White House seeks regulatory master switch

The Trump Administration took several steps last week to control how regulations are made and to direct agencies to repeal regulations they believe were unlawful, and to do so outside of the guardrails of the Administrative Procedures Act.

The Administrative Procedures Act sets the process through which regulations are made — Trump seeks to skip it

Regulations are the rules created by federal agencies after laws are enacted. By authorizing the functions of agencies (and creating agencies in the first place), Congress empowers federal regulators to create regulations to achieve the policy goals set in legislation, like the Clean Air Act. Since the 1970s, creating federal regulations has been a complicated dance between lawmakers, federal agencies, the judicial branch, and public interests. Several laws, notably the Administrative Procedures Act (APA), give structure to how bureaucrats do that work and in some cases require that agencies give the public the opportunity to weigh in during the process, called “notice and comment.” Regulations are routinely thrown out by courts for not following these procedures of the APA.

The current regulatory process inside agencies is therefore lengthy and complex, taking months to years to make a regulation. This is by design. By requiring public “notice-and-comment” periods in most cases, during which agencies invite industry and civil society to weigh in on the proposal, the APA stretches out this process and offers avenues for legal challenges to what is proposed. Although the Supreme Court determined the judiciary should play a greater role in interpreting what Congress meant when authorizing regulations in legislation in its 2024 Loper Bright v. Rainondo decision, it did not take away agencies’ abilities to interpret federal law and make regulations.

This week, the Trump Administration took several steps to assert the power of the White House over the regulatory process. Renewing his interest in more powerful shower water pressure, President Trump issued an executive order (EO) April 9 repealing existing regulations on them. Typically, the APA would require a notice-and-comment period for such a proposal. The order declares, however, “notice and comment is unnecessary because I am ordering the repeal.” The president has no power under the APA or other law to nullify a regulation. A court challenge arguing that the APA was not followed is likely.

Issue areas targeted for regulation repeal

The president has initiated a more sweeping repeal of federal regulations at the cabinet level. On February 19, he issued EO 14219, which requested departments review all regulations within 60 days and identify those that “impose significant costs upon private parties” or “impose undue burdens on small business and impede private enterprise,” those that “imped[e] technological innovation, infrastructure development, disaster response, inflation reduction, research and development, economic development, energy production, land use, and foreign policy objectives,” and regulations the Administration considers unlawful — a net so wide and vague it might cover every regulation.

On April 9, he issued a subsequent EO that ordered departments to begin the repeal process for any regulation they deem “exceeds the agency’s statutory authority or is otherwise unlawful” based on the rulings of 10 recent Supreme Court decisions on issues where the Trump Administration has expressed interest in rolling back current policies: environmental regulation, affirmative action in higher education, and taxpayer funds for religious schools. It also included a decision this past summer in which the Supreme Court limited regulatory agencies’ abilities to bring charges against those accused of violating federal laws in cases like fraud.

The April 9 EO also instructed federal departments to use the APA’s “good cause” exception while finalizing their repeals. This exception permits agencies to skip the notice and comment period when doing so is "impracticable, unnecessary, or contrary to the public interest." Presidents often cite this exception around a transition in administrations to reverse regulations issued during the final days of their predecessors’ term, but not for comprehensive regulatory review as the Trump Administration is attempting. This week, it also created a “Deregulation suggestions” portal to take suggestions for regulations to eliminate, presumably from industry lobbyists.

In case agencies do not go far enough, the order instructs the White House Office of Information and Regulatory Affairs (OIRA) to backstop their choices. Within 30 days of the end of the review period, agencies must report to OIRA why each regulation initially identified as falling within a category in EO 14219 was not recommended for repeal. A Clinton Administration-era EO empowers OIRA to review regulatory actions for consistency with presidential policy, and it can return regulatory decisions back to agencies for revision.

The first Trump Administration issued similar deregulatory EOs that were less targeted on issues. After investigating the actions of five agencies, the Government Accountability Office found that repeal actions in only one of those five resulted in regulatory cost savings.

Challenging state-level clean energy environmental regulations

President Trump this week also expanded environmental regulatory review into state and local law. State and local governments aren’t a part of the federal government and don’t have to follow executive orders, so Trump has no authority to quash state law.

On April 8, he issued an EO ordering the Justice Department to challenge in court state and local environmental laws promoting clean energy production and seeking to reduce greenhouse gas emissions. Those policies “are fundamentally irreconcilable with my Administration’s objective to unleash American energy,” it says. But whether they are “irreconcilable” or not has no bearing on whether the state regulations are legal.

As the federal Environmental Protection Agency has aimed to mitigate climate change through reducing levels of greenhouse gas emissions in transportation and power generation, many states have tried to reshape their energy markets to increase non-fossil fuel sources for electricity. 24 states have joined the U.S. Climate Alliance, adopting specific emissions targets aligned with the goals of the Paris Agreement, including coal-producing states like Pennsylvania and Montana. 29 states and D.C. require utilities to provide a certain percentage of energy from renewable sources, while seven states require utilities to deliver a specific standard amount of renewable or clean energy. States along the Pacific coast and in the Northeast also have entered or are developing carbon pricing policies by joining cap-and-trade markets.

New York Governor Kathy Hochul and New Mexico Governor Michelle Lujan Grisham of the U.S. Climate Alliance responded to the EO, “The federal government cannot unilaterally strip states’ independent constitutional authority. We are a nation of states — and laws — and we will not be deterred.”

The Administration’s EO took specific aim at California’s expansive cap-and-trade program which is linked to Quebec. The first Trump Administration issued an unsuccessful legal challenge of the agreement 2021, claiming the state preempted the federal government’s sole treaty-making power.

The EO also singled out Vermont’s Climate Superfund Act, which allows the state attorney general to fine oil companies for damage caused to the state since 1995, and New York’s similar new law creating a cost recovery program to charge the oil and gas industry for the state’s sea rise mitigation efforts.

Can the federal government change state environmental law?

Not through an executive order, but through litigation. The 10th Amendment of the Constitution preserves powers not specifically delegated to the federal government to the states. If states “preempt” federal law with their own, or attempt to regulate “interstate commerce,” the federal government would have standing to sue to strike such laws down. The EO itself “does not directly challenge, prohibit, argue preempted, or enjoin any state or local law,” Amy Turner, Director of the Cities Climate Law Initiative at the Sabin Center of Columbia Law School wrote. “But it is likely a forerunner to litigation, lawmaking, or the withholding of federal funds.”

State regulation of electricity production has a long history. Because the generation and transmission of electricity first took place at the municipal level or within state lines under a monopoly, state regulation of electric companies prevailed. Municipalities also created their own public electric companies to meet public demand. As large-scale electrification became a major component of the New Deal, the Federal Power Act of 1935 limited federal jurisdiction only to the transmission of electric power across state lines. States continue to have jurisdiction over private and public companies and electric cooperatives. Deregulation of the electricity industry by the Energy Policy Act of 1992 retained state and local regulatory power, even as companies began to restructure and compete across state markets. State regulatory power includes the authority to prefer or require specific energy sources by utilities.

States seeking economic compensation from utilities for global warming-related damage is a new development. They are modeled, according to Columbia’s Sabin Center, on Superfunds created by the 1980 Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). CERCLA created the “polluter pays principle,” requiring polluters to clean up contaminated sites. In addition to Vermont and New York, Maryland and Massachusetts are considering “climate Superfund” laws that would require utilities to pay into funds for mitigating the damage caused by greenhouse gas pollution.

Because these types of laws are new, courts have not ruled on whether they unconstitutionally preempt federal law like the Clean Air Act. In January, the U.S. Supreme Court denied taking up a case brought by Sunoco against the City and County of Honolulu’s climate Superfund law. However, a federal circuit court struck down a New York City law because the state was suing for damages created by fossil fuel companies outside its borders. The Sabin Center notes climate Superfund laws may face a variety of other constitutional challenges in coming years. This EO appears to pave the way for such challenges to launch.