Airing Concerns

In The Zone

Browner's rationale for the new standards is better respiratory protection for the 133 million American adults and 40 million children in metropolitan areas that, for the first time, would be covered by one or both of these standards. Ozone and its main component, smog, is formed by the release of volatile organic chemicals, particularly sulfur from gasoline and smokestacks during the summer. Particulate matter, better known as soot, is produced by combustion from sources such as power plants and large incinerators.

The changes could have been worse. The EPA has also proposed changing the way it measures ozone exceedences. Now, if ozone levels are over .12 ppm for any one-hour period during the day, it counts as an exceedence. Readings for the .08 ppm standard, however, would be taken over an eight-hour day, then averaged.

Clark notes another conciliatory intention: The EPA may adopt a new implementation policy to go with the new standard. That new policy might divide ozone nonattainment areas into subcategories, such as ones whose ozone levels are caused by drifting ozone from nearby cities. The EPA has already tried to bend current policy to help cities like Muskegon, Michigan, which owes its nonattainment status to its location downwind of Chicago and Milwaukee.

Whatever levels the EPA chooses in June, they will not go into effect for five or six years. States would have to submit plans for PM in 2002 and for ozone in 2000. Compliance deadlines would come sometime later.

Despite an outpouring of opposition from businesses, cities and states, it's important to remember key Clinton political constituencies pressed for even tougher standards. The American Lung Association (ALA) has pushed for a .07 ppm, and environmental groups supported that position. "We hope to persuade the EPA that there is more than enough science to justify a tighter standard," says Paul Billings of the ALA.

The political equation could become important in July if Browner decides to issue a final rule based on her November proposal and if business groups contest it. Industry could ask legislators to cancel any final ozone and PM standards under a provision of the Small Business Regulatory Enforcement Fairness Act (SBREFA) Congress passed last year. The Republican majority in the House is very thin, however, so it seems doubtful the House would override the EPA on a key environmental rule.

The question then becomes whether business groups can take the EPA to court under a second provision of SBREFA, which allows for "judicial review" of a final rule if--and this is a big if--the agency performed the kind of full-blown economic-impact analysis called for by the Regulatory Flexibility Act of 1980.

The EPA's Clark says no Regulatory Flexibility analysis is needed since ozone and PM standards won't force small business to do anything. Only states, cities and counties are directly affected. He concedes, however, that when the EPA proposes an "implementation" rule--laying out different policies local governments can choose from--the agency may well have to do a Regulatory Flexibility analysis.

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This article was originally published in the March 1997 print edition of Entrepreneur with the headline: Airing Concerns.

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