Trump admin to toss Obama fines for CAFE violations

Source: Camille von Kaenel, E&E News reporter • Posted: Thursday, March 29, 2018

Siding with automakers, the Department of Transportation yesterday dumped the proposed Obama-era fines for failing to meet fuel economy targets.

The National Highway Traffic Safety Administration posted a draft regulation on its website that would overturn a proposal for increasing civil penalties in the corporate average fuel economy (CAFE) program. Heidi King, NHTSA’s deputy administrator, signed the notice yesterday, but it has yet to appear in the Federal Register.

The Obama-era rule would have increased fines from $5.50 to $14 for every one-tenth of a mile per gallon that manufacturers fell short of the standard.

The Alliance of Automobile Manufacturers and Global Automakers had petitioned the agency to reconsider the rule. Wade Newton, a spokesman for the alliance, said the trade group was “certainly pleased” about the proposal but reserved further comment because it is in active litigation.

The federal government has collected millions of dollars in civil penalties from automakers, some of which choose to pay the fines instead of meeting the fuel economy targets.

The fines were last updated in 1997. Congress passed legislation in 2015 to require agencies to adjust the fines for inflation.

NHTSA justified its reversal by making a “tentative determination” that the CAFE fines are exempt from the congressional mandate because they are not a “civil monetary penalty.”

Dave Cooke, senior vehicles analyst at the Union of Concerned Scientists, said the agency’s assertion “takes serious chutzpah”.

The decision is likely to be fought by environmentalists and Democrats, who called earlier delays on higher fines “nonsensical” (E&E Daily, July 12, 2017).

The Democratic attorneys general of California and New York and environmental groups last year sued the Trump administration over its delay of the Obama-era increase on fines (Greenwire, Sept. 11, 2017).

Automaker trade groups have intervened in support of the government. A hearing is set for April 12.

The NHTSA decision comes amid a wider rollback of the fuel efficiency rules. U.S. EPA is expected this week to announce the Obama-era targets for greenhouse gas emissions in cars made in 2022 to 2025 are “inappropriate” and suggest revisions in the months to come. NHTSA is considering targets as much as a third lower than the Obama proposal.

The safety agency will take comments on its proposal for the fines after its publication in the Federal Register.