Inside EPA [Printer-friendly version] July 7, 2006 HOUSE CHEMICAL SECURITY BILL SETS NEW TEST FOR PREEMPTING STATES By Anthony Lacey Recently introduced House legislation setting new security rules for chemical plants would create what some sources say is an unprecedented new test for preempting states from setting standards more stringent than federal law. The bill, H.R. 5695, would give the Department of Homeland Security authority to regulate chemical facilities by assessing and ranking them based on risk and ensuring higher-risk facilities meet more stringent security requirements. The bill would preempt states from setting more stringent standards than the federal plan if a state law, regulation or standard would "frustrate the purposes" of the federal legislation, although the bill is silent on a definition for what would qualify as frustrating the federal plan. The bill differs from a Senate chemical security bill that passed out of the Senate homeland security panel last month and explicitly allows states to set more stringent standards than the federal plan. Relevant documents are available on InsideEPA.com. But the preemption provision is drawing criticism from Democrats -- who say the language is vague and unduly bars states from acting -- as well as industry groups, who are calling for a blanket preemption provision. The bill's sponsors, Reps. Dan Lundgren (R-CA) and Bennie Thompson (D- MS), say the legislation creates a new test for preempting state rules. Thompson told Inside EPA, "The art of legislation in this instance is compromise" and the preemption provision in the House bill represents a good balance between outright "blanket" preemption and no restrictions on state standards. Lungren added that the language in the bill represents a compromise that is "not an absolute preemption" as the chemical industry wants, but is also "not as strong as states rights" advocates would like. The new test adds to continuing partisan tensions over efforts by GOP lawmakers to preempt state rules. A report issued last month by Rep. Henry Waxman (D-CA), ranking member on the House Government Reform Committee, found that the House and Senate have voted 57 times and enacted 27 laws that preempt state laws and regulations in the past five years, in areas including regulation of air pollution, energy facility siting and food safety rules. The report found, for example, that federal environmental law has traditionally set a "floor" of minimum standards that states can then go beyond, but over the last five years, the floor has been turned into a federal "ceiling" that bars states from adopting more stringent requirements. For example, the energy law of last year strips states of their authority on siting liquefied natural gas terminals, and allows the Department of Energy to authorize the siting of electric transmission lines "over the objections of states and localities," according to the report. Similarly, food safety legislation passed earlier this year preempts states from adopting food safety requirements more stringent than federal standards. The bill would effectively bar California from implementing its Proposition 65 food safety labeling requirements. The report claims that the numerous examples of federal law preempting states shows that Republicans in Congress and the President have "repeatedly acted to usurp state authorities and impose policy decision dictated in Washington upon the states." In comments following introduction of the bill, Democrats say it is a prescription for litigation because it does not define when a state effort would "frustrate" federal rules. One Democratic source says the language "is like nothing I've ever seen, and creates a lot of opportunities" for lawsuits that states, industry or others may file over what may qualify as frustrating the chemical security federal plan. To frustrate something is a "vague" term, the source says. Rep. Sheila Jackson Lee (D-TX) told Inside EPA June 29 that she would like states to have authority to go beyond the federal requirements. Jackson Lee said preemption was "the crux" of the Senate and House chemical security bills and added that as long as states did not impose a "double burden" by duplicating requirements in the federal plan, she would like to allow states to set their own rules. But in June 29 press releases, the National Petrochemical & Refiners Association and the American Chemistry Council (ACC) both said chemical security legislation should provide absolute federal preemption of state and local chemical security laws and regulations. Marty Durbin, ACC's managing director for federal affairs, said in a June 29 statement that the industry's preference is for legislation to emulate the "strong federal preemption language" that Congress approved in the Hazardous Materials Transportation Act to avoid a "patchwork of potentially conflicting" state laws. That law bars states from setting more stringent standards unless they apply for and receive a waiver from the federal law. One environmentalist says the preemption debate will only intensify if the House bill moves closer to markup, and says the frustration provision in H.R. 5695 is "preemption in all but name" because it will be up to states to prove they are not frustrating the act, even though there is no definition of what constitutes frustration. Even if lawmakers can reach a compromise on the preemption issue, the House chemical security bill still faces a number of obstacles, including the issue of whether to require facilities to use inherently safer technologies (IST) to reduce risk and the fact the bill has been referred to two committees. The House Committee on Homeland Security's subcommittee on economic security, infrastructure protection and cybersecurity held a June 29 hearing on the legislation, but the bill has also been referred to the House Energy & Commerce Committee, which has not indicated when it may take the bill up for a hearing or markup. Jurisdictional squabbles have stalled the Senate chemical security legislation, as Senate environment committee Chairman James Inhofe (R- OK) has placed a hold on the bill over concerns it regulates drinking and wastewater facilities. Inhofe is demanding that the bill be referred to his committee, even though it passed out of a Senate homeland security panel markup last month. Lungren told Inside EPA it is unclear how the Energy & Commerce Committee will react to the legislation, but said he recognizes that the committee has "an interest" in the issue, and will wait to hear reaction from lawmakers on the panel. But Jackson Lee told Inside EPA that if the Energy & Commerce Committee holds a hearing on the bill, it may be a chance for the panel's members to raise issues such as environmental requirements that could be folded into the legislation. Jackson Lee said she would like lawmakers to consider, for example, any potential air quality requirements facilities may have to meet under the federal plan. But that idea is likely to receive a cool reception from Republicans, with Lungren saying co-sponsors of H.R. 5695 are trying to keep it clean of environmental language in order to keep it strictly a chemical security bill. "Air quality questions are air quality questions, they are not the last time I checked homeland security questions," Lungren said. Environmentalists are also urging lawmakers to explicitly require the use of IST in security plans, but the House bill as written is silent on the issue. Thompson said in his opening statement at the June 29 hearing that requiring the use of IST "where feasible would be more effective." He added that he was "hopeful" that bill as written would give chemical facilities an incentive to use IST, because if they make their plants safer, they lower their risk level and would be subject to less-stringent requirements.