Federal Court Overturns Trump Administration’s Delay On Obama-Era Car Efficiency Rule

The three-judge panel of the New York City-based 2nd Circuit Court of Appeals ruled Monday that President Trump’s Department of Transportation (DOT) cannot delay an Obama-era regulation that increased automakers’ fines for “gas-guzzling” cars that violate the standards of the Corporate Average Fuel Economy (CAFE) program, saying it would issue a fully explaining opinion “in due course.”

“The fuel efficiency standards penalty rule is a common sense measure that would protect consumers’ pocketbooks while reducing the carbon emissions that harm our health and drive climate change,” New York Attorney General Eric Schneiderman (D) said in a statement.

“Today’s court order is a big win for New Yorkers’ and all Americans’ health and environment. As we’ve proven again and again, when the Trump administration puts special interests before public health and our environment, we’ll take them to court — and we will win.”

The Hill added:

Congress in 2015 instructed federal agencies to adjust fines and penalties to account for inflation.

That spurred the DOT’s National Highway Traffic and Safety Administration (NHTSA) to, in 2016, increase automakers’ fines under CAFE to $14 for each 0.1 mile per gallon that each car they sell exceeds the standards, up from $5.50.

Automaker groups asked the DOT to reconsider the increases, saying they would cost $1 billion and that falling fuel costs are making it harder for companies to sell enough efficient cars to meet the standards.

The DOT last year agreed to review the rule and decided to indefinitely postpone it in the meantime. The increased penalties were due to take effect for the 2019 model year, so the agency reasoned that automakers need a longer lead time to adjust to a new regulation.

Democratic state attorneys general and environmentalists sued Trump’s DOT, arguing that it didn’t have the legal authority for an indefinite delay.

The Trump administration pushed back, telling the court that the lawsuit was premature.

“When NHTSA announced that reconsideration in July 2017, the agency simultaneously announced that it was delaying the effective date of the earlier rule while the reconsideration was ongoing,” Justice Department attorneys wrote.

“The delay decision was merely an interim step in NHTSA’s continuing review of issues concerning the civil penalty rate applicable to future violations of CAFE standards for certain motor vehicles.”

The objections, the Trump administration argued, “can be presented to the agency, and to a court in an appropriate case after the reconsideration is complete.”