Clean Air Regulations and
the EPA's New Source Review Program

First established under the 1977 Clean Air Act Amendments, the New Source Review (NSR) is a pre-construction permitting program for large manufacturing facilities. It is intended to prevent significant air emission increases that could result from major expansions or significant modifications of the facility. Today, the NSR program is considered to be the single most complicated regulatory program administered under the Clean Air Act. In fact, the program has never, in its 22-year history, been implemented in a consistent manner at the Federal or regional levels. This stems in part from the more than 4,000 pages of interpretive (and often conflicting) guidance, which has been written and re-written to "supplement" the basic 20 pages of regulations.

At a time when unions are fighting to fend off challenges from cheap imports and keep high-skill, living-wage jobs here in the United States, the New Source Review program heaps new bureaucratic burdens and forces gold-plated environmental controls onto the 22,000 large industrial facilities that employ millions of unionized working men and women. These requirements erode hard-earned productivity gains and discourage innovations vital to maintaining U.S. manufacturing facilities.

Re-Interpretation of "Maintenance" Jeopardizes Worker Safety

• The Environmental Protection Agency's (EPA) regulations specifically exclude "routine maintenance, repair and replacement" activities from being subject to NSR requirements. However, recent EPA statements and interpretations of the rule effectively repeal this exclusion. Now, any process changes that improve efficiency, enhance worker safety or prolong the life of a facility are subject to an 18-month permitting process. Such universal regulations create perverse incentives for management to delay essential repairs and maintenance, potentially putting the safety of working men and women at intolerable risk.

Workers Will Pay for Unfair Enforcement…With Their Jobs

• The EPA's Enforcement Office has begun an aggressive, multi-billion dollar nationwide initiative against several industries based on recent, questionable interpretations of the same confusing, admittedly broken rules that Agency is struggling to revise.

• The costs for these alleged violations are staggering, and could place the future of many large industrial facilities – and the jobs they provide – at risk. The EPA estimated this initiative could cost as much as $10-50 million per mill, and $2.6 billion for the entire industry. The penalties inflicted from the new regulation could virtually shut down production throughout much of the paper industry.

• Not only will we lose high-paying jobs in the United States, the jobs will likely go to overseas facilities that operate under less burdensome environmental regulations and lax labor standards.

Real NSR Reform Can Only Be Achieved "In the Open"

• Even the EPA's staff admits the New Source Review program is broken. Yet Agency efforts to reform NSR are far from complete. Critical issues remain on the table and should be resolved cooperatively before the rule goes forward. The EPA must not rush to finalize a flawed rule that will further jeopardize the very industrial competitiveness needed to sustain the nation's economic expansion.

• We believe this rule must be the result of real and open dialogue with all stakeholders. This "give and take" approach worked well in developing the Cluster Rule, where the pulp and paper industry agreed to $2.8 billion in capital expenditures for new emissions controls.

• The alternative to openness is litigation, which will only extend uncertainty, hurt America's industrial competitiveness, jeopardize worker safety and job security and squander taxpayer dollars.

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