Letter to The Honorable Michael S. Regan, Administrator, Environmental Protection Agency (July 20, 2023)

Summary

A letter dated July 20, 2023 from the House Committee on Small Business to the Honorable Michael S. Regan, Administrator of the Environmental Protection Agency, about the recent proposed rule change to the vehicle emissions standards for light duty passenger cars, light trucks, and medium-duty vehicles. The letter states that it appears the Environmental Protection Agency (EPA) may not have properly considered small entities during this rulemaking process. It requests information no later than August 3, 2023, and lists numbered questions, including how the updated tailpipe emissions standards would impact small businesses. The signature blocks name Roger Williams, Chairman, Blaine Luetkemeyer, Vice Chairman, and other Members of Congress on the Committee on Small Business.

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Full text

                                               July 20, 2023

The Honorable Michael S. Regan
Administrator
Environmental Protection Agency
1700 G Street NW
Washington, D.C. 20552

Dear Administrator Regan:

        The House Committee on Small Business writes to inquire about the recent proposed rule
change to the vehicle emissions standards for light duty passenger cars, light trucks, and
medium-duty vehicles. This rule would require that vehicles made after 2027 meet heightened
tailpipe emissions standards, require batteries within electric vehicles meet certain durability
requirements, and limit the number of non-electric vehicles that importers are permitted to
import annually.1 This proposed rule would require numerous small entities to re-engineer their
vehicles to comply with these increased standards, limit the supply of vehicles for Independent
Commercial Importers (ICI), and create new standards for battery longevity.2 It appears that the
Environmental Protection Agency (EPA) may not have properly considered small entities during
this rulemaking process.

        The EPA asserts that this rule would have minimal effects on small businesses, in part,
based on its claim that all small entity vehicle manufacturers in the United States specialize in
electric vehicles; this is untrue. Currently, Shelby Supercar Company makes the fastest domestic
production vehicle in the United States, and Hennessey Special Vehicles makes the second
fastest—both companies are small entities, and neither uses electric power units in its vehicles.3
Additionally, this proposed rule would adjust the standards for ICI’s such that they may only
import 25 vehicles each year that are non-zero emissions. Lastly, this rule proposes excepting
small businesses from its battery longevity requirements, despite this, numerous small firms will
be compelled into complying with these standards as they seek to grow their business.

       It is important for agencies to examine small businesses interests—which make up 99.9
percent of all businesses in the United States—when passing any new rule. America’s small
businesses deserve to have their voices heard and considered. It appears that the EPA’s
incomplete analysis has allowed it to avoid an important statutory requirement to hold a small

1
  Multi-Pollutant Emissions Standards for Model Years 2027 and Later Light-Duty and Medium-Duty Vehicles, 88
Fed. Reg. 29184 (2023) (to be codified at 40 CFR 85-86, 600, 1036-37, 1066).
2
  Id.
3
  Dustin Hawley, Worlds Fastest Production Vehicles, J.D. POWER (Last visited Jul. 14, 2023).
The Honorable Michael S. Regan
July 20, 2023
Page 2 of 3

business advocacy review panel to hear from impacted small businesses. We therefore request
the following information as soon as possible but no later than August 3, 2023:

1. In this rule, the EPA repeatedly states “(t)he small entity vehicle manufacturers in the market
   at this time only produce electric vehicles,” but there are indeed many notable small
   businesses that do not specialize in electric vehicles.4 What analysis was done to evaluate the
   current market participants that this rule would impact?

2. The list of ICI’s in EPA’s Draft Regulatory Impact Analysis includes only three companies,
   this represents a decrease of 50 percent over the past 10 years.5 How have emissions
   regulations such as this impacted ICI’s over that period?

3. Given that there are small entity manufacturers of non-zero emission automobiles, how
   would the updated tailpipe emissions standards in this rule impact small businesses?

4. Did the EPA consider how the cost increases associated with this regulation would impact
   small businesses further down the supply chain, such as those that rely on light and medium
   duty vehicles for their work?

       To schedule the delivery of your response or ask any related follow-up questions, please
contact Committee on Small Business Majority Staff at (202) 225-5821. The Committee on
Small Business has broad authority to investigate “problems of all types of small business” under
House Rule X. Thank you in advance for your cooperation with this inquiry.


                                                  Sincerely,




_________________________                                   _________________________
Roger Williams                                              Blaine Luetkemeyer
Chairman                                                    Vice Chairman
Committee on Small Business                                 Committee on Small Business




4
  Multi-Pollutant Emissions Standards for Model Years 2027 and Later Light-Duty and Medium-Duty Vehicles, 88
Fed. Reg. 29184 (2023) (to be codified at 40 CFR 85-86, 600, 1036-37, 1066); Worlds Fastest Production Vehicles,
J.D. POWER (last visited Jul. 14, 2023).
5
  U.S. ENV’T PROTECTION AGENCY, MULTI-POLLUTANT EMISSIONS STANDARDS FOR MODEL YEARS 2027 AND
LATER LIGHT-DUTY AND MEDIUM-DUTY VEHICLES DRAFT REGULATORY IMPACT ANALYSIS (Apr. 2015); U.S.
ENV’T PROTECTION AGENCY, INDEPENDENT COMMERCIAL IMPORTERS (ICI) LIST (Jun. 2015).
The Honorable Michael S. Regan
July 20, 2023
Page 3 of 3



_________________________        _________________________
Pete Stauber                     Dan Meuser
Member of Congress               Member of Congress
Committee on Small Business      Committee on Small Business




_________________________        _________________________
Jake Ellzey                      Aaron Bean
Member of Congress               Member of Congress
Committee on Small Business      Committee on Small Business




_________________________
Wesley Hunt
Member of Congress
Committee on Small Business


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