EPA MOVES THE GOAL LINE, BLOCKS ECONOMIC GROWTH
By Harry Alford
The number of regulations emanating from Washington, DC on a yearly basis can be mind-boggling. A recent report www.washingtontimes.com/news/2015/may/12/federal-regulations-cost-188-trillion-lost-product/found there are currently 3,415 regulations in the government’s pipeline with the Environmental Protection Agency (EPA) being a key contributor. Lately, the EPA has proposed rules on everything from trucks to planes to manufacturing plants. And unfortunately, like most things from our nation’s capital, each of those rules has a price tag with consequences on both our national and local economies.
Take the EPA’s proposal to lower the allowable ground level ozone standard. Despite ozone levels falling by around 33 percent since 1980, the EPA has decided to push the envelope further by proposing to tighten the existing 75 parts per billion (ppb) standard to between 65 and 70 ppb. According to a recent study–Proposed-Ozone-Rule-Still-The-Most-Costly/ by the National Association of Manufacturers (NAM), lowering the standard to 65 ppb would be the costliest regulation in U.S. history. This stringent rule will reduce our Gross Domestic Product (GDP) by $140 billion annually and place 1.4 million jobs at risk per year.
In June, the Illinois Black Chamber of Commerce along with the National Black Chamber of Commerce and the U.S. Chamber of Commerce had the opportunity to discuss the economic impact of this new ozone regulation on Illinois. And it’s not a pretty picture. The NAM study found that in Illinois, it would mean nearly 35,000 lost jobs and a $51 billion Gross State Product loss. Businesses in the state would be burdened with $9 billion in compliance costs and families could see a $640 drop in average household consumption per year, meaning money spent on such everyday needs as housing expenses and food will basically be going towards complying with the new ozone rule.
The proposed regulation is being rushed into place without any thought about exactly how it will be implemented. Currently, only 675 of our nation’s 3,000 counties have ozone monitors in place which means the EPA would have to rely on computer models and other subjective tests rather than physical on-the-ground measurements.
This rule will also dramatically increase “non attainment areas,” which are areas that do not meet the EPA’s air quality standards. A “nonattainment” designation has a devastating economic impact on the area in question. Not meeting federal ozone levels is a barrier to local economies as it means manufacturers stop building or expanding in that area due to the difficulty of obtaining permits. Ultimately, this impacts job creation and economic development for the affected region. Along with hindering economic growth, communities can lose federal transportation funding and possibly incur costly penalties.
As of July of last year, 123 million people, or roughly 40 percent of the U.S. population, lived in areas that hadn’t yet met the 2008 standards. With the proposed new rule, nearly every single state could fall short. But arguably, the communities most at risk of losing out on economic growth – and those desperately in need of it – are urban areas.
We can all agree on the need to breathe clean air and set air quality standards, but we need to ensure the benefits at least match the costs. By proposing a more stringent standard while most states are still struggling to meet the one set in 2008, the administration misses that mark by a long shot; and it’s local communities, business owners, and families who will bear the economic burden of the EPA’s actions.
The EPA would be better served by sitting down with the nation’s manufacturers, businesses and local elected officials to discuss how best to implement the 2008 standards before rushing ahead of itself, leaving much economic damage on the field behind them.
Harry Alford is president and CEO of the National Black Chamber of Commerce.