GOP, DEMS UNITE OVER COST CONCERNS FOR UNDERGROUND STORAGE TANK PROPOSAL

Emily Yehle, E&E reporter

Published: Thursday, August 1, 2013

When it comes to U.S. EPA regulations, Democrats and Republicans are usually on opposite sides of a starkly drawn political line. You’re either for new environmental regulations or against them.

But a little-known proposed rule on underground storage tanks has brought together more than 70 lawmakers from both sides of the aisle who think EPA drastically underestimated the cost of the rule’s implementation.

In the past few weeks, two letters have landed on EPA’s doorstep: one in June from more than 50 representatives led by Reps. Gregg Harper (R-Miss.) and John Barrow (D-Ga.) and another in July from a group of 11 senators led by Sens. Mary Landrieu (D-La.) and Jim Risch (R-Idaho).

Today, the House Small Business Committee will jump on board, with Chairman Sam Graves (R-Mo.) sending aletter to EPA Administrator Gina McCarthy asking her to withdraw the rule and convene a Small Business Advocacy Review (SBAR) panel.

Like those before him, Graves argues that EPA used “inappropriate methodology” to calculate the rule’s economic impact. Among EPA’s mistakes, he wrote, was to base its estimate on how much the changes would cost large businesses.

“This approach ignores the substantial economies of scale and greater administrative capacities that larger operators enjoy compared to their small business counterparts, who have less opportunities to spread regulatory costs over a larger output and often must contract with third-parties for services their larger counterparts can accomplish with in-house personnel,” Graves wrote.

An EPA spokeswoman did not return a request for comment.

EPA released the proposed rule in 2011, suggesting the first changes to the underground storage tank regulation since 1988. The aim is to prevent leaks that have become “one of the leading sources of groundwater contamination,” according to the agency. A 2007 report from the Government Accountability Office noted that states estimated they would spend about $12 billion to clean up 54,000 leaks.

But the petroleum industry is up in arms over EPA’s claim that new requirements under the rule will not have a significant economic impact. The Petroleum Marketers Association of America has waged a months-long campaign to force EPA to convene a SBAR panel and has successfully garnered the support of many lawmakers.

The group says small operators — such as convenience store owners — face an annual cost of $6,960 to comply with a rule that would mandate, among other things, monthly walk-through inspections, regular testing of spill prevention equipment and secondary containment for new tanks. EPA’s estimate is just $900.

In a letter to EPA on June 25, Harper and Barrow wrote that EPA has not contacted the Small Business Administration’s Office of Advocacy, as required when a rule is expected to have a significant impact on small entities. They also tout the benefits of convening a SBAR panel, an interagency committee that would review the draft rule and EPA’s analysis.

The agency, they argued, would benefit from “the expertise of the industry in assessing costs.”

“Ultimately, the discrepancy between the agency cost estimates and the industry estimates cause us concern and warrants further evaluation,” they wrote.

Landrieu and Risch have also asked EPA to hand over information on the agency’s outreach to owners and operators of underground storage tanks, including the names of those the agency worked with during its creation of the proposed rule. The rule, they said, stands to negatively affect the 60 percent of the convenience store industry that is “comprised of single-store, mom-and-pop businesses.”

Their letter was also signed by Republican Sens. Mike Enzi of Wyoming, Marco Rubio of Florida, Deb Fischer of Nebraska, Tim Scott of South Carolina, Ron Johnson of Wisconsin and David Vitter of Louisiana, as well as Democrats Heidi Heitkamp of North Dakota, Jeanne Shaheen of New Hampshire and Mark Pryor of Arkansas.

The House letter was signed by 58 lawmakers, including three Democrats: Barrow, Utah Rep. Jim Matheson and Texas Rep. Gene Green, who all sit on the Energy and Commerce Committee.

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