U.S. Federal Courts Vacate Federal Highway Administration Greenhouse Gas Rule
On Tuesday, April 2, 2024, in Commonwealth of Kentucky v. Federal Highway Administration¸ No. 23-162 (W.D. Ky.), the U.S. District Court for the Western District of Kentucky vacated the Federal Highway Administration December 2023 Greenhouse Gas Rule (see our prior blog post here for a more detailed summary of the Rule). That rule, proposed in July 2022 and modeled off of a rule proposed by the Obama administration in 2017 but repealed by the Trump administration before it could take effect, sought to require each state to set declining targets for tailpipe carbon dioxide emissions from vehicles on the National Highway System. Tuesday’s ruling follows a similar one from the U.S. District Court for the Northern District of Texas on March 28, 2024, in State of Texas v. U.S. Dep’t of Trans. No. 23-304 (N.D. Tex.) that purported to vacate the rule nationwide.
Twenty-one states, including Kentucky, sued to prevent enforcement of the rule, arguing that the rule forces states to dramatically revise transportation policies under a statutory program that merely authorizes the Federal Highway Administration to establish rules to collect data as a part of its assessment of the National Highway System. Such a regulation, the states argued, violates the major questions doctrine that requires explicit congressional authorization for rules of major economic or political significance.
The Federal Highway Administration maintained that the rule established a valid performance measure for greenhouse gas reduction across the country and was permissible as it did not mandate the amount or pace of greenhouse gas reduction and likewise did not include an enforcement mechanism to reduce emissions. But in siding with the states, the court found that any attempt by the federal government to step in and dictate state transportation standards and measures — as the Federal Highway Administration sought to do through the subject rule — exceeds the agency’s statutory authority. Moreover, the court found the rule was also arbitrary and capricious because states were projected to incur tens of millions of dollars in compliance costs to collect data already available to the federal government without providing any quantifiable benefits.
This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.
