Clean Air Amendments of 1977

While the 1970 amendments to the Clean Air Act have been called landmark legislation, significant problems have arisen in implementing them. Standards have not been met, deadlines have been moved back, and enforcement has been severely hampered by disputes in the courts. To enhance progress in air pollution control, ambiguities in the legislation needed to be removed by clarifying the original intent of the Congress. This clarification was the primary goal of the Clean Air Act Amendments of 1977. A secondary objective was to address new problems that had developed since 1970.

What has resulted? The 1977 amendments retain the same fundamental approach to air pollution control that was adopted in the 1970 amendments. They continue a pollution control strategy based on emission standards, ambient air quality standards, and state implementation plans.

The most widely publicized aspect of the legislation concerned automobile emission standards. Specifically, the 1977 amendments give the automobile industry more time to meet the standards originally set forth in 1970. The new timetable extends the 1977 standards for two more years followed by somewhat stricter hydrocarbon (HC) and carbon monoxide (CO) standards in 1980, with further tightening of the CO and nitrogen oxides (NOx) standards in 1981 and beyond. The original NOx emissions goal of 0.4 grams per mile is retained only as a research objective. In addition, the amendments would permit the Environmental Protection Agency (EPA) to waive the stricter CO standard for 1981 if it finds that this would be in the national interest and that it would not endanger public health. Furthermore, the EPA can allow small auto manufacturers more time to meet the NOx standard.

At present there are ambient air quality standards for six pollutants: sulfur dioxide, suspended particulates, carbon monoxide, photochemical oxidants, non-methane hydrocarbons, and nitrogen dioxide. Under the 1970 amendments, the primary standards, which are intended to protect public health, were to be achieved by 1975-76. The new law moves these deadlines to December 31, 1982, and allows for possible waivers of the carbon monoxide and photochemical oxidant standards until December 31, 1987. The legislation also mandates the EPA to review all the existing ambient standards by December 31, 1980, and every five years thereafter.

State implementation plans remain the principal mechanism by which the ambient air quality standards are to be achieved. For areas currently in violation of the standards, states must have implementation plans approved by July 1, 1979, under the 1977 law. These plans must include provisions for states to notify the public when any primary standard is exceeded. Further, if the plans are not submitted and approved, the EPA can block construction or modification of major emission sources in nonattainment areas.

In areas complying with the ambient standards, state plans must include provisions for the prevention of significant deterioration. Such areas must be designated as Class I, II, or III, depending upon the degree of deterioration that is to be permitted. Class I includes national parks and wilderness areas. All other areas are classified as Class II, with states free to reclassify them as Class I or Class III areas. Once designated, areas are subject to maximum allowable increases in sulfur dioxide and suspended particulate levels. The act also mandates the EPA to determine similar increments within two years for the other regulated air pollutants.

Other noteworthy requirements are placed on the EPA. One of these requires the EPA to promulgate visibility protection rules within two years. Another concerns allowable stack heights at stationary-source emitters. A third requires the EPA to study and report to Congress on comprehensive measures to protect the ozone layer within twenty-seven months of enactment.
The above examples indicate the wide variety of issues that will confront the EPA over the next few years. Such a diverse menu is likely to require new regulatory strategies and, undoubtedly, these will be accompanied by considerable controversy.

A new trend? The 1977 amendments exhibit two important characteristics that may signify a new trend in control policy: increased emphasis on state and local authority, and a move toward economic approaches to pollution control.

1. While retaining the basic regulatory approach, the new amendments confer more authority on state and local governments. For example, governors are given new authority regarding transportation control plans that include parking restrictions, gasoline rationing, and retrofitting noncommercial vehicles. In addition, governors may redefine boundaries of air quality regions (with the approval of the EPA administrator). They can also extend compliance orders of stationary-source polluters, and even suspend certain regulations in the event of emergencies.

On the local level, the amendments provide federal funds for local planning and bar the construction of major new pollution sources in a local area after June 30, 1979, if the area does not meet ambient standards and the implementation plan requirement. Finally, perhaps the most far-reaching provision allows the withholding of federal funds for projects (for example, highway construction) in any area where they would be inconsistent with implementation strategies.

Taken together, these aspects of the new act indicate decentralization within the regulatory framework. States and local areas will have more flexibility and control. Localities will be able, under many circumstances, to set stricter standards for pollution sources than those specified nationally. For example, any state can now adopt stricter auto emission standards provided the industry has two years' notice. Previously, this right was restricted to the state of California. Concurrently, the 1977 amendments are designed to stimulate interaction between federal and local authorities as well as heighten public awareness.

2. Economic approaches to pollution control are likely to play an increasing role in the future. Prominent examples in the new legislation are the use of noncompliance penalties and the emissions offset policy.
Modeled after the Connecticut plan, the penalties will be based on the cost of compliance. The rationale for this approach is that a firm that fails to meet a standard should not profit from delaying the installation of pollution control equipment and should not have an advantage over its competitors. While a far cry from a pure economic approach to pollution control, the noncompliance penalties represent a step in that direction. An even clearer example is seen in the noncompliance penalties applicable to heavy-duty vehicles (principally trucks, buses, and motorcycles). Here, penalties may vary by pollutant, by vehicle, or by engine. This concept is much closer to what economists would envision as an emission tax or emission fee.

Although formally introduced before passage of the 1977 amendments, the EPA's emissions offset (or tradeoff) policy is clarified in the new legislation. It allows for construction of new stationary sources (or expansion of existing sources) in a nonattainment area only when it can be shown that emissions from existing sources in that area will be reduced to an extent that will more than offset the new emissions. By placing the burden of proof on the potential and existing polluters, the emissions offset policy has actually helped to identify new and unknown sources of emissions in various areas. More important, however, the tradeoff policy has interesting implications for the future. Commenting favorably on the policy, the Council on Wage and Price Stability pointed to a time in which a market could develop for air emissions. That is, firms in compliance with relevant standards could sell emissions rights to buyers (firms seeking to increase emissions in the area). Such a marketlike structure would be strikingly similar to the property-rights approach to pollution control often advocated by economists.

It is now recognized by many environmental policymakers that the use of litigation as the dominant regulatory enforcement tool is a slow and costly process. The EPA is currently tied up in the courts over a multitude of regulations and procedures. The 1977 amendments and some of the innovations discussed above could represent a move toward more efficient pollution control. The most important elements of the legislation may well be those that deal with improving implementation of the laws. One of the last sections of the act calls for a study and report by the EPA in conjunction with the Council of Economic Advisers on economic measures for the control of air pollution. If successful, the study and its findings could represent an important new outlook for pollution control in the future.