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Record Does Not Support EPA Official’s Denials That He Made Untrue Statements When Testifying to Congress About New Pollution Rule

Oct. 13, 2003

Record Does Not Support EPA Official’s Denials That He Made Untrue Statements When Testifying to Congress About New Pollution Rule


Senate Committees Asked About a Crucial Change to “New Source Review” Rule Sought by Electric Utilities That Donated to Bush Campaign

WASHINGTON, D.C. – A U.S. Environmental Protection Agency official’s denial that he made untrue statements to two Senate committees regarding changes to a key Clean Air Act provision is contradicted by the record of his testimony as well as interviews with former EPA enforcement officials, Public Citizen said Monday.

In at least two media interviews, Jeffrey Holmstead, EPA assistant administrator of Air and Radiation, denied allegations in a Public Citizen report that his Senate testimony contained false information about the agency’s assessment of how revisions to the New Source Review (NSR) regulation would affect government lawsuits to clean up coal-fired electric plants.

The Public Citizen report cited documents and former EPA officials that contradict Holmstead, a Bush appointee. The report shows that Holmstead made untrue statements to the Senate Environment and Public Works and Senate Judiciary Committees in July 2002 when asked if a weakened New Source Review rule was expected to jeopardize lawsuits against electric utilities accused of modifying coal-fired plants in violation of New Source Review.

Contrary to what Holmstead told senators, EPA staffers had concluded that the new New Source Review rule would undercut enforcement cases that had the potential to reduce air pollution from U.S. electric utilities by 50 percent annually.

In an interview with the Associated Press that appeared in newspapers Oct. 10, Holmstead claimed that his Senate testimony referred to a list of seven proposals relating to New Source Review that had been issued weeks before the hearing – and “not on the overall rule change that would not be finished for many months.”

But the record of the hearing shows that Holmstead was responding to an inquiry from Sen. Patrick Leahy (D-Vt.) about the EPA’s “90-day report on NSR.” That report, issued in June 2002 (click here to view) included seven proposals for changes to the New Source Review program – including a change to the “routine maintenance” exemption that allows utilities to ignore Clean Air Act requirements if generating plant modifications are routine and fall below a certain dollar threshold.

The “routine maintenance” change is the New Source Review rule at issue in Public Citizen’s report that Holmstead is disputing.

In an Oct. 10 Washington Post story, Holmstead also denied Public Citizen’s allegations, claiming, “What we had been told by the [EPA] Office of Enforcement and [Department of] Justice was that the report and the recommendations that we had released just prior to that hearing would not have an adverse impact on the enforcement cases. We emphasized five or six times that the rule was prospective and that any activities taken at these plants prior to the rule would still be subject to the old regulations.”

These claims are contradicted by interviews with two former EPA officials cited in the Public Citizen report – both from the EPA Office of Enforcement and Compliance Assurance (OECA).

Sylvia Lowrance, former acting assistant administrator of the OECA, said Holmstead was among the officials present at many meetings where enforcement officials expressed strong opposition to a significant portion of the “routine maintenance” rule because of its potential effect on existing cases. And Eric Schaeffer, chief of civil enforcement at the agency until March 2002 and now head of the Environmental Integrity Project, backs up Lowrance’s description of events.

Lowrance and Schaeffer also told Public Citizen that making the new New Source Review rule “prospective” – as opposed to “retroactive” – did not mollify the enforcement staff’s concern that the change would jeopardize ongoing lawsuits. As documented in the Public Citizen report, electric utilities facing New Source Review lawsuits filed in 1999 have now begun citing the new routine maintenance rule as part of their defenses. In addition, the Department of Justice filed a September 2003 brief in an Illinois case in which it abandoned its previous argument that the court must apply a narrow interpretation of the New Source Review language in the Clean Air Act; experts say this kind of concession could jeopardize New Source Review lawsuits.

Click here to read the Public Citizen report, EPA’s Smoke Screen: How Congress Was Given False Information While Campaign Contributions and Political Connections Gutted a Key Clean Air Rule, online