States Sue Trump Administration Over CAFE Fines

Suit comes on heels of similar action by environmental groups.

by on Sep.13, 2017

New York Attorney General Eric Schneiderman is one of five attorneys general suing the Trump Administration over CAFE fines.

Five states, including California and New York, have sued the federal government for delaying larger penalties for automakers with vehicles that fail to meet minimum U.S. fuel-economy standards.

The state lawsuit, which also includes Vermont, Maryland and Pennsylvania, follows a separate lawsuit filed earlier by three major environmental groups, including the Natural Resources Defense Council and the Sierra Club.

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The lawsuits are the first skirmishes in what could be a protracted legal battle between the Trump administration and environmental groups and states opposed to the Trump administration efforts to roll-back fuel economy standards and emission controls enacted by the Obama administration.

The Obama-era rules require carmakers to meet a 54.5-mile-per-gallon fuel economy standard. “We will hold the Trump administration accountable,” California Attorney General Xavier Becerra said in a statement.

(Environmental groups sue over CAFE penalties. For the story, Click Here.)

The lawsuit was filed in the U.S. Court of Appeals in New York and follows a separate suit by three environmental groups over the delay. The U.S. Transportation Department has not commented on the lawsuits, which challenge the National Highway Traffic Safety Administration’s decision in July to suspend a 2016 Obama administration regulation that more than doubled penalties.

Three environmental groups filed suit after the Trump administration attempted to delay an increase in penalties for failing to meet CAFE standards.

Automakers have complained about the hike, saying it could increase industry compliance costs by $1 billion annually. The rules, however, follow a number of cases in which automakers either submitted flawed data on compliance with fuel economy standards to the Environmental Protection Agency or false data as in the case of Volkswagen AG, which used a defeat device to falsify the results of critical emission tests.

Congress ordered federal agencies in 2015 to adjust civil penalties to account for inflation and, in response, NHTSA proposed raising fines to $14 from $5.50 for every 0.1 mile per gallon of fuel that new cars and trucks consume in excess of required standards under the Corporate Average Fuel Economy (CAFE) program.

(Click Here for more about the DOT’s new guidance for autonomous vehicle testing.)

“State attorneys general have made clear: we won’t hesitate to act when those we serve are put at risk,” New York Attorney General Eric Schneiderman said in a statement.

In June, Schneiderman and attorneys general from 12 other states vowed to take legal action to block rolling back vehicle emission requirements.

NHTSA has estimated the increases would potentially result in an additional $30 million in annual civil penalties. Automakers say the increases would dramatically raise costs since they would also boost the value of fuel economy credits used to meet requirements.

(To see more about attorneys general threatening to sue if Trump administration rolls back CAFE, Click Here.)

Some automakers including some luxury makers historically have opted to pay fines instead of meeting fuel efficiency requirements.

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