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EIP:  AT LEAST 18 STATES CHARGING MAJOR POLLUTERS LESS THAN EPA-SET MINIMUM CLEAN AIR ACT FEES

Environmental Integrity Project Analysis Finds AL, AZ, CO, DE, FL, IN, KS, KY, LA, MI, MS, NC, ND, OK, SD, TX,  WV and WY Levying Fees Below Federal Clean Air Act Minimums.
 
WASHINGTON, D.C.///March 7, 2007///Eighteen or more states are letting polluters off the hook by collecting $53 million less than is called for in the minimum standard for emission fees under the federal Clean Air Act, according to a new report from the Environmental Integrity Project (EIP).  State agencies do most of the day-to-day work required under the federal Clean Air Act and the fees are needed to ensure that there are adequate state-level resources for monitoring pollution, developing air quality plans and enforcing permits for major sources of air pollution.  The polluters in question include power plants, refineries, cement kilns, incinerators, chemical plants that contribute disproportionately to the air pollution that threatens the public health and environment.

The EIP analysis identified a $52.8 million shortfall in pollution fees collected over individual years from 2002 to 2005 for the following states:  Louisiana ($9.8 million/68 percent below minimum level); Texas ($5.6 million/22 percent below minimum level); North Carolina ($5.4 million/56 percent below minimum level); Florida ($4.8 million/37 percent below minimum level); Michigan ($3.9 million/44 percent below minimum level); Alabama ($3.6 million/40 percent below minimum level); Indiana ($3.6 million/29 percent below minimum level); West Virginia ($3.5 million/45 percent below minimum level); Colorado ($2.8 million/66 percent below minimum level); Oklahoma ($2.7 million/39 percent below minimum level); Kansas ($2.1 million/37 percent below minimum level); North Dakota ($1.7 million/70 percent below minimum level); Kentucky ($1.7 million/19 percent below minimum level); Wyoming ($1.7 million/37 percent below minimum level); Arizona ($1.4 million/66 percent below minimum level);  Mississippi ($1.2 million/24 percent below minimum level); Delaware ($762,000/50 percent below minimum level); and South Dakota ($374,000/61 percent below minimum level).

Environmental Integrity Project Director Eric Schaeffer said:  "States are shortchanging either the public health or the pockets of taxpayers by setting emission fees that are too low to cover the cost of Clean Air Act enforcement programs.  Only the polluters come out ahead of the game under an arrangement where states let them off the hook rather doing what they are supposed to under federal law that requires the industry to foot the bill for these vital monitoring and enforcement efforts."

Luke Metzger, director, Environment Texas, said:   "Pollution from refineries and power plants are making our families sick.  We are counting on the Texas Commission on Environmental Quality to hold polluters accountable.  It is appalling that regulators are letting polluters off the hook for millions of dollars that could be put to work cleaning up our air."

Jeremy Nichols, founder and director, Rocky Mountain Clean Air Action, Denver, CO, said: "Colorado's clean air is facing unprecedented threats, especially from rampant oil and gas drilling.   Unfortunately, while polluters are getting a bargain, our air is getting smoggier and hazier.  The state is not just shortchanging clean air; they're shortchanging our health and our children's future."

Jeanne Zokovitch, staff attorney and director of Assisting Communities with Environmental Solutions (ACES) at the Florida office of Wildlaw, said:  "It is absurd for community air monitoring to go unfunded when it is clear from this report that there are ample revenues that are simply not being recouped."
 
The EIP notes that the problem may be even bigger, since there is "evidence that & at least 14 other states have fee structures that do not meet federal minimum standards."

REPORT BACKGROUND

The Environmental Integrity Project report looked at 18 states in which fees fell below the federal minimum, either because the states set lower emission fees or set a ceiling on the amount that could be collected from each polluter that was lower than the federal standard.  The EPA has determined that states should assess a minimum fee of $39.48 per ton for each of the following pollutants: sulfur dioxide (SO2), nitrogen oxide (NOX), smog-forming volatile organic compounds (VOCs), particulate matter, and hazardous air pollutants. The fees are to be assessed on at least the first 4,000 tons of emissions of each pollutant, according to the Clean Air Act.  The fees are used to monitor air emissions, hire inspectors, and develop and enforce regulations needed to meet federal air quality standards.

The health consequences of the pollution covered by the state-level fees are well documented.  For example, sulfur dioxide is a primary source of the fine particle emissions, which, according to the Harvard School of Public Health and the EPA, contribute to several million asthma attacks and tens of thousands of premature deaths from heart and lung disease every year. The White House Office of Management and Budget reported to Congress in 2006 that each ton of sulfur dioxide released to the atmosphere ends up costing the public health an estimated $7300.

EIP RECOMMENDATIONS

According to the EIP report, EPA should undertake a more comprehensive evaluation to ensure that low emission fees are not weakening the Clean Air Act permit program or its enforcement. In addition to analyzing inspection and enforcement activity, EPA's audit should determine whether states with low emission fees have adequate resources t

"         Issue and renew Title V permits in a timely way, and with full opportunity for public participation;

"         Measure emissions and review compliance data on a regular basis;

"         Monitor pollution levels in neighborhoods near major sources, to determine their impact on air quality; and

"         Develop and implement the plans needed to meet federal deadlines for achieving air quality standards for ozone and fine particles.

The EIP report also maintains:  "States that choose to assess emission fees below the minimum established by EPA should be required to demonstrate that the revenues they collect are sufficient to carry out these obligations, as they are required to do under the Clean Air Act." 

STUDY METHODOLOGY

EIP used the most recent emission inventory data available to compare Title V fees that could be assessed under existing state laws with the minimum fees required under Section 502(b)(3) of the Clean Air Act. Because the analysis is limited to three pollutants, it may overstate or understate revenues in some cases. For example, Colorado and Louisiana assess much higher fees for hazardous air pollutants, which could help to offset some of the revenues lost through the very low fees both states collect for emissions of "criteria" pollutants like SO2, NOX, and VOCs. Some states also collect administrative or processing fees that are not based on emissions, although these are typically too low to make up for revenue lost through inadequate emission fees.

EIP's report may understate revenue losses, because it is limited to three pollutants, and does not take into account the impact of low emission fees for other pollutants, like particulate matter and hazardous air pollutants. States that either cap the total tons of pollutants below 4,000 tons per pollutant or have a maximum total fee that is lower than the federal minimum may have a greater revenue loss. Notwithstanding federal requirements, some states do note assess any emission fees at all for hazardous air pollutants.

ABOUT EIP

The Environmental Integrity Project (http://www.environmentalintegrity.org) is a nonpartisan and nonprofit organization established in March 2002 to advocate for more effective enforcement of environmental laws.  EIP was founded by Eric Schaeffer, who was director of the U.S. Environmental Protection Agency's Office of Regulatory Enforcement.  He resigned in 2002 after publicly expressing his frustration with efforts of the Bush Administration to weaken enforcement of the Clean Air Act and other laws.

CONTACT:   Patrick Mitchell, (703) 276-3266 or pmitchell@hastingsgroup.com.
 
EDITOR'S NOTE:   A streaming audio replay of this Environmental Integrity Project will be available as of 7 p.m. ET on March 7, 2007 at http://www.environmentalintegrity.org.