Washington Report (July 2024)

Congress
Both Houses of Congress were in recess last week due to the Republican National Convention in Milwaukee. They return July 22 and face a two-week sprint before they recess again for the month of August. The focus will be on Fiscal Year 2025 appropriations bills. All of the 12 House appropriations bills have been reported from the House Appropriations Committee and 4 of these have passed the lower chamber. The Senate lags behind considerably with only 3 of the 12 bills having received committee consideration and none of the 3 has been considered by the full Senate. The fiscal year ends September 30 and a Continuing Resolution to keep the government funded past that date is almost a certainty. 

The 2024 Presidential election took an interesting, but not unexpected, turn over the weekend with President Biden ending his bid for reelection. This development was looking inevitable heading into the weekend with an increasing number of Democrat Senators and House members publicly calling for him to step aside. Gaming this potential scenario out last week, it was anticipated that Biden’s replacement would be decided by delegates at an open convention in August. But late Sunday and into Monday, most if not all of the would-be contenders fell in line with endorsements of Vice President Harris. This has been and will be a truly extraordinary election cycle and, for those interested in politics and the political process, it does not get more fascinating than this. All eyes now are on her pick of a running mate in the coming days. Mostly governors and former governors from swing states have surfaced as potential picks. Vice President Harris was polling slightly better that President Biden in a match-up with former President Trump before this weekend’s development. But now that this looks like an actual versus theoretical contest, pollsters are feverishly putting out surveys in the field to gauge the state of play. 

Port Strike
WIA continues to monitor developments on labor contract negotiations that impact ports along the East and Gulf Coasts. A statement released earlier this month by the International Longshoremen’s Association (ILA) indicated that the threat of a strike after the current Sept. 30 contract expiration deadline is "growing more likely" as the negotiations remain at an impasse. ILA’s chief negotiator said that the maritime employers represented by United States Maritime Alliance (USMX) "are running out of time" to negotiate a new master contract agreement and avoid a coastwide work stoppage across 36 ports from Maine to Texas.

Contract talks broke down after ILA learned that Maersk-owned APM Terminals and Maersk Line were using an "auto gate" system at Alabama's Port of Mobile, which powers the gate that enables trucks to enter and exit a terminal and be autonomously processed without union labor. Upon this discovery, the ILA said in June that it would not meet with USMX until the auto gate issue is resolved. Talks have not resumed in the weeks since, however USMX was out with a press release last week assuring customers that it intends to return to the negotiating table “to avoid any further disruption to the cargo flow and/or damage to our nation’s economy.”

WIA joined 158 other trade associations in signing a letter to President Biden urging his Administration to provide all the support necessary to bring the parties together so that a new master contract may be forged. That letter may be found here. 

Obviously, a port strike would have enormous ramifications up and down the supply chain. We will keep you apprised of progress of contract talks. 

Chevron Deference
Earlier in July, the Supreme Court ruled 6-3 on a case with far-reaching consequences for federal agencies and the regulated community. In Loper Bright Enterprises v. Raimondo, the Court effectively repealed the 40 year old Chevron Deference which gave federal regulatory agencies and departments wide latitude in interpreting federal statutes. The ruling is seen as a considerable victory for the regulated community. A group that provided an analysis shortly after the ruling was issued had this to say—

“As a general matter, the Loper decision is likely to cause federal agencies to exercise greater restraint when interpreting statutes. During the past several Administrations, federal agencies (of both political parties) appeared to become more aggressive in adopting strained interpretations of statutes in order to accomplish political objectives. This practice is likely to end. Under Loper, companies can likely expect more predictability and stability in the interpretations given the federal statutes governing their operations.“

A number of associations were circulating a letter to President Biden urging him to pause all rulemakings until a thorough review of these proposals—both under development and those recently finalized—is conducted to ensure that they comply with the letter and spirit of the Loper decision.

OSHA Employer Heat Standard Proposed Rule 
This month, the Biden administration announced it would publish a proposed rule to protect workers from extreme heat. The Occupational Safety and Health Administration (OSHA) submitted the rule to be published in the Federal Register, which will likely occur in the coming days.

The measure proposes two thresholds for worker protection. At 80 degrees, employers would have to provide employees with drinking water and shaded or cooled break areas. If the heat index reaches 90 degrees or above, workers would have mandatory 15-minute breaks every two hours, and supervisors would need to monitor workers for signs of heat illness and remind workers to drink water. In situations where employees are working alone, supervisors would be required to contact them every 2 hours. Employers would be required to identify heat hazards, develop emergency response plans related to heat illness, and train employees and supervisors on the signs and symptoms of such illnesses.

Worker protections in the proposal would apply for both indoor and outdoor employees and would cover a wide array of workplaces, including wood machinery manufacturers. The National Association of Manufacturers posted on social media that the proposal "adds to the regulatory onslaught facing manufacturers in America." The group called for "a heat standard that provides greater flexibility."

WIA will either be submitting formal comments on this proposal or joining comments prepared by some of the larger trades impacted by this action.

Endangered Species Act
House Natural Resources Committee Chairman Bruce Westerman (R-AR) intends to introduce legislation this week that would comprehensively reform the Endangered Species Act (ESA). This statute has long been used by environmental groups as a tool to curtail forest management on public and private lands. Chairman Westerman’s legislation seeks to soften the impact of ESA listing decisions on landowners by, among other things, requiring USFWS to establish objective, incremental recovery goals for listed species.

The 38-page discussion draft of the ESA Amendments Act of 2024 was rolled out at a hearing last week. A section-by-section summary of the bill suggests that it seeks to restore a number of definitions that were put in place through regulations adopted during the Trump Administration. One of these definitions is “critical habitat” which is a key piece in determining the impact of a listing decision. A recent example is the Northern Longeared Bat (NLEB). A few years ago, the U.S. Fish and Wildlife Service had proposed listing the NLEB as “endangered” and the definition of critical habitat was so broad that it would have precluded any timber harvesting or landscape disturbance in the bat’s 40 state range during roosting months. Advocacy efforts prevailed in rolling that action back, but it pointed out the need for ESA reform.

In addition to codifying important definitions, the bill will establish an environmental baseline to measure successful outcomes and incentivize the recovery of listed species. According to the sponsor, the bill will also promote species conservation on private and public lands and create greater transparency and accountability in the ESA regulatory process. This issue is more of an upstream one for WIA, but we are monitoring developments in this space.