DC Circuit Court of Appeals Upholds EPA Decision Not To Impose Costly Financial Responsibility Requirements on Mining Industry

By Kevin Bromberg, Assistant Advocate

In a major victory for small businesses, the D.C. Circuit Court of Appeals upheld the Environmental Protection Agency’s final determination that financial responsibility requirements were not needed to be imposed on the mining industry.* Financial responsibility requirements are requirements that would ensure that taxpayer liability would not be incurred for mining cleanup costs. This marks the culmination of nearly 15 years of the Office of Advocacy’s work on this issue. This action eliminates over $100 million of annual costs for a rule that essentially duplicates other existing state and federal regulations.

EPA proposed this regulation in early January 2017. EPA issued a final determination on February 21, 2018, that this rule would not be issued. On January 19, 2017, Advocacy filed a comment letter asking EPA to withdraw the rule as costly, hurting U.S. jobs, and providing no benefits that were not addressed by existing state and federal regulations. The letter stated that modern regulations and modern mining requirements already comprehensively addressed environmental risks and financial responsibility requirements. EPA had estimated the cost of the proposal at $110 million annually on the mining industry. With the withdrawal of this proposal, mining facilities can continue to operate, high paying U.S. jobs are preserved, and nearby rural communities can continue to benefit from sorely needed economic activity.

This rule was also the subject of a panel proceeding under the Small Business Regulatory Enforcement Fairness Act (SBREFA). Under SBREFA, affected small businesses provide advice to the federal panel of Advocacy, the Office of Management and Budget and EPA, in advance of the development of the EPA proposal. In this case, the small businesses provided substantial evidence of the duplication of the proposed EPA standard, and the harm that such a proposal would impose on the mining industry, particularly small mining firms. The Advocacy letter relied substantially on the findings and recommendations of the small mining participants. The EPA final action, which affirms many of the findings and conclusions reached in that panel proceeding, marks another success of the SBREFA panel process.

*See Idaho Conservation League, et al., v. Andrew Wheeler, Administrator, U.S. Environmental Protection Agency, et al., No. 18-1141.