New Report Exposes Surge in Use of 'Sue and Settle' Tactics that Advance Environmentalists’ Agendas

Many of the environmental rules that are in the pipeline for the next four years are on the U.S. Environmental Protection Agency’s (EPA) regulatory agenda because of court-ordered settlement agreements—including many that impact the business of construction. A new report from the U.S. Chamber of Commerce, Sue and Settle: Regulating Behind Closed Doors, identifies ten costly environmental rules resulting from sue and settle practices and names those advocacy groups that most frequently use these practices to bring about immediate action and set the policy agenda for regulatory agencies. The Chamber’s investigation showed that more than 100 new federal rules are a result of settlement of cases. Of the ten most costly rules identified by the Chamber, AGC has been focusing its advocacy efforts over the last several years on those rules that would adversely impact the business of construction: such as, the Lead Renovation, Repair and Painting Rule, the revision of the particulate matter and reconsideration of the ozone National Ambient Air Quality Standards as well as the Chesapeake Bay Clean Water Act rules. Environmental interest groups have used lawsuits to privately negotiate rulemaking schedules and other concessions from EPA – outside of the traditional regulatory process and excluding impacted parties. The Sierra Club, WildEarth Guardians and the Natural Resources Defense Council are the top three most frequent environmental group plaintiffs. The first term of the Obama Administration saw a surge in the “sue and settle” practice, with 60 such instances associated with the Clean Air Act alone from 2009-2012. As reported, AGC joined 190 other industry groups in signing a letter to express concern about the growing “sue and settle” practice whereby interest groups use lawsuits to force the federal agencies to issue regulations that advance their policy priorities—circumventing public participation and transparency protections in place for rulemakings. In addition to the letter that AGC and other industry groups signed, several attorneys general and Congress have taken steps signaling their displeasure with the practice. A federal records request to EPA from the attorneys general for Ala., Ariz., Ga., Kan., Neb., N.D., Mich., Okla., S.C., S.D., Texas, Utah and Wyo. is still pending. In Congress, legislation was introduced last year and the House Oversight and Government Reform Committee held hearings, both critical of this process. On April 24, 2013, EPA announced that it will post all “Notices of Intent to Sue” to its website on a weekly basis. These notices are submitted to the agency at least 60 days prior to a groups filing of any lawsuit. Transparency about these notices is one of the provisions asked for in the letter signed by AGC and other industry groups. The “Notices of Intent to Sue” can be found on EPA’s website here. For more information, contact Scott Berry at berrys@agc.org or Leah Pilconis at pilconisl@agc.org.