IIAR

President Trump made regulatory reform a priority during the campaign and pledged to provide industry relief from overly burdensome regulations.Since President Trump took office, he has initiated a number of actions to advance regulatory reform that will impact the industrial refrigeration industry.

INITIAL “FREEZE” ON REGULATIONS

On January 20th, White House Chief of Staff Reince Priebus issued a memo directing agencies to freeze activity on late term Obama regulations.The Memorandum asked departments and agencies to:

• Send no regulations to the Federal Register until a department or agency head appointed or designated by the President after noon on January 20, 2017, reviews and approves the regulation.
• For regulations that have been sent to the Federal Register, but not yet published, immediately withdraw them (subject to the exceptions described above and consistent with Federal Register procedures).
• For regulations that have been published in the Federal Register but have not taken effect, temporarily postpone their effective date for 60 days for the purpose of reviewing questions of fact, law, and policy (and possible further review).
• Regulations subject to statutory or judicial deadlines are excluded.

EXECUTIVE ORDER 13771

On January 30, 2017, President Donald Trump signed an Executive Order entitled “Reducing Regulation and Controlling Regulatory Costs.” The action addresses a promise he made on the campaign trail to curtail the impact of federal regulations. The Executive Order institutes a policy that for every one new regulation issued, at least two prior regulations must be identified for elimination.The new policy applies to “major” regulations that have at least a $100 million annual impact.

The order also calls for the reduction in costs of regulations and places a cap of zero dollars on new regulations for the remainder of fiscal year 2017. Any new incremental costs associated with new regulations in 2017 must be offset with the elimination of existing regulatory costs. Beginning in fiscal year 2018, each agency will be given a set budget for regulatory expenses. Agencies will be required to identify budget offsets for any regulation that is estimated to have increased costs in that fiscal year.

EXECUTIVE ORDER 13777

President Trump followed his first Executive Order on regulatory reform with a second order that provides additional details on the process by which agencies should review regulations.Executive Order 13777 directs each agency to name a Regulatory Reform Officer and a Regulatory Reform Task Force. The task forces will identify outdated, unnecessary and ineffective regulations. Initial reports are due 90 days from the issuance of the order.The order includes an accountability mechanism, so agencies will be measured on their success in following the new policies.

REGULATORY REFORM AND RMP FINAL RULE

The Environmental Protection Agency (EPA) completed it multi-year effort to revise the Risk Management Program (RMP) regulation with the publication of a Final Rule on Friday, January 13, 2017, just one week before President Trump took office.The original effective date of the Final Rule was March 14, 2017.However, the Trump Administration put a “freeze” on all regulations finalized at the end of the Obama Administration.This included a delay of the RMP rule until March 21, 2017. In late February, a petition was filed by industry with EPA requesting a further delay in the effective date of the regulation.Administrator Scott Pruitt moved quickly to extend the effective date by an additional 90 days, to June 19, 2017. Pruitt also published a Proposed Rule that would make the effective date February 19, 2019.

IIAR helped lead a coalition of industry groups in submitting comments supporting the delay until February 2019.The extended delay will give the new policy officials within the Trump Administration time to consider the concerns that have been raised regarding the Final Rule and evaluate potential improvements to the regulation.The comment period for the Proposed Rule closed on May 19, 2017.EPA will now review the comments received and move forward with drafting a Final Rule regarding the revised effective date.

IMPACTS ON OSHA AND DOL REGULATIONS OSHA

began the process of considering changes to the Process Safety Management (PSM) regulation during the Obama Administration, similar to EPA’s efforts to change RMP.OSHA’s rulemaking process generally takes longer that EPA, and the agency was not able to get to the Proposed Rule stage before the change in administrations.As a result, it is very unlikely that OSHA will advance its rulemaking efforts on PSM for the foreseeable future.

In addition to halting rulemaking efforts on PSM, the Trump Administration has also taken action to stop or delay other OSHA regulations finalized late in the Obama Administration.On May 17, 2017, OSHA announced that it intends to extend the initial date by which certain employers are required to electronically submit their injury and illness logs.The Recordkeeping Rule currently requires certain employers to submit the information from their completed 2016 Form 300A to OSHA electronically by July 1, 2017. The extent of the delay is not known at this time, but the move signals that the new Administration shares some of the concerns raised by industry about the public posting of injury and illness logs.

On May 23, 2017, the Department of Labor (DOL) sent a new proposed rulemaking to the White House Office of Management and Budget that would rescind the Obama administration’s persuader rule. The persuader rule altered the advice exemption under the Labor Management Reporting and Disclosure Act, effectively interfering with both employers’ access to legal advice on labor matters and attorney-client privilege. The new policy would effectively discourage employers from engaging with attorneys and other experts during the course of a union campaign.The rule was permanently enjoined by a U.S. District Court in November 2016.

The Trump Labor Department has decided not to appeal the ruling and is moving forward with rescinding the regulation. The Trump Administration has moved to officially withdraw a letter of interpretation issued by the Obama Administration In 2013 that granted union representatives permission to accompany OSHA inspectors on walk around inspections at non-union workplaces. The LOI was in response to a request from organized labor to change the original policy that stated employee representatives “shall be” employees of the employer unless third parties could provide specific expertise such as language interpretation or technical expertise.The LOI expanded this to include union representatives as identified by employees. The Trump Administration’s withdrawal came as part of a settlement arising from an industry challenge to the LOI.

Congress has also been active in addressing regulations finalized late in the Obama Administration.The Congressional Review Act (CRA) give Congress the authority to disapprove of regulations within 60 legislative days of becoming final. Until 2017, the CRA was only used successfully once, to stop an OSHA ergonomics rule at the beginning of the George W. Bush Administration. Congress has passed, and President Trump has signed, 14 CRA resolutions in 2017.

Once such effort addressed an OSHA regulation known as the Volks Rule. The regulationthat would extend to five years the explicit six-month statute of limitations on recordkeeping violations in the Occupational Safety and Health (OSH) Act.The new policy was counter to the underlying statutory authority and went against multiple appeals court rulings on OSHA’s statute of limitations on recordkeeping violations. Congress successfully utilized the Congressional Review Act to disapprove of the regulation and President Trump signed the resolution into law.

SUMMARY

President Trump’s actions to reform the regulatory process and walk back certain Obama regulations signal a significant shift in the regulatory climate. The new policy direction should prove helpful in mitigating the impact of late term Obama regulations and slow the development of new regulatory burdens that may impact the industrial refrigeration industry.IIAR will continue to actively engage with new policy officials and like-minded industry partners as regulatory reform efforts move forward.