Regulatory and Legal Reform

Policy and Legal

NAM, ACC Challenge EPA’s National Drinking Water Rule

The NAM and the American Chemistry Council yesterday filed a petition challenging the Environmental Protection Agency’s first-ever national drinking water standard limiting the presence of six types of per- and polyfluoroalkyl substances, or PFAS.

What’s going on: The organizations are seeking to overturn the final rule—issued in April by the EPA—in the D.C. Circuit Court of Appeals on the grounds that it exceeds the agency’s authority under the Safe Drinking Water Act of 1974 and “is arbitrary, capricious and an abuse of discretion,” in violation of the Administrative Procedure Act.

  • Under the rule, PFAS in municipal water systems are limited to near-zero levels. Systems nationwide will have three years to monitor for the chemicals and two subsequent years to install technology to reduce the compounds’ levels in the water.
  • The water systems will (and, in fact, have already begun to) sue manufacturers to cover their costs. Meanwhile, plaintiffs’ attorneys are using the standard in product liability and greenwashing suits against manufacturers.
  • PFAS are a diverse group of chemicals that have been used widely for decades due to their unique ability to douse fires and resist grease, stains and corrosion. Today they’re a key component in a wide range of critical products, from semiconductors, to the components of the electrical grid, to renewable-energy production equipment.

Why it’s problematic: The final regulation of PFAS “is wholly infeasible and threatens these vital substances’ continued application in manufacturing processes,” said NAM Chief Legal Officer Linda Kelly, adding that the agency’s rulemaking is based “on a deeply flawed cost-benefit analysis” and fails to follow Safe Drinking Water Act procedure and other statutory requirements.

  • “In many instances, there is no viable alternative for these chemicals, and companies may be forced to change plans dramatically” to follow the new rule, NAM Managing Vice President of Policy Chris Netram said in April.
  • “In everyday life, including emergency situations like a fire or operating room circumstance, there’s a real reliance on these products—it’s not just about job losses and costs but fundamental decisions that have widespread ramifications,” Netram added recently.

What should be done: The rule should be vacated as soon as possible, the NAM and the ACC told the court.

Press Releases

Manufacturers Challenge Infeasible, Costly Water Standard

The NAM Legal Center and ACC File Suit to Block the Rule

Washington, D.C. – Today, the National Association of Manufacturers, joined by the American Chemistry Council, filed a petition in the D.C. Circuit Court of Appeals challenging the Environmental Protection Agency’s final rule setting individual standards for six per- and polyfluoroalkyl substances, also known as PFAS, in municipal water systems.

“Manufacturers support commonsense regulations on PFAS that recognize the criticality of these substances across several industrial sectors—for many of these critical applications, there are no viable alternatives,” said NAM Chief Legal Officer Linda Kelly. “What the EPA did, however, was to bulldoze ahead with standards that set an acceptable level for PFAS at near zero—which is wholly infeasible and threatens these vital substances’ continued application in manufacturing processes. In doing so, the EPA relied on a deeply flawed cost-benefit analysis and failed to follow the clear-cut statutory procedures required by the Safe Drinking Water Act, among other substantive and procedural deficiencies. The NAM Legal Center is filing suit to overturn this unachievable standard and protect manufacturing operations and jobs across the country.”

PFAS are a diverse group of chemicals essential to modern life, including in the transformers used to power electric grids; in the semiconductors and solar components needed for clean energy transition; and in the aircraft, munitions, fire suppression systems and communication devices required for national security.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.89 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Policy and Legal

NAM, Partners File Opening Brief in Suit Against EPA

On Thursday, the NAM, joined by other business groups, filed the opening brief in their pending lawsuit against the Environmental Protection Agency.

What’s going on: In March, the groups petitioned the D.C. Circuit to review the EPA’s reconsideration of the National Ambient Air Quality Standards for fine particulate matter (or PM2.5), which lowers the allowable level to 9 micrograms per cubic meter of air from 12, a 25% reduction. The agency handed down the final, tightened rule in February.

  • In their brief, the coalition argues that the EPA lacks the authority under the Clean Air Act—the law that authorizes it to establish the NAAQS—to “reconsider” a decision made in 2020 to not lower the PM2.5 standard; that the agency failed to take into account the cost and feasibility of a tightened standard; and that it failed to give a “reasoned explanation for key aspects of its decision.”
  • The groups participating in the suit with the NAM are the U.S. Chamber of Commerce, the American Chemistry Council, the American Petroleum Institute, the American Forest & Paper Association, the American Wood Council, the National Mining Association and the Portland Cement Association.

Why it’s important: The tighter NAAQS rule could result in many parts of the U.S. being designated as in nonattainment, which would trigger significant new costs for manufacturers and others attempting to obtain air permits in those locations.

  • Many of these areas “are indisputably handicapped in their ability to reduce emissions to meet the new NAAQS” due to factors beyond municipalities’ and manufacturers’ control (i.e., wildfires, which affect most of the contiguous U.S. at some point each year).
  • The new rule could also prevent manufacturers from building or modifying facilities in certain areas, undermining the Biden administration’s own “Investing in America” agenda, as it would stifle investment in manufacturing and kill—not create—well-paying manufacturing jobs.

What should be done: The rule should be vacated as soon as possible, the groups told the court.

Policy and Legal

NAM Files Suit to Block OSHA “Walkaround” Rule

The NAM and allied groups are challenging the U.S. Occupational Safety and Health Administration’s recently finalized “walkaround” rule.

What’s going on: On Tuesday, the NAM, joined by like-minded business organizations, filed a lawsuit in the Western District of Texas to block OSHA’s final rule revising the Worker Walkaround Representative Designation Process. That rule was finalized in April and is set to go into effect May 31.

  • The new rule would allow nonemployees—including union representatives, plaintiffs’ attorneys, community organizers and even competitors—to accompany OSHA inspectors on workplace safety inspections.

Why it’s a problem: Not only does the final rule fail to advance the agency’s mission of ensuring workplace safety, but it is beyond the scope of OSHA’s authority. What’s more, it violates businesses’ rights, the NAM said.

  • The new regulation “infringes on manufacturers’ right to exclude others from their property, threatens new liabilities and risks compromising manufacturers’ intellectual property. The NAM Legal Center is filing suit to prevent this harm,” NAM Chief Legal Officer Linda Kelly said.
Press Releases

Manufacturers Challenge OSHA’s Unlawful Walkaround Rule

The NAM Legal Center Joins Industry Groups Seeking to Block Rule

Washington, D.C. – Today, the National Association of Manufacturers, joined by other business groups, filed suit in the Western District of Texas to challenge the Occupational Safety and Health Administration’s final rule amending the Worker Walkaround Representative Designation Process (Walkaround Rule).

The Walkaround Rule will allow an unlimited number of third parties, such as union representatives, plaintiffs’ attorneys and community organizers, to accompany OSHA inspectors on safety inspections.

“OSHA’s rule does nothing to advance its mission of improving workplace safety,” said NAM Chief Legal Officer Linda Kelly. “This rule is well beyond the scope of OSHA’s authority, and it infringes on manufacturers’ right to exclude others from their property, threatens new liabilities and risks compromising manufacturers’ intellectual property. The NAM Legal Center is filing suit to prevent this harm.”

Background:

  • For more than 50 years, OSHA’s walkaround regulation authorized only an employee of an employer to serve as another employee’s representative during an OSHA inspection.
  • In 2013, then-Deputy Assistant Labor Secretary Richard Fairfax issued a letter—commonly referred to as the Fairfax Memo or Sallman Letter—to a member of the Service Workers International Union, which stated that a nonemployee affiliated with a union or community organization could serve as a representative of employees during an OSHA inspection at a worksite without a collective bargaining agreement.
  • In 2017, a trade group challenged the Fairfax Memo as unlawfully issued outside the notice-and-comment process and inconsistent with OSHA’s regulation that authorized only an employee of an employer to serve as another employee’s representative during an OSHA inspection.
  • A federal court in Texas agreed with the trade group, and the Trump administration later rescinded the memo.
  • In August 2023, OSHA released the proposed Walkaround Rule, and the NAM submitted comments urging OSHA to withdraw it.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.89 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Policy and Legal

House Committee Approves PBM Reforms

The House Ways and Means Committee unanimously passed legislation Wednesday that includes much-needed reforms to pharmacy benefit managers, underregulated middlemen that raise health care costs for manufacturers and manufacturing workers (Fierce Healthcare).

What’s going on: PBM reforms contained in the Preserving Telehealth, Hospital and Ambulance Access Act include increasing transparency into PBMs’ business practices and delinking PBM compensation from medicines’ list prices. These changes will help reduce prices for seniors who rely on Medicare prescription drug plans.

Why it’s important: “When Americans face soaring prices for medicines or treatments, there’s a good chance that is because a PBM has driven up the price,” NAM President and CEO Jay Timmons said Wednesday.

  • “These middlemen operate with minimal transparency, and their practices distort the market, increasing the list prices patients pay for medicines while making it more difficult for manufacturers to offer quality, affordable health care benefits.”

What’s next: The legislation approved Wednesday applies to the Medicare market. The NAM is calling on Congress to enact similar changes in the commercial insurance market to lower health care costs for manufacturing employees who participate in employer-sponsored plans.

Policy and Legal

FAA Authorization Moves Forward

In a bipartisan vote Wednesday, the Senate moved to advance Federal Aviation Administration reauthorization—but lawmakers still face a looming deadline to pass the legislation (The Hill).

What’s going on: “Senators voted 89 to 10 to overcome the first procedural hurdle and move toward consideration of the package ahead of the May 10 deadline.”

  • The draft 1,069-page bill—which already has been punted three times—sets the agency’s priorities. It would authorize billions of dollars in appropriations for the FAA, as well as hundreds of millions of dollars for the National Transportation Safety Board, from fiscal year 2024 through 2028.
  • But all 100 senators must agree to fast-track the measure for it to pass before next Friday.

Why it’s important: The FAA reauthorization bill renews statutes governing the agency’s civil aviation programs, as well as revenue collection authority. From air traffic operations to airport development, these functions are critical to the U.S. economy and the ability of Americans to travel.

However . . . Both Democrats and Republicans want amendment votes on the measure, and “lawmakers acknowledge it could be a bumpy ride” to passage.

A hot-button issue: One sticky wicket amendment that’s likely to get a vote would remove language in the bill that adds 10 flights at Ronald Reagan Washington National Airport.

  • Senators from the Washington, D.C., area say the airport cannot handle any more traffic. Virginia and Maryland are home to Dulles International Airport and Baltimore Washington International Airport, respectively.
Input Stories

EPA Chemical Rule Will Add Delays, Costs for Manufacturers

a sign on the side of a building

The EPA recently finalized a rule that establishes a process for conducting risk evaluations for certain chemicals—but it will only hamstring U.S. manufacturing competitiveness if implemented, the NAM said this week.

What’s going on: In a final rule issued late last month under the Toxic Substances Control Act, the EPA “will now consider exposure to chemicals in air and water and, when possible, combined risks from exposure to multiple chemicals” (Chemical & Engineering News).

  • “The [agency] will also consider risks to workers without assuming that they are wearing personal protective equipment [and] … chemical uses required for national security or critical infrastructure.”

Why it’s important: The final regulation will unnecessarily cost manufacturers in both time and money.

  • The “new TSCA risk evaluation rule adds too many additional barriers and requirements on manufacturers and risks creating de facto bans on chemistries essential to both existing technologies and the development of new innovative materials,” the NAM said Monday.
  • “Manufacturing relies heavily on new and existing chemicals, which are the building blocks of technologies that make modern life possible,” NAM Vice President of Domestic Policy Brandon Farris told the agency last December. “To ensure continued access to the newest chemicals which can make essential technologies even more effective and efficient, TSCA should be administered in a manner that protects health and the environment while avoiding unnecessary adverse economic impacts on business enterprises.”

What should be done: The agency should revise the final rule, the NAM said.

Input Stories

New Power Plant Rules Unfeasible Without Permitting Reform

Final rules released Thursday by the Environmental Protection Agency to reduce greenhouse gas emissions from traditional fuel-fired power plants are not achievable without permitting reform—and they pose a threat to U.S. national and economic security, the NAM said yesterday.

What’s going on: The new rules, part of President Biden’s pledge to create a carbon-free energy sector by 2035, mandate that:

  • Existing coal-fired plants and new natural gas–fired facilities cut or capture 90% of their emissions by 2032;
  • Coal-fired plants drastically reduce wastewater runoff and severely tighten the emissions standard for heavy metals; and
  • Coal ash—including past deposits “placed in areas that were unregulated at the federal level until now”—be managed in storage ponds.

A first: “The power plant rule marks the first time the federal government has restricted carbon dioxide emissions from existing coal-fired power plants” (Associated Press).

  • The new regulations—which face almost certain court challenges—set emissions caps that plant operators would be required to meet.

Targeting major energy sources: Natural gas generates approximately 43% of all U.S. electricity, while coal generates about 16% (AP).

Why else it’s problematic: While manufacturers appreciate that the EPA heeded the input of their industry and did not include existing gas plants in the new requirements, as written the final rules are unattainable because the administration and Congress have not undertaken much-needed, comprehensive permitting reform, according to NAM President and CEO Jay Timmons.

  • “Congress and the president have not enacted permitting reform—making it impossible to achieve the EPA’s highly aspirational mandates,” Timmons said. What’s more, the final rules threaten “grid reliability because of the unrealistic timeline for power plants to adopt technologies within the next 10 years that have yet to even be proven at scale.”
  • Pushing through yet another set of regulations in the absence of systemic reforms burdens an already overtaxed national electrical grid, jeopardizing U.S. security in a way that “literally could leave Americans in the dark and factories offline.”

What should be done: The EPA should partner with—not undermine—manufacturers “to achieve a more balanced regulatory framework to help reach our climate goals.”

Input Stories

Return to Broadband Rules Will Harm Manufacturing Economy


The Federal Communications Commission voted Thursday to restore Obama-era broadband regulations—a move that is outside the agency’s remit and will erode investment in telecom infrastructure, the NAM said.

What’s going on: “The commission voted along party lines to finalize a proposal first advanced in October to reinstate open internet rules adopted in 2015 and reestablish the commission’s broadband authority” (Reuters, subscription).

  • The rules, repealed by the Trump administration in 2017, will reclassify broadband as a telecom service under a law originally passed in 1934. This change will subject 21st century high-speed internet to regulations designed for the era of the rotary phone.
  • The Biden administration has been seeking a return to the 2015 regulations since 2021, when the president signed an executive order urging the FCC to reinstate them.

Why it’s important: The resuscitated regulations will have a significant and negative impact on the U.S. economy, as historical evidence shows.

  • From 2011 to 2022, attempts to impose so-called “net neutrality” restrictions depressed telecom infrastructure investment by $8.1 billion each year, decreased employment by approximately 195,600 jobs and reduced gross domestic product by $145 billion annually (Phoenix Center).

Our view: “Ultimately, [the FCC]’s broadband regulations are a solution in search of a problem,” the NAM wrote in a social post. “The U.S. already has an open and fair internet. This is just the latest in a long line of decisions adding to the regulatory onslaught facing manufacturers in America.”

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