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PA Chamber Leads Coalition Urging EPA to Withdraw Controversial Water Rule

HARRISBURG – A coalition of 24 state chambers, led by the Pennsylvania Chamber of Business and Industry, has submitted a comment letter to the Environmental Protection Agency (EPA), calling for the withdrawal of a controversial water quality rule which the agency recently proposed.

In its letter, addressed to EPA Assistant Administrator Radhika Fox, the multi-state coalition raises significant concerns about the proposed rule, specifically questioning the data and methodology used in the agency’s decision to classify four additional chemical compounds as contaminants under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).

While the coalition expressed support for the establishment of a comprehensive national drinking water standard for certain chemicals, its comment letter highlights several problems with the EPA’s current proposal – asserting that the costs associated with the proposed rule are substantial and likely underestimated.

The coalition cites the potential costs of implementing the proposed maximum contaminant levels (MCLs) for two compounds, perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS), estimating an annualized cost of approximately $1.8 billion. This figure represents more than double the EPA’s own estimated costs provided in the agency’s economic analysis.

Consequently, the coalition warned that the implementation of this proposed rule could lead to sharp increases in household water costs (up to $1,000 per month) in communities nationwide.

The coalition letter outlines the following key concerns:

  • Insufficient data on occurrence levels at the proposed maximum contaminant level.
  • The introduction of a novel hazard index approach for certain chemicals, raising technical, scientific, and legal questions.
  • Limited understanding of the risks associated with the proposed MCL.
  • The necessity of considering costs and benefits as required by the Safe Drinking Water Act.

Moreover, the coalition indicates that the proposed rule fails to consider the costs of Superfund cleanups, given the pending CERCLA hazardous substance designation for PFOA and PFOS.

As a result, the letter requests the EPA withdraw its proposal and await the outcomes of the ongoing Unregulated Contaminant Monitoring Rule (UCMR) 5 process before proceeding with a regulatory determination. In its conclusion, the coalition letter stresses that these outsized costs are avoidable and urges the EPA to adopt a more reasonable and defensible approach.

The letter is available here and was signed by the following state chambers:

  • Arizona Chamber of Commerce and Industry
  • Greater North Dakota Chamber
  • Idaho Association of Commerce & Industry
  • Illinois Chamber of Commerce
  • Indiana Chamber of Commerce
  • Iowa Association of Business and Industry
  • Kansas Chamber of Commerce
  • Kentucky Chamber of Commerce
  • Maine State Chamber of Commerce
  • Maryland Chamber of Commerce
  • Michigan Chamber of Commerce
  • Minnesota Chamber of Commerce
  • Missouri Chamber of Commerce and Industry
  • Nebraska Chamber of Commerce & Industry
  • New Jersey Business & Industry Association
  • New Mexico Chamber of Commerce
  • North Carolina Chamber
  • Ohio Chamber of Commerce
  • Oregon Business & Industry
  • Pennsylvania Chamber of Business and Industry
  • South Carolina Chamber of Commerce
  • Tennessee Chamber of Commerce & Industry
  • Virginia Chamber of Commerce
  • Wisconsin Manufacturers & Commerce

On the Hill: PA Chamber Marks Progress on Top Legislative Priorities

The PA Chamber has made major policy strides this session on behalf of our broad-based membership and has identified three legislative areas as top priorities for the current session: tax reform, permitting reform, and workforce development.

We know that Act 53 of 2022 brought us decades’ worth of tax reforms, including reducing our state’s corporate net income tax rate in half by 2031, but more progress remains! Topping the PA Chamber’s priority list are two additional tax reforms that will make our tax code even more competitive and enticing for investment and job creation:

  • Accelerating the CNI Phasedown: Should we really have to wait nearly a full decade to realize the benefits of Act 53? Accelerating the CNI phasedown would make even greater strides toward the PA Chamber’s mission of bringing jobs, investment and economic opportunity back to PA – and Gov. Josh Shapiro and a strong bipartisan group of lawmakers have already voiced their support! S.B. 345 was reported from the Senate Finance Committee in a bipartisan vote and would bring the CNI rate down to 4.99% by 2026, 5 years sooner than what was enacted in Act 53.
  • Improving the Treatment of Net Operating Losses: Right now, Pennsylvania is one of only two states that cap NOL deductions below the federal limit of 80% – a major red flag to employers, and one that especially hurts start-ups and small to mid-sized businesses. Improving treatment of NOLs will generate a fairer tax system, which will promote future growth and make the Keystone State a more attractive place to do business overall. S.B. 346 was reported from the Senate Finance Committee unanimously and would raise Pennsylvania’s cap from 40% to 80% by 2027.

We’ve also laid out a comprehensive set of permitting reform solutions to modernize our current process and keep Pennsylvania competitive with other states. Our team has been advocating for these solutions at the state and federal level, and our efforts have garnered significant attention and legislative action.

Most recently, the state Senate answered our calls for reform by passing S.B. 350, requiring state agencies to create an accessible tracking system for applicants to check on the status of their permit applications as they move through the process. The bill also lays out a timeframe in which permits must be reviewed and issued, or otherwise be “deemed approved,” and provides for expanded use of third-party contractors to review applications – a big part of helping permits move through the process more expediently. The bill now awaits action in the House, and we’re urging House lawmakers to pass it without delay.

Finally, our multi-faceted workforce development strategy is targeted toward closing the job skills gap and helping to develop the next generation of skilled, inspired workers.  This includes:

  • Supporting employers and employees as they work through childcare challenges, encouraging resources be directed toward an “all of the above” childcare benefits strategy.
  • Encouraging reentrants and individuals with criminal records to reenter the workforce, including by expanding 2018’s groundbreaking Clean Slate law, which seals old criminal records so individuals have the confidence to get back to work and employers can help close workforce gaps – a win-win for workers, business owners and the economy!
  • Engaging across a number of workforce development policies that will build the workforce of tomorrow, and encourage people to live, work and raise families in Pennsylvania.

Senate Answers Call on Permitting Reform; Tax Bills Clear Committee

Last week, the Pennsylvania Senate voted to pass a comprehensive permitting reform bill that addresses several of the business community’s top concerns regarding the current process, while two committees advanced a suite of proposals to improve Pennsylvania’s tax competitiveness and enhance the permit appeals process, respectively.

Here are the highlights from last week’s session:

 

Permitting Reform

The PA Chamber coordinated a broad coalition of chambers of commerce and other statewide employer associations in sending a letter to Gov. Shapiro and state lawmakers last Monday calling for reforms to Pennsylvania’s system of issuing state permits for construction and other projects. Two days later, a bipartisan majority of senators voted to pass Chamber-supported legislation, Senate Bill 350, sponsored by Sen. Kristin Phillips-Hill (R-York).

Senate Bill 350 would require state agencies that issue permits to post information about the permits they grant on their website, create an accessible tracking system for applicants to check on the status of their applications, and clearly state the legal authority on which the agencies rely when rejecting a permit application. Moreover, the bill establishes a timeframe in which permits must be reviewed and issued – or otherwise be “deemed approved,” and provides for expanded use of authorized third-party contractors to review applications.

The PA Chamber sent a memo to Senate lawmakers last Wednesday, urging their support for this critical legislation. Senate Bill 350 later passed by a bipartisan vote of 29-19.

In a statement, PA Chamber President Luke Bernstein hailed the bill’s passage as a “generational opportunity” to enact reforms that “would lead to more jobs, greater transparency, and ultimately, a stronger economy.” To read the Chamber’s full statement on Senate Bill 350, click here.

Additionally, Bernstein joined Sen. Phillips-Hill on an episode of her podcast, Kristin’s Corner, prior to the vote to discuss the positive impacts this legislation would have on Pennsylvania’s economy. To listen to their conversation, click here.

The Senate Environmental Resources and Energy Committee separately voted on Wednesday to advance Senate Bill 198. Sponsored by Sen. Camera Bartolotta (R-Washington), the bill aims to improve the state’s permit appeals process. The PA Chamber sent a memo to committee members ahead of its consideration to express support for the proposal, which later passed by a vote of 7-4.

 

Business Tax Reform

The PA Chamber coordinated a separate letter from employer and industry associations to the governor and legislators last Monday urging them to build on the historic, bipartisan tax reforms accomplished last session to further improve Pennsylvania’s business tax competitiveness. On Wednesday, the Senate Finance Committee advanced proposals to expedite the reduction of Pennsylvania’s corporate net income tax (CNIT) and improve the treatment of net operating losses (NOLs) in the state tax code.

Senate Bill 345, sponsored by Senate Majority Whip Ryan Aument (R-Lancaster), would accelerate the CNIT phasedown, immediately reducing the tax rate to to 7.99 percent and enacting a full percentage-point annual reduction until it reaches 4.99 percent in 2026, five years sooner than the timeline established by the enactment of Act 53. The bill passed with bipartisan support.

Senate Bill 346, sponsored by Senator Greg Rothman (R-Cumberland), would increase the limit on previous years’ business NOLs that employers can carry forward and deduct from its profits in a given tax year. Pennsylvania is currently one of the only states whose treatment of NOLs is not at least consistent with the federal tax code. This unfortunate distinction makes Pennsylvania less competitive and unattractive to investment, particularly from start-up companies that frequently suffer losses in their early years. S.B. 346 would raise the cap on NOL deductions (currently 40 percent of taxable income) by ten percent annually until it reaches the federal limit of 80 percent in 2027. The bill passed committee with unanimous support.

The PA Chamber robustly supports Senate Bill 346, which would put Pennsylvania on par with 48 other states and federal tax laws – helping us attract new and additional business investment into the Commonwealth.

Both bills will be eligible for consideration by the full Senate when lawmakers return in June.

PA Chamber Statement on Senate Passage of S.B. 350

HARRISBURG – Today, Pennsylvania Chamber of Business and Industry President and CEO Luke Bernstein released the following statement after the Pennsylvania Senate voted to pass S.B. 350, legislation that would enact meaningful and necessary reforms to the state’s permitting system:

“We have a generational opportunity within our grasp to advance a significant permitting reform bill that would lead to more jobs, greater transparency, and ultimately, a stronger economy. Senate Bill 350 takes a giant step forward propelling our state to become more competitive.  By building on the governor’s efforts to improve permitting, this measure further helps to modernize, streamline, and add much needed transparency to the permitting process. The PA Chamber is proud to support Senate Bill 350 and be part of the solution that will help Pennsylvania become more competitive. From crafting this bill to ushering it through committee and ultimately the entire Senate, I want to thank Senators Kristin Phillips-Hill and Greg Rothman for their leadership and tireless dedication on this issue.”

Earlier this week, the PA Chamber led a coalition of 68 leading industry associations and chambers of commerce in urging the governor and legislature to enact meaningful permitting reform this session. Moreover, Senate Bill 350’s provisions are consistent with the PA Chamber’s permitting reform plan, an approach endorsed by the Pennsylvania Building and Construction Trades Council in a joint op-ed written by the leaders of both organizations which was published in various outlets this spring.