WATER POLICY

USDA chief played major backstage role on hot-button rule

Agriculture Secretary Tom Vilsack was a key player behind the scenes over the past two years as the Obama administration tried to keep its contentious Waters of the U.S. rule afloat in the face of swelling opposition from rural America.

Schedules obtained by Greenwire under the Freedom of Information Act show that U.S. EPA Administrator Gina McCarthy had frequent meetings and phone calls with her fellow senior administration official between the spring of 2014 and the day the final rule was unveiled this May.

Some of the meetings are specifically identified as being about the water rule; in other cases, McCarthy had time blocked off beforehand to prepare with top EPA water office and general counsel staff who led work on the water rule.

Although it's no secret the farm community had a deep interest in the controversial rule, the level of Vilsack's involvement could help explain key changes made by EPA and its regulatory partner, the Army, in the final version of the rule as opposition from powerful agricultural groups threatened to kill the effort.

Those changes have been vociferously criticized by the Army Corps of Engineers' on-the-ground experts, and have emerged as top legal vulnerabilities as the final rule is being challenged in courts across the country. Just as significant, the changes have done little to calm the rule's most prominent critics.

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But former administration officials who were previously involved with the rule say Vilsack may have been one of the prime constituencies the agencies were aiming to please.

"If Secretary Vilsack was personally opposed to this [rule], it wouldn't go," said a former Army Corps official who spoke on the condition of anonymity. "It was 100 percent the attention to rural issues that Secretary Vilsack had a pulse for, and the administration listened to him as sort of their main counsel on rural issues."

Department of Agriculture spokeswoman Cathy Cochran said Vilsack and McCarthy have lots of areas of common interest and speak with each other regularly.

"For our part, USDA manages the national forests, works closely with farmers and ranchers in food production, has partnered with landowners to achieve a record number of acres in conservation programs, and introduced new efforts for climate smart agriculture and forestry to reduce greenhouse gas emissions and ensure cleaner air and water," she said by email. "Our work with the EPA is an important part of making this work effective."

Moreover, Cochran noted that the agricultural community was a key stakeholder in the water rule.

"Secretary Vilsack has spoken regularly and publicly about urging EPA to listen to input from farmers and agri-business owners as they developed the rule, and changes made to the final rule reflected that input," she said.

Ag industry opposition

Power players in the agricultural community, led by the American Farm Bureau Federation, have vehemently opposed the water rule, which is aimed at clearing up legal confusion over which streams and wetlands are protected under the 1972 Clean Water Act. They argue the rule represents a sweeping expansion of federal power and could end up subjecting farmers to expensive and time-consuming permitting processes -- or fines -- for everyday activities like spraying pesticides or spreading manure.

Agricultural groups launched a major public relations campaign and generated thousands of comments in opposition to the rule. The regulation also became a hot topic on Capitol Hill, where lawmakers have held more than a dozen hearings on it.

Although USDA has no regulatory role under the Clean Water Act, Republican and a handful of farm-state Democratic lawmakers pressured Vilsack to intervene to stop the EPA and corps rule.

While Vilsack told lawmakers he had relayed farm communities' concerns to the agencies, he refused to press further.

"It's not our decision to make -- it's our sister agency, and we have to respect that," he told the House Agriculture Committee during a Feb. 11 hearing (E&E Daily, Feb. 12).

However, McCarthy's schedules suggest the government's lead promoter of American agriculture -- a former Iowa governor -- had a seat at the table as the administration developed the final rule.

In September 2014, after a summer of grass-roots campaigning by both supporters and opponents of the rule that piqued strong concerns in farm country, Vilsack joined a "WOTUS principals" conference call with McCarthy, then-Council on Environmental Quality head Michael Boots, Assistant Secretary of the Army for Civil Works Jo-Ellen Darcy and several aides.

The late-morning phone huddle Sept. 9 came as the House of Representatives stood poised to vote on a measure to kill the water rule.

Just 15 minutes after the conference call was slated to end, McCarthy called Vilsack for a brief one-on-one discussion, the schedules show.

That evening, House Republicans pulled 35 Democrats, largely from farm states, to their side in roundly approving a measure to squelch the water rule. Just days later, state agriculture commissioners voted unanimously to call for withdrawal of the rule.

But likely the most pivotal meeting between McCarthy and Vilsack came in early March of this year, as EPA and the corps were scrambling to make changes to the final rule before sending it to the White House for interagency review.

On March 10, four weeks before the final package was sent to the White House, McCarthy's schedules show she made the trip to USDA's beaux-arts-style headquarters for an hourlong conversation with Vilsack in his second-floor office.

The meeting appears to have had two main topics: the Waters of the U.S. rule and a report from the federal government's Pollinator Health Task Force, which is co-chaired by EPA and USDA. McCarthy received 30-minute pre-briefings on each topic with lead staff for the efforts the week before the meeting, according to records.

For the trip to USDA, the schedule shows the administrator was accompanied by several members of her staff, including then-Office of Water head Ken Kopocis and agriculture adviser Ron Carleton.

Darcy, the top Army official overseeing the corps and McCarthy's partner in the Clean Water Act rulemaking, is not listed on the schedule.

Instead, two days later, McCarthy and three of her key advisers hosted Darcy, as well as her legal counsel and an aide, for a 45-minute-long tête-à-tête, the records show.

The schedule gives no description of the topic, but leaked memos from the Army Corps' legal and technical experts indicate that March was when one of the most controversial changes in the final water rule -- hard distance limits for when a wetland is too far away from the river network to fall under the scope of the Clean Water Act -- was first floated to corps experts (Greenwire, July 27).

A provision placing certain wetlands that would otherwise be covered by the Clean Water Act outside the law's scope if they're currently in agricultural use was also dropped into the final version of the rule at the tail end of the process, the corps memos say.

Environmental groups are challenging both provisions in the courts.

Over the two weeks after the meeting with Vilsack, schedules show McCarthy met with the Office of Research and Development team that spearheaded the scientific report underpinning the rule and had calls with National Wildlife Federation President Collin O'Mara and Natural Resources Defense Council President Rhea Suh, whose organizations have been the lead proponents of the Obama administration's rule.

EPA didn't share details of what was discussed in the meetings and calls, or whether changes made in the final rule were aimed at Vilsack's concerns. But spokeswoman Monica Lee emphasized that the agencies reached out broadly for weigh-in on the rule and responded to those comments.

"In developing the rule, the agencies held more than 400 meetings with stakeholders across the country, reviewed over 1 million public comments and listened carefully to perspectives from all sides," Lee said by email. "A number of the changes to the final rule were made in response to input from the agricultural community."

Cooperation is commonplace

To be sure, coordination between agencies is a regular part of any new regulation.

A former EPA official who spoke on the condition of anonymity said the agency considers it to be a good government practice.

"No one agency is able to push any sort of rulemaking through on their own will," the former official said. "It's a process of getting feedback from all parts of the government, and that's what makes the interagency process good, and that's what happened here."

Moreover, Ferd Hoefner, policy director for the National Sustainable Agriculture Coalition, said USDA has a history of helping regulatory agencies and farmers understand each other.

For instance, he said the department played a critical part in making a recent Food and Drug Administration rule pertaining to produce safety workable for farmers on the ground.

"Some of the things that USDA was able to achieve with FDA over the food safety rule both improved the regulation and made the reaction of the agricultural community far more positive than it would have been," Hoefner said.

But Kelly Hunter Foster, a senior attorney with Waterkeeper Alliance, one of the green groups challenging the water rule as too weak, said the agriculture sector is the leading source of key pollutants overwhelming the country's rivers and streams.

"The USDA does not have a Clean Water Act regulatory role but does provide the EPA with technical support in addressing agricultural pollution problems," Hunter Foster said. "But whether or not a water body is a water of the United States and subject to the Clean Water Act is a different question, and one on which I do not believe they possess a particular expertise."

It's clear that USDA's involvement with the water rule didn't begin as the rule was nearing finalization.

Before the rule was initially proposed, the department worked with EPA and the corps to develop an interpretive rule for agriculture and an accompanying list of 56 conservation practices that were to be exempt from Clean Water Act regulation under the rule.

That effort was widely panned by both supporters and opponents of the overall rule effort, and it was blocked by Congress last year.

More outreach

Vilsack wasn't the only player whose views on the water rule McCarthy cared about.

Moderate Democrats -- vital swing votes on the issue in the Senate -- had her ear during key periods of work on the water rule.

For instance, on May 12, 2015, about two weeks before the final rule was released, Senate Agriculture ranking member Debbie Stabenow (D-Mich.) introduced McCarthy at a 45-minute-long meeting with committee members from her side of the aisle that was attended by Kopocis, the records show.

Meanwhile, the administrator was meeting personally with many outside groups on the rule, ranging from the Iowa Cattlemen's Association to a coalition of green groups.

But two organizations received extra attention from the EPA boss: the National Farmers Union and Ducks Unlimited.

With the rule facing an onslaught of opposition from agricultural groups, property rights advocates and conservative opinion makers, a clear statement of support from either of the two groups would have been a major coup for the administration. The groups were also some of the few representing key constituencies affected by the rule that were willing to engage substantively with the agencies.

To political operatives, NFU appeared to be the most winnable agricultural group for the administration's water rule effort. The organization tends to be made up of smaller-scale family farmers and ranchers and has more of an interest in conservation than other large agricultural groups.

Moreover, its members had long wanted to clear up confusion around the scope of the Clean Water Act, and President Roger Johnson had initially welcomed the proposed rule as an attempt to do so. But after digging into the details of the proposal and hearing the rest of the farm community's concerns, the group raised its own worries about the effort.

As concerns over the proposed rule and the muddled interpretive rule swirled in the weeks after their release in the spring of 2014, McCarthy spent half an hour with NFU's vice president for programs, Chandler Goule, records show.

At the time, the EPA leader was reaching out broadly to the farm community, also talking with the National Association of Conservation Districts and the National Association of State Departments of Agriculture, her schedule indicates.

But NFU quickly emerged as a top priority for the administrator's attention, with a number of meetings and calls between McCarthy and representatives from the group listed on her schedule after the rule was proposed.

She had a call with NFU's executive committee, held multiple meetings with the group's president and made two speeches to its members.

The latter speech came in Kansas in March, a week after the meeting with Vilsack at USDA headquarters. The address was a major overture to the agricultural community in which she promised important changes in the final rule (E&ENews PM, March 16).

Meanwhile, Ducks Unlimited was another player McCarthy invested significant amounts of time in.

The group has a deep interest in one of the specific areas of confusion around the Clean Water Act's reach that the rule was aiming to clear up: so-called isolated wetlands like those in the Dakotas' Prairie Potholes.

The Prairie Potholes region, sometimes called the continent's "duck factory," produces more than 50 percent of North American migratory waterfowl. But Clean Water Act protection for its wetlands was thrown into regulatory confusion following a 2001 Supreme Court decision.

With DU's membership made up primarily of politically conservative sportsmen, many with strong ties to the agricultural community, support from the group would have made for powerful political ammunition for backers of the rule.

A DU spokesman told Greenwire that the group's conversations with EPA on the rule were focused on two issues: maintaining the Clean Water Act's agricultural exemptions and ensuring that the rule was based on strong science with respect to far-flung wetlands like the Prairie Potholes.

But even as DU's lead scientist provided hundreds of pages of detailed comments and testimony throughout years of work on the issue, the organization had steered clear of advocacy around the rule.

The day after the rule was proposed in March 2014, McCarthy had DU CEO Dale Hall join her and lead EPA staff for the water rule in her office for a 30-minute meeting, according to the schedule.

Over the next 14 months, the EPA leader had several more meetings with DU leaders, records show. She even scheduled a 45-minute-long conference call with the group's board members and executive staff while she was on the road in Vermont last October. The records show McCarthy dialed in from a USDA conference room in St. Albans, Vt.

The EPA leader also touched in one last time with both Ducks Unlimited and the National Farmers Union on May 18, just over a week before the final rule was unveiled, records show.

But it's not clear that all that top-level attention paid off for the administration.

While key moderate lawmakers -- namely Sens. Amy Klobuchar (D-Minn.) and Angus King (I-Maine) -- flipped back to supporting the water rule this fall after signaling worries with the proposed version, DU stopped short of a full-throated endorsement, and NFU ultimately came out in opposition to the rule.

"National Farmers Union does not support the final Clean Water Rule because our policy opposes any expansion of jurisdiction under the Clean Water Act," Johnson, NFU's president, said in a statement to Greenwire. "We do, however, understand that the guidance and advice we offered the Environmental Protection Agency resulted in the Agency making meaningful improvements to the rule between the proposed and final versions. We appreciate EPA's willingness to meet and consider the concerns of our members."

Rule facing legal hurdles

Meanwhile, as the battle over the water rule moves to the courts, some of the changes made in the final version that were aimed at alleviating key constituents' concerns are now emerging as its greatest vulnerabilities.

The complex litigation is only at the beginning of what promises to be a yearslong process, but already the rule is facing trouble.

Last month, the 6th U.S. Circuit Court of Appeals temporarily halted the rule's implementation, pointing specifically to the hard distance limit set in the final rule.

Those limits, aimed at alleviating farmers' concerns, were a potential legal problem, the court ruled, for both procedural and scientific reasons.

"Their argument that 'bright-line tests are a fact of regulatory life' and that they used 'their technical expertise to promulgate a practical rule' is undoubtedly true, but not sufficient," the three-judge panel ruled.

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