OMB Watch
August 22, 2005

STATES OFFER OPPORTUNITIES & PITFALLS FOR PROGRESSIVE REG.

Although many progressives have begun to focus resources on winning battles in the states, the
regulatory record at the state level is characterized by both opportunities and potential pitfalls.

Successes at the State Level

Under the Bush administration, many important federal regulations have been stalled, weakened or even
rolled back. In such cases, states have often been forced to take matters into their own hands,
developing their own regulations that are more stringent than the national standards.

Most recently, Pennsylvania has decided to raise the bar on EPA's weakened mercury regulation. The
Pennsylvania Environmental Quality Board voted 16 to three to go beyond the federal mercury regulation
and require coal-fired power plants in the state to reduce mercury emissions by up to 90 percent. The
federal standards promulgated by EPA earlier this year require only a 70 percent reduction by the
mid-2020s.

Earlier this year, New Jersey also adopted more stringent standards for mercury emissions. Pennsylvania,
however, has 39 coal-fired power plants in the state and has the second highest levels of toxic mercury
pollution in the nation, making the task of lowering emissions across the state far more complicated
than in New Jersey, which has only five such plants. Pennsylvania has also joined a host of other states
to sue EPA over the standard, arguing that the Clean Air Mercury Rule does not offer adequate protection
of health and the environment. Litigation serves as another mechanism for states to demand greater
levels of protection from the federal government.

California offers another example of states enforcing stringent standards in the absence of federal
protections. EPA promulgated regulations in January 2001 to mandate dramatic decreases in harmful
emissions, most notably particulate matter and nitrogen oxide. These standards, known as the "Federal
2007 Rule," are scheduled to take effect in 2007. However, according to state and local pollution
control officials, EPA has been pressured by the trucking industry to weaken the rule. In order to
ensure truck drivers in California will be forced to comply with the original federal standard,
California passed its own diesel fuel standards in October 2001 that are identical to the federal
standard and scheduled to take effect at the same time.

Unwilling to rely on EPA to fully implement the rule, other state and local leaders worked with the
State and Territorial Air Pollution Program Administrators (STAPPA) and the Association of Local Air
Pollution Control Officials (ALAPCO) to create a Model Rule, based on the California standard,
that states could adopt to ensure diesel emissions would still be regulated in the event that the
federal standard is not implemented or is weakened. STAPPA and ALAPCO are comprised of air pollution
control officials from the states, territories, and major metropolitan areas. On Sept. 29, 2004 11
states and the District of Columbia announced plans to implement California's standards for diesel fuel
emissions as a backup to the federal regulation promulgated by EPA.

Like the federal regulation, the model rule, if implemented, will reduce emission levels by 90 percent
for particulate matter and 95 percent for nitrogen oxide. According to a STAPPA/ALAPCO press release,
the adoption of these regulations by these 12 jurisdictions will require more stringent emissions
standards from about one-third of truck sales. To date, the states that have implemented or plan to
implement the California standard are Connecticut, Delaware, the District of Columbia, Georgia, Maine,
Maryland, Massachusetts, New Jersey, New York, North Carolina, Pennsylvania and Rhode Island. (Read
more about this example here).

Local governments have also stepped in to create more robust public protections than the federal
government has mandated. Seattle led the way for a US Mayors Climate Protection Agreement, which
committed US mayors to enforcing the provisions of the Kyoto Protocol on climate change in lieu of a
federal policy.

Why Federal Mandates Matter

Action by state and local governments has increased the level of public protection in these cases, but
state legislatures can also lower the bar on public protections. Though 175 cities joined the effort
to combat climate change through reducing emissions, some states have passed policies that weaken
efforts to control greenhouse gasses. A new law in Maine, for instance, requires the Maine Department of
Environmental Protection to conduct analysis into the cost effectiveness of regulations aimed to reduce
greenhouse gas emissions, which will ultimately impede the state's ability to regulate greenhouse gases.

In other cases legislative action has caused more immediate harm to state citizens. In Florida, for
instance, the repeal of a motorcycle helmet law has lead to a significant increase in death and serious
injury. With the repeal of the law on July 1, 2000, only motorcyclists under the age of 21 or with less
than $10,000 worth of medical insurance coverage are required to wear to protective helmets. A recent
report by National Highway Traffic Safety Administration (NHTSA) has found that the repeal of the law
has led to a 75 percent increase in motorcycle fatalities, from 181 motorcyclists killed in the 30
months before the law was repealed to 280 killed in the 30 months following repeal. The costs to treat
head injuries for motorcyclists more than doubled to $44 million in 2002, and fewer than 25 percent of
the hospitalized cases for head, brain or skull injuries cost less than $10,000, the required level of
insurance to ride without a motorcycle.

States Fail at Worker Safety

When states are responsible for enforcing or implementing regulations, standards may be applied unevenly
or poorly. For instance, both states and the federal government are responsible for enforcing workplace
health and safety protections. States are solely responsible for regulating work place health and safety
in twenty-one states and U.S. territories, while the Occupational Safety and Health Administration
(OSHA) oversees regulation in the rest. This unique situation provides an opportunity to examine how
enforcement and compliance are impacted when regulation is left to the states. A recent paper
examining enforcement data in the construction industry found that state inspectors tend to be more lax
than OSHA officials in enforcing regulations. State inspectors tend to impose lower fines per violation
and have "less measurable impact on inspected firms' regulatory compliance." Moreover, the frequency of
construction injuries increases by approximately ten percent when states are responsible for
enforcement.

Unlike state standards, safeguards enacted at the federal level provide the same protections for all
Americans, regardless of where they happen to live. Thus, developing basic federal standards is
necessary for ensuring equal protection for all. Nationwide problems call out for national solutions
rather than a patchwork of efforts by states that could be prompted by economic dislocation into racing
to the bottom rather than striving for the top. Moreover, as business learned with worker right-to-know
regulations, it is less costly to comply with one federal standard than with potentially 50 different
standards at the state level.

Easy Targets for Bad "Reforms"

In Congress, bad regulatory legislation is often too political to move forward, or other legislative
priorities simply take precedence. Conservative groups, however, have made regulatory "reform" a
priority at the state level and have found much success there. Several states have already enacted
legislation similar to regulatory reform bills introduced in Congress. In fact, the Small Business
Administration's Office of Advocacy has drafted model legislation for states to implement their own
version of the Regulatory Flexibility Act ("Reg flex") that mirrors the federal statute. The
Regulatory Flexibility Act requires agencies to analyze the impacts of regulations on small businesses
before an agency can promulgate a new rule. At the state level, such analytical burdens will ultimately
only serve to further bog down already taxed agencies while putting the interests of business above
needed protections.

Still, through SBA's model legislation initiative 44 states have either implemented or introduced
regulatory flexibility legislation. Just this year, Arkansas, Missouri, Alaska, Virginia, Indiana and
New Mexico passed regulatory flexibility statutes or executive orders.

"Reg flex" is not the only initiative making its way through the states. Sunset and results commissions
are another regulatory "reform" initiative that has caught on at the state level. In fact, legislation
in Congress to establish federal sunset and results commissions is modeled off of the Texas Sunset
Advisory Commission. Other regulation overhauls that originated at the state level were eventually
adopted in Congress, such as the Unfunded Mandates Reform Act.

A PLAN for Better Safeguards?

Much of the regulatory "reform" successes at the state level have been made possible by the American
Legislative Exchange Council (ALEC) which provides policy support for conservative state legislators.
Progressive leaders recently launched the Progressive Legislative Action Network (PLAN), which seeks
to be an alternative to ALEC "by providing coordinated research support for a network of State
legislators, their staff's and constituencies, in order to equip them with coherent logistical and
strategic advocacy tools necessary for advancing key progressive economic and social policies." Yet as
myriad examples show, the states can provide just as many foils as they do opportunities for health,
safety and environmental safeguards, and ultimately state protections can not replace the need for
strong federal protections.

Copyright 2005 OMB Watch

OMB Watch 1742 Connecticut Avenue, N.W. Washington, D.C. 20009 202-234-8494 (phone) 202-234-8584 (fax)

7 http://www.ombwatch.org/article/articleview/2437/1/299?To picID=1

10 http://www.nhtsa.dot.gov/people/injury/pedbimot/moto rcycle/FlaMCReport/pages/Index.htm

14 http://www.ombwatch.org/article/articleview/2274/1/299?T opicID=1

15 http://www.ombwatch.org/article/articleview/2769/1/329?Top icID=1