State Associations: Lower Ozone Standard Will Choke Economy

Twenty-three state manufacturing and business associations today submitted comments to the Environmental Protection Agency objecting to the EPA’s move to reduce the national standards for ground-level ozone.

In 2008, after a lengthy regulatory process that included public comment and hearings, the EPA lowered the 1997 National Ambient Air Quality Standards (NAAQS) for ozone from 84 parts per billion (ppb) to 75 ppb. The EPA then in January proposed new rules to drop the standard for ozone below 75 ppb, this despite the fact that air quality has been steadily improving under the 1997 standards. Ground-level ozone contributes to smog.

As the associations’ letter states:

EPA’s proposal to lower the ozone NAAQS will unnecessarily cause severe economic harm. Large swathes of the United States will be designated as being non-compliant with the new rule and will be unable to comply with a new rule. Lowering the existing 75 ppb standard to the lower end of the proposed range of 60 ppb would result in almost tripling the number of counties being designated as being in violation of the Clean Air Act (CAA). Designating an area as being in violation (or in “nonattainment’) moreover, leads to new mandates and costs under the CAA, including additional control requirements for manufacturers, the need for new business to undergo nonattainment New Source Review permitting, and the imposition of financial penalties in areas failing to meet the new standards. All these actions will discourage new businesses from locating in nonattainment areas and restrict the growth of existing businesses.

This is not the time to impose these sorts of costs on American business, just as we are recovering from the recent financial downturn in which more than 2.1 million manufacturing jobs have been lost. It makes no sense to hurt local economies already struggling to emerge from the recession. The U.S. is projected to spend approximately $9.6 billion per year on compliance costs with the current standard by 2010. A more stringent ozone standard could impose $22 billion in additional annual compliance costs on industry, costing even more jobs.

The associations also argue that the EPA failed to follow the process required by the Clean Air Act in attempting to justify this new rule.

The EPA issued the proposed rule on Jan. 11, 2010 (Federal Register notice here), and today is the comment deadline. The final rule is expected by September.

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