. Their initial series of guest posts will be drawn from their briefings on the president’s proposed FY 2009 budget.

The President’s FY 2009 Environmental Protection Agency (EPA) budget request remains relatively flat compared to the FY 2008 request and is down slightly from FY 2008 appropriations. The FY 2009 budget request is $7.14 billion, which is $56.9 million (0.80%) less than the FY 2008 budget request and $330 million (4.4%) less than FY 2008 appropriations.

The President’s FY 2009 budget request for Clean Air and Global Climate Change (EPA Goal 1) is $939 million. This is $33 million (3.4%) less than the FY 2008 appropriations.

Looking at the EPA budget by goals, the Reduced Greenhouse Gas Intensity program within Goal 1 has a FY 2009 budget request of $121 million, which is $9.0 million (6.9%) less than the FY 2008 appropriations of $130 million and $1.7 million (1.4%) less than the FY 2008 budget request of $123 million.

Looking at the EPA budget by program and project, the FY 2009 budget request for Climate Protection programs includes a Science and Technology component, requested at $11.4 million, and an Environmental Program and Management component, requested at $87.0 million. Taken together, these were cut $10.3 million (9.5%) from FY 08 appropriations. The Climate Protection Programs include Energy Star, SmartWay Transport, the Methane to Markets Partnership and Asia-Pacific Partnership. There were a number of cuts, as well as a few increases to the programs, as illustrated below:

Climate Protection Programs

• $10.3 million cut overall (9.5% cut from FY 08 appropriations)
• Zeroing out the Greenhouse Gas Reporting Registry (100% cut from $3.4 million in FY 08)
• $6.9 million cut in Climate Science and Technology program (38% cut from FY 08 appropriations)
• $4.0 million cut in Energy STAR (8.3% cut from FY 08 appropriations)
• $177,000 increase in Methane to Markets (4.1% increase from FY 08 appropriations)
• $5.0 million increase in Asian Pacific Partnership (no previous FY 08 appropriation amount)

Clean Air Rules

Clean Air Rules are a major component of EPA’s Clean Air and Global Climate Change Goal, and include the Clean Air Interstate Rule, the Clean Air Mercury Rule and the Clean Air Nonroad Diesel Rule. These rules work towards the improvement of the United State’s air quality. Additionally, reductions on particulate matter from diesel engines will continue to be addressed through the Diesel Emissions Reduction Grants program of the Energy Policy Act of 2005 (P.L. 109-58), which authorizes $200 million annually (2007-2011). However, the President requests just $49.2 million for the FY 09 EPA Clean Diesel grant, 25% of the authorized amount.

A table reviewing changes in the Goal I and overall EPA budget is below the jump.