Energy Scorecard

This week, the Senate will vote on amendment #836 by Senator McConnell to concurrent resolution S. Con. Res. 11, the fiscal year 2016 budget. The amendment would create a deficit neutral reserve fund, which includes a prohibition against the EPA withholding highway funds from states that refuse to submit State Implementation Plans for the existing power plant regulation.

States across the country are debating what the best course of action is in regard to the administration’s proposed carbon dioxide rule for existing power plants. One of the areas of concern is EPA’s supposed ability to take away highway funds from states that do not submit state implementation plans. There has been significant legal debate on this topic in the recent months.

A legal analysis conducted for the Federalist Society by attorneys at Troutman Sanders LLP argues against the EPA having such authority:

“The notion that EPA could impose sanctions if States fail to submit the plan EPA demands can be dismissed quickly: EPA does not have that authority. EPA has not cited any such authority in its power-sector Section 111(d) rules, EPA’s generic Section 111(d) rules do not provide for sanctions…”

In addition, several scholars have recently made a second legal argument against EPA that is tied to the outcome of the Obamacare Supreme Court decision (See analysis from Jonathan Adler & William Yeatman). In the first case challenging the constitutionality of the Affordable Care Act (ACA), the Supreme Court found the government’s threat to withhold all Medicaid funds if states did not comply with the ACA to be coercive and unconstitutional. Specifically, they found that it was unconstitutional for the federal government to attach strings or conditional grants to coerce states into acting on another regulatory matter. This recent court precedent likely makes it unconstitutional for the EPA to withhold transportation funding for state compliance of EPA’s power plant regulations.

While these are strong arguments that the EPA currently lacks the authority to withhold highway funds, we know the EPA has routinely ignored the written law. There is no better example of this than the existing source rule itself, which liberal law professor Lawrence Tribe testified was “a power grab” which represents a “burning [of] the Constitution.” Additionally, attorneys general from around the country are currently litigating against EPA’s claimed legal authority.

This amendment would send a strong signal to the states that EPA will not be allowed to use coercive action against the states in withholding their transportation funding if they fail to submit to the EPA’s unconstitutional and dubious legal authority.

The American Energy Alliance supports this amendment and will include it in our American Energy Scorecard. YES is the pro-energy, pro-constitution, and pro-federalism vote.